In 1985 Geological Survey of Bangladesh (GSB) discovered high quality bituminous coal spread over an area of 6.68 Square Kilometers at a depth ranging from 118 to 509 meters in Barapukuria under Parbatipur upazilla in the district of Dinajpur. During 1987-1991 a UK based company M/S Wardell Armstrong carried out the Techno-Economic Feasibility study on this coal reserve under ODA financial support. Based upon the  Wardell Armstrong report, Petrobangla undertook Barapukuria Coal Mine Development project and the PP was approved by ECNEC.

After the approval of the project, a construction contract under a supplier’s credit of US$194.91 Million (Supplier’s credit US$109.235 Million + ADP Fund US$85.675 Million) was signed between China National Machinery Import & Export Corporation (CMC) and Petrobangla with a view to develop an underground mine having a capacity of 1.00 Million Metric Tonnes of coal per annum. After substantial completion of the project the mine was conditionally taken over. It is to be mentioned here that the company has successfully completed all payment of supplier’s credit, which is a commendable achievement of the company.

To ensure proper implementation of the project and smooth functioning of the mine operation, Barapukuria Coal Mining Company Limited was formed and registered as a company on August 04, 1998 under the companies Act 1994.