Power crisis: PM to carry wish list of projects to Beijing

Published: July 2, 2013

Nawaz to seek assistance for 1,100MW nuclear power plant, release of $448m loan and an oil refinery at Gwadar. PHOTO: ARIF SOOMRO/EXPRESS

ISLAMABAD: Looking eastward for a solution to the country’s crippling energy woes, Prime Minister Nawaz Sharif is expected to request China’s help for a number of projects when he meets his counterpart Li Keqiang in Beijing on July 4.

Some of the items on the premier’s request list include a 1,100MW nuclear power plant, release of a $448 million loan for the 969MW Neelum-Jhelum hydropower project and setting up of an oil refinery at Gwadar port.

Sources reveal that Pakistan Atomic Energy Commission (PAEC) will build the $9.5 billion power plant – which will be called Karachi Coastal Power.

The government has already allocated Rs10 billion in the current financial year for the plant. In addition, the government is expected to seek another Rs65 billion in additional foreign lending meant to provide the required financial impetus to the project.

China has three state-owned corporations that can own and operate nuclear power plants including China National Nuclear Corporation (CNNC), China Guangdong Nuclear Power Holding Company (CGNPC) and China Power Investment Corporation (CPIC).

CGNPC currently operates four nuclear power plants of 3,758MW in China and is also associated with 16 other under-construction projects having capacity of 25,000MW.

Pakistan is now seeking to expand its nuclear power generation under the new Energy Security Action Plan. The plan envisions that by 2030, the share of nuclear power in electricity production will be increased by installing 8,800MW nuclear power plants by 2030.

At present, Pakistan has two nuclear power plants of 320MW power generation capacity each at Chashma, built with Chinese assistance.

Neelum-Jhelum hydropower project

During the previous government, China had withheld a $440-million-loan committed for Neelum-Jhelum hydropower project after the Supreme Court had cancelled the Islamabad Safe City Project contract awarded to a Chinese company.  “However, now the Chinese government has cleared the loan and Pakistan has signed a loan agreement with the Exim Bank of China amounting to $448 million,” an official close to the development said.

The source revealed that Prime Minister Nawaz Sharif would ask his Chinese counterpart to expedite release of $448 million loan for timely completion of the project.

The project cost has already jumped up by 225 per cent to Rs274.8 billion.

Neelum-Jhelum is a strategic hydropower project, initiated by the government to secure water rights over the Neelum River, where India is also constructing the Kishanganga Dam.

Gwadar Refinery

The government will also look to revive the defunct Coastal Oil Refinery Project at Gwadar, which had been shelved by China in 2009-10 after operations of Gwadar port were awarded to Singapore Port Authority (SPA). A global recession added fuel-to-fire by providing another reason to shelve the project.

The proposed Coastal Oil Refinery was part of China’s plan to invest $12 billion in multiple projects in Pakistan. The refinery was designed to reach a daily output of 60,000 barrels crude oil.

Published in The Express Tribune, July 2nd, 2013.

Reader Comments (34)

  • Shaami
    Jul 2, 2013 - 3:38AM

    Mr Nawaz Sharif where are your Saudi and Arab friends right now who were assuring financial support in the past for our country?.

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  • Hasan Awan
    Jul 2, 2013 - 3:50AM

    It is a shame that despite claiming to have a nuclear technology our country lack expertise to make on Nuclear Power plant to meet our energy needs. Also building a Nuclear site near the most populous city of Karachi is a sheer stupidity and nothing else. Moreover Rather than spending more than 9.5 Billion Us Dollars for 1100 Megawatt why our government is not allocating any Money for Diamir Bhasha dam that can produce more than 4000 Megawatts in around 12 billion Us Dollars,?

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  • fact
    Jul 2, 2013 - 3:53AM

    We will always be in debt because politicians will never stop asking for money. They will always use this money for their own purpose instead of spending it on the country. Shame!

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  • Facts
    Jul 2, 2013 - 4:12AM

    Nuclear route isnt worth it. In the event of a massive earthquake, the fallout will be devastating. Pakistan is on a fault line.

    Very Very dangerous.

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  • suraj
    Jul 2, 2013 - 4:25AM

    Are you able to keep that plant safe????? If so, go ahead.. or else better to put off.. Casualties would be terrific if anything goes out of hand…

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  • Hedgefunder
    Jul 2, 2013 - 4:48AM

    PM can carry all the wish lists he likes, however the Chinese are not known for their largesse or compassion even with their all weather friends !
    They will only fund projects which have their long term interest in ploy.
    Why not try your very special relationship with the Arabs ? I suppose he is well aware of their response to any request for funds !

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  • jibran
    Jul 2, 2013 - 6:07AM

    Return of the Kashkol Part 2.

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  • Gujesh
    Jul 2, 2013 - 6:28AM

    How you treat a man who comes to you, and only you, for help every now and then ? First, the man himself will be shy of approaching you. Second, you will look at him with disdain. Third you will give him some advise to do some work, be self sufficient and stand on his feet. Fourth, you will explore whether the man is of any use to you for your selfish interest and if yes, you will try to exploit him. I dont know how Chinese treat Pakistanis.

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  • Sandip
    Jul 2, 2013 - 6:56AM

    @Hasan Awan: “Moreover Rather than spending more than 9.5 Billion Us Dollars for 1100 Megawatt why our government is not allocating any Money for Diamir Bhasha dam that can produce more than 4000 Megawatts in around 12 billion Us Dollars,?”.
    Because that’s what the brass hats have ordained. And as you may very well know, anything nuclear adds some more shine to their brass than some sensible civilian policy.

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  • Zain
    Jul 2, 2013 - 7:54AM

    Very costly projects, specially the Nuclear Power. Most countries are moving away from N. Power, because of high risk, specially in earth quake prone areas. The cost is the huge factor here, $12 Billion for just 1100 Megawatt. At that rate even the re-newable energy like Wind becomes much more feasible. You can produce 5,000 Megawatt for $10Billion with Wind energy which is safe, non-pollutant, and virtually requires very little maintenance, plus it can be set up at many places very quickly. Who makes such strategic and vital decisions in Pakistan, seems like they just shoot in the dark on a dartboard or flip a coin to pick a power project, like Oil run power plants.

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  • m omar
    Jul 2, 2013 - 8:06AM

    What is the punishment for making false promises in Islam?

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  • Zaida P
    Jul 2, 2013 - 8:22AM

    With Shale gas totally transforming the energy supply equation, Saudi Arabia has to save every dollar it can make right now to provide for a future that portends a oil price of $50 a barrel. The greedy OPEC members were forewarned by economists not to allow oil to go past $100. When it did, massive amounts were spent on R&D by the Americans to find alternate sources and shale gas was the result. You don’t tangle with a sleeping giant – that too a giant with superior mental resources.

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  • SZA
    Jul 2, 2013 - 8:39AM

    @Hasan Awan: It will be built near Karachi (on the coast) because nuclear power plants require a huge amount of cooling water…. the plant are designed on and cooled by sea water. Also Karachi has the infrastructure i.e Transmission System to evacuate the power to the national grid.

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  • Ali
    Jul 2, 2013 - 9:42AM

    The biggest delusion in which the Pakistani’s live is that China is their devoted and sincerest friend. Though I will not negate the fact that China and Pakistan are on friendly terms but the Chinese always uphold their commercial interests in all negotiations and such interests are more favorable for the Chinese than for Pakistan. World over the opportunities for investment in the energy sector are very limited especially in hydro and nuclear projects. While thanks to the leadership, which has been short sighted and has always been resorting to short-term solutions, Pakistan is well behind 20-25 years in terms of hydro power infrastructure and there are ample of such projects to be undertaken by any investor. So if China is jumping in to take up such projects then it is not a sincere and friendly favor as being portrayed. However provided that there exists such a hostile environment for foreign investors, even China’s investment with unfavorable terms appear to be a blessing.

    I just wonder how would the PPRA rules apply to such projects being offered to China.

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  • Raj - USA
    Jul 2, 2013 - 9:49AM

    We know about one 4th of July visit by NS. Let us see what this 4th of July visit brings.

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  • Aschraful Makhlooq
    Jul 2, 2013 - 10:15AM

    Once again China is going to prove itself the Pakistan’s all-season,time-tested,credible and most trustworthy comrade more than any India and US……..
    Well done Nawaz Sharif.Just do it without any fear of US because energy crisis has been the most severe and dangerous now-a-days in Pakistan and only China and Iran can give you assistance and projects to overcome energy crisis and electricity on cheap and easily affordable rates on top priority basis immediately……

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  • Polpot
    Jul 2, 2013 - 10:19AM

    This article is an attempt to subtly blackmail China
    +++++++++++++++++++++++++++++++
    Dont dare to say No…….
    Would be interesting if Xinhua carries the Chinese response.
    Save on the trip!.

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  • Polpot
    Jul 2, 2013 - 11:00AM

    A man plants a Mango tree for the next generation.
    ++++++++++++++++++++++++++++++++++++
    Same applies to hydro projects in Pakistan.
    I invite ET to publish the projects tortured timeline.

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  • Polpot
    Jul 2, 2013 - 11:02AM

    @Ali:”The biggest delusion in which the Pakistani’s live is that China is their devoted and sincerest friend. ”
    ++++++++++++++++++++++++++++++++++++++++++++++++++
    Blame it on the opium from Afghanistan.

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  • Polpot
    Jul 2, 2013 - 11:04AM

    I think Pakistan is confusing China with IMF.
    +++++++++++++++++++++++++++
    Zardari realised the folly of that at the beginning of his Presidency.

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  • Polpot
    Jul 2, 2013 - 11:08AM

    Locomotives not on the Wish List?
    ++++++++++++++++++++++
    I thought Railways were the engine of the economy.

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  • Jul 2, 2013 - 11:19AM

    So there IS something in our Prime Minister’s list beyond Musharraf?

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  • Malik Liaquat Hussain
    Jul 2, 2013 - 11:47AM

    @Shaami:
    Dear They are not friends they are NS masters

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  • Gp65
    Jul 2, 2013 - 11:50AM

    @Zaida P:
    Very insightful statement.Recommend

  • Muhammad Rizwan Ali
    Jul 2, 2013 - 2:28PM

    I am Pakistani, living in Shenzhen,China, being a Pakistani feel very comfortable here, Chinese people love Pakistani people so much.
    Nawaz Sharif must take advantage and ask Chinese authority to help Pakistan, to improve power problems in Pakistan, I am sure he will get positive response,
    After Allah, China is other helper of Pakistan

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  • Polpot
    Jul 2, 2013 - 3:47PM

    Pls make sure that 6 JF17s chaperone Nawaz’s aircraft as he lands into Beijing.
    +++++++++++++++++++++++++++++++++++++++++++++++++++
    More than 6 will laso do.

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  • Polpot
    Jul 2, 2013 - 3:52PM

    Nawaz is also going to ask the Chinese to put a Pakistani in a spacecraft towards Mars
    +++++++++++++++++++++++++++++++++++++++++++++++++
    I am told Musharraf is the prime candidate .

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  • Polpot
    Jul 2, 2013 - 4:00PM

    @Muhammad Rizwan Ali: “Chinese people love Pakistani people so much.”
    +++++++++++++++++++++++++++++++++++++++++++
    But Veena Malik comes to India:).

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  • Polpot
    Jul 2, 2013 - 4:03PM

    “The proposed Coastal Oil Refinery was part of China’s plan to invest $12 billion in multiple projects in Pakistan. The refinery was designed to reach a daily output of 60,000 barrels crude oil.”
    +++++++++++++++++++++++++++++++++++++++++++++
    Is this a China trip or a nostalgia trip?:)

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  • It Is (still) Economy Stupid
    Jul 2, 2013 - 6:31PM

    @Muhammad Rizwan Ali: “After Allah, China is other helper of Pakistan”After separating from “I” it use to be A- “Allah, Army and America can only Pakistan. It is nice to know that now you have moved to “C”-Allah and china can only help Pakistan. In few year you will say only India can help Pakistan. after “I” comes “P”-The best day for you will be to realize that after Allah only Pakistanis can help Pakistan.

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  • Sharif
    Jul 2, 2013 - 6:55PM

    Hope he will be escorted by 6 JF17 fighter planes in beijing with Nishan like award ceremony on arrival in china.Let’s see….

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  • Unbelievable
    Jul 2, 2013 - 7:25PM

    Pakistan Atomic Energy Commission (PAEC) will build the $9.5 billion power plant
    .
    Where are you going to find $9.5 Billion dollars? What plans do you have to dispose of the nuclear waste? Have you factor in the eventual cost of dismantlement? Has anyone bothered to look at the history of your two operating nuclear power plants – the ones that you don’t have the money or technical expertise to properly maintain and keep up and running?

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  • Jul 4, 2013 - 10:00AM

    its just plain stupid investing so much money in nuclear power, not to mention the hazards with it. I think with 9 billion dollars you can make a dam like tarbela with far greater capacity and are safe as well. We couldn’t tap the hydro resource just coz of our lousy, kiddish and stupid policies.

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  • Sandip
    Jul 4, 2013 - 9:46PM

    @Muhammad Rizwan Ali: Oh boy. Doesn’t look like either have been of much help to Pakistan going by the current state of affairs there. I hope its not a case of – with friends like these who needs enemies.

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