DHAKA (AFP) — Bangladesh could re-open negotiations with British company Asia Energy on an open-pit mine deal worth 1.4 billion dollars which was abandoned last year, a report said Thursday.
The country's last democratically elected government promised local protesters last August that the project would be cancelled after unrest in which five people and a police officer died.
But new finance minister Mirza Azizul Islam told the Daily Star newspaper that London-based Asia Energy was prepared to re-open negotiations over the mine at Phulbari in northern Bangladesh.
"Before this re-negotiation, the government must decide which contractual terms should be revised," he said, adding that the government also needed to confirm its coal policy.
"I personally believe that after the coal policy is finalised, we may renegotiate the contract in the light of that policy to get more benefits," he said.
A military-backed government took power in January a day after a state of emergency was imposed.
Activists have said the mine project would damage the environment and displace 100,000 people.
Asia Energy said only 40,000 would be displaced, adding that all those affected would be fully compensated.
Under Asia Energy's contract, the government had three months to approve a final proposal submitted by the company in October 2005.
However, the government failed to respond and later told Asia Energy final approval was on hold while it completed its coal policy.
The minister said a three-billion-dollar investment plan by Indian conglomerate Tata was also still pending.
"A significant issue here is allocation of natural gas for Tata's project ... we have to be sure about our own reserve and immediate gas and power demands, and how much gas we should keep for our own use," he said.
Tata's plan for a 2.4-million-tonne steel plant, two power plants, a coal mine and a fertiliser plant was shelved last year by the previous government led by the Bangladesh Nationalist Party (BNP).
It halted the deal after two years of negotiation saying political sensitivities just ahead of polls, which were later cancelled, would make it difficult for the government to make a decision.
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