RLNG-fired power project to be set up in Sindh

Published: November 30, 2017

KARACHI: The Sindh government is in talks with the federal government to establish its first-ever regasified liquefied natural gas (RLNG)-based power plant to produce 1,200 megawatt electricity to achieve energy autarky.

Prime Minister Shahid Khaqan Abbasi on Wednesday backed the project, stressing that the federal government was now fully focused on resolving the issues in the energy sector, including power transmission and distribution, power theft and circular debt.

“We fully support the Sindh government to set up the 1,200MW power project,” the prime minister said while speaking at the inaugural ceremony of a 600MW coal-fired unit at Port Qasim. He said the new imported gas-based project would enable the province to produce surplus electricity.

Plan to privatise three LNG plants faces hindrances

The PM inaugurated first of two units of the project set by China’s Powerchina Resources and Qatar’s Al Mirqab Capital under a joint venture with the Port Qasim Electric Power Company (PQEPC). The second unit of the total 1,320MW is expected to come online by February 2018.

The $2.08 billion project is completed in record time of 30 months and ahead of its scheduled time, Abbasi said. The project with 25% equity and 75% debt has been financed by the Export-Import Bank of China.

Karachi, the city of ports and the commercial hub of Pakistan, imports around 650MW from the national grid station but it still faces a shortage of around 400-500MW, especially during the peak summer.

Though the RLNG-fired power is costlier because the price of imported gas is higher than the locally-produced natural gas, the government has added some 3,600MW from RLNG-fired plants in Punjab. Another 1,200MW RLNG-based project is under construction by the Punjab government.

Abbasi said the country faced electricity shortfall for 14 years but the present government made it power-surplus. “Pakistan has surplus power production,” Abbasi said, adding that the government was now focused on resolving other issues in the energy sector.

He said the Port Qasim Electric Power Company (PQEPC) is the second largest project under the multibillion dollar China-Pakistan Economic Corridor (CPEC) project. “This project (PQEPC) reflects the vision of President Xi and (former) Prime Minister Nawaz Sharif,” he added.

He said it was his government that delivered to the masses, especially in the energy sector. Otherwise, the previous four governments failed to bring online the 400MW Nandipur Power Project in 10 years.

He said the cost of engineering, procurement, and construction of new power projects had dropped by 50% in the last three years, which would help bring new projects at lower cost.

Election in August

The PM said the next election would be held in August 2018. “Our future lies in democracy. There are no other options,” he said. “We may have (political) differences and we may have dharnas (sit-ins). However, democracy remains the only option to go with.”

Power production jumps 14% as new projects come online

Speaking on the occasion, Al-Mirqab Group Chairman Sheikh Jassim bin Hamad Al Thani said they were keen to invest more in projects in Pakistan and China.

Powerchina Resources Chairman Sheng Yuming said the average annual energy output from the Port Qasim project would be around 9,000 gigawatt hour after the coming online of the second unit in February. The project would meet the day-to-day energy needs of 3-4 million families.

Power Construction Corporation of China Chairman Yan Zhiyong said the government had eliminated terrorism and improved economic fundamentals, leading to a significant inflow of foreign investment in Pakistan.

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