The Private Power & Infrastructure Board (PPIB) has submitted claims totaling Rs 1.52 billion (GBP 4,061,838) to cover expenses related to ongoing legal disputes with Star Hydropower Limited (SHPL), Business Recorder reported, citing sources.
The dispute involve complex issues under two separate arbitration cases: one between SHPL and the Government of Pakistan (GoP) under the GoP Guarantee from December 2012, and another involving the Government of Azad Jammu & Kashmir (GoAJK) regarding the imposition of sales tax under the AJ&K Finance Act.
The claim arises from the London Court of International Arbitration (LCIA) proceedings, which include multiple disputes. The PPIB has requested these funds through the Power Division, following a decision made during a meeting at the Attorney General’s office on February 22, 2023, that the Power Division would bear all legal costs associated with the arbitration.
According to PPIB’s submission, one major claim involves a tariff award for the 147 MW Patrind project, amounting to Rs 1.04 billion (GBP 2,781,562). A second claim, for Rs 373.97 million (GBP 994,750), concerns sales tax imposition on services under the AJ&K Finance Act 2015. The third claim, Rs 102.36 million (GBP 285,526.62), is related to delayed invoice payments and associated interest.
The Managing Director of PPIB emphasised that the company is unable to cover these costs, citing increased budgetary demands and operating expenses after the merger of the Alternative Energy Development Board (AEDB) into PPIB. “PPIB has already spent Rs 440 million from its own resources on LCIA arbitrations with SHPL, which has severely impacted its operational finances,” the MD stated.
The PPIB is now urging the Power Division to approach the Finance Division for an urgent allocation of Rs 1.52 billion through a Technical Supplementary Grant (TSG). The funding request is essential to continue managing the financial burden of ongoing arbitration.
