ISLAMABAD – The shareholders of The Hub Power Company Limited (HUBCO) and Thal Limited have passed major resolutions to extend and amend sponsor support for key coal-based power projects in Thar, solidifying their commitments to the energy sector’s growth and sustainability.
In a landmark decision, HUBCO’s Extraordinary General Meeting (EGM) approved the continuation and expansion of sponsor support for Thar Energy Limited (TEL) and ThalNova Power Thar (Private) Limited (TN), both critical to Pakistan’s long-term energy infrastructure development. Under the resolutions, HUBCO has been authorised to provide or amend guarantees through Standby Letters of Credit (SBLCs), aimed at securing investments either as equity or subordinated debt to address funding shortfalls under the existing Sponsor Support Agreements.
HUBCO’s commitment for TEL includes guarantees of up to $31 million, valid until January 2034 or until the end of TEL’s project loan term, whichever is later. Similarly, for TN, the company has been authorised to extend guarantees up to $20 million, with the backing remaining effective until July 2034 or the conclusion of TN’s project loan. The CEO, CFO, and Company Secretary have been given full authority to negotiate, procure, and execute all necessary documentation related to the SBLCs, including entering into security agreements, notices, and filings as required by lenders.
HUBCO’s continued financial support highlights the company’s focus on ensuring the stability and operational success of its coal-based projects in Thar, which are pivotal to meeting Pakistan’s growing energy needs.
Meanwhile, Thal Limited has reaffirmed its commitment to the ThalNova Power Thar project with a resolution authorising continued investment support of up to $23.3 million. The backing will cover any funding shortfall or cost overruns before or after the Project Completion Date, remaining effective for up to 10 years or until TN’s Term Loan Discharge Date, whichever comes later.
Thal Limited’s support includes guarantees either through standby letters of credit or other forms of security, providing a vital safety net for the project’s financial stability. The company also confirmed the continuation of resolutions passed in 2018, which authorize the issuance of standby letters of credit for Debt Service Support (DSRA LC) and Commercial Risk Guarantee obligations, each up to $12.4 million. These guarantees will remain in place for a decade or until TN’s Term Loan Discharge Date.
The management of Thal Limited, including its CEO, CFO, and Company Secretary, has been authorised to manage, negotiate, amend, and execute all necessary documents and agreements related to these financial instruments.
These strategic decisions from both companies underscore their long-term focus on the development of sustainable energy solutions in Pakistan, particularly in the critical Thar region, as part of the country’s broader energy infrastructure development plan.
