ISLAMABAD: Prime Minister Nawaz Sharif on Tuesday approved a much-anticipated project for setting up of a Liquefied Natural Gas-fired power plant in Punjab under timelines to be decided later.

While presiding over a meeting of the Cabinet Committee on Energy (CCE) here, the prime minister deferred two agenda items — relating to circular debt and load management plan — but took interest in a presentation by officials from Punjab for setting up of a major power plant on what they called the “Bhikki model”.

At a previous CCE meeting, Punjab Chief Minister Shahbaz Sharif had noted that a coal-based project in Rahim Yar Khan of 1,200MW capacity had been shelved and requested that the project be revived after converting it into an LNG-based plant.

Committee decides that during Ramazan no shutdown will be allowed on account of development work

The prime minister had directed the water and power ministry to evaluate the proposal for revival of the project after converting into a LNG-fired plant and whether or not it could be included in the projects to be launched under the China-Pakistan Economic Corridor (CPEC).

So while evaluation by the ministry was still awaited on Tuesday, the chief executive officer of Punjab’s Quaid-i-Azam Thermal Company, Ahad Cheema, made a presentation on the subject. He proposed that a new LNG-based project should be launched on the ‘Bhikki model’ and the National Electric Power Regulatory Authority (Nepra) be asked to give a reference tariff for bidding. The tariff could be adjusted on the basis of the bidding results.

Interestingly, the 1,200MW Bhikki plant has itself been facing technical and mechanical problems since its inauguration by the prime minister on April 19.

The prime minister approved the scheme in principle but said the new plant should be situated near the main gas pipeline so that additional expenditures were kept to a minimum, unlike in the case of the Nandipur plant.

A source told Dawn that neither did Mr Cheema mention the location of the proposed project in his presentation nor did the prime minister ask him to do so. But it was clear from proceedings of CCE’s previous meetings that the LNG-based project would be located near Rahim Yar Khan.

The power ministry would now be required to move a formal summary to the cabinet for approval and implementation.

Sources said that two coal-based projects of 1,200MW to 1,320MW capacity originally planned to be set up in Rahim Yar Khan and Muzaffargarh were removed from the CPEC list to create room for investments in the Diamer-Bhasha dam. This hurt business interests of a few influential investors who “needed to be accommodated” by the government.

An official said a ministerial committee led by Finance Minister Ishaq Dar and comprising ministers and secretaries of the petroleum and power ministries that was set up to analyse the demand and supply situation on the basis of the projects being erected for the period up to September 2018 had completed its work.

The prime minister asked the committee to continue working on a plan for the period ending in 2023. The committee would submit its report in August this year.

The meeting was also briefed about utilisation of idle capacity of some rental and independent power plants under litigation in the light of consultation with the law ministry.

An official statement said the prime minister directed that changes be made in scheduled outages of power plants on account of repair and maintenance from summer to winter season in a way that maximum electricity was provided when most required during months of peak demand.

The CCE unanimously decided that during Ramazan no power shutdown would be carried out on account of development work. It was also decided that factors, including increase in use of electricity appliances due to economic prosperity and behavioural patterns of power consumers, be included in the estimation of projected demand.

Published in Dawn, June 7th, 2017