ISLAMABAD: The Centre has severely objected to over 150 percent increase in cost escalation of Sindh’s Thar Coal Water Carrier Project for generating electricity by using domestic coal, The News has learnt.
The provincial government has estimated Rs15.370 billion as cost for placing water carrier from Nabisar reservoir to Thar Coal Block-II project, on which the Centre has officially communicated to the province that this cost could be reduced from Rs15.370 billion to Rs6 billion only, saving Rs9.3 billion.
“The Centre has estimated that saving of Rs9.3 billion can be made by using economical methods in this project,” official sources confirmed to The News on Sunday.
The water used for the Thar plant will be treated by RO (Reverse Osmosis) process which is mostly used for drinking water. At the end of the day, this high cost of water carrier will be charged from the public.
According to PC-1 prepared by Sindh government and sent out to the Centre, the cost of pipeline for flow of water witnessed a mammoth increase from Rs2.2 billion to Rs11.8 billion, registering an increase by almost 400 percent.
After a surge in the cost of the project, the provincial government is bound to table this project before the Planning Commission’s Central Development Working Party (CDWP) and subsequently before the Executive Committee of the National Economic Council (Ecnec) for getting approval.
The provincial government has sent the PC-1 before the Planning Commission for technical and financial appraisal and the PC found severe over estimation in cost calculation of the project.
According to the Planning Commission’s official response, available with The News, Rs9 billion could be saved. It stated that they received PC-1 of this project on 27th October, 2015 and reviewed it. It said the cost could be reduced if use of costlier pipes is avoided and some other technical steps are taken. “We strongly believe that serious rationalisation of cost is possible, to reduce it from Rs15.3 billion to Rs6.0 billion,” the official communication concluded.