KARACHI, Oct 31: Over a dozen speakers on the second and final day of two-day international symposium on “Sindh Coal (Lignite) Mining Challenges and Success” on Wednesday called for setting in place an up-front tariff structure for the investors who want to mine coal in Sindh and Thar for establishing electric power projects.

A realistic and flexible up-front tariff will incorporate financial, production and operational costs, end user price of energy and supply of energy, one of the speakers pointed out. An investment model for coal-fired electric generation projects will address risk factors and also work out return on the investment in relation to rate of return on other business.

Almost all the speakers expressed the view that coal resource exploitation for generation of electric power in Pakistan was now inevitable as oil price was on the rise and other sources of energy were capital-intensive.

Availability of coal in abundance in Sindh and particularly in Thar leaves very little choice for the government and investors than to explore optimum exploitation of this source.

“No harm in importing energy from neighbouring countries like Iran, Turkmenistan or Qatar,” observed another speaker but also warned that “energy imports create dependence which makes the sovereignty of the country vulnerable.

“It is all the more ridiculous to explore energy sources from other countries when Allah has endowed Pakistan with rich coal deposits that can last for several generations,” he added.

Sindh Minister for Mines and Mineral Development Irfan Marwat said that by allowing duty-free import of mining equipment and electric power generation plants, the government had already set a stage for the investors to establish power projects.

“An up-front tariff structure for coal-fired electric power projects will clear the way for such projects and accelerate the process of power generation,” added Marwat who chaired the technical session on Wednesday.

He spoke of the acute power shortages in the country which was hurting industrial and agricultural growth and hence a quick decision on up-front tariff would help in overcoming this limitation.

Simplification of procedure for approval of power projects is another need to be addressed in overcoming the power shortages, he stressed.

A senior government official disclosed that a national coal policy was being designed by the Ministry of Petroleum and Natural Resources aimed at attracting the much-needed foreign direct investment and harness alternate energy sources.

The government is targeting 19 per cent energy generation from coal by 2030 and 50 per cent by 2050. “Lignite reserves in Sindh are huge and suitable for power generation and also a cheap dependable source which can meet the country’s energy requirements for a long period,” he said.

Another participant expressed the view that mining, purification and generation cost could be brought down by taking up by projects of higher production and generation.

Most of the technical experts emphasised on the use of endogenous resources — Thar coal. The relevant authorities in Sindh government are understood to have drawn up a technical feasibility and according to recommendations the local and foreign investors may join the project if they are assured of required rate of return on their investment.

In present conditions, the required rate of return of investment in energy sector will be achieved only if Wapda and KESC provide guarantee to buy coal based electricity at 9.5 cents per unit.

Mr Amanullah Khan read out a paper on “Power generation without carbon dioxide Emission” which is called Oxyfuel combustion. He offered detailed technical explanation of the oxyfuel process which is said to be relevant to Pakistan’s conditions and the coal.\

Those who made presentations on Wednesday were Additional Chief Secretary of Sindh for Planning and Development Ghulam Sarwar Khero, Chairman of Mining Engineering Department of Mehran University Dr Muhammad Ali Shah, Thomas Larry of Sindh Carbon Energy Limited, London, a Chinese expert from China National Machinery Import and Export Corporation, Chief Secretary Sindh Aijaz Qureshi, Secretary Industries of Azad Jammu and Kashmir Rashid Hussain Malik and many others.