Phulbari Coal Mine Executive Summery by Asia Energy

ASIA ENERGY PLC
2nd Floor Foxglove House

166-168 Piccadilly
London
W1J 9EF
United Kingdom
Tel:
+44(0)20 7290 1630
Fax:
+44(0)20 7290 1631
Email: info@asia-energy.com
i
Asia Energy Corporation (Bangladesh) Pty Ltd

Plot-2(B), Block-SE(C), Road-138
Gulshan-1, Dhaka-1212
Bangladesh
Tel:
+88 02 885 0205/6
Fax:
+88 02 882 9025
Email: aec@asiaenergybd.com
STATEMENT OF INTENT: ASIA ENERGY CORPORATION (BANGLADESH) PTY LTD

Overall Environmental and Social Intent
Asia Energy Corporation (Bangladesh) Pty Ltd (Asia Energy, or the Company) proposes to develop and operate
an open cut coal mine near Phulbari Township in northwest Bangladesh (the Phulbari Coal Project). The Project is
located in a predominantly rural / agricultural area and consists of the mine, ex-pit overburden dump and associated
mine infrastructure (Mine Footprint). As a result of mine development, villages located within the Mine Footprint and
the eastern extremity of Phulbari Township will be relocated. Transport of the coal to domestic and international
markets will require upgrading rail infrastructure, construction of a coal loading facility at Khulna in southern
Bangladesh and dredging of a deep shipping channel for access through the Bay of Bengal. Asia Energy has also
applied to the Government of Bangladesh (GoB) for permission to construct a mine-mouth power station.
Asia Energy has already submitted relevant statutory documents to the GoB (Initial Environmental Examination, and
Environmental Impact Assessment) and received from the Department of Environment the appropriate
environmental approvals for the mine to proceed. Based on approval conditions, Asia Energy intends to develop
and operate an open cut mine according to sustainable development principles, ensuring social and economic gains
both to the local community and nation, while minimising the impact on the environment. Accordingly, the Company
has endeavoured to ensure that this Environmental and Social Impact Assessment (ESIA) addresses in a
comprehensive and open manner, the interaction of the proposed mine with the community and environment. An
Environmental and Social Action Plan has also been developed to address likely impacts, mitigation action plans,
monitoring, management of risks, and schedules.
Asia Energy acknowledges that development of the mine at Phulbari will have some impact on the local area and
will require relocation of people. In this regard, the Company plans to build the coal mine in broad and open
consultation with the community and all stakeholders, benchmarking it in accordance with the standards set by the
Bangladesh authorities and international development agencies. The Company is aware of the complexities of the
Project and has the knowledge and capability to mobilise multi-disciplinary teams, and the commitment to deal with
all aspects of the Project and its incumbent technical, environmental and social risks.
Overall Approach to Issues

Asia Energy is committed to planning, designing and implementing the Project in a responsible manner, adhering to
the highest national and international norms, standards and requirements. Detailed design work is proceeding on
many engineering, environmental and social aspects of the Project, including plans for mitigation measures.
Mine operation, site rehabilitation, resettlement and mine closure plans have been developed in consultation with
relevant stakeholders, and driven by sustainable ecological and social principles. The entire planning process has
been underpinned by open and informed consultation (local community, non-government organisations, various
levels of government, inter-ministerial committees and other stakeholders); developing broad community support
and a financial commitment for the mine sites rehabilitation and closure. Mine planning has followed mining
industry best practice procedures and world recognised guidelines, notably the Equator Principles, International
Finance Corporation (IFC) environmental and social safeguard policies (on such issues as involuntary resettlement,
ethnic minority people and cultural property), the World Banks and IFCs specific guidelines on coal mining, and the
proposed new IFC Performance Standards.
Asia Energy has developed Project monitoring benchmarks for social matters (such as reduction of illiteracy),
employment and income levels (job creation and poverty reduction), environmental safeguards (indicator
parameters and species) and for the eventual closure of the mine. The Companys objective has been to undertake
comprehensive environmental and social impact assessments through a process of consultation with all
stakeholders, (demographic and socioeconomic, resettlement, town planning surveys, information centre,
government and community consultations, tea shop meetings), and listening genuinely to their concerns.
Development Concepts
There is no alternative site for the mine, as the coal resource deposited hundreds of millions of years ago occurs at
a specific location. Given that the mine and its infrastructure are fixed to that specific location, its development has
to be acceptable in every respect - technical, management, social, economic and environmental. In preparing the
ESIA, concerns of the stakeholders have been considered and where possible, accommodating alterations made.
These include:
minimising overburden dump, infrastructure and river diversion areas to prevent undue land loss;
altering the mine path to avoid most of the eastern part of Phulbari Township, reducing resettlement by
25 percent;
a commitment to assist farmers with improving agricultural productivity in Project affected areas; and to
deliver water in the dry season;
development of both native forests and high value agricultural production in the rehabilitated areas;
protection and maintenance of wetlands and sal forests adjacent to the Project area, including the
regionally important Ashoorar Beel;
use of best available equipment to minimise noise and dust impacts, including the use of conveyor belts
for moving coal and acoustically efficient trucks; and
construction of sound bunds opposite the coal processing area and between the mine and Phulbari
Township.
Specific Environmental and Social Undertakings

As part of the mine development Asia Energy will:
help establish some wetland and native forests for a biodiversity corridor;
develop an agriculture marketing strategy for growers in the Project area;
develop a strategy for improved rural livelihood and biodiversity;
upgrade some aspects of the local health and educational facilities;
promote womens enterprise; and
provide necessary training for development of skills, as per Contract 11/C-94, Exhibit C.
Community Support
The Project is a significant development for Bangladesh and for the northwest of the country in particular. There are
tangible environmental, social and economic benefits that will accrue locally, regionally and nationally. Asia Energy
has developed a strong co-operative relationship with the Phulbari community. Most of the local community support
the Project, even with the understanding that a considerable number of residents will require resettlement and
livelihood restoration support. As with any major project, objections have occurred. Asia Energy has addressed the
issues in open consultation with the concerned groups. Local support is reflected by the Upazila Nirbahi Officers of
Birampur, Phulbari, Nawabganj and Parbatipur of the Dinajpur District who have signed the No Objection
Certificates, in favour of the Project.
This is one of the largest privately funded projects in Bangladesh and the Company will ensure that the mine is
developed according to best practice principles and that the environmental and social impacts are addressed to
both Bangladesh, World Bank and IFC standards.
Gary Lye
Chief Executive Officer
Environmental & Social Impact Assessment (ESIA) of Asia Energys Phulbari Coal Project
Executive Summary
TABLE OF CONTENTS
ES 1.0 INTRODUCTION TO THE PROJECT ........................................................................................1
ES 1.1 Background Overview ..................................................................................................1
ES 1.2 Project Location and Physical Characteristics..............................................................4
ES 2.0 PROJECT JUSTIFICATION AND BENEFITS ...........................................................................4
ES 2.1 Need for the Project .....................................................................................................4
ES 2.2 Benefits of the Project ..................................................................................................7
ES 3.0 THE PROPONENT AND MINE LEASES...................................................................................8
ES 3.1 Asia Energy..................................................................................................................8
ES 3.2 Mining Leases ..............................................................................................................8
ES 4.0 LEGAL STATUS OF PROJECT AND COMPLIANCE ..............................................................9
ES 4.1 Environmental Clearance by the Government of Bangladesh......................................9
ES 4.2 Compliance with Laws, Conventions, Guidelines and Policies.....................................9
ES 4.3 Compliance with International Conventions, Guidelines and Policies ..........................9
ES 5.0 CONSULTATION .......................................................................................................................9
ES 6.0 ALTERNATIVES CONSIDERED IN MINE DESIGN ................................................................11
ES 7.0 THE PROJECT ........................................................................................................................12
ES 7.1 Project Overview ........................................................................................................12
ES 7.2 Coal Mine Establishment............................................................................................15
ES 7.2.1 Infrastructure Relocations and River Diversion ........................................15
ES 7.2.2 Mine Infrastructure....................................................................................18
ES 7.2.3 Land Requirement and Acquisition...........................................................18
ES 7.2.4 Mine Construction.....................................................................................21
ES 7.3 Coal Mine Operations.................................................................................................21
ES 7.3.1 Aquifer Dewatering, Clearing and Topsoil Stripping .................................21
ES 7.3.2 Overburden Removal ...............................................................................21
ES 7.3.3 Coal Mining ..............................................................................................22
ES 7.4 Coal Handling and Treatment ....................................................................................22
ES 7.5 Coal Transport............................................................................................................24
ES 7.6 Plant and Equipment, Workforce and Operational Hours...........................................24
ES 7.7 Water, Waste and Hazardous Materials Management...............................................24
ES 7.8 Rehabilitation and Final Landform..............................................................................26
ES 7.9 Ancillary Development................................................................................................26
ES 8.0 BIOPHYSICAL IMPACTS ........................................................................................................28
ES 8.1 Soil, Land Use and Land Capability Assessment.......................................................28
ES 8.1.1 Soil ...........................................................................................................28
ES 8.1.2 Land Use and Capability ..........................................................................28
ES 8.2 Air Quality...................................................................................................................28
ES 8.3 Noise, Blasting and Vibration .....................................................................................29
ES 8.4 Mine Water Balance ...................................................................................................29
ES 8.5 Surface Water ............................................................................................................29
ES 8.6 Groundwater...............................................................................................................31
ES 8.7 Visual Assessment .....................................................................................................33
ES 8.8 Biodiversity.................................................................................................................33
ES 8.9 Greenhouse Gas (GHG) Emissions ...........................................................................34
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April 2006
Executive Summary
Page - i
Executive Summary
ES 9.0 SOCIO-ECONOMIC IMPACTS ................................................................................................34

ES 9.1 Some Facts about the Affected Community ...............................................................34
ES 9.2 Land Acquisition .........................................................................................................36
ES 9.3 Population Displacement............................................................................................36
ES 9.4 Livelihoods and Income..............................................................................................36
ES 9.5 Social, Community and Cultural Practices .................................................................39
ES 9.6 Impacts on Infrastructure and Services ......................................................................39
ES 9.7 Health and Safety Impacts .........................................................................................39
ES 9.8 Impacts on Cultural Heritage and Graveyards ...........................................................40
ES 9.9 Vulnerable Groups .....................................................................................................40
ES 9.10 Host Community Impacts ...........................................................................................41
ES 10.0 CUMULATIVE IMPACTS .........................................................................................................41
ES 11.0 RISK ASSESSMENT ...............................................................................................................42
ES 11.1 Risks, Uncertainties and Opportunities ......................................................................42
ES 11.2 Environmental and Social Residual Risks ..................................................................42
ES 12.0 MANAGEMENT PLANS ..........................................................................................................48
ES 12.1 Environmental and Social Action Plan (ESAP)...........................................................48
ES 12.2 Socio-economic Action Plan.......................................................................................49
ES 13.0 PROJECT SUSTAINABILITY ..................................................................................................49
ES 14.0 CONCLUSIONS .......................................................................................................................50
LIST OF FIGURES
Figure ES.1: Project Location ...................................................................................................................1
Figure ES.2: Phulbari Coal Mine Footprint................................................................................................2
Figure ES.3: Project Alternative Analysis for Coal Mining Justification and Method of Extraction. ......... 12
Figure ES.4: Mine Activities Schedule ....................................................................................................14
Figure ES.5: Extent of Mine Activities for Year 25 ..................................................................................16
Figure ES.6: Mine Development Schedule ............................................................................................. 17
Figure ES.7: Mine Infrastructure (End Year 3)........................................................................................19
Figure ES.8: Land Resettlement Plan.....................................................................................................20
Figure ES.9: Representative Mine Stages ..............................................................................................22
Figure ES.10: General Layout of Coal Handling Facilities ......................................................................23
Figure ES.11: Proposed Coal Transport Route ......................................................................................25
Figure ES.12: Conceptual Final Land Use Plan......................................................................................27
Figure ES.13: Mine Water Balance for Major Components .................................................................... 30
Figure ES.14: Water Level Drawdown in Upper Dupi Tila Aquifer and Injection Borefield......................32
Figure ES.15: Visual Landscape Assessment at End of Mine, South of Phulbari Township. .................33
Figure ES.16: Resettlement Survey Status Map.....................................................................................35
Figure ES.17: Extended Phulbari Township Land Use Plan................................................................... 37
Figure ES.18: Generic Village Plan ........................................................................................................38
Figure ES.19: Significance Assessment Matrix ......................................................................................42
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April 2006
Executive Summary
Page - ii
Executive Summary
LIST OF TABLES
Table ES.1: Project Benefits .....................................................................................................................7
Table ES.2: Summary of Stakeholder Consultation to Date ................................................................... 10
Table ES.3: Key Project Parameters and Approval Schedule for the Phulbari Coal Project................... 13
Table ES.4: Mine Activities ..................................................................................................................... 18
Table ES.5: Habitat within Mine Footprint...............................................................................................34
Table ES.6: Key Indicators of Households in 5 Kilometre Zone ............................................................. 34
Table ES.7: Project Risks and Opportunities ..........................................................................................43
Table ES.8: Medium to High Level Environmental Risks and Responses .............................................. 46
Table ES.9: ESAP Sub-Plans .................................................................................................................48
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April 2006
Executive Summary
Page - iii
Executive Summary
EXECUTIVE SUMMARY
ES 1.0 INTRODUCTION TO THE PROJECT
ES 1.1
Background Overview
Asia
Energy
Corporation
(Bangladesh) Pty Ltd (Asia
Energy), under a contractual
agreement with the Government
of Bangladesh (GoB), has
explored for coal and is
preparing to develop a coal mine
in the Phulbari area. Phulbari is
located about 350 kilometres
northwest of Dhaka (Figure
ES.1). Feasibility studies have
proven a high quality coal
resource
that
can
be
economically and responsibly
mined.
A coal mine at Phulbari and
associated
facilities
and
infrastructure will make a major
contribution to sustainable
regional
and
national
development, and contribute to
poverty
reduction,
the
overarching policy objective of
the government.
Local and regional benefits Figure ES.1: Project Location
directly attributable to the
Project include public revenue, employment opportunities, development of infrastructure (rail/road,
international port facilities), security of energy resource, reduced demand on declining gas reserves,
improved access to sanitation, health and educational facilities, and training opportunities.
Consequently, the proposal will have wide ranging effects on a local and regional scale.
The proposed Scheme of Development is to construct and operate an open cut coal mine and transport
coal products to domestic and international markets. A coal resource and coal reserve of 576 and 517
million tonnes respectively have been identified and a maximum extraction rate of 16 million tonnes per
annum (Mtpa) recommended. First coal will be extracted after approximately two years of mine
development, with coal production continuing for 36 years. The scheme can be separated into the
following components:
1. Mine Development and Operation
The mine development and operation areas include the mine, ex-pit overburden dump, associated
infrastructure (coal preparation and handling facilities, and road, rail and river diversions) and buffer
zone. The required area (Mine Footprint) is shown on Figure ES.2.
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April 2006
Executive Summary
Page - 1
Figure ES.2 : Phulbari Coal Mine Footprint

690000
695000
700000
705000
710000
Parbatipur
Upazila
2830000
l
s a
is
iv e r
U
H
Ex-Pit
Overburden
Dump
Phulbari
Township
ure
&
tle
Lit
2820000
Phulbari
Upazila
ive
Pul R
Kh a r i
Mine
Pit
ct
tru
ras
Inf ne
ne Zo
Mi uffer
B
2820000
2825000
2825000
Madhyapara
Mine
ia
ukur
BarapMine
Coal
2830000
Nawabganj
Upazila
2815000
r
Ri ve
Jamun a
2815000
Ashoorar
Beel
I
Birampur
Upazila
2810000
2810000
690000
Map History
Date : November 29, 2005

Data Source : SMEC Database
Projection : UTM Zone 45N (WGS 84)
Map Reference No : ESIA-V1-ES-02
Prepared By: Firoz Zaman, SMEC
Contact Person : Abidur Rahman, SMEC
abid@smecbd.com
Prepared For:
695000
700000
2500
705000
2500
Scale - 1:140000
Mining Lease Area - B
Exploration Licence Area - G
Exploration Licence Area - H
Exploration Licence Area - I
Under Application
Exploration Licence Area - T
Under Application
Mining Lease Area - U
Under Application
Barapukuria Mine Lease
5000
710000
7500 Meters
( A4 Paper Size)
Mine
Mine Footprint
Upazila Boundary
Mine Pit
Major Road
Railway
River
Flood Overflow Channel
Phulbari Township
Ex-pit Overburden Dump

5 km. Radius
10 km. Radius
Executive Summary
2. Resettlement
As a result of mine development, the eastern extremity of Phulbari Township and the villages existing
over the Mine Footprint will have to be relocated. This will require resettlement of existing households
and businesses, land acquisition and replacement of existing infrastructure and services. The Project
requires resettlement of 9,160 households (40,304 people) within the Mine Footprint and 600
households (2,640 people) in host communities and transport realignments around the mine site.1
Aspects 1 and 2, encompassing an area of 5,933 hectares are collectively termed the Project for the
purposes of the Environmental and Social Impact Assessment (ESIA).
3. Coal transport
Coal will be transported to domestic and international markets. This will require upgrading rail
infrastructure along the transport route and construction of a coal loading facility (Khulna), for shipping
through the Bay of Bengal to international markets. A separate ESIA (SMEC 2006) for coal
transportation is currently being finalised.
4. Coal fired power station
Although the current scheme is to transport coal to domestic and international markets, Asia Energy is
also investigating the opportunity of developing a 500 megawatt (MW) coal fired power station using
Phulbari coal (Asia Energy 2005a). This will later be upgraded to 1000MW. A separate proposal has
been submitted to the GoB on 9th October 2005.
Project development will have social and environment impacts, which have to be credibly mitigated.
Impacts will include dislocation and resettlement of over 40,000 people; potential marginalisation and
social disarticulation; and temporary loss and disruption to livelihood, cultivable land, agricultural
productivity, buildings, services, water resources and infrastructure. Other important impacts will
include lowering groundwater levels, land settlement, and noise, air and visual issues. To address
these issues, comprehensive mitigation measures are proposed, which will eliminate or substantially
reduce these potential impacts. Commitment is required from the mining company, GoB and financial
institutions to ensure that mitigation measures outlined in the ESIA are diligently carried out.
This ESIA has been prepared in accordance with relevant World Bank (and its related International
Finance Corporation (IFC)) guidelines, including Equator Principles and IFC Safeguard Policies, World
Bank Environmental Health and Safety Guidelines and the World Bank Pollution Prevention and
Abatement Handbook. The document presents a comprehensive Project description; an assessment of
potential environmental, social and economic impacts; and the measures by which adverse impacts can
be mitigated or minimised, and beneficial impacts enhanced. Over 300 national and international
specialists, experienced in Bangladesh and/or mine development, contributed to the ESIA.
The environmental and social impacts associated with the development of the town extension and new
villages have been assessed in sufficient detail to demonstrate that viable relocation options are
available. Further work will be required with GoB involvement in the development phase.
The ESIA is provided in four volumes:
Volume 1: Environmental Impact Assessment
Volume 2: Mine Technical Reports
Volume 3: Environmental Technical Reports
Volume 4: Social Technical Reports
Additional resettlement may be required in case of mine noise disturbance.
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April 2006
Executive Summary
Page - 3
ES 1.2
Executive Summary
Project Location and Physical Characteristics
The Project site is located in northwest Bangladesh, 350 kilometres from Dhaka and within the Phulbari,
Nawabganj, Birampur and Parbatipur Upazilas of Dinajpur District (Figure ES.1).
Phulbari is a small town, served by the national
highway, north-south railway network, and an
airport at Syedpur, 40 kilometres to the north. The
railway town of Parbatipur, 18 kilometres north of
Phulbari, is a major rail junction with links to India.
The Project is located on the Barind Tract, an
elevated plateau region with a height of 25 to 32
metres above sea level. Due to the slightly
elevated nature of the Barind Tract, the Study
Area is not prone to frequent flooding. Average
temperatures range from a maximum of around 33
degrees Celsius in summer to a minimum of 10 Photo ES.1: Phulbari Township
degrees Celsius in winter.
Rainfall occurs
predominantly between late May and October, with average annual rainfall of approximately 1,800
millimetres.
The Little Jamuna River, and Khari Pul and Nalsissa rivers are located to the west and east of the
proposed mine site, respectively. None of these watercourses have extensive catchments and they are
not connected to any major river system. The Khari Pul River drains into Ashoorar Beel, an important
wetland and local fishery (Figure ES.2). Other wetlands occur within the Study Area. Several remnants
of regenerated native sal forest are present within the largely agricultural landscape, but are outside the
Mine Footprint. There is a regionally extensive groundwater resource overlying the coal.
Photo ES.2: Sal forest
Photo ES.3: Rice irrigation
ES 2.0 PROJECT JUSTIFICATION AND BENEFITS

ES 2.1
Need for the Project
Bangladeshs limited energy resources and low level of commercial energy consumption have been
identified as critical bottlenecks to improving the countrys economy and reducing poverty. Bangladesh
is also characterised by low levels of foreign and/or domestic industrial investment, a high level of
deforestation and a lack of competitive export products. Limited energy resources and poor export
earnings greatly contributed to Bangladeshs trade deficit. By developing one of the largest and
shallowest proven coal resources in Bangladesh, the Phulbari Coal Project has the potential to assist
Final Report
April 2006
Executive Summary
Page - 4
Executive Summary
with the improvement of the countrys economy by providing a high quality energy resource for local and
international consumption, as well as providing significant export earnings to the Bangladesh economy.
This is one of the largest private developments of its kind in Bangladesh and has the potential to bring
significant benefits to the nation, in particular to the strategic development of west and northwest
Bangladesh. Mining of the Phulbari coal resource would also support the governments objective of
poverty reduction through planned economic growth and social development.
It is considered that the Project is justified as it meets important national needs, helps to satisfy local,
regional and international demand for coal, decreases the nations dependence on natural gas, and,
with the implementation of mitigation measures, has social and environmental acceptability.
1. Supports GoB Objectives
Mining of the coal resource at Phulbari would strongly support the GoBs objectives and the aspirations
of its people that collectively seek poverty reduction. Coal mining would increase economic growth
through private investment and through direct and indirect employment. It would also provide an
avenue for moving the GoB closer to its universal electrification goal by providing good quality thermal
coal which could underpin growth in coal-fired electricity generation. This would attract new industries
and provide an opportunity for replacing imported inferior coal in the brick-making industry. Project
development would also stimulate improved social and human development through improved
infrastructure for education, communications and public health. It would employ a viable professional
workforce in the largely rural northwest of the country.
2. New Local Energy Alternative

Energy consumption in Bangladesh is predicted to rise substantially over the next 10 years. With the
GoB commitment to the provision of rural electrification, and the current reliance on imported petroleum
and biomass fuel to make up the energy shortfall, there is an urgent need to locate and develop local
energy alternatives. Phulbari coal, which has generally low sulphur content and high calorific value,
offers a reliable and long-term energy alternative to supplement existing energy reserves. It also offers
a part solution to environmental damage caused by destruction of trees for fuel.
Due to diminishing known gas reserves, coal development has become an urgent issue in Bangladesh.
Project development could play an important role in supplementing energy sources, especially in
northwest Bangladesh. With the forecast depletion of known gas reserves by 2019, the Project would
provide vital diversification from predominantly gas-fired power stations and could thus extend the life
of gas reserves.
3. New Source of Electricity

With the proposed power station of 500MW (later upgrading to 1000MW), the Project has the potential
to underpin substantial base-load electricity generation in Bangladesh and accelerate private sector
investment in infrastructure and services for at least 30 years. A 1000MW power station represents a
20 percent increase over the 2003 installed capacity, and would provide 10 percent of Bangladeshs
forecast electricity demand in 2015. This would contribute significantly to Bangladeshs ability to meet
future power demand, particularly in the northwest. It could substantially assist in rural electrification
and poverty reduction through encouraging private sector growth in power generation plants and
enabling improvement in social and human development.
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Executive Summary
4. Export and Domestic Markets

Due to the proximity of the Project to burgeoning international markets, the Project thermal and
metallurgical coal will be domestically and internationally cost competitive against other coal suppliers
to the Asian region.
Air quality throughout Bangladesh has been significantly degraded due to the use of low quality (high
sulphur) imported coal and significant environmental benefits can be realised by replacing existing coal
supplies with low sulphur Phulbari coal. Environmental considerations will be particularly important in
light of new domestic legislation (which requires imported coal to have less than one percent sulphur).
5. Economic Considerations
Asia Energy will invest around US$3 billion over the life of the Project in capital on the mine and power
station, and an additional US$10.4 billion in operating costs. According to GHD (2006), the Project will
generate more than US$21 billion in economic benefit to Bangladesh and will add one percent a year
(US$0.7 billion/annum) to Gross Domestic Product (GDP). The direct effect on GDP is anticipated to be
US$7.8 billion and indirect multiplier effects of US$13.7 billion. Payments to the GoB will exceed US$7
billion. Substitution of imported to local coal will save US$3 billion over the life of the Project. Some
US$310 million will be spent on village resettlement and relocation of part of Phulbari Township (GHD
2006).
Coal mining would provide opportunities for increased economic growth by stimulating private
investment and employment opportunities. It is estimated that the Project will employ some 2,100
persons during construction phases. When fully operational about 1,200 will be long-term employed at
the mine and another 450 on barging and shipping operations. Assuming a multiplier of 10 additional
jobs for each person employed, this equates to 16,500 new jobs.
Although there would be a cumulative loss in volume of traditional agricultural production in the Mine
Footprint over the life of the mine, Johansen & Sani (2006) concluded that this would be more than
compensated by in-pit backfilling, an increase in agricultural production due to improved agricultural
technologies, and by the value of forage and tree production on the rehabilitated areas.
6. Regional Transport Improvements

Proposed rail, port and shipping upgrades will have significant regional and international development
benefits by providing export access to west and northwest Bangladesh, plus neighbouring land-locked
countries such as Nepal. It will bring in industries that rely on goods transport, with attendant
employment and development opportunities. As a result of the Project, a total of US$314 million will be
spent on rail and port development to provide a reliable export route.
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Page - 6
ES 2.2
Executive Summary
Benefits of the Project
There are likely to be environmental and social impacts resulting from the mine; however proposed
management strategies will mostly mitigate these impacts to acceptable levels. At the same time, the
Project will produce tangible benefits that will accrue to the district and the nation. Project benefits are
summarised in Table ES.1.
Table ES.1: Project Benefits
Project Benefits
The Project is one of the largest privately funded projects in Bangladesh. Being privately funded, there will
be no need to divert funds from existing government programmes and activities.
The Project will contribute to the development of a major mining province in Bangladesh and make available
an important coal resource.
The Project will replace imported poor quality coal with locally mined and better quality coal.
The Project will reduce the reliance upon biomass (including trees and other vegetation) for energy, thereby
resulting in benefits to the environment.
The Project will stimulate and strengthen local and regional economies and provide opportunities for poverty
reduction through planned economic growth of industrial, local cottage manufacturing and service delivery
development.
The Project will provide training and development opportunities for professional, technical, skilled and
unskilled local communities.
The Project will accelerate the pace of sustainable economic and social development; raise standards of
living by improving local and regional road, rail, power, communication, reticulated water supply and
sanitation; and improve community infrastructure and health facilities.
The Project will strengthen the macro economic performance of Bangladesh by:
reducing reliance on imported diesel fuels for power generation;
providing an internationally traded commodity for export;
providing a stimulus for foreign investment;
generating foreign exchange and savings; and
providing direct payments to the government through royalties and taxation.
The Project will enable a diversification of the local economy from agriculture to include mining and service
industries.
The Project will provide the opportunity for a new mining industry in Bangladesh.
The Project will create a stabilising effect on the local currency, as a result of export revenue.
The Project will strengthen the banking sector with the advent of new forms of capital market activity.
The Project will construct improvements to infrastructure that may provide spin-off benefits and a platform
upon which other private sector development projects can come to fruition.
The Project may provide the energy source for coal fired power plants to assist in meeting Bangladeshs
forecast electricity demand. This has significant benefits, including:
provision of power to areas not presently serviced;
a higher energy resource security; and providing an alternative for diversification of power generation
(currently predominantly gas-fired);
reduction of the pressure on diminishing gas reserves; and
facilitation of more investment as supply becomes more secure.
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April 2006
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Executive Summary
Project Benefits
The Project may reduce poverty through employment opportunities, including:
creation of up to 1,200 direct long-term mine operational jobs;
creation of significant numbers of jobs during the mine construction phase; and
creation of spin-off or indirect employment as a result of the operation and construction of the mine.
This could be up to ten times the actual mine related employment.
The Project may improve living standards through training and educational capacity.
The Project may improve the position of women through the creation of employment, providing opportunities
for women to participate in the consultation process and providing improved infrastructure.
The Project will create a new extended township and new villages, with improved infrastructure and facilities.
The Project will provide all season irrigation water to affected farmers enabling them to have extra crops.
There will be improved understanding of the ecological values of the area.
The Project will provide opportunities to re-establish ecological systems and endemic habitats.
ES 3.0 THE PROPONENT AND MINE LEASES

ES 3.1
Asia Energy
Exploration licences for the Project are held by Asia Energy Corporation (Bangladesh) Pty Ltd (Asia
Energy, the Proponent), a fully owned subsidiary of Asia Energy PLC (incorporated in England and
Wales in September 2003). Asia Energy Corporation Pty Ltd holds the Investment Agreements, and
Agreements for the Exploration and Mining of Coal with the GoB (Contract No. 11/C-94). Asia Energy
PLC owns all issued share capital of Asia Energy Corporation Pty Ltd. The Contract permits Asia
Energy to undertake exploration and mining of coal in northern Bangladesh.
In April 2004, Asia Energy PLC raised US$14 million and was admitted to trading on the Alternative
Investment Market of the London Stock Exchange. The raised capital was immediately used to embark
on the feasibility study and planning of the Scheme of Development for the Project.
ES 3.2
Mining Leases
Some mining leases and exploration licenses for the Project are held by Asia Energy Corporation
(Bangladesh) Pty Ltd. Asia Energy holds Mining Lease B and Exploration Licenses G and H (see
Figure ES.2). Approvals for Exploration Licenses I2,T, and J to Q (co-products)3, Mining Lease U,
the conversion to a Mining Lease of Areas G and H, and agreement with Barapukuria Underground
Coal Mine (for the location of the box cut outside Asia Energys lease areas), are pending.
It is understood that the Phulbari Coal deposit extends South into area 1
Exploration licenses J to Q are for co-products within the mine overburden, thus they overlie areas within the Mine Footprint
already covered by coal mine and exploration leases.
2
3
Final Report
April 2006
Executive Summary
Page - 8
Executive Summary
ES 4.0 LEGAL STATUS OF PROJECT AND COMPLIANCE

ES 4.1
Environmental Clearance by the Government of Bangladesh
The primary legislation for the environmental approval of projects in Bangladesh comprises the
Environmental Conservation Act (1995) (Amended 2000 & 2002) (ECA) and the Environmental
Conservation Rules (1997) (ECR). The Project is classified as Red under the categorisation system of
the ECR, as it is deemed to have potentially significant environmental issues. Application for
Environmental Clearance for a category Red project is a two-part process:
application must first be made for an Environmental Site Clearance (ESC). To obtain an ESC,
an Initial Environmental Examination (IEE) must be prepared by the proponent and submitted
to the Department of Environment; and
after an ESC has been granted, the proponent must submit an Environmental Impact
Assessment (EIA) to the Department as per the Terms of Reference approved in the IEE,
together with an application for issuance of an Environmental Clearance Certificate (ECC).
Asia Energy submitted its IEE on 10th February 2005. The Department of Environment (DoE) issued
the ESC on 29th March 2005. An EIA was subsequently submitted on 30th July 2005, with the request
to approve the EIA and issue an ECC in favour of Asia Energy. The Department granted an
Environmental Clearance Certificate for mining activities planned over the Mine Footprint on 11th
September 2005. With this approval, compliance with DoE guidelines regarding Environmental
Clearance is complete. The Departments consent conditions have been reviewed and incorporated
into the Project plan and design.
ES 4.2
Compliance with Laws, Conventions, Guidelines and Policies
An assessment has been undertaken of the application of Bangladesh law to this Project. Permits
and/or actions to be attended to by Asia Energy prior to Project commencement and during the
operation of the mine to comply with legislative requirements have been identified. At the current stage
of Project planning and development, Asia Energy is in compliance with GoB legislation and policies.
ES 4.3
Compliance with International Conventions, Guidelines and Policies
Bangladesh is a signatory to a number of international conventions. Project planning and design has
considered these conventions and incorporated all relevant aspects. The Project is considered to be in
compliance with international conventions.
ES 5.0 CONSULTATION
An open and informed consultation process was initiated at the commencement of the ESIA process,
with the overall objective being to ensure that the stakeholders and affected communities have been:
kept informed about Project proposals and developments;
afforded the opportunity to express their concerns and views; and
assured that their concerns, views and suggestions will be taken into account in the planning
and decision-making process.
Stakeholder consultation has been comprehensive, extensive and intensive, with approximately 34,000
household interviews conducted. A summary of consulted stakeholders is provided in Table ES.2.
Final Report
April 2006
Executive Summary
Page - 9
Executive Summary
Table ES.2: Summary of Stakeholder Consultation to Date

Stakeholder Category
National Level
Divisional Level
District Level
Activities Undertaken for EIA/SIA Preparation

Consultations with representatives of:
Government Departments: Department of Environment (DoE); Bureau of Mineral Development
(BMD); Department of Public Health Engineering (DPHE); Roads & Highways Department (RHD).
Boards: Bangladesh Power Development Board (BPDB); Bangladesh Water Development Board
(BWDB); Bangladesh Telegraph and Telephone Board (BTTB).
Other Government organisations: Petrobangla, Bangladesh Council of Scientific and Industrial
Research (BCSIR); Bangladesh Atomic Energy Commission (BAEC).
Consultations with DoE, Bogra
Consultations with: Deputy Director, Youth Development; Executive Engineer, Barind Tract
Multipurpose Development Authority (BMDA); Divisional Forest Officer, Executive Officer
Bangladesh Agricultural Development Corporation (BADC); Deputy Director, Department of
Agriculture Extension (DAE); District Education Officer, Department of Higher and Secondary
Education; District Primary Education Officer, Department of Primary Education; District Livestock
Officer, Directorate of Livestock Services; Executive Engineer (RHD); Executive Engineer, Public
Works Department (PWD); Deputy Director, Bangladesh Rural Development Board (BRDB);
Executive Engineer & Superintendent Engineer (DPHE); Deputy Director, Department of Social
Service; Assistant District Fisheries Officer, District Fisheries Office, Adjutant, Ansar VDP,
Regional Manager Palli Darirda Bimochaon Foundation, (PDBF); Programme Officer, Department
of Women Affairs; Regional Maintenance Officer , District Controller of Food; Assistant Director,
District Family Planning Office; District Assistant Engineer, Education Engineering Department;
Chief Engineer, Power Development Board (PDB); Land Acquisition Officer, DC Office.
Upazila Nirbahi
Officer (UNO)
Phulbari
Paurashava
Consultations with four UNOs in the study area (Birampur, Nawabganj, Parbatipur, Phulbari).
Consultations with the Council of Phulbari Paurashava.
Ward-wise meeting with each of the nine wards in the Municipality.
Undertaking a town planning survey of over 4000 holdings in Phulbari Paurashava.
Upazila Officials
Consultations with 346 upazila government officials in the four Study Area upazilas.
Union Parishad
Consultation with eight union parishads located in the 5 Kilometre Zone (Khanpur, Joypur,
Golapganj, Hamidpur, Aladipur, Daulatpur, Khayerbari, Shibnagar unions).
Villages
24 ward-wise village consultations held within Joypur Union (six wards); Khanpur Union (six
wards); Golapganj Union (four wards); and Hamidpur Union (two wards);
38 meetings with resettler and host area households on the selection of resettlement villages
115 villages documented via the Village Checklist.
49 villages in eight Unions and Phulbari Paurashava, and five SMEs, covered by case studies for
the Socio-Economic Assessment.
Individual
households &
business
enterprises
Household survey: Interviews with 21,202 households in the 5 Kilometre Zone to gather
demographic and basic socio-economic information. This demographic survey is ongoing until late
2005.
Resettlement Survey: Interviews with 12,780 households and 1,524 business enterprises during
the Resettlement Survey to gather information on compensation and resettlement preferences.
Interviews with 837 host area households
Health Impact Assessment: Interviews with 341 individuals as a part of the qualitative stage of the
HIA process. An additional survey of 2436 households took place during the quantitative stage.
Group Discussions
12 group discussions have been held to date with specific groups of Project-affected people
including women, farmers, landless, indigenous groups and various associations including the
Phulbari Transport Workers Association, Phulbari Town Business Association and Uttar Lasmipur
Bazaar Business Association.
56 group discussions as a part of the HIA process.
Funding agencies
World Bank/IFC, ADB
NGOs
Bangladesh Environmental Lawyers Association (BELA), Christian Commission for Development

in Bangladesh (CCDB), Adventist Development and Relief Agency (ADRA), Thengmara Mohila
Sabuj Sangha (TMSS), Caritas, Health, Education and Economic Development (HEED), World
Concern, Swakalpa Society, Pallisree, ASA, BRAC.
Other
Various other organisations. These are identified in the PCDP included at Volume 4 of the ESIA.
Final Report
April 2006
Executive Summary
Page - 10
Executive Summary
The consultation process has identified a number of key issues, including: scope and status of the
Project; land acquisition and compensation; resettlement; livelihood restoration and employment
opportunities; local infrastructure and services; protection of natural resources and the environment;
community relations; and social and economic benefits. Each of these issues has been considered and
addressed as far as practicable in the design of the Project and in the development of Project mitigation
and impact management measures. For those issues that have been raised that are unrealistic,
information has been provided to stakeholders in an attempt to manage these expectations.
ES 6.0 ALTERNATIVES CONSIDERED IN MINE DESIGN

Figure ES.3 shows the process used to assess the preferred mine development option. The primary
Project objective and development proposal is to economically mine coal reserves within the Phulbari
Basin.
Embedded within this main objective are a number of supporting objectives including:
extracting most of the coal resource to ensure economic gains to Bangladesh, the mining
company, stockholders;
developing the Project in open consultation with the community and all stakeholders;
minimising impacts on the environment and the community; and
implementing an Environmental and Social Action Plan.
The main outcomes of the consideration of alternatives are as follows:
The Deposit (coal resource) is fixed to the Phulbari Basin. There is no alternative mine site.
Open cut mining maximises Project benefits in comparison with underground mining. Due to
depth, thickness, geological shape and geotechnics of a coal seam, the open cut method was
identified as the only technically viable option that would meet the Projects primary objective.
The mine will commence from the north and proceed south. Comparison between the northsouth and south-north options indicate that the depth to coal is less in the north, requires 26
percent less area for ex-pit overburden dump, impacts on 10 less villages (containing 667
households and 92 ethnic families), and less graveyards and religious buildings. The north
option is also further away from the environmentally sensitive Ashoorar Beel. In addition, the
north-south option would allow continuous mining into the inferred coal resource in Area I,
subject to GoB approval.
Stakeholder discussion considered various mining options, such as encroachment of mine and dumps
on settlement areas; proximity and location of areas of significant conservation; areas of archaeological,
religious and ancestral (graves) significance; river diversion; location of mine infrastructure, especially
noise generators; rehabilitation plans; mine equipment; water management; land acquisition;
compensation; loss of agricultural land; and flooding.
An example of a significant change (September 2005) to Project design is the modification in the mine
path to avoid most of the eastern part of Phulbari Township, reducing total resettlement by 25 percent
but with loss of some 20Mt of the coal resource. Similarly it was decided to use coal conveyors and
acoustically designed haul trucks, which will dramatically decrease noise emissions, but at a
considerably increased capital cost.
Final Report
April 2006
Executive Summary
Page - 11
Executive Summary
Figure ES.3: Project Alternative Analysis for Coal Mining Justification and Method of Extraction.
ES 7.0 THE PROJECT

ES 7.1
Project Overview
A summary of the Projects key parameters and approval timetable is given in Table ES.3. A mine and
associated activities schedule is shown on Figure ES.4.
The Project proposal is to develop and operate an open cut mine and associated operations over an
area of approximately 5,192 hectares (see Figure ES.1). With addition of the resettlement villages,
town extension and new road and rail corridor, the total land requirement is 5,933 hectares. The mine
will be located east of the Little Jamuna River, commencing north of Phulbari Township and moving
southwards. Approximate dimensions of the Mine Footprint are nine kilometres long and between four
and eight kilometres wide. The Project will operate for approximately 38 years with coal extraction up to
16 million tonnes per annum (Mtpa) over 36 years.
Final Report
April 2006
Executive Summary
Page - 12
Executive Summary
Table ES.3: Key Project Parameters and Approval Schedule for the Phulbari Coal Project
KEY PROJECT PARAMETERS
Location
Phulbari, Dinajpur District, 350 km NW of Dhaka
Tenement and
Application areas
coal - B, G, H, I, T U
co-products J to Q
Proponent
Coal Resource
572 Mt (288Mt measured, 244Mt indicated, 40Mt inferred)
Average Coal
Quality
Moisture
Ash
Sulphur
Specific Energy
2.7%
6.5% - 19%
<1%
6,600 kcal/kg
Coal Types
Metallurgical Coal
Export Thermal Coal
Domestic Thermal Coal
Reject material
4 Mtpa
8.5 Mtpa
2.5 Mtpa
1 Mtpa
Mine Operation
Mine type
Max. Coal Extraction
Waste Rock
Civil Works
Hours/operation
open cut, truck and shovel

16 Mtpa
7.1 : 1 waste bcm/t of coal
construction of rail spur, realignment of roads, rail and river
24 hours a day, seven days a week
Life-of-Mine
38 years: 2 years site preparation and 36

years extracting a total of 517Mt
Water Supply
groundwater and rainfall
Power Supply
grid supply, supplemented by containerised

power units for backup
Define Resource
IEE / ESC
107 holes, 23,500 metres

Approved / Granted by DoE
Q24 2005
29th March 05
EIA / ECC
Approved / Granted by DoE
11th Sept. 2005
Coal Processing
Resettlement Plan
Infrastructure
Mine Design
Mine Dewatering
Site Development
Design completed
Finalised
Design completed
Submitted
Commencing
Commencing
Q2/Q3 2005
Q3 2005
Q3 2005
Q3/Q4 2005
Year 1
Year 2 to 3
Overburden strip
Commencing
Year 2
Coal extraction
Project Timetable
Commencing
Q3, Year 3
Employment
Financial
Direct Annual Revenue to Gross Domestic Product (GDP)
US$700 million
Analysis
Construction workforce of 2,100, with 1,200 long-term positions

Contribution to Community Life-of-Mine
US$4,200 million
Q = specific quarter of given year, eg Q2 = April to June
Final Report
April 2006
Executive Summary
Page - 13
Executive Summary
Key elements of the proposal include:

implementing a staged resettlement plan;
realigning the existing railway and affected roads and utility services;
realigning the Khari Pul River;
installation and operation of mine dewatering and aquifer injection systems;
installation of a water distribution system to adjoining agricultural areas and settlements;
constructing mine related surface facilities including coal handling and water management
infrastructure, coal washery, workshop, offices, worker amenities and utility services;
open cut operations and overburden (or waste rock) emplacements (ex-pit and in-pit);
environmental protection measures, including noise bunds and buffer areas; and
progressive rehabilitation.
The extent of mine activities is shown on Figure ES.5.
Developing and commissioning the mine will take approximately two and a half years. Initial run-ofmine (ROM5) production will be approximately 1.5 Mtpa, increasing to 16 Mtpa ROM in Year 8. Coal will
be crushed, washed, and then loaded onto rail wagons for transport to regional centres of Bangladesh,
to India or to a sea port for export. Some of the coal may also be trucked to local industries, such as
brick kiln operations. Co-products (sand, gravel, water, kaolinite, silica sand, hard rock, clay), within the
overburden may be extracted for commercial purposes, subject to GoB approval process.
Overburden dumps6 and mined areas will be appropriately contoured, stabilised and rehabilitated as
soon as practical. The ex-pit overburden dump will be up to 120 metres high, while mined areas will
closely approximate existing contour levels once rehabilitated. Post mine land uses will include a
mixture of agriculture, agro-forestry and natural habitats. The final void will be up to 250 metres deep
and will naturally fill with groundwater on termination of dewatering activities.
A mine development plan is shown on Figure ES.6.
ES 7.2
Coal Mine Establishment
ES 7.2.1 Infrastructure Relocations and River Diversion

A number of roads and the main north-south railway will need to be relocated prior to mining. Roads
will be located on levees to minimise flood risk and meet Bangladesh road construction requirements.
Proposed relocations are shown on Figure ES.5.
Two branches of the Khari Pul River will be diverted around the northern and eastern part of the mine.
The diversions will total 14.4 kilometres, resulting in the abandonment of 10.5 kilometres of the existing
watercourse. The proposed diversions will help maintain environmental flows to Ashoorar Beel7.
Run of Mine (ROM) coal is the mined coal prior to processing.

Overburden dump: Material is placed ex-pit (external to the pit) or in-pit (in the pit).
7 Major wetland with adjacent native sal forest in the Phulbari district
5
6
Final Report
April 2006
Executive Summary
Page - 15
Figure ES.5 : Extent of Mine Activities for Year 25

695000
697500
2827500
Barapukuria T
Coal Mine
Barapukuria
Lease
705000
Dirty Water
Collection
Mine Waste Water Discharge
702500
2827500
R e - a l i g n m e n t
Groundwater
Collection
700000
und
2825000
Visu
al
ated Area
ea
en
Mine Footprint
-a
li
gn
m
t
#
2815000
2822500
e Jamun a R iver
Ashoorar Beel
Ranikantor
Beel
2815000
2817500
Littl
abid@smecbd.com
ea
e Ar
in
re M
Map History

e e
e v
L
Futu
l
ai
2817500
d
o o
F l
2820000
it Ar
695000
i ng
Cut
eP
Activ
Ri
M in
B UND
Open
Western Part
of Phulbari
Township
Prepared For:
Ex-pit
Overburden
Dump
Explosives
Store
f
on o
D i re c t i
OIS E
Phulbari
Township
Noise
Bund
2822500
Rehabilit
N
2820000
2825000
Mo
e
R i v
i s s a
s i o n
l s
e r
N a
i v
697500
700000
2500
Scale - 1:75000
Mine Licence \
Exploration
Mine Lease Area
Major Road
Rail (Existing)
River
Mine Footprint
702500
705000
2500 Meters
( A4 Paper Size)
Road (Proposed)
Rail (Proposed)
River Diversion
Noise Bund
Visual Mound
Flood Levee
Mine Infrastructure
Phulbari Township
Water Body
Mine Infrastructure Area
Active Mine Area
Future Mining Area
Rehabilitated Mine Area
Figure ES.6 : Mine Development Schedule

695000
700000
702500
ver
Year 1 - 5
2822500
Phulbari
Township
15
20
Year 20 -
2820000
Year 15 -
2820000
Year 5 - 1
Year 10 -
2822500
Primary &
Secondary
Crushing Station
Phulbari
New Town
Initial
Laydown
Area
e r
R i v
s
i v e r
2825000
s a
N a l s i s
R i v e r
rkhari R
ive
Tilai R
Kh
a
2825000
697500
25
Li
tt
Year 25 -
le
30
2817500
un
2817500
Ja
Year 30 -
38
a River
695000
Map History

Map Reference No : ESIA- ES - 06
abid@smecbd.com
Prepared For:
697500
1000
700000
0
1000
Scale - 1:60000
2000
702500
3000 Meters
( A4 Paper Size)
Existing Road
Mine Pit
River
Mine Infrastructure
River Diversion
Rail Loop
Phulbari Township
Mine Footprint
Land Occupation Plan

Year 1 - 5
Year 5 - 10
Year 10 - 15
New Town
Year 15 - 20
Water Reservoir
Year 20 - 25
Overburden Runoff
Treatment Pond
Year 25 - 30
Year 30 - 38
Executive Summary
Approximately 11 kilometres of track on the main north-south railway will be relocated. A new station
will be constructed and passenger and freight access to Phulbari retained. It is planned to use the rail
network for bulk deliveries of diesel, mining machinery and other materials to the mine and for coal
transport from the mine.
ES 7.2.2 Mine Infrastructure

The proposed Mine Footprint will cover an area of approximately 5,192 hectares (Table ES.4).
Table ES.4: Mine Activities
Activity
Mine pit
Ex-pit overburden dump
Mine infrastructure area
Infrastructure & buffer areas
TOTAL
Hectares
2,180
1,465
513
1,034
5,192
Mine infrastructure will mostly be in place within the first three years of mine development, as shown on
Figure ES.7.
The Project will require a large number of deep dewatering tubewells to operate in and around the
perimeter of the mine to maintain safe working conditions and mine stability. Peripheral dewatering,
water supply to the eastern part of Phulbari Township, final design for irrigation supplies and
construction of aquifer injection bores are due to commence in early 2006.
As the mine develops, overburden will be used to construct earthen bunds around various parts of the
mine. Excess material will be deposited to form a 120 metre high ex-pit overburden dump. Noise
bunds (15 metres high), flood diversion levees (three metres high) and visual mounds (five metres high)
will progressively be constructed around the mine and infrastructure periphery.
Mine facilities will mostly be located in the Mine Infrastructure Area in the south western part of the site,
and will include offices, worker amenities, maintenance workshops, fuel unloading and storage facilities,
water management systems, utility services, mine power plant, internal roads, security fencing and coal
handling facilities. Coal handling infrastructure will comprise an interim rail laydown facility, an elevated
conveyor to transport coal from the pit to the infrastructure area, coal crushers and crushed coal
stockpile, coal handling preparation plant (CHPP) where coal will be washed, product stockpiles and rail
load out facilities. The explosives storage facility will be located between the eastern mine path and expit overburden dump.
ES 7.2.3 Land Requirement and Acquisition

Most of the required land will be acquired under specially drafted legislation. Some early private land
sale is required to commence mine dewatering drilling and preparation of the first resettlement village.
Land ownership is planned for completion at the end of Project Year 1.
The affected 9,760 households will be resettled in seven distinct phases over a ten year period (Figure
ES.8). Some other households may require movement due to noise disturbance. The phases are in
general sequential conformity to the mine land occupation plan (see Figure ES.6) and will coincide with
the development of the extended Phulbari Township and new planned villages. The processes and
procedures followed for land acquisition and population resettlement will be in accordance with the
detailed Resettlement Plan that has been prepared for this Project.
Final Report
April 2006
Executive Summary
Page - 18
Executive Summary
ES 7.2.4 Mine Construction

In the lead up to mine development, a number of pre-mining activities will be carried out. These will
include: purchase of land; establishing a rail siding and construction village; advanced mine dewatering;
road, rail and stream deviations; installation of an irrigation system to supply Project-affect farmland;
land clearing; bund construction; mine infrastructure construction and box cut development.
Infrastructure relocation will take approximately three years. Permanent coal handling facilities in the
Infrastructure Area will begin operation at the beginning of Year 4.
ES 7.3
Coal Mine Operations
Mine operations will commence in the north and progress to the south. The early objective is to mine
down to the coal floor as quickly as possible with minimum overburden mining. Overburden mining
commences in Year 2. Coal is first produced in Year 3, with production ramping up from 2.5 Mtpa to 16
Mtpa in Year 8. The primary disposal site for overburden waste to Year 6 is the ex-pit dump, after which
there is sufficient room in the pit to begin infilling (in-pit dumping) the mined areas. Both in-pit and ex-pit
overburden dumps are used to the end of mining. The maximum coal production of 16 Mtpa continues
to Year 27, and then declines until mining ceases in Year 38. The progression of the mine and
approximate time frames are presented in Figure ES.6.
Mine operations will broadly occur in the following sequence:
aquifer dewatering, clearing and topsoil stripping;
overburden removal;
coal mining; and
rehabilitation of mined areas and overburden dumps. This will occur progressively throughout
the life of mine.
ES 7.3.1 Aquifer Dewatering, Clearing and Topsoil Stripping

Aquifer dewatering will occur throughout the mines operational life. Deep dewatering tubewells will be
installed progressively some distance in front of the southward advancing mine as closer sacrificial
tubewells are destroyed. There will be approximately 80 to 100 dewatering tubewells operating at any
one time. Aquifer injection, to reduce the extent of water level drawdown away from the mine, will be
progressively installed five kilometres from the pit and then operated throughout the life-of-mine.
The proposed mining area is flat and used predominantly for rice production. Depth of topsoil and clay
from the surface is up to nine metres. Initially the top 20 centimetres of topsoil will be stripped and
stockpiled, but later be placed directly onto areas being rehabilitated. The sub-soil layer will also be
removed and separately stockpiled to facilitate placement back in the soil profile when required.
Stockpiles will be managed to protect soil health and prevent soil erosion. Trees occurring in the Mine
Footprint will be harvested and provided to the surrounding community. Other vegetation will be
removed in accordance with GoB requirements.
ES 7.3.2 Overburden Removal

Near the end of Year 1, major mining equipment will start excavation to remove overburden over the
coal seams. Approximately 4,400 million loose cubic metres (Mlcm) of overburden will require removal
over the life-of-mine. Overburden will be used on-site for construction and rehabilitation, or placed on
the surface east of the mine (ex-pit), or in the mine (in-pit). The ex-pit dump will extend over some
Final Report
April 2006
Executive Summary
Page - 21
Executive Summary
1,465 hectares and reach approximately 120 metres high. Approximately 30 percent of all overburden
will be dumped ex-pit; the remainder will be deposited back into the mine pit.
ES 7.3.3 Coal Mining

There are five coal horizons, divided into 11 coal seams. Individual coal seam thickness varies from 20
to 40 metres, with a cumulative total thickness of up to 73 metres. Coal from the thick and extensive
Upper and Main seams will mainly be targeted. Once the coal is exposed, mining will be undertaken
using a fleet of dozers, hydraulic excavators and haul trucks. Most coal will require blasting. The coal
mine will slowly move southwards at a rate of approximately 200 metres per year. The depth of the pit
will generally be between 250 and 300 metres for the life of the mine.
Representative mine stages at Year 14 and Year 38, are shown on Figure ES.9. At Year 14 coal
extraction is at a maximum of 16 Mtpa and rehabilitation has commenced on the in-pit dump. At the
final stage of mining (Year 38), rehabilitation works over both in-pit and ex-pit dumps will be well
advanced, with a final void remaining in the south of the mining pit.
On termination of mining, the dewatering pumps and injection bores will be turned off. Groundwater
inflow will progressively fill the final void to create a water lake of approximately 696 hectares.
Mine of Mine Year 14
End of Mine Year 38
Figure ES.9: Representative Mine Stages
ES 7.4
Coal Handling and Treatment
Coal handling and treatment will include crushing, conveying, treatment, stockpiling and exporting
various quality coal types from the site. Coal handling facilities are shown on Figure ES.10.
Coal will be hauled from the pit by truck to nearby primary and secondary crushers. Following crushing,
the coal will be fed onto an overland conveyor, which will transport coal to a tertiary crusher and
stockpiles near the Coal Handling Preparation Plant (CHPP). The overland conveyor eliminates the
need to truck the coal to the CHPP, significantly reducing potential noise and air quality impacts.
Final Report
April 2006
Executive Summary
Page - 22
ES.10
G
LIN
ND
HA
Executive Summary
The CHPP uses conventional technology to remove stone and reduce the ash and sulphur content of
the coal. Depending on its characteristics, processed coal will be placed in three product stockpiles:
export thermal, domestic thermal or metallurgical. Some of the coal may not require washing, either
because it is to be sold to local markets or it meets the requirements for export grades. Washed coal
rejects will be returned to an overburden dump.
Coal products will be sold from the mine gate or conveyed to one or two over-rail surge bins, which will
load moving trains.
ES 7.5
Coal Transport
Coal from the proposed mine will be transported to domestic and international markets. Some coal will
be sold at mine gate and for mine-mouth power station consumption, however the majority will be
transported by rail to other parts of Bangladesh, directly to India or to a sea port for shipping to
international markets. This will require upgrading rail infrastructure along the transport routes, and
construction of a coal loading facility (Khulna), for shipping through the Bay of Bengal to international
routes. The proposed coal transport route is shown on Figure ES.11.
At peak mine production it is anticipated that:
0.5 million tonnes (Mtpa) of coal will be collected by truck from the mine gate and used locally;
2.5 Mtpa of coal will be transported by rail to local sidings in central Bangladesh and/or used
for local power stations;
4.0 Mtpa of coal will be transported by rail to Indian markets; and
8.0 Mtpa of coal will be transported by rail and ship to international markets.
More coal can be used for local power stations if required, with a subsequent reduction in export. It is
anticipated that 1.0 Mtpa will be returned to the mine as reject material.
ES 7.6
Plant and Equipment, Workforce and Operational Hours
The geology and geometry of the coal deposit are ideal for a truck and shovel mining operation. Other
plant and equipment will include backhoes, haul trucks, drills, track dozers, front end loaders, graders
and water carts.
It is anticipated that approximately 2,100 persons will be employed during mine construction, comprising
both skilled and unskilled workers. The mine will operate 24 hours per day and 365 days per year. The
average directly employed workforce will be about 1,200 persons. Under Contract No. 11/C-94, at least
three quarters of the workforce will eventually have to be Bangladeshi.
ES 7.7
Water, Waste and Hazardous Materials Management
A Water Management Plan has been prepared to provide the principles and procedures for the
collection, storage, transport, use, treatment and disposal of surface water and groundwater during
mine operations. The aim of mine water management is to minimise the impacts of mining operations
on the natural water balance of the region. The water balance model indicates that the mine will have
excess water throughout the year.
Final Report
April 2006
Executive Summary
Page - 24
Figure ES.11 : Proposed Coal Transport Route
600000
700000
800000
900000
1000000
2900000
2900000
#
Y
INDIA
2800000
Coal Loading on Train

PHULBARI
Phulbari Coal Mine
2800000
#
Y
PARBATIPUR
#
Y
#
Y
ISHWARDI JN.
#
Y
GAZIPUR
R IV
PAD
INDIA
Train Transport to Port
2700000
2700000
SHANTAHAR
INDIA
#
Y
DHAKA
2600000
2600000
#
Y
DARSANA
MEGHNA
2500000
Khulna Port
R
RI VE
KHULNA
MONGLA
Barge
Akram Point
Hiron Point
O F
B A Y
2400000
2400000
CHITTAGONG
0
!
Mongla Port
Loading Terminal
#
Y
B E N G A L
Mongla
Fairway
Buoy
S w a t c h
600000
Map History
November 29, 2005

o f
700000
Prepared For:
G r o u n d
Mouth of River Coal Loading
900000
50
Scale - 1:3200000 ( A4 Paper Size)
Phulbari Coal Mine

International Boundary
Existing Railway
Rail Transport Route
River / Ocean
Sundarbans Reserved Forest
1000000
100
150 Kilometers
#
Y
Rail Stations
Port
Loading Terminal
Buoy Location
Marine Transport Route
>
0
ESIA-V1-ES-11
abid@smecbd.com
Map Reference No :
N o
800000
50
Date :
2500000
#
Y
>
>
Port Loading
Executive Summary
The mining operation will produce a variety of waste products, the vast majority of which will be soil,
sand and rock for removal to the overburden dumps. Other likely waste products include coal washery
rejects; sewage; contaminated runoff; oils and grease; hazardous wastes such as batteries, cleaning
chemicals, solvents and acids; inert solid wastes such as tyres, wood and metal wastes; and domestic
wastes such as food, paper and plastic. The Waste Management Plan sets out how wastes will be
responsibly dealt with, including an estimate of waste quantities and measures to monitor, reduce, reuse and recycle wastes.
Hazardous materials used and stored on the mine site will include distillate and Heavy Fuel Oil (HFO),
explosives, solvents, acids, paint, cleaning materials, pesticides, herbicides and acid mine drainage
(AMD) materials. A Hazardous Materials Management Plan has been prepared that details the
measures for the safe storage and handling of hazardous materials likely to be used on-site.
ES 7.8
Rehabilitation and Final Landform
Progressive rehabilitation of the overburden dump and mined areas will be undertaken over the life of
the Project. Rehabilitation will be done according to a land use plan, the conceptual design is shown on
Figure ES.12.
The final Project landform will generally consist of:
native and agro-forests on rehabilitated ex-pit overburden dump;
in-pit overburden dump and other disturbed areas contoured to pre-mining levels with
development of sustainable agricultural pursuits; and
a final void up to 250 metres deep that will fill with groundwater on cessation of dewatering.
The final landform will include a 14 kilometre long wildlife corridor from the rehabilitated, 120 metre high
ex-pit overburden dump, past the mine lake, to the remnant sal forest and wetlands of Ashoorar Beel.
ES 7.9
Ancillary Development
The ESIA addresses in detail the development and operation of the Phulbari coal mine. However, some
ancillary development will be necessary to bring the Project to fruition, namely:
the design of the western extension to Phulbari Township and resettlement villages; and
the construction of coal transport infrastructure. The proposed transport route will use the
existing rail network, supplemented by upgrades and new rail sidings, a new port and coal
barge loading facility at Khulna, and floating transfer facilities on the Pussur River near the Bay
of Bengal.
These ancillary developments are largely outside the direct control of Asia Energy and require
significant GoB involvement, commitment and operational management.
An ESIA for Coal Transportation is now being finalised (SMEC 2006). It concludes that the majority of
impacts could be effectively controlled through the implementation of a range of standard mitigation
measures.
Final Report
April 2006
Executive Summary
Page - 26
Figure ES.12 : Conceptual Final Land Use Plan

694000
696000
698000
700000
702000
704000
2826000
2826000
gnment
-al
r
i
2824000
2824000
a
ss
N a l s i
Re
Road
D i v e r s i o n
2820000
2818000
ttl
#
698000
1000
Ashoorar Beel
700000
0
1000
Scale - 1:65000
702000
2000
( A4 Paper Size)
Exploration Licence \ Mine Lease Area
Proposed Rail
Existing Road
Proposed Road
Existing Rail
River Diversion
Flood Overflow Channel

River
Beel
704000
3000 Meters
Settlement
Phulbari Township
Conceptual Land Use Plan

Agricultural Use
Forest
Lake
Link Forest
2816000
Ranikantor
Beel
st
Prepared For:
55
Hectare
Proposed
Road & Rail
Fore
2816000
Link
una River
am
e J
abid@smecbd.com
2818000
Li
Lake
696 Hectare
Map History

2820000
Agricultural Use
2550 Hectare
696000
2822000
2822000
e r
R i v
Phulbari
Township
694000
e
R iv
l
Pu
Forest
1946 Hectare
Executive Summary
ES 8.0 BIOPHYSICAL IMPACTS

ES 8.1
Soil, Land Use and Land Capability Assessment
ES 8.1.1 Soil
Prior to mining, topsoil will be progressively removed from approximately 4,300 hectares of land and
stockpiled for later use in rehabilitation. Removal and preservation of topsoil will be critical for
rehabilitation works, as it contains organic matter, seed supply, and readily recyclable plant nutrients.
Potential impacts on stockpiled soils include water and wind erosion, depletion of oxygen, loss of
structure through compaction, depletion of nutrients, reduction in beneficial soil micro-organisms and
weed infestation. A detailed Soil Management Plan has been prepared that addresses the above
impacts.
ES 8.1.2 Land Use and Capability

The majority of land in the Mine Footprint is used for agricultural purposes, with villages, towns and
some plantation forests scattered throughout the landscape. Project development will necessitate
changes to land use, some temporary and some permanent.
As mining progresses, previously mined areas will become available for rehabilitation, resulting in
further changes to land use. A Project Rehabilitation and Closure Plan has been developed, which
describes the planned changes to land use arising from the rehabilitation process. The ex-pit
overburden dump will not support rice cultivation. Instead, it is proposed that the dump should
ultimately comprise a mixture of permanent native forest and agro-forestry. The in-pit overburden dump
would be initially suitable for cash crop agriculture and/or agro-forests, and eventually returned to rice
production after land settlement and stabilisation.
ES 8.2
Air Quality
Outside the monsoon season, baseline sampling indicates maximum ambient concentrations in the
areas outside Phulbari Township are close to, or exceed, the GoB residential standard. Therefore, any
increase in ambient concentrations is likely to result in an increased frequency of the standard being
exceeded. Project emissions are likely to increase the number of days where ambient PM10 (24 hour)
concentrations exceed the GoB standard. Until background concentrations can be reduced, satisfying
the GoB standard would preclude almost any development that generates particulate matter emissions.
An alternative approach would be to allow the development of key projects that include the
implementation of all reasonable and feasible emission control measures. The GoB could combine this
approach with an overall air quality improvement programme for the region that would also aim to
reduce emissions from other sources to best achievable levels. An Air Quality Management Plan has
been prepared to address the above impacts. The plan includes an effective series of emissions control
and management measures that are currently being used on similar coal mines in Australia and the
United States of America, and are considered international best practice.
Final Report
April 2006
Executive Summary
Page - 28
ES 8.3
Executive Summary
Noise, Blasting and Vibration
World Bank guideline values for environmental noise were adopted as Project Noise Objectives, which
are lower than GoB criteria. An assessment of potential noise impacts from the Project found that noise
impacts would exceed the Project Noise Objectives during construction and operation of the CHPP; the
haulage of overburden from the initial box cut; mining operations when the mine is next to Phulbari;
trucks transporting coal from the mine to the local market; and ex-pit overburden dump operations.
With Project mitigation measures in place, modelling results indicate that noise impacts from the Project
will generally be below the Project Noise Objectives. The exceptions are:
northern areas of eastern Phulbari Township during the operation of the interim coal outloading facility. Activities associated with this facility will need to be proactively managed with
reduced activity levels during the night time period, particularly in the winter time when noise
enhancing inversion conditions are present; and
from the haul road between the mining pit and the infilling of the infrastructure area, in the
southern and eastern areas of Phulbari. These impacts can be appropriately managed by
restricting use of the haul road to day time in the initial stages of the Project, priority
resettlement for most affected residences and early development of the noise bunds.
A Noise and Blasting Management Plan has been developed as part of the Project Environmental and
Social Action Plan (ESAP), to ensure that noise impacts are controlled.
ES 8.4
Mine Water Balance
A mine water balance and flow model for both dry and wet seasons for the median rainfall scenario is
shown on Figure ES.13 and indicates that the Project will have excess water throughout the year.
Based on various climatic and mine water demand scenarios it is assessed that during the wet season a
large quantity of groundwater and treated surface water (about 400 to 800 ML/day) will need to be
discharged off-site into nearby watercourses, primarily the Little Jamuna River. During the dry season
there is sufficient clean water available to supply irrigation for two crop rotations in the affected area,
continuous aquifer injection, and town and mine domestic water requirements. A combined clean and
treated water excess of 100 to 230 ML/day will be available for riparian use, river discharge purposes
and possibly water demands for the coal fired power station.
The mine water balance indicates little variation in water availability in the dry season for the various
climatic scenarios.
ES 8.5
Surface Water
The Phulbari area is located on the elevated Barind Tract, which is outside the major flood areas of
Bangladesh. The mine will be protected from floods by a peripheral Project bund, consisting of a three
metre high flood levee, 120 high metre ex-pit overburden dump, five metre high visual mounds and 15
metre high noise protection bunds. Hydrology modelling indicates that for a 1 in 100 Year Average
Rainfall Intensity event, villages and transport corridors are not expected to be inundated by the
resultant 0.2 to 0.3 metre increase in flood waters due to the presence of the Project bund and western
extension of Phulbari. Land settlement to the north of the mine may increase flood levels, however
villages are 0.6 metre to one metre higher than the current agricultural floodplain and unlikely to be
impacted by a major flood event.
Final Report
April 2006
Executive Summary
Page - 29
NA = Not Assessed
Executive Summary
Khari Pul River will be diverted east of the ex-pit overburden dump. During construction, and until the
new channel is stabilised, there is potential for increased erosion in the diverted section of the river and
increased turbidity downstream, with associated impacts on aquatic biota. The diversion will
incorporate a range of in-stream habitat features such as still pools, areas of slack and fast flowing
water, and provision of ecological links such as fish passages. Long term impacts arising from diversion
of the Khari Pul River are expected to be minimal.
Water containing high suspended solids in the mine pit, overburden dumps, coal stockpiles, processing
areas, noise bunds, levees and other infrastructure will be collected and treated within the Mine
Footprint. Excess treated water will be released to nearby watercourses. During the wet season,
discharge of treated water is expected to have a negligible impact on water volume or quality of
receiving surface water bodies. Increased volumes of water in river channels during the dry season
may be beneficial for aquatic biota, and downstream farmers. However, it is also important to maintain
natural seasonal variations and flow velocities for biodiversity maintenance.
Encapsulation of acid mine drainage (AMD) materials is common in coal mining operations. With
implementation of standard mitigation measures, it is considered unlikely that AMD will occur. The
design of leachate capture from the overburden dumps is being finalised.
Effluent discharges from sewage, mining and coal processing operations, and runoff from plant and
equipment maintenance areas may contain pathogens, oil, grease, chemical residues and acid mine
drainage leachate. These discharges will be collected, appropriately treated and preferentially reused
on-site.
ES 8.6
Groundwater
To maintain dry and safe working conditions in the open cut mine, aquifers require dewatering and
aquitards need to be depressurised. Due to mine dewatering activities, water level drawdown will form
an irregular ellipsoidal shape with water level declines in excess of 10 kilometres from the mine. This
would reduce groundwater availability to Phulbari Township, surrounding villages and local farming
communities within the given area of influence. Groundwater drawdown may also impact on
biodiversity, wetlands and rivers in the surrounding area. Significant mitigation works will be required to
reduce water level impacts on the surrounding community. These include:
Aquifer Injection: Computer modelling indicates that repressurisation of the Upper Dupi Tila
Aquifer through a radial injection system (tubewells or infiltration trenches), some four to five
kilometres from the mine site is a viable method of groundwater level control, subject to field
trial verification. Water level drawdown due to mine dewatering activities would be restricted to
between the mine and injection area, as shown in Figure ES.14. The source of clean water
would be from the mine dewatering system. If the aquifer injection was installed in a ringed
configuration around the mine, the Priority Areas for Biodiversity Conservation (Ashoorar,
Mollar, Hashkhola and Pakoria beels and Madhyapara, Ashoorar and Rambhdrapur Sal
Forests) would be protected from mine dewatering impacts. An additional benefit is that water
levels close to the injection zone should not suffer from the current dry season fluctuations,
thus groundwater from shallow tubewells should be available throughout the year.
Affected and Resettlement Villages: Deep tubewells will be constructed to supply reticulated
water to existing villages affected by Project dewatering activities and resettlement villages.
Water supplies will be typically managed by village water committees and financed by the
mine.
Phulbari Township: Reticulated water supply, waste water and sanitation will be supplied to
both the eastern and western parts of Phulbari Township. Water will be delivered through high
level tanks connected to the mine dewatering system. Systems will be operated by the
Department of Public Health Engineering with the mine supplying the water, reticulation
system, equipment replacement and operational costs.
Final Report
April 2006
Executive Summary
Page - 31
Figure ES.14 : Water Level Drawdown in Upper Dupi Tila Aquifer and Injection Borefield
690000
697500
705000
712500
2835000
2835000
#
S
#
S
Nawabganj
Township
#
S
%
[
#
S
River
#
S
#
S
#
S
#
S
#
S
#
S
# Ashoorar
S Beel
#
S
#
muna
Mollar
Beel
#
Hashkhola
Beel
#
S
#
S
# #
S S
Ranikantor
Beel
# #
S S
#
S
#
S
2812500
2827500
The predicted groundwater

levels in this area appear
to be close to the lowest levels
already occurring during the
late dry season. Further groundwater
monitoring will be undertaken in
this area by Asia Energy.
2812500
GT2777042
2820000
Phulbari
Upazila
#
S
Ja
#
S
# Township
S Phulbari
#
S
#
S
#
S
%
[
#
Littl e
2820000
GT2738017
Pakoria
Beel
Madhyapara
Hardrock Mine
2827500
#
S
ve r
Ri
Rambhadrapur
Sal Forest
S
Na #
ls
sa
is
#
S
#
S
#
S
#
S
Barapukuria
Coal Mine
# #
S S
#
S
e r
R i v
Madhyapara
Sal Forest
#
S
#
S
la
This Area Affected

by other Mining
Operations
Badarganj
Upazila
Ka
Parbatipur
Upazila
Ashoorar
Sal Forest
Birampur
Upazila
2805000
2805000
690000
697500
Map History

abid@smecbd.com
Prepared For:
2500
705000
0
2500
Scale - 1:170000
#
S
%
[
Injection Tubewell Locations

BWDB Piezometers
Upazila Boundary
Phulbari Township
River
Beel
5000
712500
7500 Meters
( A4 Paper Size)
River Diversion
Forest of Conservation Significance
Affected Area
Low Drawdown (5 - 10 m),

71 square km.
Moderate Drawdown (10 - 15 m),
57 square km.
Severe Drawdown ( > 15 m),
82 square km.
5 km. Radius
10 km. Radius
Mine Footprint
Mining Pit
Infrastructure & Buffer
Executive Summary
Water Supplies to Irrigators: Between the mine and injection borefield, some irrigators will
lose water from their shallow tubewells, especially in the dry season. In the wet season rainfall
irrigation is practiced. Depending on the degree of water level drawdown and distance from
the mine, reticulated water will be delivered to affected farmers by large diameter pipelines and
trenches/canals from the mine dewatering system; or by construction of new deep tubewells.
Sufficient water from the dewatering operation is available for the piped delivery system in the
dry season (216 ML/day) for two irrigated crop rotations, thus allowing three crops per year.
The irrigation system will be operated by the Barind Multipurpose Development Authority and
non-government organisations (NGOs), in partnership with the mining company.
River Discharges: The preferred watercourse for disposal of excess dewatering water is the
Little Jamuna River, due to its larger catchment and higher natural flows. Water release to the
Khari Pul River will maintain riparian flows.
A Water Management Plan (including both surface water and groundwater) has been developed as part
of the Project ESAP to ensure that the water issues are appropriately implemented, managed and
reported.
ES 8.7
Visual Assessment
The Project will alter the current landscape of low relief agricultural use to a large operating mine with
ex-pit overburden dump, noise bunds, levee banks, coal stockpiles and associated infrastructure
developments. In the early stages, there will also be significant construction activity, which will
dominate the landscape for about three years. Visual impacts will become less prominent as mounds
are constructed and rehabilitated with trees. In the longer term, following completion of mining, the expit overburden dump will appear as a forested hill, linking landscape areas around the final void and
forested corridors further south to Ashoorar Beel. The remaining area will be developed for agricultural
pursuits. Figure ES.15 shows the end of mine landscape (wet season) from south of Phulbari
Township looking from west to east.
Figure ES.15: Visual Landscape Assessment at End of Mine, South of Phulbari Township.
ES 8.8
Biodiversity
Mine development will cause direct loss of terrestrial habitat types. Areas of each habitat type that will
be occupied by the mining operation, associated infrastructure and buffer zones are shown in Table
ES.5.
Apart from sal forest, all other habitat types are common and widespread on the Barind Tract bioregion
and rural areas of Bangladesh in general.
Final Report
April 2006
Executive Summary
Page - 33
Executive Summary
All have been substantially modified by human activities.

No naturally-occurring or large sal forest areas are
located within the Mine Footprint. The loss of terrestrial
habitats would result in the loss of species from the Mine
Footprint area but not from the wider area. None of the
species present are endemic to the Project Area, and the
area is not considered critical to the survival of any
species. Migratory bird species have been observed,
mainly in the dry season, but the area is only considered
a minor staging ground for these species.
Table ES.5: Habitat within Mine Footprint

Habitat Type
Hectares (ha)
Cultivated Land
Homestead Vegetation
Roadside Vegetation
Exotic Plantation
Wetlands
Total
4,166
666
82
196
82
5,192
The Priority Areas for Biodiversity Conservation are outside the Mine Footprint. A Biodiversity
Management Plan has been prepared, which details mitigation measures to minimise impacts on
biodiversity.
ES 8.9
Greenhouse Gas (GHG) Emissions
Coal mining can result in the emission of GHGs into the atmosphere. Over the life of mine it is
estimated that the total CO2 equivalent emissions from the Project will be approximately 25.1Mt CO2.
This is equivalent to 0.7Mt of CO2 per year of the Project. The Projects overall contribution to
Bangladeshs and global GHG emissions is relatively small. Nevertheless, a range of energy efficiency
measures have been devised to reduce energy costs and limit GHG emissions.
ES 9.0 SOCIO-ECONOMIC IMPACTS

ES 9.1
Some Facts about the Affected Community
Distribution of human settlements and the status of the demographic survey are shown in Figure ES.16.
A summary of key household indicators within five kilometres of the mine is provided in Table ES.6.
Table ES.6: Key Indicators of Households in 5 Kilometre Zone
Indicator
Population (2004 projections)
Gender Ratio (males/100 females)
No. of Households
% Home Ownership
% Sanitation Facilities
- Sanitary
- Ring slab
- Katcha
- Open field
% Electricity Access
% Household Income Sources
- Sale of agricultural products
- Wage labourer
- Trade/business
- Service holders (Govt/private)
- Rent (housing/land)
% Monthly Household Income
- 1000 taka
- 1001 5000
- 5001 10,000
- 10,001 15,000
- 15,001 20,000
- 20,001
Upazila
Birampur
11,850
107.2
2951
91.0
Nawabganj
21,845
105.9
5673
94.7
Parbatipur
4,447
103.7
1044
97.2
Phulbari
55,523
104.6
11534
87.5
5.1
28.6
10.5
55.8
10.8
6.0
23.0
7.6
63.4
24.0
11.7
20.9
8.0
59.4
32.0
24.3
29.6
9.0
37.1
41.6
58.3
60.5
12.9
10.7
0.4
62.1
54.0
12.5
8.5
1.1
59.3
58.9
19.8
14.2
0.2
36.0
48.2
31.2
20.2
3.3
5.8
82.1
9.5
1.6
0.6
0.6
6.0
83.0
7.6
2.0
0.7
0.6
2.6
82.3
10.3
3.0
0.7
1.1
3.3
70.5
17.4
4.2
1.6
3.0
Final Report
April 2006
Executive Summary
Page - 34
E 16
16
ES 9.2
Executive Summary
Land Acquisition
Some 5,933 hectares of land will need to be acquired over the life of the Project. Asia Energy intends to
request specially drafted legislation to be enacted in a relatively short period of time to enable land
acquisition and for payment of compensation. It is intended to acquire land (privately and through the
GoB legislation) and make appropriate compensation in one process. Households and businesses will
be relocated from this area in a phased resettlement programme over an anticipated ten year period.
Land is a vital resource for households in Bangladesh, with four out of five of the poorest of the
countrys population owning less than half an acre of land. Careful management is therefore critical to
minimise the long-term effects of the mine on the local population.
ES 9.3
Population Displacement
Experience shows that people who are involuntarily displaced are exposed to impoverishment risks.
These risks relate to the loss of capital (natural, human and social) brought about by involuntary
displacement and of entitlements and opportunities possessed at former locations.
Potential impacts associated with population displacement and involuntary resettlement will be
addressed through a well planned, executed and monitored resettlement programme. A basic principle
is to give affected persons a choice of resettlement options, namely:
resettlement to the extended Phulbari Township;
resettlement to designated upazila relocation sites; and
resettlement to an area identified by the household.
A one-off cash evacuation allowance will be provided to all displaced households and business owners
to cover the costs of the physical movement of people, livestock, and other moveable assets.
Schematics of an extended Phulbari township and generic village plan are shown on Figure ES.17 and
Figure ES.18 respectively.
ES 9.4
Livelihoods and Income
The acquisition of land will impact on the livelihoods and income-generating potential of all households
and businesses within the Mine Footprint. Agriculture forms an important part of local livelihoods with
landless and land-poor households typically relying on the sale of their labour in farm-based activities.
The decrease in total available cultivable land resulting from the land acquisition process will affect land
owners, sharecroppers, persons leasing land and agricultural wage labourers who depend on
agriculture to survive. Seventy-four percent of all reported household income sources in the
Resettlement Survey were generated from agriculture-related activities. Loss of land can also have
impacts on forms of livelihood and income-generating activities that rely on access to common property
and natural resources.
An important positive impact of the Project will be the generation of employment. Anticipated impacts of
mine employment and related business development opportunities include:
local employment and procurement opportunities; and
income-generation opportunities through the provision of services to contractors and the
foreign workforce.
Final Report
April 2006
Executive Summary
Page - 36
Executive Summary
Labour for these positions, particularly unskilled, will be sourced locally, with priority given to Projectaffected people, thereby maximising local benefits. In addition to direct and indirect mine related job
opportunities, Phulbari Township will be provided with reticulated water, sanitation, electricity and
stormwater runoff systems. Resettlement villages will be provided with reticulated water, electricity and
runoff drainage.
The impacts on land, wages and enterprise-based livelihoods will be alleviated by the implementation of
a number of mitigation measures that focus on diversification of income earning opportunities. These
include: entitlements for loss of income; establishment of a Social Investment Fund for community
development projects; additional assistance to re-establish livelihoods (e.g. training); and a local
recruitment policy to enable direct employment for Project-affected people.
ES 9.5
Social, Community and Cultural Practices
Social and cultural adjustments will be necessary for both resettled and host communities. Existing
bonds between resettled households and host communities as well as shared socio-cultural
characteristics will ease this adjustment, but social disruptions may nevertheless impact on some
households and social categories. Specific examples of social conflicts that may arise include: conflict
between local communities and Project staff; competition over resources; unequal access to
opportunities and changes to the position of women and traditional kinship relations.
Impacts on existing social and community practices and bonds will be minimised by reducing the
distance that households will be required to move wherever feasibly possible. Preferred relocation sites
have already been identified and will help achieve this aim.
ES 9.6
Impacts on Infrastructure and Services
Given the magnitude of this Project, there will be impacts on infrastructure and services. The Project
will provide an opportunity for the improvement of infrastructure. Services such as electricity, potable
water and sanitation will be available in the planned extended Phulbari Township, as will facilities such
as education, health, religion and small businesses. Services within the Mine Footprint to be disrupted
include:
Health services: doctors, herbal practitioners; pharmaceutical outlets; and a number of clinics;
Education: at least 123 formal educational facilities will require replacement; and
Market places: markets located within the Mine Footprint will require relocation.
It is proposed to replace or compensate for loss of government and semi-government agency offices
and other structures. All existing health structures in the Mine Footprint are proposed to be replaced.
They will be located in appropriate resettlement areas prior to the resettlement of displaced households.
For each proposed resettlement village of approximately 2,500 people, it is proposed to have two
primary schools, one high school and a religious school (if required by village residents). The land use
plan also proposes a total of five primary schools and three high schools within the extended Phulbari
Township. Telecommunication services will be provided in the extended Phulbari Township.
ES 9.7
Health and Safety Impacts
Some potential negative health and safety impacts of mine development which need mitigation
strategies are assessed as: psychological problems from resettlement; potential outbreaks of vector
borne, water borne and communicable diseases; respiratory illnesses from an increase in dust levels
and air pollution; increase in accidents and injuries in the local area; and increases in HIV/AIDS and
sexually transmitted diseases.
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There is also the potential for health benefits from better access to improved drinking water;
replacement of and improvements to health infrastructure within newly established resettlement villages;
and new income-generating opportunities. Proposed mitigation strategies include:
health monitoring and surveillance activities;
establishment of a Social Investment Fund to support local training activities and promote the
development of sustainable livelihoods;
providing entitlements and resettlement provisions that should go some way to reducing the
mental anguish associated with the resettlement process;
physical and operational measures at the mine site to reduce dust and air pollution;
strengthening of existing screening, case detection and management programmes for
communicable and vector borne diseases;
increased use of formal traffic control arrangements and occupational health and safety
education to reduce the number of accidents and injuries; and
an education and awareness programme on HIV/AIDS and sexually transmitted diseases,
augmented by other measures such as voluntary HIV testing.
ES 9.8
Impacts on Cultural Heritage and Graveyards
Of the 79 cultural and historical sites identified within 10 kilometres of the mine site, 35 are located in
the Mine Footprint. Archaeological assessment indicates that the main ancient site (a buried Buddhist
stupa) can be removed with Ministry of Culture approval after complete excavation and accurate
documentation. The other ancient sites have been disturbed over time by local people and can be
removed after trial excavation. Most medieval sites (Hindu temples, Muslim Mazars, palaces, ponds,
churches and erected monuments) are partially damaged, and can be moved after documentation.
Modern sites and older destroyed structures can be removed after discussion with local people.
There are 758 graveyards identified in the Mine Footprint. All graves, graveyards and cremation sites
will be treated according to the wishes and preferences of surviving relatives prior to the occupation of
any area of land for mining purposes. Costs of grave relocation will be borne by the Project.
ES 9.9
Vulnerable Groups
Vulnerable categories include women, children, the elderly, landless people who rely on agricultural
labour as their main source of income and indigenous groups. Detailed measures can be found in the
Resettlement Plan and Indigenous Peoples Development Plan.
General measures proposed to protect the interests of these vulnerable groups include:
payment of a rehabilitation allowance to bona fide vulnerable households such as femaleheaded households, the elderly and disabled;
rehabilitation of resettled indigenous and vulnerable groups coordinated by a specially
established committee;
establishment of a Household Rehabilitation Fund for vulnerable households who rely mainly
on income from agricultural labour;
establishment of a Social Investment Fund to fund the school fees of children from vulnerable
resettlement and host area households; and
provision of physical assistance (e.g. transport and labour) rather than a cash allowance in the
case of some vulnerable households such as the elderly or disabled.
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ES 9.10 Host Community Impacts

Key impacts on host communities include acquisition of land and its conversion to residential areas for
displaced households; social disturbances associated with the relocation of displaced households and
increased pressure on existing social services and facilities. The measures proposed to promote the
smooth implementation of resettlement-related activities in host areas include:
formal consultation mechanisms involving representatives of the host and displaced
communities to promote smooth social integration;
host communities will be considered as Project-affected parties and compensated according to
the same principles as resettled households for any losses incurred as a result of resettlement
activities;
appropriate social services and facilities will be provided at each upazila relocation village;
where host community services or facilities are affected by the resettlement programme
appropriate measures, (for example, construction of additional classrooms to accommodate
increased student numbers from resettled households), will be implemented; and
host communities will be involved in the implementation of programmes to improve the
production capacity and management of the natural resource base.
ES 10.0 CUMULATIVE IMPACTS

Cumulative impacts are defined in the Equator Principles and IFCs Procedure for Environmental and
Social Review of Projects (1998a) as those impacts that could arise as a result of projects or potential
developments that are realistically defined at the time the environmental assessment is undertaken if
those projects and developments could impact on the project area.
Four future projects have been identified, which fit the above definition in respect of the Phulbari Coal
Mine. These include the Barapukuria Underground Coal Mine, Barapukuria Power Station, Phulbari
Power Station and Madhyapara Hard Rock Mine. Detailed environmental investigations have not been
undertaken for any of these projects, so the quantum of cumulative impacts cannot be determined.
Significant issues include the following:
Water resources: all will have interactions with local groundwater and surface water users,
with impact to farmers, town, villages and water quality.
Air quality: there are already concerns about existing regional air quality. The new facilities
will generate particulate and gaseous emissions that will need to be carefully managed so that
cumulative air quality impacts are kept within acceptable bounds.
Noise: there will be cumulative impacts from the Phulbari mine and Phulbari Power Station.
The issue will require a proactive approach in the design and management of these two
facilities.
Livelihoods and employment: these developments will lead to loss of livelihoods and
employment in agriculture, but will offer direct and indirect employment opportunities.
Population: increases are likely as a result of the above developments and the direct and
indirect employment growth flowing from them.
Infrastructure and services: mining and energy sector developments have the ability to
contribute substantially to any regional infrastructure and services.
The Project has been comprehensively assessed and best practice mitigation measures included in
design and proposed operations.
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ES 11.0 RISK ASSESSMENT

This is one of the largest developments of its kind in Bangladesh and has the potential to bring
significant infrastructure and financial benefits to the Country, particularly to the west and northwest.
With Project development there are a number of associated risks and uncertainties, which relate to
institutional, political and market factors, as well as specific direct and indirect technical, environmental
and social impacts. Some of these risks are significant and the investor needs to undertake their own
assessment of degree of risk. However, there are also a range of opportunities for the financial
institutions to develop partnerships with the GoB, community groups and other interested stakeholders
to overcome or lessen some of these risks, improve living standards and stimulate local and regional
economic activity.
ES 11.1
Risks, Uncertainties and Opportunities
The perceived risks and uncertainties for institutional, political, technical, environmental and social
issues are summarised in Table ES.7.
ES 11.2 Environmental and Social Residual Risks

A qualitative risk analysis was undertaken to assess the severity/consequence and likelihood of
environmental and social impacts. This analysis applies to impacts projected to occur after mitigation
measures. Figure ES.19 sets out the assessment matrix.
Likelihood
Rating
Negligible
Severity / Consequence Rating*

Minor
Moderate
High
Very High
Certain
L-M
M-H
Likely
L-M
M-H
Possible
L-M
M-H
Unlikely
L-M
L-M
Rare
L-M
* L = low, M = medium, H = high residual risks

Figure ES.19: Significance Assessment Matrix
The risk analysis identified environmental and social impacts that had a risk ranking of medium or
higher. These and proposed remedial responses are set in Table ES.8.
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Table ES.7: Project Risks and Opportunities

Risk & Uncertainty
Issue and Comment
Institutional and Political Issues

Regulatory
environment
GoB regulatory requirements: Much of the GoB legislation of relevance to the Project needs updating, not clearly understood, often not enforced, and may overlap in terms of functional authority (IUCN,
2005). The capacity of the GoB to apply the existing legislative and policy framework to large private sector multidisciplinary developments, such as this Project, is uncertain. This uncertainty highlights
some risks associated with the Project development. As no agency within the GoB exists that is able to provide comprehensive advice for multidisciplinary developments, Asia Energy engaged IUCN
(2005) to identify and review legislation and permissions pertinent to Project development. Thus, Asia Energy is confident that the required procedural and permit requirements have been identified.
However, while large-scale consultations have been held, the decision-making process of the GoB (as guaranteed in Contract 11/C-94) is not within the control of Asia Energy. This has major implications
for the time of granting the government approvals required to enable the Project to proceed; for example, granting of exploration licenses and mining leases over some areas of the planned Mine
Footprint. Significant delays in the approvals process have already been experienced in this regard. Delays in the approvals process may adversely impact on planned Project development timeframes.
Opportunity: These limitations in the GoBs institutional capacity present an opportunity for the Project and financial institutions, to assist the GoB with strengthening their ability to legislate and regulate
multidisciplinary developments; Bangladeshs fledgling mining industry in particular. This could be achieved through the formation of mutually beneficial partnerships with the GoB and other relevant
stakeholders. For example, Asia Energy will be providing assistance to the Office of the Deputy Commissioner, Dinajpur, for land title searches.
Government policy
Uncertain government policy: The Ministry of Power, Energy and Mineral Resources is currently revising the existing coal related rules, regulations and policies due to increased interest by foreign
companies in the countrys mining sector.
Opportunity: ESIA investigations for the proposed coal mine are the most extensive undertaken in Bangladesh. In addition proposed mitigation measures are worlds best practice standard. This
knowledge can assist the GoB to develop mine related regulations that form the basis for regulating existing and future mine related developments. For example, Asia Energy is assisting the GoB in
formulation of mining legislation.
Mine License areas
Licenses need approval by GoB before the mine can proceed: Asia Energy does not hold all required mining and exploration licenses: Asia Energy holds Mining Lease Area B; and Exploration
License areas G, and H. Asia Energy has not received approval for Mining Leases of I and T (site of ex-pit overburden dump), nor Mining Leases for Areas U, H and G, without which mining cannot
proceed. Area I Exploration License application has been in the system for at least 15 months. Exploration licenses J-Q for co-products8 are under application.
The Project intends to start the box cut on Barapukuria Mine Lease to intersect coal on the common boundary : There is general agreement between Barapukuria and Phulbari about cooperation between projects, but there is currently no formal agreement for construction of the pit off the Phulbari lease boundary.
Coal transport
Infrastructure upgrade and approvals: Coal transport will require upgrades to some 300 kilometres of the rail network, construction of a new port at Khulna, rail sidings and extensive dredging of a
shipping channel. These works will require significant GoB involvement and operational management, and are outside the direct control of Asia Energy.
Opportunity: Proposed rail and port upgrades will have significant regional and international development benefits by providing export access to west and northwest Bangladesh, plus neighbouring landlocked countries (Nepal). It will bring in industry opportunities that rely on goods transport.
Third parties
Reliance on third parties: Coal transport will be reliant on the ability of third parties (eg Bangladesh Rail and Mongla Ports Authority) to deliver rolling stock, run trains on-time and dredging of rivers and
outer sand bars in a timely manner.
Opportunity: Opportunities exist for institutional strengthening to substantially improve the training of rail and ports employees, and improve operational efficiencies. There are opportunities for joint
venture partnership for coal: rail transportation with GoB. This will have significant benefits for improving regional development and Bangladeshs capacity to expand export opportunities.
Community
relocations
Acceptance of township and village relocations: A number of resettlement options have been proposed, including locating and conceptual planning for a township extension and new villages. In
consultation with stakeholders, sufficient detail has been provided to demonstrate that these options can be successfully implemented. However, these options will require significant GoB involvement
and review, and may require specific regulatory approvals.
Mining of co-products is being considered but does no from part of the current ESIA
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Risk & Uncertainty
Issue and Comment

Opportunity: The proposal will create model town and villages that are culturally sensitive and incorporate infrastructure that will improve standards of living and quality of life.
Barapukuria Coal
Mine
Mine constraints: This mine will extract coal under a major aquifer and failure has already occurred on one occasion. If closure occurs again coal supply to the Barapukuria Power Station will be limited
and power output under capacity. Supply of power with this facility is being negotiated for the Project.
Opportunity: If this mine does not operate to capacity, there is the opportunity for the neighbouring Phulbari Coal Mine to provide the coal source to the near completed Barapukuria Coal Power Station.
Global recession
Markets: Reduction in price of coal.
Fundamentalism
Religion: Bangladesh is a secular society where all religions are tolerated. The government takes action against radical elements of society.
Technical Issues
Resource uncertainty
Unknown extent of coal reserves: Coal reserves for the first 36 years of coal mining at Phulbari have been defined. While coal reserves in areas B and H are well defined, coal extends southwards
into area I. Therefore, while coal reserves can only increase, total coal resources are still unknown. There could be resettlement issues associated with the expansion of the Mine Footprint, including
resettlement of a larger number of indigenous households.
Opportunity: The Project will be developed and operated for the next 38 years in accordance with worlds best standards. This knowledge and expertise would form the basis for developing other coal
reserves in a responsible and efficient manner.
Experienced staff
Lack of experienced personnel: The Project is the first open cut coal mine in Bangladesh, thus there is no experienced skilled workforce in open cut mining. Asia Energy will have to train locals to
undertake specific operation and maintenance activities associated with the Project.
Opportunities: Training of skilled workers, as required under Contract 11/C-94, will eventually provide a local core skilled workforce and assist in future mining ventures in northwest Bangladesh. Initially,
a large skilled workforce will need to be outsourced until such time that skills are transferred to local people.
Cumulative
environmental
impacts
Lack of regional environmental knowledge: The ESIA addresses cumulative impacts. It indicates that there is a lack of relevant regional environmental information. For example, Barapukuria Coal
Mine and Power Station have been developed and may soon commence operations. Potential environmental and social impacts of these projects have not been assessed in any detail and thus
cumulative effects with the Project coal mine cannot be quantitatively assessed. Future development in the region is also difficult to quantify, as the GoB has no future structure plan for resource or
regional development.
Opportunity: Expertise developed from the Project would greatly assist the GoB to manage similar operations.
Aquifer Injection
Lack of Field Testing: Aquifer injection has been proposed as a mitigation measure to restrict the areal spread of water level drawdown and subsidence. Aquifer injection is a proven technique on mining
projects to achieve the desired result but needs to be field tested before confirmation on its acceptability.
Opportunity: Many farmers are unable to achieve dry season irrigation from shallow tubewells due to current declines in groundwater level. Aquifer injection, if successful, will also provide a constant
water level for nearby shallow tubewells, thus allowing irrigation for a third crop which is currently not possible.
Earthquakes
Seismic activity: Bangladesh lies in active seismic zones making the occurrence of earthquakes and associated damage to mine infrastructure a possibility.
Cyclones
Disruption to port, barges and international shipping due to climatic conditions: This would impact on coal transport and delivery of mining equipment, and may require additional coal stockpiling at
the mine site.
World Heritage
Transport ships passing close to the Sundarbans: If approval for this export component is refused, mine production may require reduction.
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Risk & Uncertainty
Issue and Comment
Environmental and Social Issues

Land Acquisition
Procurement of large tracts of land: Few projects in Bangladesh have involved such large-scale land acquisition. The existing land acquisition process in Bangladesh is complicated and time
consuming, and efforts will be required to streamline the process. Additional government resources (staff and equipment) will also be required to ensure smooth implementation. In the Project area there
is land that cannot be directly acquired under existing Bangladesh legislation. Specially drafted legislation, similar to the Chittagong Hill Tracts (Land Acquisition) Regulation, 1958 and the Jamuna
Multipurpose Bridge Project (Land Acquisition) Act, 1995 may be necessary to obtain all of the required land for the Project.
Opportunity: Institutional strengthening to streamline government processes related to land acquisition and compensation associated with resettlement.
Influx of persons
seeking work
Health: The incidences of sexually transmitted diseases, including HIV/AIDS may rise due to an influx of persons for direct and indirect employment, potentially exposing the population to an increased
risk.
Opportunity: Funding for community development, education and awareness raising activities for protection against HIV/AIDS
Local community
opposition
Degree of community support: Community opposition occurs in any large-scale development, those with large resettlement components typically being particularly contentious. Project-affected people
initially appeared supportive of the Project and participated in the consultation process through attendance at meetings and responding to the various surveys. Some discontent has become evident
amongst some Phulbari Paurashava (municipality) residents with the organisation of a local committee, distribution of pamphlets, and public meetings. However the majority of affected persons still
support the Project.
Resettlement and
compensation
Compensation process: Previous experience with the payment of compensation for other projects in the area, eg. Barapukuria Coal Mine, has been unsatisfactory. Compensation payments must be
transparent, promptly paid and accountable. A non-transparent and inequitable compensation process could impact on relations between the local community and the mine.
Cemeteries
Permission to remove ancestry ties: All graves in 1,365 graveyards will need to be treated according to the wishes of affected families.
Cultural Heritage
Permission to remove national heritage: Permission will need to be sought from the Ministry of Culture to excavate, and if necessary, relocate a small, buried archaeologically important site, that
exists in the mine displacement area
Inflation
Increase price of goods and services: These may increase with mine development and associated influx of non-local Bangladeshi and foreign workers. Public relations between the community and the
mine may suffer as a result.
Project timing
Land acquisition and resettlement processes in Bangladesh: These are complicated and time consuming and therefore may delay Project timing and coal delivery.
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Table ES.8: Medium to High Level Environmental Risks and Responses

Environmental
issue
Residual risk
Response
Air Quality
M-H
This risk is mainly a consequence of relatively high ambient airborne particulate concentrations that are a result of regional and local influences. At times ambient
conditions may already exceed regulatory standards without mine emissions. However, it is not expected that combined ambient and mine emissions will be greater than
the 24 hour maximum World Bank limit. Risk management will include dust suppression systems and an integrated and real time monitoring system.
Water Management
M-H
Water management will be relatively complex, due to large quantities of water generated on the site, and storage, treatment and discharge requirements. Although a
relatively high residual risk, there is a high level of confidence that proposed management measures and real time monitoring systems will effectively manage this risk.
Soils
This risk reflects the heavy rainfall events that can occur in the region, either before or during the monsoon season, and the creation of new soil profiles that will require
time to stabilise and develop. This risk will decline once rehabilitation is progressed and soils adequately stabilised.
Land Capability and

Land use
Land capability will be affected during the Project. A rehabilitation plan has identified viable alternative land uses, including biodiversity areas and cash crops.
Consequently, this risk will decline as these new land uses become established.
Noise
The risk relates mostly to night periods when mine activities are near sensitive receptors, coupled with temperature inversion conditions. Risk management includes
adopting a night time noise objective of 45 dBA, compared to a GoB criteria of 50 dBA. If night time levels exceed the objective, mine activities will be reviewed, modified
or stopped. Risk may be reduced by monitoring and adjustments to the resettlement process.
Water Quality
Water quality has a comparatively lower risk than hydrology, due mainly to the high confidence of proposed management measures, and physical and biodiversity
indicator monitoring will effectively ensure discharge criteria are met.
Groundwater Level
Drawdown
This issue has a high severity/consequence of affecting groundwater resources available to Phulbari and village communities surrounding the mine. Despite this, there is
a high degree of confidence that proposed aquifer injection and irrigation schemes will mitigate potential impacts.
Land Settlement
Consolidation of sediment will occur mainly under the Mine Footprint and eastern part of Phulbari Township. Land settlement will reduce quickly away from the mine site
due to the presence of natural river recharge and artificial aquifer injection system. A waste water management scheme is being planned for eastern Phulbari.
Compensation will be made available for any affected lands or structures.
Visual
High visual intrusion will occur in early operations, but this risk will substantially decrease as the Project site is landscaped and rehabilitated.
Waste
Waste management will adopt contemporary management measures that have been successfully adopted throughout the world.
Loss of Income
Generation and
Livelihoods
M-H
The Resettlement Plan provides comprehensive compensation and livelihood re-establishment mechanisms. However, some households may fail to re-establish their
livelihoods. This risk will decline as new land uses and agricultural practices become established. This situation risk will be monitored and corrective measures taken
where necessary.
Unmet Employment
Expectations
M-H
Asia Energy has develop a preferential employment policy and is committed to maximising local employment and procurement opportunities wherever possible. Despite
these measures, unmet expectations will be impossible to eliminate completely.
Disputes Over
Compensation
Outstanding grievances or disputes as a result of the land acquisition and the displacement process are inevitable, given the scale of resettlement associated with this
Project. These grievances will be managed to the greatest extent possible through the grievance redress procedure outlined in the Resettlement Plan.
Injudicious Use of
Cash Compensation
On a broad scale, the likelihood of this situation occurring as a result of the Project is unlikely. However, for those households to which it does occur, the severity of the
residual risk will be very high, resulting in overall residual risk rating of medium. This risk will be mitigated as far as possible through awareness and social campaigns.
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Environmental
issue
Residual risk
Response
Split Communities/
Community Bonds/
Loss of Social
Networks
Individual household resettlement choices and/or the incorporation of previously individual villages into larger relocation sites may result in changes to existing community
bonds. Mitigation measures, such as the provision of designated relocation sites within existing upazila or relocation to a site of their own choice, should minimise this
impact.
Ongoing Community
Tensions/Conflict
There is the potential for ongoing tension between community members, particularly when displaced communities try to assimilate into their host communities.
Consultation, the establishment of local liaison forums and community involvement in the planning and management of resettlement activities will help mitigate tensions.
Increase in Disease
This impact is likely to vary according to the existing health of the community and it will have a wide ranging significance dependent on the severity of the disease and its
outcomes. The existing health status of individual elements of the community will also affect the success of the planned preventative and health awareness programmes
to be developed for mine staff and the local community.
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ES 12.0 MANAGEMENT PLANS

ES 12.1
Environmental and Social Action Plan (ESAP)
The ESAP and sub-plans have been prepared according to legislative and policy requirements of the
GoB; the Equator Principles; international best practice guidelines, principally: IFC Operational Policy
OP 4.01, IFC Safeguard Policies, the World Bank Pollution Prevention and Abatement Handbook, and
the World Bank Environmental Assessment Sourcebook (particularly Update Number 25: Environmental
Management Plans); consultation with relevant GoB departments, the local community, and other
interested stakeholders; consideration of baseline studies conducted in the Projects Study Area; and
impact and mitigation assessments. The Project is currently at the feasibility stage, further refinements
will be required. Key elements of the sub-plans (Table ES.9) include plan objectives; compliance and
regulatory requirements; potential impacts and mitigation measures; monitoring rationale and schedule;
and environmental commitments and implementation schedule.
Table ES.9: ESAP Sub-Plans
Mine Water Management Plan
Biodiversity Management Plan
Soil Management Plan
Mine Rehabilitation and Closure Plan
Air Quality Management Plan
Waste Management Plan
Greenhouse Gas Management Plan
Hazardous Material Management Plan
Noise and Vibration Management Plan
Health and Safety Plan
Community Consultation Strategy
Preferential Employment Strategy
The ESAP is not a static document and will be subject to regular review and external audit with the aim
of ensuring compliance with current regulatory requirements and continual improvement of the Projects
environmental performance. The Plan will be updated on at least an annual basis to incorporate
specific requirements for planned and/or phase-specific operational activities over the mine site.
Through a structured and rigorous process of reporting and auditing, the ESAP provides the interface
between the Project, regulatory authorities and the community. The results of environmental and social
monitoring will be available:
monthly to the GoB;
quarterly through reports to the lending institutions and Chairman of the Board (mining
company);
quarterly through the mine newsletter to the local community and business;
annually through the Annual Environmental Management Report to DoE, Project financiers,
community and stakeholders;
annually through the statutory Annual Report from the mining company, to all shareholders,
stock exchange, internet and the Phulbari Information Centre; and
annually through an independent social and environmental review by qualified auditors. The
report will be displayed on the mining company webpage and in the Phulbari Information
Centre.
Reports 1, 2 and 4 will be prepared by the Mine Environment Manager. The Community Liaison
Manager will prepare Report 3. Report 5 will be prepared by the corporate section of the mining
company. Further details are given in Section 7.1.2 of the ESAP (Volume 3, Section 5) of the ESIA.
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ES 12.2
Executive Summary
Socio-economic Action Plan
There are three plans governing management of the potential socio-economic impacts of the Project,
these being:
Resettlement Plan, which focuses on the resettlement programme and ensures that it is
properly planned and integrated with mine development requirements and schedules, and
effectively implemented;
Indigenous Peoples Development Plan, which aims to ensure that the concerns of the
indigenous groups are considered during the Projects implementation and operation; and
Public Consultation and Disclosure Plan, which provides a summary and review of
consultation and disclosure activities undertaken prior to and during the ESIA, and details the
proposed programme for the construction and operation phases of the Project.
ES 13.0 PROJECT SUSTAINABILITY

There are three principles that pertain to the concept of sustainable development. The application of
these principles to the Project is outlined below.
Precautionary Principle: Where there are threats of environmental damage, lack of full
scientific certainty should not be used as a reason for postponing measures to prevent
environmental degradation. Open cut coal mines occur throughout the world. Measures to
mitigate adverse potential environmental and social impacts are well developed and have been
incorporated into Project design to worlds best practice standards. Thus potential
environmental impacts will be controlled to meet the requirements of the GoB and the Equator
Principles. Use of the Precautionary Principle and planned progressive rehabilitation activities
and process will ensure that long term serious or irreversible environmental damage should not
occur.
Inter/intra-generational Equity: This addresses the fair distribution of assets including
natural, built and human capital within and between generations. One of the outcomes of this
Project is poverty reduction and thus improves living standards in Bangladesh. If the Project
proceeds, it is anticipated that, not only would the living standards of the local Bangladeshi
improve in the near term, but that subsequent generations would also have a better standard
of living as a result, as needed infrastructure would be in place to support future generations.
This Project supports the principles of inter and intra-generational equity. The Project will
contribute to the GoBs poverty reduction strategies by contributing to improvements in
employment, maternal health, education, electric power, sanitation and safe water and
nutrition. Despite this contribution to the countrys poverty reduction strategy, it will be
important to ensure that benefits to the local community are sustainable in the longer term,
including employment after the mine closes; the availability of land to agriculture after
rehabilitation; and the continued long-term provision of adequate services and infrastructure.
Conservation of Biological Diversity and Ecological Integrity: The Project is not
anticipated to have an adverse effect on biodiversity or ecological integrity. Indeed, Asia
Energy plans to rehabilitate 1,946 hectares of the Mine Footprint back to natural forest, and
through afforestation, link this forest with that located south of Ashoorar Beel, thus providing a
significant wildlife corridor. This area of natural forest is likely to improve biodiversity in the
area.
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ES 14.0 CONCLUSIONS
The purpose of this ESIA is to provide prospective investors (and other concerned) with an assessment
of the possible environmental and social impacts arising from the development and operation of the
Project. The report identifies strategies and methods to mitigate or manage possible adverse impacts
and enhance beneficial impacts, and assesses residual impacts remaining after the application of
mitigation measures. To ensure that the assessment conforms to worlds best practice and leading
international financial lending institution standards, the ESIA was prepared in accordance with the
Equator Principles, associated World Bank and IFC policies and guidelines, and took due note of the
Asian Development Bank policies and guidelines. The ESIA indicates that the Project can be
successfully developed and implemented to meet relevant GoB regulatory and policy requirements, and
international policies and guidelines. The GoB has already granted environmental clearance for the
Project.
The ESIA highlights a number of potential beneficial impacts likely to accrue as a result of Project
development, including the potential for improved social and economic development for the local
community, contribution to the GoB goals of poverty reduction and universal electrification, much
needed diversification away from gas-fired electricity generation, and provision of royalties and taxes to
the GoB worth hundreds of millions of dollars.
The ESIA confirms that development of the Phulbari coal resource in a populated, predominantly rural
area will lead to some social and environmental impacts. The social and environmental concerns that
the Project will have to address during development include the orderly resettlement of people, fair
compensation for those affected, equitable land acquisition processes, training and provision of jobs for
local people, management of land subsidence, maintenance of water supply, and the minimisation of
dust creation and disturbance due to noise.
Mitigation and management measures have been developed which will minimise and/or manage the
majority of potential impacts to worlds best practice standards. These measures have been formalised
into a series of management plans including the appended Environmental and Social Action Plan,
Resettlement Plan, Indigenous Peoples Development Plan and a Public Consultation and Disclosure
Plan. These documents have been prepared in accordance with internationally accredited standards
and address environmental and social monitoring, implementation of mitigation measures, management
of risks and schedules, relocation needs, compensation and resettlement entitlements, alternative
livelihood opportunities and improved living conditions (with a model town and reticulated water and
sewerage systems) with specific consideration for the local underprivileged groups, including ethnic
minority groups and women.
Despite the application of mitigation measures and management plans, a range of potential residual
impacts remain and existing social and physical environments in the Project area will change. These
issues will require dedicated and culturally sensitive leadership on behalf of Asia Energy to minimise the
risk of harm to the environment or people affected by Project development, and maintain productive,
friendly relationships with local communities.
Asia Energy has expressed commitment to developing and operating the open cut mine according to
sustainable development principles, ensuring social and economic gains both to the local community
and nation, while being sensitively attuned to the environment. In summary, while there are impacts
associated with development of the Project, this report demonstrates that with commitment and strong
leadership on the part of Asia Energy, most of these impacts can be managed to worlds best practice
standards, and residual impacts can be satisfactorily managed.
Final Report
April 2006
Executive Summary
Page - 50

Phulbari Coal Mine Executive Summery by Asia Energy

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Phulbari Coal Mine Executive Summery by Asia Energy

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ASIA ENERGY PLC

2nd Floor Foxglove House

Asia Energy Corporation (Bangladesh) Pty Ltd

STATEMENT OF INTENT: ASIA ENERGY CORPORATION (BANGLADESH) PTY LTD

Overall Approach to Issues

Specific Environmental and Social Undertakings

ES 9.0 SOCIO-ECONOMIC IMPACTS ................................................................................................34

Figure ES.2 : Phulbari Coal Mine Footprint

Date : November 29, 2005

Ex-pit Overburden Dump

Additional resettlement may be required in case of mine noise disturbance.

Project Location and Physical Characteristics

Photo ES.2: Sal forest

Photo ES.3: Rice irrigation

ES 2.0 PROJECT JUSTIFICATION AND BENEFITS

Need for the Project

2. New Local Energy Alternative

3. New Source of Electricity

4. Export and Domestic Markets

6. Regional Transport Improvements

Benefits of the Project

ES 3.0 THE PROPONENT AND MINE LEASES

ES 4.0 LEGAL STATUS OF PROJECT AND COMPLIANCE

Environmental Clearance by the Government of Bangladesh

Compliance with Laws, Conventions, Guidelines and Policies

Compliance with International Conventions, Guidelines and Policies

Table ES.2: Summary of Stakeholder Consultation to Date

Activities Undertaken for EIA/SIA Preparation

World Bank/IFC, ADB

Bangladesh Environmental Lawyers Association (BELA), Christian Commission for Development

ES 6.0 ALTERNATIVES CONSIDERED IN MINE DESIGN

ES 7.0 THE PROJECT

Phulbari, Dinajpur District, 350 km NW of Dhaka

Asia Energy Corporation (Bangladesh) Pty Ltd

572 Mt (288Mt measured, 244Mt indicated, 40Mt inferred)

open cut, truck and shovel

38 years: 2 years site preparation and 36

groundwater and rainfall

grid supply, supplemented by containerised

107 holes, 23,500 metres

Approved / Granted by DoE

11th Sept. 2005

Direct Annual Revenue to Gross Domestic Product (GDP)

Construction workforce of 2,100, with 1,200 long-term positions

Q = specific quarter of given year, eg Q2 = April to June

Key elements of the proposal include:

Coal Mine Establishment

ES 7.2.1 Infrastructure Relocations and River Diversion

Run of Mine (ROM) coal is the mined coal prior to processing.

Figure ES.5 : Extent of Mine Activities for Year 25

Mine Waste Water Discharge

Date : November 29, 2005

Figure ES.6 : Mine Development Schedule

Date : November 29, 2005

Ex-pit Overburden Dump

Land Occupation Plan

ES 7.2.2 Mine Infrastructure

ES 7.2.3 Land Requirement and Acquisition

ES 7.2.4 Mine Construction

Coal Mine Operations

ES 7.3.1 Aquifer Dewatering, Clearing and Topsoil Stripping

ES 7.3.2 Overburden Removal

ES 7.3.3 Coal Mining