Petrobangla to sign accord with errant firm GTC for Madhyapara hard rock mining

Petrobangla, the state-owned Oil and Gas Corporation is set to sign a Direct Purchase Method (DPM) agreement with Germania-Trest Consortium (GTC) for the next two years at a higher rate to produce hard rock from the mine of Madhyapara in Dinajpur.
In line with the idea, Petrobangla has started price negotiations with GTC for the same job for signing a fresh contract for the management of operation and development, production and maintenance of the Madhyapara hard rock mine.
"We are set to allow them to continue operation as we need to continue huge construction in the country," a senior official of the Energy Division told the Daily Observer on Tuesday. However, Petrobangla has started price negotiation with GTC for the same job for signing a fresh contract, the official confirmed.  
Despite GTC's poor performance, Petrobangla allowed the errant company several times, and asked the company to continue work after the expiry of tenure on February 14 in 2020.
Petrobangla appointed GTC as the mine's operator in 2013 for six years at a rate of US$18 plus per tonne production to extract 9.2 million tonnes of granite. But, it could produce only 3.75 million tonnes by 2019.
"Now they are asking $20 to $22 per tonne although they don't need to mobilize any equipment or renovate anything....usually the cost could come down but they are asking for more," a Petrobangla official said preferring anonymity.
Although the company made Tk 7 crore and Tk 22 crore operational profits in a few years, financial books say that after going into commercial operation in 2007, it has incurred losses amounting to Tk 593 crore till June 2018.
Petrobangla developed the mine in cooperation with North Korean company Nam-nam, in 1994 under a suppliers' credit, it finished the job in 2007 after six years as per schedule. However, Nam-nam milked out Tk 1,014 crore by this time.
Meanwhile, the Nam-nam escalated the project cost many times between 2007 to 2012 and produced 20 lakh tonnes of rocks but made a loss of Tk 132 crore.
"After the engagement, GTC extracted 90 tonnes of stones within six years of the contract period but could produce no more than 41 per cent of the amount within the time
that expired in February 2019," official said.
"As per the previous contract, the company had to produce 92,000 tonnes of rocks during its contract period but it extracted only 37,000 tonnes. For the last two months, interestingly, GTC has been producing around 5,000 tonnes of rocks per day and earning Tk 40 crore per month,"  Petrobangla officials said.
"Now GTC is showing its capacity only to sign a long term final agreement with the government," the official added.
State-run 'Geological Survey of Bangladesh' authority discovered the hard rock in a depth of 128 meters, according to a survey, the Madhhyapara mine area spans over 1.2 square kilometres and has a reserve of around 174 million tonnes of hard rock and granite.