ISLAMABAD: Minister for Planning, Development, and Special Initiatives Ahsan Iqbal has been contacted by K-Electric (KE) and M/s Oracle Power PLC on their plans to relocate the 1320 MW coal-fired Thar plant.
It was explained to Ahsan Iqbal in a letter signed by Naheed Memon, the CEO of Oracle Power PLC, Syed Moonis Abdullah Alvi, the CEO of K-Electric, and Yang Jian Duoto, the country representative of Power China International Group Company for Pakistan, that the project, which is already listed as a China Pakistan Economic Corridor (CPEC) energy priority project, would be of national significance.
In addition to introducing base load power powered by domestic coal, it would also promote economic expansion, lead to the creation of jobs, and further increase the utilisation of the Thar coal resources, which are positioned to form the backbone of Pakistan’s future energy security.
A request was made to KE to begin negotiations in order to resolve the Rs47 billion clawback dispute.
To forward the project, the Energy Department of the Government of Sindh (GoS), Oracle Power PLC, K-Electric Limited, and Power China International Group Company recently signed a Memorandum of Understanding (MoU). The agreement achieved by these parties demonstrates their commitment to making a significant contribution to the nation’s economic development.
The parties have agreed to consider the project’s potential transfer to Port Qasim, subject to technical, commercial, and timely development factors. The project was originally planned for the Thar Block VI.
An overview of the project’s history shows that Oracle began working on its development in 2010 and received a concession from the GoS in 2012. The project’s development effort has required a significant financial investment from the corporation. Another key milestone was reached in 2017, when the project was given “priority project” status inside the CPEC framework. At the 9th JCC conference in 2019, the project was further integrated into the oil and gas group. After the 10th JCC meeting in 2020, the project is still listed among the CPEC projects.
The letter states that this is the final CPEC coal-to-power project, and that Pakistan has the best opportunity to develop and use Thar coal to produce affordable power given the increased restrictions placed on the construction of coal power plants by international financial institutions.
Both businesses believe that the low-cost base load power produced by domestic coal power plants is a crucial prerequisite to reduce the skyrocketing electricity price and stop the flight of foreign capital out of the nation. In the province of Sindh, KE is expected to be the biggest energy consumer and the best off-taker for Chinese financiers to sponsor new power projects.
To meet the steadily rising demand in its system, KE is currently finalising its long-term business plan. In order to fulfil the city of Karachi’s increasing need for electricity, KE intends to optimise its fuel mix by introducing a combination of base load plants based on locally available resources, including local coal. It is anticipated that starting in the fiscal year 2028–2029, there will be a need for new base load power.