Suffering from an acute power crisis, the Government of Pakistan has decided to revive the approximately PKR 4.1 trillion Keti Bander thermal power project as a CPEC project in the expectation of getting financial help from China. The power plant was abandoned way back in 1997 on grounds of it not being “a cost effective project’ and ‘availability of surplus electricity in the country for future use.’
According to a press release issued by the Department of Energy in Pakistan, M/s Bridge Factor Consortium has been assigned to carry out a feasibility study of the Keti Bander Project. The study will include the laying of a 450-kilometer-long railway line from the Thar coalfield to Keti Bander, installation of 1320 MW power plant extendable up to 10,000 MW, development of jetty to cater transportation of machinery and equipment for power house.
On June 24, 1997, water and power minister had informed the Pakistan National Assembly that the 1320 MW (originally 5280 MW) Keti Bander project in Sindh has been abandoned with the consent of the foreign sponsors, Consolidated Electric Power Asia. The then Pakistan government had cited following reasons for the cancellation of the project:
• No physical and real construction work had started at the site.
• The electricity generated would be too expensive. It would cost Rs 4 per unit at the generation site and Rs 8-12 at consumers end.
• CEPA intended to import coal instead of utilising deposits in Thar.
• Surplus electricity is available in the country for the future use.
• CEPA was asking the WAPDA & PPIB to build a transmission line instead of doing the same itself.
However, the very next day, CEPA owned by the Gordon Wu of Hong Kong had denied the termination of the project by saying that no decision had been conveyed to them and that CEPA’s efforts to have a meeting with the prime minister proved fruitless.
Quoting informed sources, Pakistan media had also rejected the govt’s claim of availability of surplus power in the country and said that “on the contrary, according to the World Bank Pakistan has to produce 1600 MW each year after 2001 and even nineteen existing projects (mostly proposed to be set up in Punjab ) including units of CEPA cannot fulfil the required power demand of the country”.
Now, expecting financial help from China, the Pakistan government has entrusted the Energy Department to pursue development of Keti Bander Power project. “The Study will cost 326.44 million and will cover all aspect of development”, said Pakistan Government’s Energy Secretary Agha Wasif in a release.
The consultant has been asked to give a feasibility report within 10 months and has also been asked to prepare business plan and assist government up to financial closure. Strategic environmental assessment will also be integral part of the study.
According to release, the decision to revive the Keti Bander Project was taken in a meeting attended by senior government officials. In the meeting, Khurshed Anwar Jamali, Chairman, BoD SECMC emphasised on complete master plan, SEZ and future expansion provisions in the area.
At opening of the meeting, Waseem Ahmed, Chairman P&D Board stated that development of Keti Bander is an important part of the Government of Sindh (GoS) strategy towards developing the energy sector.
“Energy Department, Government of Sindh is pursuing development of Keti Bander project vigorously. The GoS is going to close one of the biggest budgets of the history of Sindh of PKR 4.1 trillion,” Ahmed said.
Rasid Hussain Kazi, Special Secretary Energy, Abu Bakar Madani, DG SCA, Shariq Raza, Technical Officer and Shahnawaz Chief Investment Finance Department were also present in the meeting.
The composite billion dollars Keti Bander project has four components;
a) A 5280 MW electric plant.
b) A deep sea port (at a distance of 148 km from Karachi).
c) An industrial zone between Thatta and Jamshoro.
d) Thar coal field development.
e) Job opportunities for 7000 indigenous people of Sindh.
The formal agreement of Keti Bander project was signed on August 3, 1995 between the CEPA and govt of Pakistan. On October 27, 1995 another agreement regarding the purchase of electricity from CEPA was signed by government of Pakistan.
It was decided that the project will be completed in 2001 and its electric power plant will be composed of eight units. Each unit would produce 660 MW, and the first two units will use imported coal (probably from Indonesia) for the production of 1320 MW electricity while for the remaining six units indigenous Thar coal will be used. The ground breaking ceremony of the project was performed on January 30, 1996.
The agreement of co-operation between Sindh govt. and CEPA was signed on April 25, 1996 and the initial work of geological and soil survey was started by the CEPA with the help of Geo Engineering Management Services. CEPA also purchased a 3000 acre piece of land at the cost of Rs. 90 million and deposited five million US dollars (twenty crore rupees)in the joint account of Sindh govt. and CEPA.
It was stipulated in the implementation agreement that WAPDA and PPIB (private power infrastructure board) will lay double circuit 500 KW transmission line between Ketibunder and Jamshoro (185 km) before December 31, 1996. But they did not even complete the initial tender work of the transmission line.
On May 1, 1997 CEPA wrote a letter to federal minister of water and power and requested for the provision of transmission line but could not get any response, then they sent another letter to finance minister on June 5, 1997 but the response was same. Finally on June 24, 1997 government of Pakistan announced the termination of the project.