A senior official of the water and power ministry told Dawn on Thursday that electricity tariff for Naudero-1 & 2 would be around 14 cents and 22 cents per unit at an exchange rate of Rs78.20 a dollar and fuel cost of about Rs34,000 per ton. The two projects, said the official, would cost more than Rs40 billion in three-four years. If calculated at the current exchange rate of Rs86 and fuel cost of Rs52,000 per ton, total repayments would be more than Rs50 billion, he added.
Sponsored by Walters Power International (of former Oklahoma governor David Walter), in collaboration with Pakistan Power Resources (of Iqbal Z. Ahmed), the two rental power projects would be based in Naudero, the hometown of Bhuttos. The official said the cabinet which adopted the ADB recommendations on RPPs on Wednesday had decided that the projects would be implemented as part of the Larkana package.The official said Water and Power Minister Raja Pervez Ashraf had announced at a news conference on Wednesday entire ADB report would be put on the ministry's website on Thursday. But at a late-night meeting, it was decided that the report be scrutinised in detail to see whether to put its full text or excerpts on the website.
Water and Power Secretary Shahid Rafi was not available for comment.
The official said the eight RPPs cleared by the ADB included four sponsored by the Pakistan Electric Power Company and four recommended by the Private Power & Infrastructure Board. Pepco's projects included Techno-1 & 2 with a capacity of 300MW, Guddu Rental of 110MW and Young Gen's of 200MW. PPIB's projects included Reshma Rental of 200MW, Karkey-1 of 231MW, Naudero-1 of 51MW and Gulf Power of 62MW. He said Naudero-2 of 49 MW had also been cleared as part of the Larkana package.
The official said the six RPPs for which the ADB had recommended legal examination of contracts and a decision on the basis of their affordability included Kamoke 70MW, Sahuwal 65MW, Piragheb 190MW, Korangi 204MW, Ruba 155MW and Techno-extension.
The official said the five projects that the ADB desired to be scrapped included Karkey-2 of 230MW, Premier of 58MW, IPL of 200MW and Naudero-2 of 49MW, but the last one had been cleared for implementation.
The Economic Coordination Committee of the cabinet had recently turned down a request for diversion of natural gas from cement industry to the Naudero-2 project on the grounds that the project did not fulfil legal requirements for gas allocation.
The government has already paid mobilisation advance of more than Rs15 billion, but none of the contractual deadlines of electricity generation has been met.
The agreement authorises the government to encash investors' guarantee at a rate of $5,000 per megawatt if they miss commercial operation dates. It can also claim 150 per cent liquidity damages on the expiry of grace period and renegotiate the contract.
The projects given mobilisation advance included Techno-1 (Rs1.5 billion), Techno-2 (Rs924 million), Young Gen (Rs1.25 billion), Pakistan Power Resources (Rs812 million), Karkay Barge (Rs6.4 billion), Gulf Rental (Rs680 million) and Reshma Power (Rs3.45 billion).
