660MW Thar Coal Based IPP Achieves Financial Closing

The 660 MW Lucky Electric Coal Power Project based on Thar Coal on Monday achieved financial closing, signing of which was witnessed by Minister for Power Syed Ali Zafar.

ISLAMABAD, (UrduPoint / Pakistan Point News - 25th Jun, 2018 ) :The 660 MW Lucky Electric Coal Power Project based on Thar Coal on Monday achieved financial closing, signing of which was witnessed by Minister for Power Syed Ali Zafar.

The financial closing documents were formally signed by Private Power Infrastructure board (PPIB) Managing Director Shah Jahan Mirza and Chief Executive Officer of M/s Lucky Electric Coal Power Project I. H. Haqqi.

The project will be located at Port Qasim near Karachi, and based on local coal from Thar. An investment of US$ 1080.9 million will be made for project, which will be equipped with the super critical technology and sea water will be utilized for cooling of the plant.

Lucky Power Project is being financed through debt equity ratio of 75:25%, with the sponsors being M/s Lucky Cement Limited while its lenders' consortium consists of Habib Bank Limited, United Bank Limited, National Bank of Pakistan, Bank Alfalah Limited, Askari Bank Limited, Soneri Bank Limited, The Bank of Punjab, Meezan Bank Limited, Faysal Bank Limited and Dubai Islamic Bank Limited, said a press release.

Upon the financial closing, the PPIB will also issue a sovereign guarantee on behalf of the Government of Pakistan in favour of the project company to secure the payment obligations of power purchaser.

The achievement of financial closing will facilitate the project sponsors in initiating construction activities at site which will be concluded by March 2021 and the project will start generating electricity thereafter.

The Sindh Engro Coal Mining Company (SECMC), which is the lease holder for execution of mining operations for coal extraction in the Thar coalfield, Block II, will supply coal to the project while the electric power generated from it will be sold to CPPAGL under a 30 years power purchase agreement.

Speaking on the occasion, Minister for Energy Syed Ali Zafar said in order to improve power supply in the country, to make it more robust and reliable, and reduce dependence on imported fuels, projects based on indigenous Thar Coal assumed further importance from energy security as well as economic perspective. He advised the PPIB to further exploit the Thar coal potential for power generation.

He appreciated the PPIB� for achieving another major milestone with the financial closing of Thar coal-based IPP (Independent Power Producer) after 660 MW Engro Powergen. Thar coal reserves estimated at 175.5 billion tons hold vital importance for generating thousands of megawatts of affordable electricity for decades to come.