ISLAMABAD, Sept 11: The government has decided to conduct a feasibility study for power generation by putting together the reserves of small gas fields. The 65th meeting of the Private Power and Infrastructure Board was informed here on Monday that the Asian Development Bank had offered to finance up to 75 per cent of the cost of the feasibility study besides providing technical assistance while the remaining cost would be financed through the Public Sector Development Programme.

Officials said a number of fields in the country were abandoned by the gas companies because of their small size and resulting commercial non-viability.

In many cases, the fields were in proximity with each other and there were technologies available to put together their reserves to make them economically viable ventures for power generation, they said. In some cases, possibility existed to set up power plants at the gas wellhead, they said.

The proposal, which will be further processed by the Planning Commission, entails the procedure of short-listing the promising sites and undertaking detailed studies. The gas in small fields whose pumping into the main pipeline is uneconomical will be ideal for power generation, it says.

The board approved amendments to the standard formats of the letters of support and performance guarantees to maximise investor comfort, including reduced steps for tariff negotiations, flexibility in negotiating agreements and facilitating faster processing.

Minister for Water and Power Liaquat Ali Jatoi directed the PPIB to expedite negotiations to finalise agreements with four independent power producers. He said the government had been able to sign the first implementation agreement in 15 years with the Orient Power sponsored by Omanese investors.