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LAHORE: The federal government is likely to sign a contract agreement with a Chinese company by April 20 for laying the $2 billion Matiari-Lahore high-voltage direct current (HVDC) transmission line.

China Electric Power Equipment and Technology Company Limited (CET) — a company owned by the State Grid Corporation of China — had started civil work on small scale at its own risk after the government issued a formal letter of interest (LOI) to it in February 2017. However, the contract agreement could not be signed due to various issues between the government and the company.

“We are very close to signing the contract agreement which will allow the company to formally launch civil works on laying the line along with construction of two convertor stations within a period of 27 months. The government wants this HVDC line ready in March, 2021 for the evacuation and transport more than 4,000 megawatts of electricity from the coal based plants in Thar, Port Qasim and Hub,” a senior official of the Power Division told Dawn on Saturday.

The 878km long transmission line is part of the China-Pakistan Economic Corridor (CPEC) and is the country’s first project based on direct current (DC). Another similar 660kV HVDC line from Port Qasim to Faisalabad is also included in the list of the projects to be launched under CPEC.

“We were expecting signing of the contract agreement, which is ready on our part, on April 6 or 7 of this month. However, the Chinese wanted to have some more discussion with the Power Division on the date of starting construction work.”

Published in Dawn, April 8th, 2018