Asia Energy skips earnest money defying mining rules

Asia Energy skips earnest money defying mining rules

The government is evaluating the feasibility report submitted by the Asia Energy Corporation despite its non-payment of about Tk 210 crore as earnest money”” a prerequisite for the deal””during applying for mining licence.

Experts, involved in the evaluation, have termed it illegal and said, ” Such a preference to a foreign company is being given for the first time and for unknown reasons.”

According to Section 39(C) of the Mines and Minerals Rules of 1968, companies applying for licences have to pay 3 per cent of the estimated cost of the scheme as bank guarantee for ensuring payment of royalties and other payable costs.

But the Asia Energy Corporation that has applied for mining licence did not pay about US$30 million as bank guarantee, which was a gross violation of the rules.

Sources said the evaluation committee, led by Prof Nurul Islam of BUET, would recommend the government to launch an investigation why the then director of the Bureau of Mineral Development (BMD) Md Maminullah pursued for an agreement with the BHP Minerals International Exploration Inc at 6 per cent royalty when it should have been 20 per cent.

Terming the signing of agreement totally illegal experts’ report would read, ”The agreement was signed violating the Mines and Minerals Rules of 1984 in terms of royalties and other tax regimes.”

According to the Mines and Minerals Rules of 1984 the royalty should be 20 per cent for both the open and under cast mining. But the agreement signed with the BHP, later with the Asia Energy Corporation, revealed only 6 and 5 per cent of royalty for open and under cast mining respectively.

In the agreement the government also favoured the interest of BHP providing long time tax holiday and other low tariff in different components. To legalise the agreement the then government had changed the Mines and Minerals Rules of 1984 incorporating royalty as 5 and 6 per cent for the two mining systems.

”Agreement should be signed depending on the existing rules and no rules can be changed to favour any particular quarters,” one of the experts said.

However, submission of the evaluation report on the feasibility study of the Asia Energy Corporation is indefinitely delayed, as the chairman of the committee is reluctant to do so for unknown reasons. At least two meetings of the evaluation committee were deferred, one after another, within the couple of weeks, which angered most of the members.

A number of committee members expressed doubt to this correspondent about the ability of the committee to submit the evaluation report to the present government.

Nonetheless, people are eagerly waiting to see the expert evaluation on the feasibility study on the Phulbari Coal Field as the agreement is widely known as against the interest of the country. Most of the citizens of the country were long been demanding cancellation of the agreement with the Asia Energy Corporation.

© Copyright 2003 by The New Nation

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