Pak govt to sign foreign Cos for power projects

Karachi: The Federal government has decided to sign agreements only with foreign-based companies to establish at least 1000MW coal-fired power plants at Thar coal field and other sites in the province, including Sondha Jherruk Thatta, Lakhra, Dadu, and Badin and has annulled all agreements made with local companies.

The decision was take at a high level meeting chaired by the Federal Minister for Water and Power, Raja Parvez Ashraf. They said that the issue surfaced when a committee established for reviewing the progress found that the local companies, which had signed agreements with the government, have failed to give a feasibility report in this connection, owing to lack of financial resources.

They said the local companies were not be able to invest at least Rs 200 billion to establish 1000MW power generating plant in a short time of three to five years. Therefore, it was decided to sign agreements only with foreign-based companies, which are capable to make the project feasible by the deadline, they added.

To overcome the worsening power crisis in the country in general and Karachi in particular, the Federal government has planned to generate at least 6000MW within three to five years, and ultimately achieving the target of generating 20,000 MW through coal by 2030, the sources said.

They said that the existing capacity of power generation in the coal sector was only 160MW, which is expected to increase to around 20,000 MW by 2030. To a question, they said that foreign firms have expressed concern over the law and order situation in the country, 'but we have assured them to provide full security arrangements in Pakistan.'

They said the cheapest electricity would be produced from coal and termed it as the best option to overcome the energy crisis in Pakistan. They said that, 'although 185 billion tons of coal reserves have been confirmed at Thar, no progress has been made by the private sector to convert this abundance for power generation.

When asked, they said the agreements would be signed with equal equity participation where power companies would invest to establish plants and the government would provide land and coal.

It may be mentioned here that a Chinese company M/s Sinocoal, International Engineering Group (SCIEG), which conducted the technical part of the feasibility study by M/s Shenhua on Thar coal, has recently expressed interest in designing the coal mines. The company suggested that Pakistan should review the whole policy on coal, including mining, production as well as its import and export.