ISLAMABAD, Nov 25: The government on Thursday appointed the National Engineering Services of Pakistan (Nespak) consultant to hold, within three months , an international competitive bidding for the construction of $1.6 billion 969-megawatt Neelum-Jhelum hydro-electric project in Azad Kashmir.

The decision was taken at a meeting presided over by Minister for Water and Power Liaqat Ali Jatoi on the directives of the president who had recently called for implementing the project without further delay.

The Nespak had also been asked to set up a special cell to complete documentation, tendering and evaluation of the interested companies within three months to award the contract to the prospective bidder.

Talking to reporters, the minister said the financial proposals of the pre-qualified bidders would be evaluated by the governor of the State Bank of Pakistan and Nespak to ensure maximum transparency.

He said the Wapda chairman had been directed to facilitate Nespak by providing relevant documents about the project, the interested companies and their proposals to hold international competitive bidding for the project implementation immediately.

The minister agreed that India had allocated funds for Kishanganga project on the same river (Neelum River) but added that Pakistan would make every possible effort to secure its national interest and priority rights over the river.

If the project is not started immediately, Pakistan would be obliged under the 1960 Indus Waters Treaty to allow India divert Neelum waters for power generation that would compromise Pakistan's priority rights over the river.

Under the design, the intake of the project would be from Neelum river at Nauseri, 42-km East of Muzaffarabad and its outlet and power house would be located at 22-km downstream of Muzaffarabad. The two points would be connected through a 32-km tunnel that would cross underneath the river bed of Jhelum.

The report of the Nespak to implement the project will be submitted to the Economic Coordination Committee (ECC) of the cabinet for approval. The minister said some companies had already been pre-qualified by Wapda but fresh proposals would be invited to attract more companies to ensure that all the competing companies had international standings.

The minister said the project cost, currently estimated at $1.6 billion, was expected to drop significantly through competition. The minister said there was no need for submission of a summary to the ECC as requested by Wapda to hold negotiations with the four Chinese firms because an environment of competition and transparency was likely to reduce project cost and attract quality bidders.

The minister also said he would ensure that there was no load shedding in the country during the next two months despite low water availability situation. He said he had directed Nespak to prepare a report on maintenance requirement of Wapda's thermal stations and IPPs to schedule the maintenance work on rotation basis throughout the year, particularly during the period of better water availability.

He said it had been decided to postpone minor maintenance works of thermal units and IPPs for at least two months to meet the national energy needs during the winter season. He said Pakistan's total installed capacity was more than 17,000-megawatt but only 11,000-megawatt or so was currently available to the system.

Referring to Wapda's request for release by the federal government of an additional Rs19 billion for import of furnace oil in the months of December and January to maximize thermal power generation, the minister said the decision would be taken by the prime minister.