Nizam Ahmed : The London-based Global Coal Management (GCM) Resources Plc (formerly Asia Energy) which has been seeking permission for commercial exploration of Phulbari coalmine over the last nearly two decades, have taken new strategy to convince the authorities as the government has started its second consecutive terms, company sources said on Saturday.
According to the new strategy the company will be seeking to advance the proposed with active interaction with the new administration over the next one year as the government is seemed to have consolidated its authority quelling political violence that rocked the country since February last year.
"Over the next 12 months the Company will be seeking to progress the Project with the Bangladesh Government while further strengthening our relationship with the local community," GCM Executive Chairman Michael Tang in his statement while announcing Interim results of the company for the six months ended 31 December 2013, at the London headquarters of the company on Friday.
Malaysian national Mr Tang said the company had recorded a loss of 518,000 pound sterling for the period ended 31 December 2013, including non-cash expenditure of £230,000.
However the aggregate loss of the GCM plc was 2.2 million sterling in 2012 GCM Plc forcing the company to reduce its administrative expenses by more than 50 per cent which warranted downsizing and cost cutting by closing down redundant offices and outlets in Dhaka and coalmine site at Phulbaria under norther Dinajpur district.
But during the period of loss and cost cutting the company successfully raised £2.3m by the placement of 11.7 million shares. The fundraising, the first since November 2005, was supported by a new substantial shareholder Magnus Energy Group who now holds 15 per cent of GCM and by Polo Resources Limited, the Company's largest shareholder, he said.
During the last six months the Government has continued along the path of re-balancing the country's energy sector by moving towards coal-fired power plants in line with its Power System Master Plan, reportedly targeting contracts for 4,000MW of coal fired-power plants by the end of 2014.
The future energy demand trend for Bangladesh is not unlike that predicted for the adjacent Association of South East Asian News (ASEAN) countries for which the International Energy Agency (IEA) recently reported coal is emerging as the fuel of choice because of its relative abundance and affordability in the region. Over the last six months the company has continued to engage with the local community both within and surrounding the Project area to discuss and understand their views of the Project. An independent survey finalised in the last six months indicates that support for the Project has been growing.
"We are explorers and our job is to explore resources for the benefit of the country and its people. So we will continue our efforts to convince the authority that," Chief Executive Officer (CEO) of GCM Resources in Dhaka, Gary Lye told The Daily Observer.
The GCM has been struggling since late 1990s to get government approval for exploration of the coalmine with an estimated reserve of 572 million tonnes of high-quality bituminous coal.
If explored, the Phulbari coalmine is likely to create 17,000 new jobs and ensure livelihood for 40,000 people feared to be affected during exploration in openpit method over the next 35 years, according to the GCM.
However, environmentalists and rights groups say the Phulbari coalmine will violate human rights of indigenous people from 23 different tribal groups, and destroy nearly 12,000 acres of Bangladesh's most fertile and productive farmlands.
In sharp contrast, the GCM officials observe that the Phulbari mine will help the country in generating up desired level of electricity. It will also move the country faster towards to its goal of getting 50 per cent of some 20,000 mw electricity to be needed in the country from the coal-fired power plants by 2021, energy experts said.
Bangladesh has five coal fields with an estimated reserve of some 3.0 billion tonnes, they said. Of the five, only one in Barapukuria is now under exploration and feeding coal to a 250- mw coal-fired power plant near the mine site.
Mr Tang Mr Tang, whose official name is Michael Vee Mun Tang, is also executive co-chairman and managing director of Polo Resources, a Canadian Investment Fund owning 30 per cent of the total shares of GCM, became the Executive Chairman in June last year.
Later in October another Malaysian tycoon Dato' Md Wira Dani Bin Abdul Daim has replaced British entrepreneur Neil Lindsey Herbert from the board of directors of GCM, as a Non-Executive Director.
With Mr Tang and Mr Daim, Malaysians have become dominant in the three-man board of directors, which following the recent reconstitution retained another Briton Guy Elliott as a member of the board. Under the leadership of Malaysian business tycoons, the GCM is eyeing to rearrange its strategy in winning a deal for commercial exploration of the proposed Phulbari coalmine in Dinajpur district.
Michael Tang is the principal of Malaysia-based Mettiz Capital Limited ('Mettiz'), an investment company with significant corporate and financial experience in natural resources, power generation, manufacturing and real estate.
The GCM appointed Mettiz, a lobbyist in Bangladesh early this year to get approval of the government for commercial exploration of the Phulbari coalmine, for which the company has been trying for more than a decade. According to the deal signed with Mettiz in March, the GCM will award the lobbyist firm a directorship of the company if the Malaysian firm can get the approval by the end of the 2013.
As the outgoing government was indecisive, the GCM and Mettiz are preparing to launch the drive for winning the exploration deal anew after a new government takes charge in Bangladesh, company officials said. However, after involvement of Mettiz, the Bangladesh officials and local pressure groups around the proposed coalmine site were seen to become vocal in favour of the open-pit exploration, which was so long opposed by environment groups.