Rs 474 Bln Investment Made In K-Electric After Privatization: Senate Body Told

The Senate Standing Committee on Power Tuesday was apprised that an investment of Rs 474 billion has been made in K-Electric since its privatization in 2005.

ISLAMABAD, (UrduPoint / Pakistan Point News - 20th Dec, 2022 ) :The Senate Standing Committee on Power Tuesday was apprised that an investment of Rs 474 billion has been made in K-Electric since its privatization in 2005.

The committee which met with Saifullah Abro in the Chair was told that first foreign direct investment of around $ 700 million was made in the company after its privatization.

Imran Qureshi, Chief Regulatory Affairs of K-Electric, apprised the committee that the K-Electric was first established in 1913 and nationalised in 1952. The company has 3.4 million customers and earned its first profit in 2012 after its privatization, he said.

He said K-Electric was currently running six power plants including Korangi Combined Cycle,Korangi Gas Turbine, SITE Gas Turbine, BQPS II, BQPS III, Port Qasim having total capacity of around 1870 MW.

Senator Saifullah Abro said that despite producing 1870 MW with additional of 1100 MW from Government of Pakistan, why K-Electric failed to meet the energy requirement of Karachi.

He inquired the K-Electric officials about the cost incurred on these power projects and details relating to Power Purchase Agreement of K-Electric with government.

The Chairman expressed dissatisfaction over the briefing and directed the officials to provide a comprehensive briefing in the next meeting.

Chairman Committee Senator Saifullah Abro also expressed displeasure over the continuous absence of Federal Minister for Energy (Power Division) and CEO, K-Electric in the meeting. The Committee decided to meet and discuss the matter with the Chairman Senate.

The Senate Committee was also briefed by privatization commission about the privatization of K-Electric.

The officials apprised the committee that, in 1992, the government approved a strategic plan for the commercialization and privatization of power sector. K-Electric was making loses for the last 13 years and the loss for the year 2001,2002 and 2003 were Rs.16.4 billion, Rs 17.7 billion and Rs14.4 billion respectively, they added.

They further informed that privatization process for K-Electric was started in 2001 but it could not complete because no suitable buyers came forward and the process was again initiated in 2003 and the contract was awarded to consortium led by Hassan Associates with a bid of Rs 1.65 per share.

Senator Saifullah Abro directed the Privatization Commission to provide all the bidding details relating to financial advisor in the next meeting.

Moreover, the matter relating to electricity provided to Balochistan agriculture sector for tube wells was also taken up.

The Chair formed a Sub-Committee and appointed Senator Fida Muhammad as it's Convener. The Sub-Committee will probe the matter and submit its report within two months' time.

The committee also discussed the matter of public importance raised by Senator Mushtaq Ahmad Khan with respect to recruitment process followed for the different vacant jobs advertised by Peshawar Electric Supply Company (PESCO). Senator Mushtaq Ahmad Khan questioned as why the details relating to agreement between PESCO and University of Engineering and Technology, Peshawar has not been submitted before the committee and why do the recruitment process has been held up so far.

Gul Nabi Sayed, CEO PESCO, informed the committee that appointment letters against 128 posts of Junior Engineers have been issued to the selected candidates.

Mushtaq Ahmad Khan inquired the PESCO officials to provide details of candidates, who have scored 80 per cent marks in written tests but failed to secure a place in final selection.

Senator Saifullah Abro directed the PESCO to provide lists of written test result and final recommendation of candidates in the next meeting. The Committee also decided and recommended Power Division to put the process of issued orders & joining on hold unless & until the requisite documents are submitted by Power Division.

Regarding a detailed briefing on provincial government development funds (2020-23), the Committee unanimously decided and recommended the CEO, PESCO to meet the rehabilitation requirement from ELR funds. The ELR funds may be utilized accordingly.

Senator Saifullah Abro questioned that why agreement between K-Electric and government of Pakistan has not been renewed since its expiry in 2015 and when will the agreement be renewed.

Saifullah Abro directed the ministry to provide correspondence regarding the renewal of agreement between K-Electric and the government in the next meeting.

The meeting was attended by Senators Fida Muhammad, Saifullah Sarwar Khan Nyazee, Zeeshan Khanzada, Prince Ahmed Umer Ahmedzai, Haji Hidayatullah Khan, Bahramand Khan Tangi, Muhammad Asad Ali Khan Junejo, Mushtaq Ahmad Khan, Sana Jamali, Additional Secretary for Power Division Arshad Majeed, Chairman NEPRA Tauseef H.Farooqi, Imran Qureshi Chief Regulatory Affairs for K-Electric and other concerned officers.