ISLAMABAD: The government on Monday declared the financial closing of the 660MW Lucky Electric Power Project on Thar coal with targeted commercial operations by end of March 2021.

The documents of the financial closing were formally signed by Private Power & Infrastructure Board (PPIB) Managing Director Shah Jahan Mirza and Lucky Electric Coal Power Chief Executive Officer I. H. Haqqi. The signing ceremony was also witnessed by caretaker Minister for Energy, Barrister Syed Ali Zafar.

The project will be located at Port Qasim near Karachi, and based on local coal from Thar. The project is estimated to cost $1.081billion and will be equipped with super critical technology. Seawater will be utilised for cooling the plant.

Lucky Power Project is being financed through debt-to-equity ratio of 75:25. The consortium of lenders include Habib Bank, United Bank, National Bank, Bank Alfalah, Askari Bank, Soneri Bank, The Bank of Punjab, Meezan Bank, Faysal Bank and Dubai Islamic Bank.

Upon financial closing, PPIB will also issue sovereign guarantee on behalf of the government in favour of the project company to secure the payment obligations of the power purchaser.

The Sindh Engro Coal Mining Company which is the lease holder for execution of mining operations for coal extraction in the Thar coalfield, Block II will supply coal to the project while the electric power generated from it will be sold to Central Power Purchasing Agency-Guarantee under a 30-year power purchase agreement.

Published in Dawn, June 26th, 2018