GCM Resources puts press speculation to bed

London-based resource exploration and development company GCM Resources updated the market on Tuesday, after its press speculation announcement on 23 September.

The AIM-traded firm said its investigation found that press speculation in the Bangladesh media of an alleged decision by the government of Bangladesh, on the mining method at Barapukuria coal mine, was “inaccurate and misleading”.

GCM said it has obtained feedback from sources from within government and the Bangladesh media which confirmed that no decision has been made on whether the state-owned Barapukuria Coal Mining Company Limited, which is currently mining coal in the Barapukuria coal basin through underground mining, should adopt the high coal production open pit mining method.

Additionally, it said it found that there were no grounds to suggest that the company's Phulbari Coal Project was impacted in any way.

“Since the announcement on 23 September, further Bangladesh media articles have accurately reported that a technically orientated progress meeting was held in government circles but no decisions were made regarding mining methods,” GCM’s board said in a statement.

“The company is deeply concerned regarding the negative impact that unsubstantiated and speculative media reporting can have on its and its stakeholders' image, reputation and financial position and consequently it has instructed its lawyers to issue a legal notice to a media outlet to protect its interests.”

GCM reiterated that, through its subsidiary, it has a legally enforceable contract with the government of Bangladesh which gives it the right to explore, develop and mine coal in northern Bangladesh.

“Under the purview of the aforementioned contract, it successfully explored the Phulbari coal basin and provided the government with a Scheme of Development, supported by a detailed Environmental and Social Impact Assessment, for developing a high production open pit coal mine.

“The company is awaiting government approval of the Scheme of Development to proceed with mine development and has received no notification from the government of any changes that would impact on its contract and ensuing rights.”

GCM said it is confident that a developed Phulbari Coal Project will contribute towards “significant” long term economic growth and social development by supplying thermal coal for up to 4,000MW of lower cost power while generating many thousands of jobs, and that it is “in the best interests of the government, the nation and the local community that the Project proceed as quickly as possible.”