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Thar Engro Coal Power Project

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The Thar Engro Coal Power Project is a coal-fired power plant under construction in Tharparkar District, Sindh, Pakistan 25 kilometers from the town of Islamkot near the village of Singharo-Bitra. The project is being developed as part of the China–Pakistan Economic Corridor by Sindh Engro Coal Mining Company (a joint venture between the government of Sindh and Engro Corporation) and China Machinery Engineering Corporation in the Thar Block-II of the Thar Coalfield.

Background

In May 2008, the Government of Sindh invited proposals for the development of Thar Coal reserves through a public private partnership basis. The Sindh Engro Coal Mining Company (SECMC) was formed as a joint venture between Government of Sindh (GoS) and Engro Corporation in October 2009 in order to develop of mining at Thar Coal Block II of the Thar coalfield.[1] In May 2013, a power company in the name of Thar Power Company Ltd. (THARCO) was incorporated as a subsidiary of SECMC with the mandate to develop the first power project based on coal mined by SECMC. As per the JV agreement, Engro is responsible for Project Management and Financing, while GoS for Infrastructural Development and attaining requisite consents and approvals for the project.[2]

Project details

The first phase of the project will yield 660 megawatts of electricity, with subsequent phases eventually increasing power generation capacity.[3] The consortium will also develop an adjoining open cast coal mine capable of producing up to 3.8 million tons of coal per year at depths of 135 meters[4] as part of the first phase of the Thar-II Project.[5] The first phase is expected to be completed by early 2019[6] at a cost of $1.95 billion,[7] with the mine itself costing $789 million.[8]

The initial phase will consist of two 330 MW plants which each will have a "Sub-Critical Circulating Fluidized Bed," boiler, steam turbine, and generator.[9] Electricity generated from the project will be connected to the national electricity grid at Matiari, from where power can be directed to Karachi or towards northern Pakistan via the Matiari to Lahore and Matiari to Faisalabad 660 kilovolt transmission lines. In addition to power plant construction, the government of Sindh is currently widening and rehabilitating the road from Thatta to the Thar coalfield at a cost of $100 million.[10]

The mine will then be expanded to yield 6.5 million tonnes per annum of coal to support two addition 330 MW power plant within one year of completion of the initial 660 MW project.[11] While establishing the mine will cost $789 million, the cost required to increase mine capacity from 3.8 to 6.5 million tons per annum will cost an additional $124.7 million as the incremental cost of mining capacity expansion is low.[12]

In Phase II, the mine will be expanded to yield 13.5 million tonnes of coal to support power plants to yield 2400 MW of electricity. In Phase III of the project, the mine will be expanded to yield 19.5 million tonnes of coal annually in order to support 3600 MW of power generation.[13][14][15]

Tariff

The National Electric Power Regulatory Authority of Pakistan has agreed to a tariff of 8.5015 cents/unit for the first 330 MW of electricity, 8.3341 cents/unit for the next 660 MW of electricity, and 7.9889 cents/unit for the next 1,099 MW of electricity.[16] The tariff rates are valid for 30 years, and is based on a debt equity ratio of 75:25.[17]

Local effects of the project

The villages of Senhri dars and Thareo Halepoto will require relocation in order to develop the project,[18] at a cost of $62 million.[19] Developers of the project also have pledged to re-fill coal pits once coal reserves are exhausted, and have also pledged to "plant hundreds of thousands of indigenous trees to maintain the natural ecosystem of the desert."[20] Developers of the project also predict that 3,000 unskilled workers will be required for construction, and have stated that all these workers would be recruited from the local Thar population,[21] and an additional 1,400 semi-skilled workers.[22]

See also

References

  1. ^ "Sindh Engro Coal Mining Company" (PDF). Sindh Board Of Investment. Retrieved 4 February 2016.
  2. ^ "Sindh Engro Coal Mining Company and China Power International signed MoU to set up 6,000 MW Power Plants". Engro Corporation Limited formerly Engro Chemical Pakistan Limited. Retrieved 4 February 2016.
  3. ^ "Generation Licence No. IGSPL/49/2015 Licence Application No. LAG-285 Engro Powergen Thar (Pvt.) Limited" (PDF). NEPRA. 18 March 2015. p. 6. Retrieved 14 March 2016. The proposed Power Project/Generation Facility of EPGTPL with an Installed Capacity of 660.00 MW will be the first part of the Energy Park (total generating capacity of approximately 3600 MW) which will be utilizing the lignite coal of Block II.
  4. ^ Shaikh, Shamsuddin (27 February 2016). "Thar coal - separating fact from fiction". Business Recorder. Retrieved 14 March 2016. "Mining activities require pits of up to 135-meter depths to be dug.'
  5. ^ "China Machinery Engineering to fund Pakistan coal projects". China Daily. 22 December 2015. Retrieved 19 February 2016.
  6. ^ "Thar coal field's Block-II achieves financial close". The News Pakistan. 3 January 2016. Retrieved 19 February 2016. The production of remaining 660 megawatts from block-II will begin by the end of 2018 or by the beginning of 2019 while the mining and energy projects in block-I and block-VI of Thar will also reach their financial close this year," said the official.
  7. ^ Rapoza, Kenneth (19 February 2016). "China Shutters Coal Mines At Home, Opens $2 Bln Mining Project In Pakistan". Forbes. Retrieved 19 February 2016.
  8. ^ Sindh Engro Coal Mining Company (30 December 2014). "PETITION FOR REFERENCE COAL TARIFF DETERMINATION FOR CONTRACT STAGE TARIFF" (PDF). Thar Coal and Energy Board. Retrieved 14 March 2016.
  9. ^ "Generation Licence No. IGSPL/49/2015 Licence Application No. LAG-285 Engro Powergen Thar (Pvt.) Limited" (PDF). NEPRA. 18 March 2015. p. 6. Retrieved 14 March 2016.
  10. ^ "Thar coal project completes financial closure". Daily Times (Pakistan). 9 January 2016. Retrieved 14 March 2016. Shams Shaikh said that widening and rehabilitation of road network from Thatta to Thar Coalfield Block-II, including construction of a new bridge on River Indus was at the final stage. It was a $100 million project and so far $65 million have been spent.
  11. ^ Bhutta, Zafar (13 August 2015). "Mining firm arranges funds from Chinese, local banks". The Express Tribune. Retrieved 14 March 2016. Power plants with a capacity of 660MW will be set up in the first year and another 660MW will be added next year through Thar coal. "This 1,320MW can be made available in 50 months which is the biggest advantage to the consumer and the nation," Shaikh remarked.
  12. ^ Sindh Engro Coal Mining Company (30 December 2014). "PETITION FOR REFERENCE COAL TARIFF DETERMINATION FOR CONTRACT STAGE TARIFF" (PDF). Thar Coal and Energy Board. Retrieved 14 March 2016.
  13. ^ http://sindhcoal.gos.pk/
  14. ^ "Rs9.6bn Thar power plant in jeopardy". Dawn. July 13, 2010. Retrieved 4 February 2016.
  15. ^ "Landmark deal seals finance of Thar coal mine". The Express Tribune > Pakistan > Sindh. August 18, 2015. Retrieved 4 February 2016.
  16. ^ Mirza, Javed (30 January 2015). "Govt approves upfront tariffs for Thar coal-fired power projects". The News (Pakistan). Retrieved 14 March 2016.
  17. ^ Mirza, Javed (30 January 2015). "Govt approves upfront tariffs for Thar coal-fired power projects". The News (Pakistan). Retrieved 14 March 2016.
  18. ^ Shaikh, Shamsuddin (27 February 2016). "Thar coal - separating fact from fiction". Business Recorder. Retrieved 14 March 2016. "Mining activities require pits of up to 135-meter depths to be dug. However the ecology of the desert will not be affected as these pits will be filled back once the coal has been extracted. Under its environmental management plan and the best industrial practices followed globally, SECMC plans to plant hundreds of thousands of indigenous trees to maintain the natural ecosystem of the desert. The company will incorporate wind and water erosion control measures, inclusive of dune management where necessary, in project design. It has also explored bio-saline agriculture as an alternative means of livelihood for the locals of Thar which will enable them to cultivate crops on saline land using advanced farming technique'
  19. ^ Sindh Engro Coal Mining Company (30 December 2014). "PETITION FOR REFERENCE COAL TARIFF DETERMINATION FOR CONTRACT STAGE TARIFF" (PDF). Thar Coal and Energy Board. Retrieved 14 March 2016.
  20. ^ Shaikh, Shamsuddin (27 February 2016). "Thar coal - separating fact from fiction". Business Recorder. Retrieved 14 March 2016. "Mining activities require pits of up to 135-meter depths to be dug. However the ecology of the desert will not be affected as these pits will be filled back once the coal has been extracted. Under its environmental management plan and the best industrial practices followed globally, SECMC plans to plant hundreds of thousands of indigenous trees to maintain the natural ecosystem of the desert. The company will incorporate wind and water erosion control measures, inclusive of dune management where necessary, in project design. It has also explored bio-saline agriculture as an alternative means of livelihood for the locals of Thar which will enable them to cultivate crops on saline land using advanced farming technique'
  21. ^ Shaikh, Shamsuddin (27 February 2016). "Thar coal - separating fact from fiction". Business Recorder. Retrieved 14 March 2016. " Over the next few months, the Project will require unskilled manpower of up to 3000 people - all of whom will be Tharis. Moreover, there will be great prospects for skilled manpower required in the Project - up to 1,400 people will be needed for skills such as mine truck drivers, shovel/excavator operators, technicians, mechanics, masons etc'
  22. ^ Shaikh, Shamsuddin (27 February 2016). "Thar coal - separating fact from fiction". Business Recorder. Retrieved 14 March 2016. " Over the next few months, the Project will require unskilled manpower of up to 3000 people - all of whom will be Tharis. Moreover, there will be great prospects for skilled manpower required in the Project - up to 1,400 people will be needed for skills such as mine truck drivers, shovel/excavator operators, technicians, mechanics, masons etc'

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