KARACHI, May 17: The Hub Power Company Limited (Hubco) was issued Letter of Support (LoS) by the government on Wednesday for setting up a new power plant with net capacity of 225MW, a senior company official told Dawn on Thursday.

“We had completed all formalities and forwarded to the Private Power & Infrastructure (PPIB), pre-feasibility documents for a new power plant earlier this year,” said the company official and added that after several sessions of discussions, the company was awarded LoS on Wednesday. He thought that to be a major step forward.

The company official said the new power plant would cost around $230 million.

“Tariff structure would be discussed with the National Electric Power Regulatory Authority (Nepra) in due course,” he said.

Hubco already operates the country's biggest independent power plant (IPP) with net capacity of 12,00MW located in Tehsil Hub, District Lasbella, Balochistan.

Chief Executive of Hubco, Mr Javed Mahmood, in answer to a query, responded that world-wide it was the sellers' market for power generation machinery since it was the manufacturer who dictated costs and terms.

He claimed that Hubco would have an edge in acquisition as well as delivery due to the good reputation that the company and its parent enjoy.

The CEO of Hubco would not disclose the location of the new plant but hinted that it would neither be in Karachi, nor in Balochistan. But Mr Javed made it a point to emphasise: “We are absolutely committed to Pakistan and would like to expand our activities in this country.”