The total cost of the project, which involves digging out 3.8 million tons of coal annually and using it to generate power, is estimated at $1.7 billion. DESIGN: FAIZAN DAWOOD
The contractors for Pakistan’s first integrated Thar coal mining and power project will be shortlisted by the end of this month, said Shamsuddin A Shaikh, the chief executive officer (CEO) of Sindh Engro Coal Mining Company (SECMC) on Wednesday.
“Four Chinese EPC contractors are being evaluated for the purpose,” he said during a media briefing on the much anticipated project, which will add 660mw of power to the national grid by 2017.
The company has already started initial work at the mine site, located 360km from Karachi, by removing two metres of sand. The hired contractor will start the work on the open-pit mine by end of 2014.
The total cost of the project, which involves digging out 3.8 million tons of coal annually and using it to generate power, is estimated at $1.7 billion. But the financial close of the project is yet to be done.
However, Shaikh believes there won’t be any problems with the financing, which is mostly coming from Chinese financial institutions.
“This is the most feasible project since we will use our own coal. No one can predict how the price of imported coal will behave in future,” he said, recalling that Pakistan had set up oil-based thermal power in the 1990s on assumption that the price wouldn’t fluctuate drastically.
“But that is exactly what happened.”
“The fact that Prime Minister Nawaz Sharif along with former President Asif Ali Zardari attended the ground breaking of the project together a few days back has added to its credibility,” he said.
The project is based on 75:25 debt-to-equity ratio. The company envisages raising $900 million from Chinese banks, $300 million from a Pakistani banking consortium and the remaining $400 million from sponsors.
The Sindh government has already transferred $100 million to a special account. Another $50 million will be transferred later, and Engro will arrange $150 million along with some other business groups.
Published in The Express Tribune, May 8th, 2014.
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COMMENTS (10)
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@ Shah,
I live on planet earth where Pakistan begs for loan from IMF, is unable to arrange sovereign guarantee for many power projects, rental power scam, now solar power scam coming up. But anyways it's interesting to know your half cooked knowledge. ENGRO paid all the money on their part (complete money/guarantee) Government of Sindh is only infrastructure partner in public private venture.
Don't give me links, i know these brilliant so called scientists very well. Tell me where is the energy output. And don't mind this scientist was also involved in endorsing unning car from water being self insult to the world. (After 9 billion budget if 1 MW is still to be produced shoot him and yourself).
Don't mix ENGRO project with UCG one is run by professionals with above the ground energy generation and the other one is run by zero+zero+zero.
@Kashif: Ha Ha You Are The One Employed By US but i am The Drone Lover
WB Stopped Funding Because Of Sovereign Guarantee lol seriously what planet do you live in. The Govt' of Pakistan Cannot Give Guarantee For A Mere $30 Million Dollar IDA Concessional Loan But Can Give The Same To Engro Worth Billions Of Dollars To Purchase Chinese Machinery. If You Want To Troll At Least Have The Decency To Get Your Facts Correct.WB Did Not Withhold Funds Because Of 'Sovereign Guarantee' But Because All Of A Sudden Their Policy Took A U Turn And They Started Emphasizing Low Carbon Technologies Guided By A Hypocritical Desire To Save The Environment.
Zero Output from ucg project dear sweet but delusional kashif here is some news that might give you and your US Employers A Heart Attack So Be Careful
https://www.google.com.pk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&cad=rja&uact=8&ved=0CD8QFjAD&url=http%3A%2F%2Fwww.brecorder.com%2Fpakistan%2Fgeneral-news%2F142307-pak-1st-gasification-plant-to-generate-electricity-from-next-year-samar.html&ei=JXB0U8WSEeHD7Aar4YH4Aw&usg=AFQjCNFeNlT3pKFos8bdqCZ_2qab6T5-Bw&bvm=bv.66917471,bs.1,d.bGE
@ Shah,
World Bank stopped funding on Thar Coal due to lack of sovereign guarantee. (my innocent pakistani shah sahib).
And Coal technology for power plants is available from JAPAN and CHINA also. If you are so refraining USA.
Last nail in your mind : UCG power generation is not at all to increase emissions or pollution it is different from Coal Power Generation. ( My innocent shah sahib , drone lover).
@ Shah,
Yes its criminal as it's tax payer's money. And with zero output there should be life sentence. Secondly did government stopped him from producing energy.
Why we Pakistanis keep our brains closed and mouths open for money. I told you the scenario from 2009. Not 2014, So be clear.
I don't have the need to , you can contact US Department of Energy and ask about this program which they offered under TOT.
Sleep tight.
@Kashif: When I Read Your Post,Your Comments About Him Made Me Suspicious As To Who You Work For.Thank You For Telling Me Who You Work For and Thus Confirming Them.Your Feelings Are Understandable As Scientists Like Dr Samar and Dr AQ Khan Do Tend To Give Your Employers Sleepless Nights.
You Must Be Joking USA Offer UCG Technology To Dr Samar.It's Common News That USA Has Stopped Exporting Coal Technology Or Supporting Coal Projects on An Official Level.US Controlled World Bank Stopped Funding The Thar Coal Project Back in 2010.Now You Have The Audacity to Tell Me That US Offered UCG Technology to Dr Samar
No Oil Mafia,Give Me A Break.You Tell Me That It Is Ok To Throw Billions Of Precious Rupees On Oil Imports But Is Criminal To Give To A Man Who Is Giving Our Country Energy Independence
@ Shah,
I met his whole team, gave the TOT offer to them on behalf of US Department of Energy for UCG focusing on pilot project.
You know what he said. " If i can make missile and bomb , i can also create energy from Coal"
No Oil Mafia, He wasted government's Rs.9 billion. (Admitted by even the corrupt government of PPP in the history of Pakistan).
@ Every One,
Good development on Engro Project. There was a scam scientist also propogating UCG at Thar Coal and failed to produce even 1 MW with office in Islamabad and UCG project at Thar.
He refused to take US DOE (Transfer of Technology program) since wanted to do it at own.
Anyone recall the grand opening of the Thar Coal Project attended by Sharif and Zardari? Engro still hasn't obtained financing and plants a newspaper article about once a month to try and create the illusion of progress.