ISLAMABAD: The Implementation Agreement (IA) for Pakistan’s largest Thar coal-based power generation project (1,320MW capacity) has been signed at the Private Power and Infrastructure Board (PPIB).
“PPIB Managing Director Shah Jahan Mirza and Thar Coal Block-I Power Generation Company Limited (TCB-I) Chief Executive Officer Meng Donghai signed the agreement to materialise the financing of $1.912 billion as the cumulative project cost,” according to a statement issued on Monday. “The Power Purchase Agreement (PPA) of the project has already been signed.”
The 1,320MW Shanghai Electric Thar Block-1 Coal Project is being developed under the umbrella of the China-Pakistan Economic Corridor (CPEC) through TCB-I while Shanghai Electric Group Company is the main sponsor of the project.
The project would utilise Thar coal supplied by Sino Sindh Resources Limited, which is executing coal mining operations for extraction in the Thar coalfield Block-I.
The letter of support has already been issued to the project by PPIB while financial closing is expected to be achieved very soon. It is anticipated that Shanghai Electric Thar Block-1 Coal Project would start generating electricity from March 2021.
Latest advancements by this project would pave the way for timely commissioning of the project. The project will be connected with the 660KV+ Matiari-Lahore HVDC Transmission Line Project for power transmission.
Being fully compliant with the World Bank and International Finance Corporation (IFC) standards, the addition of 1,320MW of indigenous, affordable and reliable electricity would not only energise the national grid, but would also result in savings of foreign exchange of around Rs75 billion annually on account of fuel cost, generate economic activities and employment opportunities for the people of Thar in particular and would also entail improvement of the basic infrastructure in the vicinity of these projects.
Further, this will boost the confidence of the investors who are interested in Thar coal mining and power generation.
Speaking at the occasion, PPIB Managing Director Shah Jahan Mirza said that the board, under the guidance of Energy Minister Omar Ayub Khan, is acting as the lead organization of the government in developing indigenous resources like Thar coal and hydro for power generation and has so far achieved considerable success which include commissioning of Pakistan’s first Thar coal-based 660MW Engro Powergen and two hydro IPPs namely 84 MW New Bong and 147 MW Patrind.
“Exploration of Thar coal is opening a new chapter in the energy history of Pakistan and PPIB has been successful in implementing another six Thar coal-based power projects of 4,290MW which are at different stages of development,” he added.