Islamabad 16, December 2019

IMPLEMENTATION AGREEMENT FOR PAKISTAN'S LARGESTHAR COAL BASED POWER PROJECT SIGNED

ISLAMABAD, 16th December 2019: The Implementation Agreement (IA) of Pakistan's largest thar coal-based power generation project of 1,320 MW power generation capacity has been signed at Private Power and Infrastructure Board (PPIB) for materializing the financing of 1,912.2 Million US$ as the cumulative Project cost. The project is based on state of the art Super Critical Technology. The signing of the said agreement is yet another step forward on the resolve of the present government to encourage indigenous resources. Honorable Minister for Energy Mr. Omar Ayub Khan who is also the Chairman of PPIB has highly appreciated PPIB’s efforts to expedite processing of IPPs based on indigenous fuel. Mr. Shah Jahan Mirza, Managing Director PPIB signed the documents on behalf of the Government of Pakistan (GoP) while Mr. Meng Donghai, Chief Executive Officer of M/s Thar Coal Block-I Power Generation Company Limited (TCB-I). Signing was witnessed by senior officials of PPIB and the Project Company i.e. TCB-1. Earlier, the Power Purchase Agreement (PPA) of the project has already been executed.

The 1,320 MW Shanghai Electric Thar Block-1 Coal Project is being developed under the umbrella of China-Pakistan Economic Corridor (CPEC) through Project Company i.e. TCB-I while M/s Shanghai Electric Group Company is the main sponsor of this project. The project will utilize Thar Coal supplied by Sino Sindh Resources Limited which is executing coal mining operations for coal extraction in the Thar coalfield Block-I. 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 will start generating electricity in March 2021. Latest advancements by this project will pave the way for timely commissioning of the Project. The project will be connected with the 660 +kV Matiari-Lahore HVDC Transmission Line Project for power transmission. This transmission line project is also being implemented by PPIB under CPEC which is currently under construction and targeted to be operational by March 2021.

Being fully compliant with the World Bank/IFC standards, the addition of 1,320 MW of indigenous, affordable and reliable electricity will not only energise the national grid, it will also result in savings of foreign exchange of around 75 billion rupees annually on account of Fuel Cost, generate economic activities and employment opportunities for the people of Thar in particular and will also entail improvement of the basic infrastructure in the vicinity of this project. Further, this will boost the confidence of the investors who are interested in thar coal mining and power generation.

Speaking at the occasion, the Managing Director PPIB Mr. Shah Jahan Mirza said that PPIB under the guidance of Honorable Minister for Energy is acting as the lead organization of the GoP 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 660 MW 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 quite successful in implementing another six thar coal based power projects of 4,290 MW which are at different stages of development, he added.