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CENTRAL COAL TERMINAL

Chinese firm interested

$lb proposal likely next month

Sharier Khan
A Chinese company has expressed its interest in building a central coal terminal in Maheshkhali to facilitate import and distribution of coal for several large coal-fired power plants to be built there over the next decade.
The China Communications Construction Company (CCCC) will submit a detailed proposal for the $1-billion terminal early next month. It has primarily said it will arrange the finance from China.
A central coal terminal will directly help the government produce cheaper coal-based power.
The government has planned to turn Maheshkhali into the country's energy hub by building eight to 10 coal power plants there generating 10,000 megawatt, which is more than what the country produces now. Huge land has already been acquired to that end.
In the first phase, the government plans to install four l,200MW plants each and the first tender for such a plant was floated in May.
Each of the 1,200 MW plants will annually require more than 3 million tonnes of coal. When there will be full 10,000 MW power generation on this island, it would have to handle around 27 million tonnes of coal annually, which is a massive affair.
The tender floated in May by the Power Development Board (PDB) has sought to build a dedicated coal terminal for the first plant, which means it had not considered a central terminal. The tender also sought the contractors to ensure the source of coal for nine years.At a pre-bid meeting of the PDB, interested bidders observed that it would be very difficult for a single contractor to perform these tasks.
"With a separate terminal for each plant, the cost of the project would go up to $3 billion and that would affect the power generation cost," said an official, referring to the Japan-funded 1,200 MW Matarbari coal power project costing $4.4 billion. The Matarbari project includes a coal terminal costing $700 million to feed coal to two such plants.
Earlier in April, the CCCC came up with a primary proposal to the power ministry to design and build a common import terminal. In its letter the company said it had initiated a study at its own cost to make a preliminary assessment of building a coal import terminal on the Maheshkhali Island.
"Based on the study, we feel confident that it would be most appropriate to build one large coal terminal to support the development of coal projects in the area and that the terminal can be built phase by phase as necessary," said CCCC, adding that it would like to build a terminal initially to handle coal for 4,000 MW power generation and gradually expand it to support up to 10,000 MW.
The CCCC also suggested that the project's financing could be based on government-to-government, or any
other type that could be mutually agreed upon.
The power ministry in mid-June held a meeting with the CCCC where the company said it was ready to submit the detailed proposal after the eid holidays.
Following the meeting with CCCC officials, the PDB amended its tender terms and dropped the provision of a construction of the terminal for its 1,200-MW plant. It is now leaving this matter for the central terminal.
The Coal Power Generation Company Bangladesh (CPGCB) that would eventually handle this terminal is meanwhile closing a tender on July 14 to appoint a consultant for the Matarbari 1,200 MW coal power project. This project has got a financial green signal from Japan.
A top official of CPGCB told The Daily Star that they had received a proposal from the Japanese company Sumitomo for future expansion of the Matarbari coal terminal, which was being funded by JICA.
"We are holding talks with a Japanese and a Singaporean company to build two more coal power plants close to the Matarbari site," the official said, explaining the necessity of future expansion of the Matarbari terminal.
The Matarbari plant will come into operation in 2022. Other coal power schemes to be undertaken in Maheshkhali will also come into operation around that time.