All set for privatisation of two LNG power plants

Decision in line with IMF’s demands likely to increase cost of power generation

ISLAMABAD:

The federal government has decided to privatise the country’s two liquefied natural gas (LNG) power plants in line with the demands of the International Monetary Fund (IMF) under the $6 billion Extended Fund Facility (EFF).

Pakistan entered the EFF, a 39-month funding programme with the IMF in July 2019, but the release of tranches has faced delays due to issues over the required reforms.

According to sources, the government sent the privatisation plan of LNG power plants – Haveli Bahadur Shah and Balloki – to the IMF, stating that the two high-performance plants would be sold off in June.

The sources said that the IMF has demanded immediate privatisation of the LNG power plants by the end of June 2022.

At the request of the IMF, the Privatisation Commission started work on the privatisation of the LNG power plants.

Haveli Bahadur Shah and Balloki are power plants generating electricity at full capacity. Both the power plants were installed during the Pakistan Muslim League-Nawaz era.

With regard to selling them, the IMF has suggested that privatisation of high-performance power plants would fetch a good price.

The sources said that both the dual-fuel power plants are capable of generating electricity from LNG as well as diesel.

They said that the privatisation of power plants is likely to increase the cost of power generation.