China Eximbank commits $256.41 million for Barapukuria Coal Mine Expansion Project (Linked to Record ID#34237 and #33957)

Project narrative

In 2016, an agreement was signed between the Government of Bangladesh and the Chinese Government to extend the existing underground mining operations of Barapukuria coal mine in order to increase the production capacity of the mine. China Eximbank pledged $256.41 million in export credit financing for this expansion. A June 30, 2017 publication by the Government of Bangladesh’s Economic Relations Division suggests that this loan reached the official commitment stage but never disbursed any funding. The loan is not listed as an active loan in a subsequent publication by the Government of Bangladesh’s Economic Relations Division, so we assume that it was suspended. This suspension is likely related to the discovery of the “Barapukuria coal scam”, which was a corruption scandal concerning the misappropriation of around 142 hundred thousand tons of coal, worth over BDT 227 billion by officials of Barapukuria Coal Mining Company Limited (BCMCL) from the coal mine of Barapukuria, Dinajpur District, in northern Bangladesh. The scandal was revealed in July 2018 when a board member of the Bangladesh Power Development Board went to visit the coal mine and found no fresh coal whereas according to the document there should have been around 142 hundred thousand tons of coal reserved. The matter came to light when a Bangladeshi English-language daily reported the incident. Petrobangla, the parent organization of the BCMCL, promptly suspended a few officials in this connection while the Anti-Corruption Commission started an inquiry to trace the corruption. Barapukuria's coal-fired power plant suspended its operations due to the shortage of coal as an immediate effect of the corruption scandal. Before the shutdown of the plant, it had been supplying around 380MW power to the national grid on an average. When the power plant shut down the first time, the people of eight northern districts of Rangpur and Dinajpur regions suffered from a lack of electricity. BPDB then decided to restart one of its units for five days on August 20, 2018. On August 28, 2018, the plant shut down again. The exact locational coordinates of the Barapukuria Coal Mine can be found at https://www.google.com/maps/place/Barapukuria+Coal+Mine/@25.5475525,88.9606762,15z/data=!4m5!3m4!1s0x0:0x1c8f7c27b0be0694!8m2!3d25.5475525!4d88.9606762