ISLAMABAD — Engro Powergen Qadirpur Limited (EPQL) has urged the Power Division to intervene and expedite the signing of a Supplementary Agreement (SA) with the Central Power Purchasing Agency Guarantee Limited (CPPA-G), allowing the company to use low-BTU indigenous gas from the Badar-1 field to enhance power generation.
In a formal communication to the Power Division, EPQL CEO Adeel Qamar highlighted that the 225-megawatt EPQL power plant—operating under a Power Purchase Agreement since 2007 and running primarily on permeate gas from the Qadirpur gas field—has contributed significantly to the national grid since commencing operations in March 2010.
According to the company, it has supplied 18.9 billion units of electricity to the grid, with high utilisation levels under the Economic Merit Order (EMO). The plant’s operations, Qamar said, have resulted in Rs89 billion in low-cost electricity savings, $1.6 billion in foreign exchange savings by using domestic gas instead of imported fuels, and Rs96 billion in revenue to fuel suppliers such as SNGPL and OGDCL—through the sale of gas that would otherwise be flared.
However, with gas supply from Qadirpur field in decline, EPQL has sought alternative fuel sources to maintain its output. After exploring options with stakeholders, including the Private Power and Infrastructure Board (PPIB) and CPPA-G, the National Electric Power Regulatory Authority (NEPRA) approved the use of low-BTU gas from the Badar-1 field as an additional fuel source in February 2024.
EPQL subsequently signed a gas supply agreement with Petroleum Exploration Limited (PEL) on August 5, 2024, for 8–13 million standard cubic feet per day (mmscfd) of low-BTU gas. A month later, EPQL submitted a draft Supplementary Agreement to CPPA-G for review and inclusion in the existing PPA.
Nearly ten months on, the matter remains unresolved, according to the company.
“We note with deep concern that, despite a lapse of 10 months, the matter is still pending with CPPA-G, delaying the opportunity for EPQL to generate additional electricity using low-BTU gas from Badar-1,” Qamar stated.
He added that the infrastructure for transporting and utilizing the gas is already in place and ready for immediate operation. The proposed agreement follows a Take-and-Pay model, meaning the gas will only be utilized when EPQL qualifies under the Economic Dispatch Merit Order.
Had the approval been granted by October 2024, EPQL estimates it could have generated an additional 122 million units of electricity—leading to Rs787 million in savings for electricity consumers and $9 million in foreign exchange savings.
Qamar emphasised that the delay comes at a time when the country is grappling with high power generation costs due to reliance on imported fuels, particularly during peak summer demand.
“We have consistently followed up with CPPA-G and responded promptly to all queries, but the approval remains pending,” he said. “It is imperative to finalize the Supplementary Agreement without further delay.”
EPQL has appealed to the Power Division to facilitate the approval process and unlock the economic and operational gains associated with the project. The request underscores the broader need for faster regulatory processes to harness local energy resources, especially in a strained macroeconomic environment.
