Special Report
ISLAMABAD: The government has so far decided that K-Electric may be engaged to arrange finances/funds for the development of 660MW Unit-II of Jamshoro Coal Power Project mainly due to non-availability of the finances/funds, it was learnt on Tuesday.
This disclosure was made by Managing Director (MD), Private Power & Infrastructure Board and Additional Secretary, Power Division during a meeting of the Technical Committee constituted by Ministry of Energy (Power Division). The Technical Committee’s meeting was held on 15th March 2023 under the chairmanship of MD PPIB in order to discuss KE’s proposal/sit visit report. The representatives of Power Division, Central Power Purchasing Agency (CPPA), National Transmission and Despatch Company (NTDC), Jamshoro Power Company Limited (JPCL), GENCO Holding Company Limited (GHCL) and K-Electric (KE) participated in the meeting.
According to available documents, after detailed deliberation, it was decided by the Technical Committee that JPCL will immediately initiate the process for transfer of title of land from WAPDA to JPCL. Similarly, the meeting will be arranged for finalization of the transaction structure of the proposed transaction between a smaller more focused group, with representation of PPIB and KE and NTDC to prepare an initial study on the demand supply analysis, in the case KE opts to offtake power from both units (2x660MW) of Jamshoro Coal Power Project. Moreover, it was decided in this meeting that Power Division /GHCL/PPIB will facilitate KE’s team in arranging meeting with current and potential lenders namely Asian Development Bank (ADB), Saudi Fund for Development (SFD) and Kuwait Fund for Arab Economic Development (KFAED) for initiation of discussion to explore financing options for the second unit.
However, MD PPIB and Additional Secretary, Power Division made it clear during the course of this meeting that the Government of Pakistan (GoP) will not provide any guarantees or engage directly with SFD and KFAED to arrange finances/funds for KE, for the development of Unit-II.
Earlier, the KE has shown interest in development and power purchase from 2nd unit of Jamshoro Coal Power Project (2x660MW). And, after the submission of interest by KE, the Technical Committee, in its last meeting, advised the KE to pay site visit and submit the site visit report along with its proposal for the development of 2nd unit Jamshoro Coal Power Project.
While giving presentation in the Technical Committee meeting, KE’s representatives stated that the commercial operation of 660MW Unit-II of Jamshoro coal by FY 2027 is critical to meet the future demand of KE. It was further reiterated by KE that in accordance with its demand supply projection, there is a requirement of base load power of 660MW in FY 2027, and therefore, if GoP decides to carve out Unit-II of Jamshoro plant, timelines will have to be worked back from GY 2027. It was also informed that that based on the information available there are technical, commercial, regulatory, legal and transaction structuring challenges for completing this transaction.
