November 24, 2003	Monday	Ramazan 28, 1424

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ISLAMABAD, Nov 23: Five parties, including three local and two foreign, have submitted their proposals for the construction of the $1.5 billion Neelum-Jhelum Hydro Power Project that would serve to protect Pakistan’s priority rights over the Jhelum waters.

Official sources told Dawn that a high-powered special cell had been set up by the government to evaluate the proposals on Neelum-Jhelum Power Project and invite a strong consortium for signing of a memorandum of understanding (MoU) soon after Eidul Fitr to construct the project on turn-key basis on a war-footing.

The cell which reports directly to the president and the prime minister was set up in September this year following an advice by the military authorities that development of the project was crucial to Pakistan’s interests and should be treated as a special case.

Pakistan is obligated under the 1960 Indus Waters Treaty to allow India to construct a 450MW project on river Neelum if it fails to start constructions of the Neelum-Jhelum Project.

The special cell is headed by Power Minister Aftab Ahmad Khan Sherpao and comprises Rawalpindi Corps Commander and other civil and military officials.

The parties who have responded positively to the government invitation include a consortium led by Sachal Engineering, Indus Power and Habib Rafiq Construction (the three local parties) and Dong Fong and CMEC of China.

Officials said the government had issued invitations to eight companies but only five of them submitted positive proposals.

They said the consortium led by Sachal Engineering was likely to be assigned to develop the project because it has signed MoUs with seven companies to develop the 969-mw project.

Other members of the consortium include Frontier Works Organisation (FWO), Golder Associates of Canada, Norconsult of Norway, Synergics Energy Development of USA, H&M Engineering of USA, J&P of Cyprus and Gezhouba of China.

The selected party would be required to immediately mobilise machinery and material at the project site with a view to reserving Pakistan’s priority rights on the Neelum river because India was also inviting proposals for its 450-mw Kishenganga project.

The sources said the government planned to advance 15 per cent of the total project cost to the consortium as its equity to be disbursed over a period of six years. The remaining 85 per cent of the project would be arranged in the form of loans against guarantees to be issued by the government.

The sources said the government decided to treat the project at the federal level as a special case because it was felt that the implementation of a project of such a strategic importance to Pakistan should not be left to Wapda which has been dragging its feet on the projects for years.

The dam of the project would be constructed at Nossari and connected through a 28.5-km underground tunnel to a power house to be located 9-kms off Kohala towards Muzaffarabad. The feasibility study of the project has been prepared by Norconsultant.