Three major contracts have been signed for the production of tens of thousands of tonnes of coal in Sagaing Region, starting this year. Two of the mines will be in Kalewa township, and one in Mawlaik township.
The Ministry of Mines signed a production-sharing contract on January 18 with Shwe Taung Mining in Paluzawa, Kalewa township, Kale district, and the following day with Four-Person Group Mining in Darthwaykyauk Creek, Mawlaik township, Mawlaik district and Minpalaung, Ywangan township.
Max Myanmar Group of Companies then signed a contract with the Ministry of Mines on January 22 to exploit a 5200-acre plot at Waryechaung in Kalewa-Thitchauk region, Kalewa township. A Max Myanmar spokesperson said production had already started and they intended to produce 30,000 to 50,000 tonnes of coal within a year and later increase production.
Max will sell back the produced coal at FEC$8 a tonne to the Ministry of Mines, including a 2percent tax, said the spokesperson, adding: “Our investment comes to at least K100 million.”
The first contract lasts for 10 years, with the possibility of an extension.
“For the time being, we will be using all the coal for the Max cement factory in Nay Pyi Taw and later, for other industrial uses,” said the spokesperson, who added that all the coal would be for domestic use.
A secretary of the Geotechnical Engineering Committee said the environmental impact of coal extraction should be examined.
“If ground water is extracted during production it will have to be treated. Also, if people are living nearby, resettlement compensation has to be provided.”