Govt set to shelve Gwadar Coal Project

ISLAMABAD: The government is all set to shelve its initial plan for installing Gwadar Coal Power Project of 300 megawatt (MW) with estimated cost of $360 million from the list of China-Pakistan Economic Corridor (CPEC) projects, The News has learnt.

Instead of installing Gwadar Coal Power Project, feasibility study is currently underway to consider different available options including installation of imported RLNG-based three plants with capacity of 100 MW each.

“Different options are under consideration to install power plants at Gwadar for meeting existing and future requirements in the context of $46 billion CPEC projects,” official sources confirmed while talking to The News here on Monday.

When the feasibility study is completed, the government will be in position to take ultimate decision on its plan to shelve coal project and grant go-ahead for RLNG-based 100 MW project at first phase which will be extended into second and third plants with the increasing demand in years ahead, added the sources.

Major General (R) Zahir Shah, Project Director CPEC Secretariat at Planning Commission on Monday, said that different options were under consideration but the final decision to this effect would be taken by Ministry of Water and Power and Gawadar Development Authority (GDA) with mutual consultation of all stakeholders.

However, according to official progress report on CPEC projects related to energy, a copy of which available with The News, Port Qasim Electric Power Company executed by Sinohydro and Al-Mirqab Capital, Qatar, would construct two power projects with 660 MW each and first project would be completed by June 2017 and second 660 MW project would be completed by April 2018.

So far civil work on the site has started. The lease indenture has been signed between Port Qasim Authority (PQA) and sponsors. The power requirement of 4.5 MW will be implemented by K-Electric and Sinosure.

The remaining issues that still needs to be resolved related to Port Qasim Power project are exemption of Sales Tax on Dredger to be imported for construction of jetty, registration of lease indenture, water supply, timely power evacuation and land for ash yard within 10 km radius.

The Sahiwal Power Plant with capacity of 1320 MW will be executed by Shandong Ruyi Group and Huaneng Shandong Power Generation Company Limited.

The letter of support (LOS) has been issued recently and IA/PPA signed it. The coal handling agreement with PQA/PIBT signed and sponsors have started construction from the equity. The land lease cleared, coal supply agreement signed and procurement is in process.

The financial close of this project is expected by April 2016 and construction of spur line up to power plant.

The Engro Surface Mine in Block II of Thar Coal project is underway as coal tariff announced, excavation is in process, financing agreement signed on 21st Dec 2015, Sino sure policy approved, detailsdesign of mining is in process, all financial agreements signed, financial close achieved on April 4, 2016 and coal mine construction started. The remaining unsettled issues related to this project are exemption from Customs Duties for Mining Dump trucks and nomination to verify exemptions on imports from locally manufactured goods as to the IPPs.

The Engro Thar Coal-fired Power Plant (2X330 MW) is being executed by Engro  Power Gen Thar Ltd. (Engro and CMEC) and construction started and expected date of completion would be June 2019.

The Suki Kinari Hydropower Project with 870 MW is being executed by China Gezhouba Group Company Ltd as its financing agreement signed and its completion date would be 2020. On South-North Transmission line and Matiari-Lahore Transmission Line is being executed by State Grid (CET) and cooperation agreement on Matiari-Lahore and Matiari-Faisalabad Transmission project were signed.