Private Power and Infrastructure Board (PPIB) has sought the Board''s approval to issue notice of proceed and Letter of Intent (LoI) to Thar Electricity (Private) Limited (TEPL) for establishment of 700MW (2x350) MW plant at Thar Block-VI, official sources told Business Recorder. Giving the background, the sources said, 1,320 MW (2X660MW) Thar mine mouth coal-fired power plant by Oracle was included as actively promoted project under China Pakistan Economic Corridor (CPEC) Framework Agreement signed on November 8, 2014.
The sources said, sponsors through an SPV M/s TEPL submitted a proposal on October 7, 2015 for development of 600 MW (2X300MW) Thar coal based power project at Block VI, Sindh under Power Policy 2015. According to the proposal M/s Oracle Coalfields PLC holds 90 percent shares as a main sponsor and M/s SEPCO Electric Power Construction Corp holds 10 percent shares. Due to inconsistency with CPEC framework agreement, sponsor on June 29, 2016 re-submitted their revised proposal for development of 1320 (4x330) MW coal based power project in two phases (ie 2x330 MW in each phase). However the proposal was incomplete and inconsistent with CPEC framework agreement regarding configuration of the proposed plant.
TEPL submitted second revised proposal on January 3, 2017 which was also incomplete (received in PPIB on January 16, 2017) wherein Oracle was replaced by SEPCO as a main sponsor with 70 % of the equity contribution. However, due to cessation of upfront tariff on January 19, 2017, further processing of the project was stopped. In the meantime, the project was included in the list of prioritized energy project in the second meeting of Energy Planning Experts Panel Group of CPEC held on February 14, 2017. Furthermore, on July 27 2017, NEPRA announced new upfront generation tariff for projects on Thar coal.
Subsequent to Nepra''s upfront generation tariff for projects on Thar coal, TEPL submitted its third revised proposal on November 6, 2017 for 1,320 MW to be implemented in two phases, with revised shareholding. However, keeping in view Nepra''s restriction for development of only super critical coal-fired power plants at Thar, the proposal was later revised for 1400 MW to be implemented in two phases of 700 (2 x 350 MW) each.
M/s TEPL''s proposal was forwarded to PPIB consultant who pointed out that various documents such as power of attorney, consortium agreements and exhibits etc are required to be revised for project size of 700MW.
Accordingly, TEPL submitted updated exhibits, scanned signed copies of power of attorney and consortium agreement which were forwarded to the consultant for evaluation. The consultant concluded that "based on our evaluation of the proposal provided to us by PPIB, pertaining to Thar Electricity (Private) Limited for setting up 700 MW (2x350MW) Thar lignite coal based power plant at Thar Block VI, Tharparker, Sindh we conclude that the requirements of the policy and the guidelines have been substantially complied with and therefore, Thar Electricity (Private) Limited, stands qualified subject to the receipt of following outstanding documents (in original): (i) site confirmation letter from PEPCO/NTDCL; (ii) revised consortium agreement based on 700 MW capacity of plant; and (iii) revised power of attorneys based on 700 MW capacity of plant.
Recently, TEPL submitted original power of attorneys, consortium request letter to NTDCL for power evacuation of 1400MW (4X350 MW) Thar project at Thar Block-VI which has been forwarded to Consultant for evaluation. However, final evaluation report is still awaited.
Earlier CPPA-G on February 15, 2017 issued consent for phase-I (ie, 2X330MW) scheduled to be commissioned in last quarter of 2019, however CPPA-G interlinked phase-II of the project with grant of firm consent by NTDC for interconnection and evacuation of power from generation facility and further clarified that both phases of the project will be dealt as independent projects and separate PPAs will be executed for each phases.
As regards, the CPEC Framework Agreement, PPIB has highlighted that the project has been listed as prioritized project of 1,320 MW Oracle Power Project; however as per proposal submitted by TEPL, the main sponsor/initial shareholder of the project is Sichuan Provincial investment Group Co Ltd (with 78 percent equity), and Oracle Power PLC (12.1 percent equity) and Power China International Group Ltd. (9.9 percent equity) as other sponsors. Furthermore, sponsors intend to implement the project in two phases of 700 MW each, whereas project is listed as 1,320 MW coal project in CPEC Framework Agreement.
PPIB, in its proposal for the PPIB Board has sought approval for issuance of notice to proceed and LoI TEPL for the development of phase-I (2x350) MW Thar coal based power plant located at Thar Block-VI, Sindh, subject to submission of a positive final recommendation by the consultant.
The change in shareholding, size and implementation of project in two phases will require approval of the Joint Energy Working Group (JWEG) and Joint Coordination Committee (JCC) of CPEC. It will be submitted for consideration of JWEG and JCC in the forthcoming meetings, the sources concluded.
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