Mining and Minerals Law in Bangladesh

by Barrister Tahmidur Rahman | Sep 11, 2026

Corporate & FinanceLicences, land and project risk9 min read

Mining and Minerals Law in Bangladesh

Advice for investors, operators, contractors, traders and lenders on mining and minerals projects across Bangladesh, from exploration licences and quarry leases to environmental clearance, land access, joint ventures with state entities, offtake, finance and the commercial and regulatory disputes that can follow.

Overview

How mining projects are regulated in Bangladesh

Bangladesh is not a traditional mining jurisdiction, but its mineral resources matter: coal and hard rock in the north-west, limestone, glass sand, white clay and peat, heavy mineral sands along the coast, and construction materials extracted across the country. Demand from construction, glass, ceramics, cement and energy keeps interest in exploration and extraction alive, as does growing global attention to critical minerals and secure supply chains. We advise investors, operators, contractors, traders and lenders on minerals projects in Bangladesh, from licensing to offtake, finance and disputes. This work sits within our corporate and finance practice.

The core legal framework for solid minerals is the Mines and Minerals (Regulation and Development) Act 1992 and the rules made under it, administered by the Bureau of Mineral Development within the Energy and Mineral Resources Division. It distinguishes exploration, mining and quarrying, and sets out licences, leases, royalties, reporting and safety obligations. Oil and gas sit under separate petroleum legislation and production sharing arrangements with Petrobangla. Ordinary sand and soil extraction falls under a separate leasing regime protecting rivers, embankments and farmland. Classifying the material and activity correctly is the first legal step in any mining project here.

Land and environment are the usual critical path. Mineral rights and surface land rights are different things, and a licence does not by itself give access to land owned or occupied by others. Projects may need purchases, leases, compensation arrangements or, for state-backed projects, compulsory acquisition. Environmental clearance under the Environment Conservation Act 1995 is required, and extractive projects generally fall within the categories requiring detailed environmental assessment. Community concerns about displacement, water and farmland have shaped the history of mining in Bangladesh, so stakeholder engagement and resettlement planning are legal as well as social issues.

Many significant deposits are held or operated by state-owned companies, and private participation often takes the form of contracts with those companies or joint ventures rather than standalone licences. That brings procurement rules and government approvals into the picture. Foreign investors register through Invest Bangladesh, which took over the functions of BIDA, BEZA and the PPP Authority from 23 August 2026, and need to plan for foreign exchange, tax and repatriation. We advise on services contracts, operation and maintenance agreements, joint ventures, equipment supply and offtake arrangements so that rights, payment terms and dispute resolution are clear from the start.

Disputes in the sector can involve licence cancellations, royalty assessments, land and compensation claims, environmental enforcement, contractor claims and disagreements between joint venture partners. Some can be resolved through statutory appeals or negotiation, others in the High Court Division or in arbitration, including investment treaty protection where a foreign investor's project is affected by state action. Barrister Tahmidur Rahman, Barrister Remura Meheruba Mahbub and Adv Syed Wahid lead the firm's work on these matters, with support from our regulatory team, drawing on colleagues in our corporate and finance groups, and clients can contact us through our Dhaka office.

01 · What we handle

Core workstreams

  • Licensing and tenure
  • Land access and compensation
  • Environmental and safety approvals
  • State partnerships and contracts
02 · How it runs

Four clear stages

  1. 01Classify and scope
  2. 02Secure rights
  3. 03Contract and finance
  4. 04Operate and defend
03 · Start here

Talk to a partner

Consultations in Dhaka or by video. Scope, team and fees are agreed in writing first.

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How we help

Our mining and minerals services

Workstream 01Corporate & Finance

Licensing and tenure

  • Classify and scope
  • Secure rights
  • Contract and finance
  • Operate and defend
Workstream 02Corporate & Finance

Land access and compensation

  • Classify and scope
  • Secure rights
  • Contract and finance
  • Operate and defend
Workstream 03Corporate & Finance

Environmental and safety approvals

  • Classify and scope
  • Secure rights
  • Contract and finance
  • Operate and defend
Workstream 04Corporate & Finance

State partnerships and contracts

  • Classify and scope
  • Secure rights
  • Contract and finance
  • Operate and defend
Workstream 05Corporate & Finance

Investment, finance and offtake

  • Classify and scope
  • Secure rights
  • Contract and finance
  • Operate and defend
Workstream 06Corporate & Finance

Disputes and state action

  • Classify and scope
  • Secure rights
  • Contract and finance
  • Operate and defend
01

Licensing and tenure

We advise on exploration licences, mining leases and quarry leases under the minerals legislation, prepare applications to the Bureau of Mineral Development, and handle renewals, transfers, variations and compliance reporting. We confirm how the material and activity are classified, identify royalty and fee obligations, and advise on the conditions most likely to be attached to a grant, including work programmes, security deposits and reporting.

02

Land access and compensation

Mineral rights do not guarantee land access. We carry out title due diligence over project land, structure purchases, leases and compensation agreements with owners and occupiers, and advise on land acquisition procedures where the state acquires land for a project. We also advise on resettlement planning, grievance mechanisms and documentation that reduces the risk of later land disputes, protests and court challenges that can halt work on site.

03

Environmental and safety approvals

We guide projects through environmental clearance, including the assessment and consultation process for extractive activities, and advise on conditions, monitoring and renewals. We also advise on mine safety, explosives licensing, water use and waste management, and on responding to inspections and enforcement notices so that operations are not interrupted by avoidable compliance gaps during extraction, processing or transport, and so that lenders' environmental covenants are met.

04

State partnerships and contracts

Where deposits are held by state-owned companies, we advise private investors and contractors on tenders, mining services contracts, operation and maintenance agreements, production sharing and joint ventures. We negotiate payment security, change in law, force majeure and termination provisions, and advise on government approvals and procurement rules that apply when contracting with public bodies, including bid challenges where a tender process is flawed.

05

Investment, finance and offtake

We structure foreign and local investment in mining and processing businesses, advise on Invest Bangladesh registration, tax and foreign exchange, and act for lenders and borrowers on project and equipment finance and security. We also draft and negotiate offtake, supply and export agreements for minerals and processed products, including pricing, quality and assaying, shipping and payment terms, and the foreign exchange rules that govern export proceeds.

06

Disputes and state action

We act in disputes over licence refusals and cancellations, royalty and tax assessments, land compensation, environmental enforcement, contractor claims and joint venture deadlocks. We pursue statutory appeals, writ petitions in the High Court Division and commercial arbitration, and advise foreign investors on investment treaty protection where state measures threaten the value of their mining investment, coordinating with overseas counsel.

RecognitionThe Legal 500Asia Pacific ranks Tahmidur Remura Wahid (TRW) Law Firm for dispute resolution in Bangladesh.
Cross-border reach6 jurisdictionsMatters coordinated with counsel in the UK, US, UAE, China, India and Singapore.
Bar and admissionsDhaka and LondonBarristers and advocates in Bangladesh, with a solicitor of England and Wales (non-practising).
HeadquartersDhakaHouse 410, Road 29, Mohakhali DOHS. Consultations in person or by video.
Who leads this work

Partner-led, on every matter.

Corporate & Finance matters at TRW are led by partners, supported by associates, with one responsible lawyer from first advice to final outcome.

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01

Can a foreign company obtain a mining lease or exploration licence in Bangladesh, or must it partner with a local or state entity?

Foreign participation is possible, but the route depends on the mineral, the location and the government's policy for that resource. Licences and leases under the minerals legislation are granted by the authorities after an application process, and conditions can include work programmes, financial capacity and local participation. For deposits already held by state-owned companies, foreign investors usually participate through contracts or joint ventures rather than holding tenure directly. We review the target project, confirm the current policy and licensing position, and advise on the structure most likely to secure approval and protect the investor's position over the project's life.

02

What is the difference between a quarry lease, a mining lease and sand extraction rights?

Bangladeshi law treats these activities differently. Mining leases generally cover the extraction of minerals through underground or open-pit operations, while quarry leases cover surface extraction of materials such as stone, gravel and certain sands. Ordinary sand and soil, especially from rivers and farmland, are regulated under a separate leasing regime designed to protect riverbanks, embankments and agricultural land, with restrictions on where extraction can take place. Applying under the wrong regime causes delay and can expose the operator and its contractors to penalties. We confirm the correct classification before an application, contract or investment decision is made.

03

Does a mining licence give the right to use privately owned land?

No. A licence or lease grants rights to explore or extract minerals, but surface land remains subject to the rights of its owners and occupiers. The project must secure access through purchase, lease or agreement, or the state may acquire land for a public project under the land acquisition legislation, with compensation payable. Title to rural land can be complex because of inheritance, incomplete records and informal occupation, so careful due diligence matters. We verify title, negotiate land agreements and advise on compensation and resettlement, which are often decisive for whether a project can proceed peacefully.

04

What environmental approvals are required for mining or quarrying projects in Bangladesh?

Environmental clearance from the Department of Environment is required under the Environment Conservation Act 1995 and its rules. Extractive projects are generally placed in categories requiring an initial environmental examination and a full environmental impact assessment, with public consultation, an environmental management plan and conditions on monitoring. Separate permits may be needed for water use, waste disposal and explosives. International lenders and development finance institutions will also apply their own environmental and social standards. We advise on the assessment process, review consultants' reports for legal risk, and help the project meet clearance conditions throughout construction and mining operations.

05

How do private companies and foreign contractors work with state-owned mining companies in Bangladesh?

Usually through contracts awarded by tender or negotiation, such as mining services, development and operation, or equipment supply, and sometimes through joint ventures. These contracts are subject to public procurement rules and government approvals, and the state party may have limited flexibility on terms. Key issues include payment security, foreign currency payments, price adjustment, change in law, force majeure, performance guarantees and termination compensation. Dispute resolution clauses, including the seat of any arbitration, deserve particular attention. We advise bidders and contractors on tender documents, negotiate contract terms and help manage the relationship with state counterparties once the contract is running.

06

What royalties, taxes and duties apply to mineral extraction and processing in Bangladesh?

Royalties are payable at rates that depend on the mineral and are set by rules and government notifications. Income tax, VAT, customs duties on imported equipment and withholding tax on payments to contractors and non-residents also apply, and incentives may be available in some cases. Rates and notifications change, so the current position should be confirmed for each project. Disputes can arise over valuation, classification of minerals and the timing of payments. We advise on the fiscal terms of mining projects, model the effect of tax and royalty provisions in contracts and represent clients in assessments and appeals.

07

Are critical minerals and heavy mineral sands in Bangladesh open to private investment?

Interest in critical minerals, including heavy mineral sands found along the coast, has grown, and the government has explored the resource through state bodies. Whether, and on what terms, private or foreign investors can participate depends on policy decisions, the institutions responsible for the resource and the applicable licensing framework, some of which involve specialised regulators. The position can change with new policy announcements. We monitor developments, advise investors on realistic entry routes such as technical partnerships or processing ventures, and structure arrangements that comply with the law and protect commercial interests in any mining or processing project.

08

What protection does a foreign investor have if the government cancels a mining licence or contract?

Domestic law provides several protections. Licence cancellations must follow the statutory procedure, and decisions can be challenged through appeals or by writ petition in the High Court Division where the authority acted unlawfully, unfairly or beyond its powers. Contract claims against state entities can be pursued under the contract's dispute resolution clause, often arbitration. Foreign investors may also be protected by a bilateral investment treaty between Bangladesh and their home state, which can provide international arbitration for expropriation or unfair treatment. We assess each layer of protection and act quickly, because deadlines and notice requirements can be short.

How a matter runs

From first call to resolution.

  1. 01

    Classify and scope

    We identify the mineral, activity, location and project vehicle, confirm which legal regime applies, and map the licences, land rights, environmental approvals and government consents the project will need before significant costs are committed.

  2. 02

    Secure rights

    We prepare licence and lease applications, negotiate land access and compensation, structure the investment through Invest Bangladesh where relevant, and manage the environmental assessment and clearance process alongside the client's technical and environmental consultants.

  3. 03

    Contract and finance

    We negotiate contracts with state entities, partners, contractors and offtakers, document project and equipment finance and security, and align dispute resolution, governing law and payment terms across the full suite of project agreements.

  4. 04

    Operate and defend

    We support renewals, royalty compliance, inspections and expansion, and act in disputes over licences, land, environment and contracts through appeals, writ petitions, arbitration or investment treaty claims where needed, always with an eye on keeping operations running.

“Demonstrates an extraordinary command over both domestic litigation and international arbitration.”

The Legal 500 Asia Pacific, Bangladesh: Dispute resolution, client feedback

FAQ

Questions, answered.

Still unsure? Email info@trw.co with a short outline of the matter.

Which authority regulates mining in Bangladesh?
The Bureau of Mineral Development, under the Energy and Mineral Resources Division of the Ministry of Power, Energy and Mineral Resources, administers licensing for solid minerals under the minerals legislation. Petrobangla and its companies handle oil and gas. District administrations play a role in sand and soil leasing, and the Department of Environment issues environmental clearance. Investment registration for foreign investors now sits with Invest Bangladesh, which replaced BIDA in August 2026. Other bodies regulate explosives and workplace safety, so projects deal with several regulators.
Which minerals are found in Bangladesh?
Known resources include coal and hard rock in the north-west, limestone, glass sand, white clay, peat and gravel in various regions, and heavy mineral sands along the south-eastern coast containing minerals such as ilmenite, zircon and rutile. Natural gas remains the most significant extractive resource. The commercial viability of each deposit depends on geology, location, land use and infrastructure, as well as policy decisions on how the resource should be developed, by whom, and on what terms.
How long does it take to obtain a mining licence?
Timing depends on the mineral, the type of licence, the completeness of the application and the environmental assessment required. Exploration licences can usually be obtained more quickly than mining leases, which involve detailed technical, financial and environmental review. Land access and community engagement often take longer than the licence itself. We give a realistic timetable after reviewing the project and track each approval closely. Investors should build land and consultation time into their plans rather than treating the licence as the only milestone.
Can mining rights be transferred or used as security for a loan?
Transfers of licences and leases generally require approval from the licensing authority, and there may be restrictions on assignment, change of control or mortgage of the rights. Lenders therefore usually combine security over the project company's shares, plant, equipment, receivables and contracts with direct agreements and step-in rights. We review the licence terms and the minerals legislation and advise on a security package that is effective in practice, including what happens to the rights if the borrower defaults or the licence is suspended.
What role does community consultation play in mining projects?
Consultation is part of the environmental assessment process and is expected by international lenders, but its importance goes further. Projects in Bangladesh have faced strong local opposition over displacement, water and farmland. Early, genuine engagement, fair compensation and clear grievance mechanisms reduce the risk of delays, protests and legal challenges. We advise on the legal framework for consultation and on documenting agreements with affected communities, including compensation, employment and benefit-sharing commitments, so that promises made on the ground are recorded and can be honoured.
Is mining permitted in the Chittagong Hill Tracts?
The Chittagong Hill Tracts have a distinct legal and administrative framework, including the role of regional and hill district councils and traditional institutions, together with sensitive land rights questions. Any extractive activity there needs particularly careful analysis of land, consent and approval requirements. We advise investors to take specific advice before committing to any project in the region, and can carry out that review, including engagement with the relevant councils and the position of indigenous communities.
Can disputes with state mining companies go to arbitration?
Often, yes, where the contract includes an arbitration clause. Many contracts with state entities provide for arbitration under the Arbitration Act 2001, sometimes with a foreign seat or institutional rules. Some matters, such as challenges to regulatory decisions, belong in the courts. Enforcing an award against a state entity raises its own questions. We advise on dispute clauses at the drafting stage, so that the forum, seat and rules are workable, and act in arbitration and enforcement proceedings in Bangladesh and abroad.
Do you work with technical and environmental consultants?
Yes. Mining projects depend on geological, engineering, environmental and social studies, and the legal work must fit with them. We work with consultants appointed by our clients and can recommend independent experts. We review technical reports for legal risk, ensure that studies meet the requirements of the authorities and lenders, and present expert evidence in disputes where technical questions are central. Close coordination between lawyers and consultants also helps keep applications consistent and avoids delays caused by conflicting reports.

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