MIRPUR (June 03 2010): An integrated plan was being evolved soon to make the country self sufficient in natural gas production, official sources said. The sources told APP here on Wednesday that the government had chalked out a comprehensive policy to provide natural gas to maximum population across the country including Azad Jammu and Kashmir (AJK).

The government had already launched several projects to extend gas facility to the masses through pipelines and in the form of LPG, the sources added. "Pakistan is blessed with world's biggest stocks of coal in Sindh and these coal resources are proposed to be utilised for the production of gas under a gigantic plan," the sources said, adding, according to the plan, small stations of gas production, using coal, would be installed at different places to supply gas primarily to remote and far flung areas of the country through compressor units. A similar project is also proposed to be launched in AJK soon, the sources said.

ISLAMABAD (June 03 2010): Statoil Company Norway delegation comprised three senior executives visited Oil & Gas Development Company Limited (OGDCL) on the special invitation of OGDCL Shah Mehboob Alam MD/CEO to explore further possibilities to discover hydrocarbon resources jointly in Pakistan from May 31 to June 2, 2010.

Statoil Company Norway is among the ten top E&P companies in the world and working at present in 40 countries world-wide showed interest to invest in E&P sector of Pakistan. The delegation was given detailed briefing about various sectors including Geophysics and Geological studies/structure presence of hydrocarbon resources and energy requirements of the country.

MD/CEO OGDCL assured the delegation to extend all possible co-operation and coordination for joint venture activities to enhance hydrocarbon resources base in the country.

The delegation met Kamran Lashari Secretary Petroleum and Natural Resources along with MD OGDCL. Lashari also gave assurance that the Ministry would welcome the interest of Statoil Company for investment and exploration activities in Pakistan. Thereafter the delegation had a meeting with Naeem Malik Director General Petroleum Concession (DGPC) for detailed discussion and future prospects of E&P activities in this part of the world. The delegation also visited the officials of Chamber of Commerce of Islamabad and Overseas Investment Ministry, where they had detailed discussion of mutual interest with Saleem H. Mandviwalla, PM's Advisor for investment. The delegation will leave Pakistan for Norway on June 3.-PR

ISLAMABAD (June 10 2010): The government is working on a proposal to initiate project '100 MMCFD synthetic natural gas (SNG)'-a product of LPG air mix-with the objective of supplying it to Pakistan Electric Power Company (Pepco) and Karachi Electric Supply Company (KESC) at Bin Qasim to overcome peak load sheddingm, especially during winter, Business Recorder has learnt.

Under the project, proposed by Pepco, 100 MMCFD SNG will be inducted into a system of Sui Southern Gas Company Limited (SSGC) for supplying it to power plants. The work on this proposal is underway keeping in view the gas shortage for power plants and
high price of HSFO. "The SNG price is higher than HSFO but less than the price of LSFO and diesel," sources said.

Earlier, SSGC, with the support of Petroleum Ministry, had initiated work on '100 mmcfd synthetic natural gas (SNG) project', which was shelved after Pakistan Research and Development Foundation (PRDF) termed co-mingling of SNG with natural gas (NG) unfeasible. "But now the government wants to try experience of LPG air mix to produce SNG for power plants, sources added.

Pepco said that an exercise is being carried out to use liquefied natural gas (LNG) in Karachi at Bin Qasim Power Plant and allow Swap of an equivalent quantity of MMBTU for use in Pepco power plants in the north. "Use of SNG at Bin Qasim Power Plants (BQPS) shall ensure, as per Pepco's calculation, that the per unit generation cost on Swap gas at Muzaffargarh Thermal Power Station is slightly higher than the per unit generation cost on SNG at KESC Bin Qasim," Pepco said.

Pepco is of the view that natural gas is the fuel of choice for Pepco power plants due to its cleanliness and low cost. The existing gas supplies are not enough and high priced HSFO, LSFO, and diesel fuels have to be used. "This shortfall can, however, be met with supply of an adequate quantity of SNG through imported LPG," Pepco in its proposal
said, adding that SNG can be made available in 6 to 7 months. After the bidding process is completed, SNG can be assured for 5 to 7 years till alternative sources like LNG/import of natural gas from Iran, etc may become a reality.

ISLAMABAD (June 13 2010): The Trans-Asia Refinery has planned to set up an oil refinery at Port Qasim, Karachi, at an estimated cost of $450 million, to meet the domestic requirements of petroleum products. The Hascombe Pvt Limited has also expressed intention to establish an oil storage facility, of 6500 tons, at Shikarpur at an estimated cost of Rs 350 million.

According to Annual Plan 2010-11, Coastal Refinery Ltd (CRL) and Bosicor Oil Pakistan Limited (BOPL) intend to set up Single Buoy Mooring System Offshore Oil loading/unloading facility near Hub Coastal line, at an estimated cost of $30 million.

An allocation of Rs 2.6 billion has been indicated during 2010-11 for the fuel sector, excluding the non-budgetary corporations, in the 10th five-year plan 2010-15. During 2010-11, the crude oil production is planned to be 88726 barrels per day against estimated production of 65,500 barrel per day in on-going financial year.

Gas production is planned at 4065 MMCFD against the estimated production of 4000 MMCFD in 2009-10. Coal production target is 4.5 million tons, against the estimated production of 3.5 million tons in 2009-10. Development activities on the blocks already explored at Thar and being allocated to different companies by the government of Sindh will continue during 2010-11. The work on underground coal gasification project at block No 5 will also continue.

An allocation (revised) of Rs 859 million was made for fuel sector during 2009-10 excluding non-budgetary corporations programme. During 2009-10, crude oil production is estimated to be 65500 barrels per day (BPD) against the target of 70,000 BPD showing an achievement of 94 percent, while gas production is expected to be 4000 MMCFD against the target of 4100 MMCFD showing an achievement of 98 percent. Indigenous coal production is expected to be 3.5 million tons against the target of 4.5 million showing 68 percent achievement. A total of 75 wells are expected to be drilled against target of 100 wells.

The Petroleum Policy 2009 has been approved to accelerate the exploration and production activities by encouraging the foreign investment. In the new policy, the factor of the biddable gas price gradient having a weightage of 20 percent has been eliminated.

Now the bids will be evaluated on the basis of work programme with related financial commitment on work units. The work on National Coal Policy is also underway.

The technical standards regarding oil transportation (pipelines) petroleum industry (retail outlets, depots for storage of petroleum products, road transport vehicles, containers and equipment used for the transportation of petroleum products) and oil refineries have been notified by Ogra. Ogra has issued four new tube oil blending/reclamation plant licenses.

ISLAMABAD (June 14 2010): Ministry of Petroleum and Natural Resources has proposed to Finance Minister Dr Abdul Hafeez Sheikh to award the multibillion dollar Mashal LNG project to Dutch company '4Gas' in integrated structure following the directives of Supreme Court of Pakistan, Business Recorder has learnt.

As per the Supreme Court order dated 28 April 2010, the project structure will be integrated and 4Gas will be the Integrated Developer of Mashal LNG project.

Earlier, Economic Co-ordination Committee (ECC) of the cabinet allowed Petroleum Ministry to ink a $25 billion LNG deal with French firm GDF which was annulled by the Supreme Court after observing some procedural violations.

"After consultation with Finance Minister, Petroleum Ministry has decided to move ECC for award of contract to '4Gas' in integrated structure," sources said adding that it would be recommended to the ECC to approve 4Gas as an integrated developer for Pakistan Mashal LNG Project, which would be responsible for procurement and transportation of LNG, setting up and operation of an FSRU based terminal, unloading, storage, regasification and supplying regasified LNG (RLNG) to SSGC / SNGPL as per the agreed terms and conditions.

4Gas has offered maximum indicative terminal tariff of US $0.5 per mmbtu to be firmed up after EPC award, on finalisation of FSRU time charter agreement and placing order for major equipment. According to terms and conditions: (i) terminal capacity will be 3.5 mtpa (minimum); (ii) terminal location at Khiprianwala-Port Qasim Karachi; (iii) first gas by Q1 of 2012; (iv) As per ECC approved Letter Of Support (LoS), government of Pakistan (GOP) shall enter into an Implementation Agreement with 4Gas and GOP Guarantee for SSGC's payment obligation will be available; (v) 4Gas to finalise the project timeline within two weeks of the award to meet the project completion date mentioned above; (vi) 4Gas to submit performance bond as per RFP requirements; (vii) after the award of PMLP to 4Gas as an Integrated Developer, 4Gas will enter into formal/final negotiations with the LNG suppliers and submit documentations for review by SSGC/Consultant and the approval of GOP; and (viii) 4Gas to fulfil the requirements of PQA and execute an implementation agreement with the Port Authority.

In September 2009, a Price Negotiation Committee (PNC) was appointed by Ministry of Petroleum comprising of Special Secretary-MPNR (Head), Member Energy-Planning Commission (Member) and Additional Secretary-MoF (Member) to negotiate LNG supplies with Shell.

As some of the suppliers were reluctant to supply to 4Gas and preferred supplying directly to GOP/SSGC, therefore, the PNC negotiations was based on an unbundled approach rather than Integrated as approved earlier by ECC of the Cabinet in February 2007.

Long/medium term volumes offered ranges from 0.5 to 3.5 mtpa DES and were based on the Pricing Mechanism generally followed in the Asia Pacific region. 4Gas offer was for a Conventional Land based terminal of 3.5 mtpa capacity with an early supply option utilising the FSRU till completion of onshore storage and regasification facility. Keeping in view the requirement of gas by end 2011 and to lower the terminal tariff, it was decided to continue with the FSRU based solution for a period of 5 years or more.

Requirement and design capacity of a conventional land based terminal shall be established after two to three years of operation of floating type. The maximum indicative tariff offered by 4Gas is US $0.5/mmbtu. Channel widening and dredging activities required to be carried out by PQA on fast track to meet the PMLP timeline.

KARACHI (June 15 2010): A six-member Pakistani delegation has left for Sana'a to explore and discuss possibilities for the import LPG and LNG for Pakistan from Yemen.

According to an announcement here on Monday, Federal Advisor on Textile and Honorary Consul General of Republic of Yemen in Sindh Dr Mirza Ikhtiar Baig was leading the delegation which also included Chairman of Associated Group and Jamshoro Joint Ventures Limited (JJVL), Iqbal Z. Ahmed. The delegation will meet Yemeni Minister of Oil Amir Al-Aidarous and high officials of the Ministry of Oil to discuss proposed investment in the extraction of LPG project in Yemen for Pakistan.

KARACHI (June 22 2010): Pakistan's oil products imports have significantly increased by 34 percent to the highest-ever monthly import level of 1.4 million tons in the May 2010 as compared to average monthly imports of 1 million tons so far in the current fiscal year. "The major reason behind this increase is declining production of local oil refineries amid growing circular debt situation," Farhan Mahmood, an analyst at Topline Securities said.

And as a result of this the import of crude oil in May declined to 0.5 million tons compared to average monthly import of 0.6 million tons during the current fiscal year, he added. He said an alarming development for Pakistan's overall balance of payments is the growing reliance on imported oil products.

At a time when current account deficit has reduced close to 2 percent of GDP in FY10, this rising trend of oil import can be a challenge for the government next year when the uncertainty of new IMF loan is still there, he mentioned. In May 2010, oil marketing companies imported 1.4 million tons of oil products which were the highest monthly imports ever witnessed by the country, he said. Due to circular debt crisis, the local refineries are producing less than their capacity.

The total oil products imports stood at 11.2 million tons during 11 months of FY10, as compared to 8.9 million tons during same period last year, up 26 percent. This increase is primarily driven by furnace oil imports, which stood higher by 30 percent on year-onyear basis to 6 million tons. On the other hand, import of crude oil declined by 15 percent in the same period causing total imports to increase by 8 percent to reach 17.3 million tons in the 11 months of FY10.

Import of FO, major fuel for electricity generation in Pakistan, stood at record 0.75 million tons in May 2010. Due to rising FO demand in the country by thermal power plants and restrictive local refinery capacity, imports of FO is consistently increasing.

During 11 months of FY10, total imports of FO stood at 6 million tons against 4.6 million tons last year. During this period, FO demand in the country stood at 8.4 million tons.

The figures show that 71 percent of the FO demand is met through imports as compared to 63 percent last year. Similarly, import of petrol in May stood at record 0.1 million tons compared to average monthly imports of 0.05 million tons during current fiscal year. This is mainly due to higher petrol demand amid CNG shortage.

He said circular debt is the major reason behind declining refinery production. Due to liquidity shortage, refineries' demand for crude oil is reduced. The figures show that refineries imported only 6 million tons during 11 months of FY10 as compared to 7.1 million tons, 15 percent lower intake than last year.

In May 2010, crude oil imports stood at 0.5 million tons, the lowest monthly imports in last 18 months, he said, adding that Pakistan refineries meet 73 percent of the crude requirement through imports due to lower indigenous oil production.

He said the two big oil refinery plants are expected to be commissioned in 6-18 months with combined processing capacity of 220,000 barrels per day, more than 80 percent of the country's existing refinery capacity. These are BYCO's 120,000 barrels per day and TransAsia's 100,000 barrels per day processing plants. "We believe that for refinery operations to be viable, the issue of circular debt needs to be resolved," he said.

"Moreover, refinery margins should remain protected via deemed duty, otherwise we might see lower refinery utilisation by upcoming refineries thus putting pressure on Pakistan fragile external account," he added.

QUETTA (June 23 2010): Provincial Finance Minister Asim Kurd Gailo on Tuesday said that after installation of refining plant at Rekodeq, the project would generate over Rs 45 billion income for Balochistan. Addressing the post-budget briefing at Civil Secretariat here, he said that Rs 1 billion has been allocated in annual Balochistan Budget for Fiscal Year 2010-11 for installation of a refinery at Rekodeq to refine gold, silver and copper, being explored at Rekodeq and Saindak.

He said that presently gold, silver and copper of Rekodeq and Saindak was shifted to China for refining and later the Chinese government gave some part of it to Pakistan, after taking its share. He said that total Rs 4 billion would be incurred on installation of refinery at Rekodeq, for which Rs 2 billion would be earmarked in Balochistan Budget 2011-12 and Rs 1 billion in the third year.

He recalled that noted atomic scientist Dr Samarmand Mubarak during two meetings with the Balochistan government's stakeholders had assured that installation of refinery at Rekodeq would help in generating Rs 45 billion for Balochistan annually.

He said that installation of refinery at Rekodeq would also create 15,000 jobs, helping in resolving unemployment issue. He said that Rs 12 billion was allocated for establishment of Balochistan Board of Investment which, after consultation and recommendations of experts, would invest in certain sectors.

He said the Balochistan government had disliked the idea of handing over control of Gwadar Port to Singapore government and had conveyed its feelings to the federal government. The provincial government will like to run the port. He hoped that a functional Gwadar Port would provide big revenue to the provincial government.

He highlighted that it was the first time in the history that Balochistan got its due share in the National Finance Commission Award and natural resources. He noted that achievement of such share helped the provincial government to raise salaries of police, Balochistan Constabulary and Levies Force by 100 percent and of other employees by 50 percent besides enhancement in medical allowance by 15 percent. He claimed that earlier, in the past no Balochistan government could raise salaries of the employees by 15 percent. He said that Rs 12 billion was allocated in new budget for law and order against allocation of Rs 6 billion in last year. He added that Rs 200 million was earmarked for the
payment to the Frontier Corps Balochistan for helping in maintaining law and order in the province.

He said that huge funds had been allocated in new budget for creation of over 5800 posts, adding that already 5000 posts were being filled under Aghaz-e-Haqooq-e-Balochistan Package. He said that over 6600 other posts were lying vacant at the provincial departments while the federal government had promised to take 5000 youths in federal posts from Balochistan, adding that such process would help provision of jobs to over 20,000 youths.

He said that due to raise in salaries, the Balochistan government would bear Rs 17 billion additional expenditures. He added that non-development expenditures had surged to Rs 83 billion from Rs 53 billion. He said that in new budget, Rs 30 million was allocated for development schemes to be identified by every MPA. He recalled that last year such amount was Rs 50 million for every MPA. He said the efforts were being made to curb corruption. He recalled that in the past, percentage (lion's share) in government contracts was by 24 percent which had been reduced to 12 percent.

He denied giving comments on secret fund of the Chief Minister. He also avoided commenting on purchase of costly vehicles for ministers and officials and additional expenditures of CM Secretariat and Ministers' offices. He said that Rs 7.1 billion deficit of the new budget would be bridged through revenue collection and savings in expenditures on development schemes.

Responding to a question, he said the Balochistan government would not follow Sasti Roti Scheme as launched by the Punjab government. He said that Balochistan culture did not allow launching such schemes, adding that in his view such schemes would amount to turn people into beggers. He said that last year Rs 100 million was paid as compensation to families whose beloved ones were killed in target killing.

ISLAMABAD (June 24 2010): The British Foreign Secretary, William Hague, has said that Britain's new government would provide 665 million pounds sterling to Pakistan in assistance for the next four years. He stated this at a joint press conference with Pakistani counterpart Shah Mehmood Qureshi here during his three-day official visit to Pakistan after assuming charge as Foreign Secretary.

Earlier, the two had held a meeting reviewing the bilateral relations and exchanging views on regional and international issues of mutual interest. Out of this assistance, he said, 200 million pounds would be provided for education sector and 50 million pounds to terrorism-hit areas, and the remaining would be spent in other areas. He said that Pakistan is a sovereign country and UK has no objection on the recent Iran-Pakistan gas pipeline agreement. The British Foreign Secretary said that the new government wanted to strengthen bilateral relations with Pakistan in all fields.

He added that the UK desires to build a long-term strategic partnership with Pakistan and wants to strengthen the existing bilateral ties further. William underlined that there is vast potential of improvement and broadening of bilateral relations between the two countries.

Foreign Minister Shah Mehmood Qureshi said that the two sides decided to carry forward the relations and expand them in diverse fields. He said that both sides also discussed bilateral issues, especially the difficulties being faced by Pakistani citizens in issuance of visas. On Pakistan's role in the war on terror, the British Secretary praised the sacrifices and the resilience shown by the Pakistani people in fighting extremism and terrorism.

"I respect and salute the commitment of Pakistan in fighting extremism and terrorism and the significant sacrifices rendered by Pakistan," he added. The UK Foreign Secretary said that the new government is working on building strong relations with many countries, and India is one of them, and the UK wishes to strengthen its economic and cultural ties with India as well. However, he said, such relations would not affect the ties between Pakistan and the UK.

About the recent UN sanctions imposed on Iran, Hague said that UK supports the UN General Assembly resolution and other additional measures aimed at pressurising Iran to shun its nuclear program. About US proposed strategy pertaining to withdrawal of the ISAF forces from Afghanistan in 2011, he said that his government would favour staying
of the international forces in Afghanistan until its own forces are capable in handling the situation.

Qureshi said that Pakistan needed energy for power generation and was working on multi-pronged strategy to address the shortfall, with the assistance of Friends of Democratic Pakistan, the EU and China. However, he said, Pakistan is a responsible country, and would respect the international obligations while dealing with the energy related issues. Regarding the recent dossier handed over to Pakistan by India, Qureshi said that Pakistan has raised some questions pertaining to the Mumbai attack, and India has given some information in this regard.

ISLAMABAD (June 24 2010): Pakistan and Iran on Wednesday reiterated their commitment to execute the Iran-Pakistan (IP) gas pipeline and power trade projects with the remarks that both projects are in the best interests of both brotherly countries.

Pakistan is repeating its stance that it will not back out from the gas pipeline project despite pressure from Washington, which is engaged in strategic dialogue with Islamabad.

Official sources confirmed that Iranian Ambassador to Pakistan, Mashallah Shakeri, and Minister for Water and Power, Pervaiz Ashraf, discussed progress on the two projects at a meeting in the Parliament House. The issues pertaining to import of 1000 MW power from Iran to Pakistan and enhancement in power from 35 MW to 100 MW for Gwadar came under discussion during the meeting. According to sources, some issues are unresolved so far with regard to import of 1000 MW electricity.

The Minister for Water and Power, along with a team, will visit Tehran in August to resolve the issues with the Iranian leadership. After the visit of Pervaiz Ashraf, an official delegation, comprising technical experts, will reach Tehran to discuss the technical aspects of the project, including tariff and cost. This would be reciprocated by the Iranian side. National Engineering Pakistan (Nespak) has already finalised feasibility study report of the project, whereas Iran is yet to complete its work.

The Iranian Ambassador briefed the Minister on the recent developments on import of power project and informed him about the current status of transmission line from Iran to Gwadar. Both the Minister and the Ambassador agreed to further expedite the project.

They also agreed that delegation of technical experts from both sides would visit each other's country. The Ambassador stated that Iran is also keen to establish Iran-Pakistan- Turkey rail link. The proposed rail project will further boost bilateral relations with Iran.

The Minister replied that Pakistan would fully support the project, as it would enhance regional co-operation.

ISLAMABAD (June 28 2010): Iran-Pakistan (IP) Gas Pipeline Project has the potential to transform Pakistan into an Asian Tiger. It can also help resolve the water dispute with India, said Pakistan Economy Watch (PEW) on Sunday.

IP gas project will not boost Iran's economy and influence to a level that is unaccepted by United States (US). Tehran will never emerge as a monopolistic supplier; it is not a wildcard in the hands of Ahmadinejad.

Americans are opposing the project as they have perceived the project as a threat to their monopoly in the region but have failed to offer any alternative, said Dr Murtaza Mughal, President PEW in a press statement here. Washington needs to understand that benefits of a co-operative strategy are always better than the dividends of a non-co-operative one.

Persistent opposition can supplement anti-American feelings among Pakistanis, he warned.

For Pakistan, IP can boost its relations with China and would help resolve the water issue with India, as New Delhi might not be able to ignore this source of energy for long. A gas-for-water deal can emerge as a believable confidence-building measure, he noted."We need this gas, as our economy is under stress and it cannot absorb the shocks of
wide swings in energy prices, having serious repercussions". Mughal said Pakistan has limited ability to develop indigenous resources in the short run without compromising other critically important sectors.

Our policymakers have not developed resources that can keep pace with economic expansion, resulting in great energy demand-supply gap which Iran gas can help subside.

It is an economic issue for us but the US views it as a political issue that has delayed the project since 1990 when the world's second largest producer proposed sale of part of 974 trillion cubic feet gas, he said. US should stop efforts to deprive Pakistanis of their legitimate right.

IMonday, June 07, 2010

ISLAMABAD: Pakistan leaves behind Argentina to top the countries running the highest number of vehicles on compressed natural gas (CNG) and also having the highest number of CNG refuelling stations.

Already, the government, in its Economic Survey 2009-10, has noted that Pakistan has topped the list of countries where the highest number of vehicles are being run on CNG.

However, experts believe the trend may receive a setback after a massive hike in the CNG charges, announced by the government in the budget for 2010-11, presented on Saturday.

The International Association of Natural Gas Vehicles (IANGV), in its study, has noted that Pakistan has the world’s highest number of CNG-run vehicles, leaving behind Argentina and Brazil, which led this phenomenon for many years.

A senior official at the Ministry of Environment welcomed the healthy trend in the wake of alarming pollution levels in many major cities in recent years, using POL products other than CNG.

“The increase in CNG rate is not my subject but, of course, this may discourage its use to a great extent,” he said in response to a question about unexpected hike in its price. The survey said by end of 2009, the number of CNG-run vehicles had gone up to over 2.4 million, whereas the number of CNG stations stood at 3,105.

The total number of vehicles, excluding hundreds of thousands of rickshaws and motorbikes, across Pakistan is now 5.67 million. Despite the fact that almost half of the vehicles are being run on CNG, air pollution continues to be a major concern. Lahore leads as the most polluted city, followed by Islamabad, the only properly planned city.

Peshawar stands at No 3 regarding air pollution while Karachi comes at No 04, the survey pointed out. Soaring prices of both petrol and diesel, which are amongst the highest in the region, left many people with no other option but to opt for CNG and in less than two years, the number of CNG-fitted vehicles jumped to over 2.47 million, which according to IANGV was 2 million in December 2008.

Islamabad—Ministry of Petroleum and Natural Resources Friday signed exploration licenses and petroleum concession agreements for five blocks with minimum financial work commitment of US $ 18.65 million, spread over 12343.35 sq.kms. The agreements were signed with Dewan Petroleum Limited by Kamran Lashari, Secretary Petroleum and Natural Resources, Mohammad Naeem Malik, Director General Petroleum Concessions, Dewan Zia Ur Rehman Farooqui, Chairman, Dewan Petroleum Limited.

Minister for Petroleum and Natural Resources Syed Naveed Qamar was also present. The five blocks for which the exploration licenses petroleum concession agreements were executed include Blocks No. 2869-14 (Kalchas South), 2872-1 (Noor South), 2871-3 (Rukanpur), 2771-2 (Khangarh) and 2871-2 (Yazman) with Dewan Petroleum (Pvt.) Limited (DPL). Talking to media persons, the minister said it was priority of the government to promote self-dependency culture and efforts were underway to exploit local resources to meet energy needs.

He said that local companies would have to take lead to carry out exploration work in view of security situations in certain areas. He said that the government was also signing agreements with other countries to meet energy needs and the IP project finalized recently with Iran was part of such efforts.

He said that majority production of oil and gas was from Sindh but now major discoveries had also been made in the Khyber Pakhtunkhwa. Replying to a question about circular debit, the minister said it had affected not only this sector rather the country’s economy, therefore a meeting was held with the prime minister recently in this regard. He said that Rs 41 billion was being released by end of the current month to clear the Pakistan State Oil’s (PSO) liabilities. Replying to another question, he said the Liquified Petroleum Gas (LPG) was a deregulated fuel but the Oil and Gas Regulatory Authority(OGRA) could intervene when its prices hit a specific level. Earlier, the secretary said it was day of happiness seeing such projects were coming up for exploration of indigenous resources to meet energy requirements. He added that a total of 28 companies including 17 foreign were working in the country, adding that progress had been expedited and the ministry signed 31 exploration licenses during six months while in last ten years its average was ranging from 8 to 9 licenses.

Rukanpur, Khangarh and Yazman blocks are mainly located in District Bahawalpur. Noor South block is mainly located in District Bhawalnagar. These four blocks are in Punjab Province. Kalchas South block is mainly located in District Dera Bugti, Balochistan. The DPL is a local petroleum exploration and production company. DPL is the operator of one exploration block namely Safed Koh in District Dera Ghazi Khan and one D&P Lease namely Radho (Salsabil) which is producing 22.37 MMCF gas and 146.96 Barrels of oil per day.

ISLAMABAD (June 01 2010): The government is to approach the Asian Development Bank (ADB) to seek financing for Thar coal power project, sources in PPIB told Business Recorder.

Pakistan faces continuous energy deficit, which with the passage of time, is leading to economic slowdown. The energy deficit has particularly hampered the growth of industrial sector, causing contraction in job creation and rise in unemployment. The lignite coal reserves of Pakistan are abundant and would provide a least-cost alternative to other fuel resources presently available.

By utilizing only 30 percent of the estimated 175 billion tons of Thar coal the energy needs of the country can sufficiently be met for decades. So far, within Pakistan's energy portfolio, natural gas and oil dominate with insignificant contribution of coal towards power generation.

In a balanced national energy mix that the government intends to achieve in the next five-year plan, the coal-based power generation would increase energy security and financial stability. It will mitigate the country's exposure to volatile global energy prices which have damaged the balance of payments in recent years. It will also provide low-cost base-load electricity to the national grid to both help fill the power gap and moderate the seasonality of hydro power generation.

Coal development will also re-balance national energy portfolio by bridging the fuel supply gaps and improving the prospects for sustainability in power sector. Sources said that recent deliberations with the World Bank's Regional Head of Energy, Raghu Sharma, led to the Ministry of Water and Power's decision to prepare a case for coal to play a major role as least-cost option in future energy plans of the country.

"Sindh government would like to be involved in preparing a successful case to approach multilateral agencies, such as the ADB, for seeking international funding for development of coal power projects," sources quoted TCEB Managing Director Ajaz Ali Khan as saying in a letter to the federal government.

KARACHI (June 01 2010): Secretary Sindh Board of Investment (SBI), Muhammad Younis Dagha said the investment of $1.6 billion by the private companies on the projects to generate electricity from the wind at district Thatta, is a clear manifestation about confidence of the investors on the government.

The Secretary SBI was speaking at a meeting of those companies which are working on the projects to generate electricity from wind at the Wind Corridor of Sindh, Jhampir in district Thatta held at his office on Monday. Chief Executive Officer (CEO), Alternate Energy Board, Arif Alluddin, District Co-ordination Officer (DCO), Thatta Manzoor Sheikh, SP Investigation Thatta, Imdad Shah and other notables were also present.

Dagha said the investment in the wind energy projects is also proof of the fact that government is serious to cope with the energy crisis. It also speaks about determination of the government that serious steps are being taken for the promotion of favourable investment, he added.

The officials as well as representatives of those companies, which are working on the wind energy projects, including China International Water and Electric Corporation, Turkish Company "Zorlu Energy", Fauji Fertiliser company, Sachal Energy, Lucky Energy, Sapphire Energy, HOM Energy, Gul Ahmed Energy, Metro Energy, Master Energy and Wind Eagle were also present. Each of the company is working on project to generate 50MW electricity from the wind while on completion of the projects total 600MW of electricity will be available.

Speaking on the occasion, the representatives of the companies apprised the Secretary SBI about their problems. The SBI Secretary said the government would provide all necessary facilities for the wind energy projects.

The meeting decided the Alternate Energy Development Board would set up its camp office at Jhampir to facilitate the companies working on the wind energy projects. It was also decided the companies would also provide prior information about their requirements to the DCO Thatta so that steps could be taken accordingly.-PR.

PESHAWAR (June 05 2010): The village electrification plan and extension of existing distribution system is smoothly moving ahead and so far 168 schemes have been completed out of total 700 schemes, costing Rs 1.147 million. This was disclosed during a presentation given to Governor Khyber Pakhtunkhwa Owais Ahmed Ghani at the Governor's House here on Friday.

Chief Executive officer, Tribal Areas Electricity Supply Company (TESCO) Abdul Rashid Khan Gandapur delivered the presentation in which he elaborated the existing power distribution system and development activities besides the future plan to augment the system on sound and perfect footings.

Highlighting the existing facilities, he said that currently 19 grid stations of 132 KV and 15 of 66 KV were providing electricity to FATA with 800 MVA installed capacity and 652 MW recorded load through as many as 24 thousand transformers. The current number of consumers in FATA is 352292 including 311666 domestic and 28086 commercial consumers.

The Governor was told that Rs 650 million had been incurred on power sector development during the current fiscal. Around Rs 335 million is being spent on different other projects including 132 KV Marble City grid station in Mohmand Agency besides installation of additional power transformers in the existing 132 KV grid stations in Mir Ali, Parachinar, Bara and Miranshah.

It was further stated that the Prime Minister had recently approved additional funds worth Rs 334 million for four new grid stations at Kuraiz, Khar, Datta Khel and Darra Adam Khel and installation of additional transformer at Sadda grid station. The Chief Executive TESCO informed the Governor that loadshedding schedule was vigorously followed in FATA as well and the tribesmen were extending full co-operation in this regard.

The Governor said that the electricity system in FATA needed to be further improved and said that the distribution system should be planned so that FATA could be supplied uninterrupted electricity through alternate lines in case of fault or breakdown. He also laid stress on materialising the Jamrud grid station project and directed that the political administration of Khyber Agency should accelerate the process of acquisition of land. The Governor urged that power distribution system must be strengthened to cope with the future requirements.

The Governor was also briefed on proposals regarding tentative power supply development plan for FATA, envisaging construction of at least 27 grid stations and 940 KM transmission lines over the next ten years. The plan would cost Rs 10 billion. The Governor appreciated the proposal and hoped to make efforts for required funding.

FAISALABAD (June 07 2010): On the motivation of City District Government (CDG), a pioneer test project of solar energy for street lighting in specific areas, with the financial co-operation of local traders and merchants. This was disclosed by DCO Saeed Wahlah while presiding over a meeting held here to discuss the importance and feasibility of solar energy project.

The meeting was attended by EDO(Municipal Services) Liaqat Chatta, EDO Finance Syed Arshad Hussain, Secretary Anjuman Tajran Chaudhry Mahmood Alam Jatt, local traders Zafar Sindhu, Muhammad Zahid Mehmood, Masood Ahmad Butt and others.

The DCO said that being second biggest city of the Punjab province, Faisalabad has its own significance and importance in terms with the progress and development. He said that the City District Government desired to promote solar energy for lightening important roads, commercial areas, parks and other necessary places as solar energy system is considerably cost_ effective as compared to the traditional electricity as claimed by the company engaged in this business.

After detail deliberation it was decided at a meeting that the a poineer test project of solar energy would be set up on the streetlights of D ground to Satiana road green belt and first of all two solar lights would be installed immediately on trial basis, afterwards these solar energy would be installed on 30 poles as agreed by the local traders.

ISLAMABAD (June 09 2010): A three-member German delegation called on the Federal Minister for Water and Power, Raja Pervez Ashraf here on Tuesday and discussed matters related to energy through coal gasification, mining and plant technology. The delegation headed by Lothar Jungemann of Uhde Group expressed their interest in coal power generation through coal gasification and gave a detailed briefing to the meeting on their plan.

He stated that their company has an expertise of coal gasification with environment friendly state of the art technology. The Minister assured that the government will facilitate the company and asked to submit a concrete and detailed plan for this proposed project. He said that the government will also work out possibility of joint venture with German company on the project.

The Minister said that Thar region has rich deposits of coal in Sindh and have 9 blocks, adding that the government is taking steps to exploit the coal reserves in Sindh and some companies are working there in this regard. Thar coal energy board has also been established to generate power for our future needs.-PR

PESHAWAR (June 09 2010): In order to overcome the heightened energy shortage in the Federally Administered Tribal Areas, the government of Pakistan has mandated FATA Development Authority (FDA) to explore and implement alternative modes of power generation. These alternative models of power generation would be utilised in some of the remotest areas of the country where the installation and maintenance of electricity supply from the national grid could get really expensive.

Subsequently, in a strategic level meeting of the Authority, it was proposed to investigate the possibilities of exploiting solar power as a potential energy resource due to the practicability of reasons ranging from abundant availability to cost competitiveness.

On priority basis, the FDA took up the first phase of "provision of solar energy to villages in FATA" project in April 2009 at an estimated cost of Rs 190.00 Million to initiate detailed feasibility studies of alternative energy resources for 450 villages in FATA.

An official of the Directorate of Information FATA, while describing the importance of these energy development arrangements, said that power generation was extremely essential to the entire region's progress for it fuelled the machinery that drove the economy. "Like other parts of the country, the exploitation of alternative energy resources also carries primary importance in FATA because energy is at the heart of most critical socio-economic developmental issues faced by the people of FATA today amid all efforts to reclaim stability through progress", he added.

Being a specialised field of study, it was essential to partner with a research and development outfit having the competence and experience in the fields of renewable/alternative energy technology development and implementation. NUST Consulting, a semi-autonomous subsidiary of the National University of Science and Technology, became the implementing partner to launch the project marked by ingenuity.

The decision was taken after considering the fact that it had already worked to provide solar electrification facility in 60 villages of Khyber, Mohmand, Bajaur and Kurram Agencies.

Along with carrying out the feasibility studies of providing solar energy units to 450 villages in FATA, work on actual installation of solar electric system on 4 pilot projects is also in progress. Following the findings and recommendations of these studies, multiple high impact energy projects will be launched in a phased program throughout FATA for which meaningful efforts are already made to strike working partnerships with Alternative Energy Development Board (AEDB) and National Energy Conservation Centre (Enercon).

KARACHI (June 10 2010): Responding to growing global demand for high-efficiency power generation, General Electric (GE) has developed the world's first two-stage turbocharged gas engine and is applying this game-changing technology to its Jenbacher J624 gas engine.

The new engine provides significant output and efficiency increases compared to the single turbocharged version and is particularly well-suited for operation in hot environments and combined heat and power (CHP) applications.

It was introduced at an official product launch event held on Wednesday at GE's Jenbacher headquarters in Jenbach, Austria, which more than 35 customers and distributors attended. Representatives from the pilot customer for the first new engine, Red Harvest, a large Dutch greenhouse plant operator, also attended the event.

"We are proud to be the pilot customer for this new J624 gas engine with two-stage turbocharging," says Jaap Noordam, owner of Red Harvest. "The new engine not only provides us with higher efficiency, but also offers us higher flexibility for our CHP operations." With the new system, which GE developed with specialists from ABB Turbo Systems Ltd, the J624 achieves approximately 10 percent higher output, increasing from 4 megawatts (MW) to 4.4 MW and offers an electrical efficiency of 46.5 percent.-PR

ISLAMABAD (June 12 2010): Saleem H. Mandviwala, Minister of State/Chairman BoI urged to work on priority basis to overcome the grievous energy shortfall in the country, emphasising to deregulate the power sector to foster economy, businesses and investments. He said during a detailed session with Vince Harris CEO Hub Power Company and Honorary Investment Counsellor of BoI in United Kingdom.

The Hubco is the country's leading independent power producer (IPP). The Hub power station is one of the largest private power projects in the newly industrialised world and supplying at times up to 10 percent of the country's total electricity generation. Hubco is contributing to the country's growth by enhancing its generation capacity through new energy projects.

Vince Harris said that Pakistan's largest independent power producer Hubco is setting up a 225 MW combined cycle power plant in District Narowal, Punjab and will start supplying electricity in October 2010 to reduce the acute power shortage. He said that 84 MW Hydel Power Plant in Azad Kashmir would start functioning in 2012 to control the power dearth.

Saleem appreciated that these new power plants by Hubco reflect their desire to be a part of the solution to the burgeoning energy crisis in Pakistan. Pakistan Energy Conference is scheduled on July 17 in Karachi to address the role of energy sector to combat the current energy shortfall and planning of strategic actions to overcome this grievous problem on emergency basis. Vince said that the agenda of the conference should also to explore new investment opportunities in every sector of Pakistan.

Moreover, the Minister called for Vince to develop a suggestive plan of action to control the energy crisis and cope with future demands of the electricity. Vince being the Honorary Investment Counsellor of BOI in United Kingdom also requested to highlight the role of BOI Pakistan in the conference on Power being held by British Government in London on July 6, and assured to extend all possible assistance required to them as and when needed.-PR

ISLAMABAD (June 14 2010): Pakistan Economy Watch (PEW) on Sunday said the country could transform deserts into power capitals by using them to generate solar energy. Solar energy can also turn our badlands into lush green farms ensuring food security for upcoming generations.

Twelve EU countries are spending $560 billion to generate solar power while our budgetary allocation for promotion of alternative energy is mere Rs 61.6 million, which indicates lack of awareness and interest, said Dr Murtaza Mughal, President PEW.

Government spends around $12 billion annually on energy imports that eats up major portion of export earnings. Tens of billions are being wasted for political considerations but promotion of alternative energy, which is need of the hour, has always taken a backseat.

How can government ensure provision of electricity to over 15000 villages which are without electricity since independence, he questioned. Solar power is the only option in 7000 villages in Balochistan with 40 and above houses where electricity providers have expressed their inability on remoteness, cost and expected losses etc.

These villagers are part of 37 percent citizens having no grid connectivity. They deserve better treatment; he said adding that energy crisis could be overcome with the help of alternative energy resources.

Government should enhance visibility, improve confidence of masses as well as investors, offer tax breaks, boost financing and announce direct and indirect subsidies to promote alternative energy.

Dr Mughal said that the allocation of Alternative Energy Development Board should be corresponding to other energy sector allocations, its strength should be tripled and branch offices should be established in all provinces to secure a future for coming generations.

KARACHI (June 15 2010): Sindh government has asked Islamabad to engage Pakistan Electric Power Company (PEPCO) for establishing 1,000MW power plant at Thar coal field. Talking to Business Recorder on Monday, Zubair Motiwala, advisor to CM on investment said that Sindh government had formally requested the centre for setting up 1000MW power plant at Thar coal field.

He said that we have shown our keenness to engage PEPCO for this purpose. When questioned about the summary of 30 per cent hike in electricity tariff moved to the cabinet for approval, Motiwala said that the proposed 30 per cent hike in electricity tariff, which is aimed at reducing circular debt, would be effective in phases. He also urged the authority concerned to adopt modern techniques to plug power leakage instead of penalising consumers by increasing electricity tariff.

He further said that feasibility on ENGRO power plant, having a capacity of 590 MW, would be finalized till October 2010 and would get operational by 2015. Moreover, Motiwala said that the government could not attract substantial investments in major sectors except power sector during last year, and added that investors belonging to Germany, United States of America and Iran are only keen to invest in energy sector.

ISLAMABAD (June 15 2010): Chashma Nuclear Power Plant has been restored again after the annual repairing and gas refilling on Monday. A private news channel quoting Chashnuup sources reported that the Nuclear Power Plant of 325 MW which had been closed for the last 64 days for annual repair and gas refilling has been reopened. Pakistan's atomic experts had participated in the annual repair and gas refilling of power plant.

KARACHI (June 16 2010): Pakistan can look to Russia for assistance in overcoming its energy crisis. This was said by Russian Consul General in Karachi Andrey V Demidov at a reception hosted at the consulate to celebrate the National Day of the Russian Federation. The Russian Consul General said his country was blessed with vast energy resources and Pakistan could utilise these resources and their expertise.

He said Russia was willing to help Pakistan exploit its vast coal reserves in Balochistan and Thar. Demidov said that strengthening relations with Pakistan was his priority and Russia would continue to interact with Pakistan in resolving global issues. He said the meetings held last year between the presidents and prime ministers of both countries had helped define concrete areas of inter-action and provided a much necessary impetus and boost to Russia-Pakistan friendship.

He said the Russian-Pakistani Inter-Governmental Commission on Trade and Economics, Scientific and Technical Co-operation is expected to start functioning soon and would give practical shape to trade potential. Speaking to the media on the occasion, Founder President Pakistan Russia Business Forum Abdur Rauf Tabani said there was huge potential for economic co-operation between the two countries, which he said was very modest.

Tabani said according to his information, the present trade turnover was no more than $400 million. He said there was great potential for Pakistani textiles in the Russian market, while there was a large scale perennial demand for Pakistani leather garments and products in Russia. He said Pakistan could also supply gems and jewellery cutting technology to Russia. Similarly Pakistan could benefit from Russia in the oil and gas drilling sector.-PR

KARACHI (June 18 2010): Nishat Group and consortium Abu Dhabi Investment Council (ADIC) and City School have acquired AES Lal Pir and AES Pak Gen from AES Corporation of USA. According to a press release issued here on Thursday, AES Lal Pir and Pak Gen are based in Muzaffar Garh and were established in late 1990.

The generation capacity of these two units is 727MW using state of the art steam turbine. These plants which have been acquired are managed by an excellent and dedicated team of professionals. In this acquisition Nishat Group and Associates collectively own 50 percent of the shares whereas Abu Dhabi Investment Council which is owned by the Government of Abu Dhabi has acquired 30 percent and City School 20 percent.

With this acquisition Nishat Group has become a major energy provider within Pakistan generating over 1200MW excluding captive power and playing a significant role in supplying much needed electricity to Wapda and Pepco. This acquisition at a time when the country is under an IMF programme demonstrates foreign investment in this case from Abu Dhabi Investment Council (ADIC) can be attracted based on sound financial viability of projects undertaken within Pakistan.

Nishat Group and its consortium members are optimistic about the future of this sector in spite of the present concerns over circular debt and is totally committed to build upon and expand its generation capacity within Pakistan playing its due role to reduce the energy shortfall particularly affordable energy to Pepco for distribution.-PR

LAHORE (June 19 2010): The Punjab government has announced a subsidy of Rs two billion for installation of solar powered tube wells to improve the performance of the agricultural sector badly damaging due to prevailing energy crisis. This was stated by the Punjab Minister for Agriculture Malik Ahmad Ali Aulakh, while speaking at a meeting held in the committee room of the Punjab Assembly here on Friday.

The meeting reviewed the pace of on-going projects of agriculture, wildlife and fisheries and goals of new projects. Officers of the departments concerned gave a detailed briefing to the minister about these projects. The Punjab Minister directed the officers to devise a comprehensive strategy for ensuring effective use of budget allocated for the coming financial year.

He said that the provincial government had allocated a sum of Rs 3.2 billion for agriculture, Rs two billion for livestock and Rs one billion for forestry and fisheries sectors' development in the budget 2010-11. Aulakh further stated that Rs 709 million had also been allocated for the Punjab Agricultural Research Board to provide funds for important projects of agricultural research.

Besides this, Rs 940 million have been earmarked for infrastructure of agricultural research and salaries to the agricultural scientists. This is first time that such a huge amount has been allocated with clear goals, the Minister added. He claimed that allocation made for the improvement of research infrastructure was equal to the total budget of 2007 for agriculture. He directed the officials to ensure that benefits of development projects should reach to the common citizen. Ahmad Ali Aulakh warned that no leniency would be tolerated in this regard.

ISLAMABAD (June 19 2010): Pakistan this year expects to finalize four wind power deals worth $500 million to exploit a renewable resource that has been barely tapped in a country with a yawning gap between power capacity and demand. The country suffers chronic power cuts that inflame public anger and stifle industry, a crisis seen by analysts as a test for President Asif Ali Zardari.

Daily shortfalls are 4,500-5,000 megawatts (MW), Water and Power Ministry figures show. But the South Asian nation's coastal belt holds particular promise for wind power, with a potential of producing 50,000 megawatts, according to the US National Renewable Energy Laboratory.

Arif Alauddin, chief executive of Pakistan's Alternative Energy Development Board (AEDB), on Friday said talks were underway with six Pakistani investors to build wind farms. "We have reached a stage I can say at least four deals will be finalized this year and production would start next year," he told Reuters. "The worth of these deals will be $500 million." They would encompass four 50 MW plants with expected completion by the end of 2011, he said.

INCENTIVES, LAND AEDB is trying to boost local private investment in alternative energy by offering incentives and access to wind turbine makers and operators such as Siemens, Nordex SE, Coolwind, SWEG and General Electric. Nordex in March agreed to supply FCC Energy Ltd, a local company, with turbines for a 50 MW farm in the southern Sindh province. To attract private investors, Alauddin said the government is guaranteeing an annual rate of return of up to 18 percent and will pay power producers if the wind blows below an annual average of 7.3 metres per second.

AEDB has already allocated land for 18 independent power producers for wind power projects of 50 MW each. The US Agency for International Development has plans to help Pakistan develop wind farms to generate 300 MW by the end of 2014. "You cannot expect changes overnight. It'll take time. But we believe some 10,000 MW would be coming through wind in the next five to 10 years," Alauddin said.

AEDB is carrying out national wind mapping for possible farms in other locations such as south-western Balochistan and north-western Khyber-Pakhtunkhwa. Pakistan is also looking at solar energy as another renewable option, and the central bank is offering to finance 80 percent of local solar investments. The government has removed duty and sales taxes on solar technology imports.

Sixty-five percent of cash-strapped Pakistan's electricity comes from oil and gas and 30 percent from hydroelectric sources. An additional 5 percent comes from two nuclear plants. Out of total imports of $31.48 billion in the last 10 months, oil imports were $8.3 billion, government figures show. "We've got to turn around our energy mix. We cannot afford it," said Mohammad Khaid, director general of the state-run Pakistan Electric and Power Company (PEPCO). Pakistan aims to add at least 2,000 MW by December from seven rental power plants and one independent producer.

Copyright Reuters, 2010

KARACHI (June 19 2010): The Ministry of Water and Power (MoWP) has reportedly given a 'go-ahead' to Punjab government for the establishment of the controversial 44MW hydroelectric power plant at Chashma-Jhelum (CJ) link canal, Business Recorder learnt Friday.

Moreover, the MoWP has also instructed the Indus River Systems Authority (Irsa) to work out a plan to ensure availability of water at the Chashma-Jhelum (CJ) link canal for running the proposed power plant, according to well-placed sources. Sources said that earlier the issue seemed to be resolved and the power plant, proposed by the Punjab government, would not be built, however, the federal government, two weeks ago, had started convincing the Sindh government to agree with the project.

The Sindh authorities remained firm on their stance and refused to allow establishment of any hydroelectric power plant at CJ link canal, they added. Recently, the Irsa had arranged a briefing on the project, which was also attended by Sindh's representatives including MNAs Yusuf Talpur and Ameer Ali Shah Jamote, Sindh's member in the water body Mohammad Khan Memon and Secretary Irrigation and Power Shuja Ahmed Junejo.

Interestingly, Punjab's representative in the Irsa, who left the meeting in protest on June 10, 2010 after facing great resistance by the Sindh authorities, also returned and attended the briefing, they said. According to sources, the Sindh members had a detailed briefing and at the end they informed the meeting that it would not be possible for water-thirsty Sindh province to provide its share to Punjab for running the power plant.

Punjab government through MoWP is pressurising Sindh to provide water for the power project and Greater Thal Canal, they said and added that federal authorities had also assured that the proposed power plant would be shelved. Sources said that MoWP had recently asked the Irsa to work out a plan to ensure provision of water at the CJ link canal.

Presently, Punjab is getting more than 12,000 cusecs of water against the allocated 10,000 cusecs from Panjnad Canal and 14,000 cusecs from Taunsa against its allocation of 12,000 cusecs, they said. However, there is more than 70 percent shortage of irrigation water at Kotri Barrage, 40 percent at Guddu Barrage and 30 percent at Sukkur Barrage, due to which the agricultural lands were being badly affected.

Copyright Business Recorder, 2010

LAHORE (June 20 2010): It may invite wonders on the part of many people, but Pakistan Electric Power Company (Pepco) sources have claimed that more than 2119 megawatts (MW) electricity would be generated before June, 2011 with the completion of 13 ongoing power generation projects, including thermal, hydel, rental and others. According to sources, the ongoing projects are expected to complete in 2010-11, including Bhikki Power Project, Sheikhupura district, Punjab province with generation capacity of 209 MW and can use both gas and oil while this project is probably to be completed by September 2010. Similarly, the Khan Khwar hydropower scheme, having 72 MW power generation capacity, is likely to complete in August 2010. Sources said that the rental plant at Satiana Road (200 MW) is likely to complete by August 2010; Hubco Narowal power project (oil base) with generation capacity 214 MW will complete in September 2010; Liberty Power Tech Project, located near Faisalabad (oil and gas base) having generation capacity 195 MW is likely to complete by September 2010; Tapal Rental Power Project, Kamoki, Gujranwala (oil) having generation capacity 70 MW might complete in September 2010; Jinnah Hydropower Project Kalabagh Town District Mianwali with 96 MW is likely to complete by June 2011. Duber Khwar hydropower project with 130 MW power generation capacity is likely to complete by January 2011; Guddu Rehabilitation-I (gas base) would add 198 MW by January 2011; Zorlu Energy (wind project-I) will add 44 MW by January 2011; Nandipur Power Project 425 MW Combined Cycle Power Project is likely to complete by April 2011; and Bin Qasim Power Station (BQPS)-II (oil base) in partnership with a Chinese firm, Harbin having generation capacity 115.9 MW is likely to complete by January 2011 sources added. The work on the Diamer Bhasha Dam having total installed capacity of 4500 MW is planned to be accelerated in 2010-11 and it is located on Indus River about 315 km upstream of Tarbela Dam, 165 km downstream of the Northern Area capital Gilgit and 40 km downstream of Chilas. Sources claimed that the installed power generation capacity is expected to increase from 22176 MW in 2009-10 to 24295 MW in 2010-11. This includes 420 MW of rental plants, 1,241 MW of IPPs, 298 MW of hydropower, 44 MW of wind power and 115.9 MW from KESC. Only one project of coal gasification (100 MW) in Thar was in public sector while all others were in private sector, sources added. An allocation of Rs 125 billion has been indicated for the power sector during 2010-11 including the budgetary corporation programme (Rs 12 billion) and self-financing. The Senate standing committee on finance was informed some few days ago by Managing Director of Pepco Tahir Basharat Cheema that the government has chalked out a comprehensive, multi-billion dollars, Public Sector Power Enhancement Plan 2010-15 that would add some 10,000 MW to the system by 2015. Cheema told the committee that the plan would be finalised by this month and its recommendations would be forwarded to the government soon for implementation. He said that the list of the "US Signature Projects", projects, to be financed with the US assistance, are yet to be finalised and initiated. Giving details of projects in Balochistan, he told the committee that feasibility report on construction of 600 kilometre transmission line between Zahedan and Quetta has been completed for import of 1000 MW power from Iran. This project would cost $600 million and would be completed during next four years. He said that a technical team from Pakistan, comprising officials from Nespak has already left for Tehran to discuss the outcome of the feasibility study with Iranian counterpart agency, so that a combined plan can be prepared for execution of 1000MW power import project. Balochistan's power demand will increase from existing 850MW to 2000MW in years to come, he said.

Copyright Business Recorder, 2010

ISLAMABAD (June 22 2010): Hundreds of policymakers, energy experts, project developers and investors from around the world will gather in the Philippines this week to discuss boosting investments and technologies to advance clean energy
solutions in the Asia and Pacific region. Hosted by the Asian Development Bank (ADB), the Asia Clean Energy Forum (ACEF) is held annually to discuss technology transfer and finance in a range of areas, including energy efficiency, renewable energy, access to energy for the poor, and climate change, said ADB press release received here on Monday, adding that the forum is now in its fifth year. ADB has announced a range of initiatives to bring down barriers, such as price and policy issues, that prevent the wide-scale adoption of low-carbon and clean-energy technologies in the Asian and Pacific region.

Copyright Associated Press of Pakistan, 2010

BEIJING (June 25 2010): Chinese companies this month quietly signed a contract to cooperate in building two nuclear reactors at Pakistan's Chashma atomic complex. The China Nuclear Industry Fifth Construction Company and the CNNC China Zhongyuan Engineering Corp, which specialises in foreign nuclear projects, agreed to work together on the third and fourth plants at the Chashma complex.

According to a Chinese-language announcement on the website of the Construction Company (www.cnfc.net.cn). The deal, signed in Shanghai on June 8, confirmed that long-running plans about Chinese help in expanding Chashma are moving forward. A Pakistani government official said there was nothing new in the agreement and that it was part of an ongoing co-operation with China in the peaceful use of nuclear energy. "China has long been co-operating with Pakistan for the use of nuclear technology for peaceful purposes and this co-operation is continuing," the official said.

The pressurized water reactors are "a major co-operative project between China and Pakistan that both governments treat as highly important," said the company announcement dated the same day as the signing, which received almost no domestic media attention at the time.

The project will "bring Chinese nuclear energy to the world and is significant for once again bearing firm fruit for Sino-Pakistani friendship," said the company. It did not give any details about the timing and cost of the project. The companies have worked on earlier reactors at Chashma.

Mounting signs that China will proceed with the reactor project in Punjab have stirred international misgivings, especially in neighboring India and the United States. The United States said this month it wanted clarification from China on the proposed plants, which have been under planning and deepening negotiation for years.

NUCLEAR SUPPLIERS GROUP Pakistan and India are wary rivals, and both possess nuclear weapons and stay outside the nuclear Non-Proliferation Treaty. Islamabad has looked to Beijing to counter to Indian influence. Pakistan also faces severe power shortages. China says its nuclear co-operation with Pakistan is purely peaceful and follows international safeguards.

Copyright Reuters, 2010

ISLAMABAD (June 25 2010): Asian Energy Ventures Ltd & Associates (AEVL), a Karachi-based company has shown interest in setting up Pakistan's first naphtha based Independent Power Producer (IPP) which can start commercial operation within two years. The group is already involved in a number of power projects based on different fuels including gas, RFO as well as hydel technology.

Naphtha is an indigenous fuel and presently there is a surplus of 2 million tons per year which is exported and which may rise to about 4 million tons in the future. The World Bank has already recommended use of naphtha as a fuel for IPPs in Pakistan as it is a commonly used fuel for power generation in India and in other countries.

In a letter to the federal government the group's Executive Director, Faheem Mirza said that Asian Energy Ventures Ltd & Associates seek allocation of naphtha at Export Parity Price (EPP) on an ex refinery basis as this fuel will be used as primary fuel for an IPP to be set up under the private power policy.

IPP will bear the transportation costs from the refinery to its site on a year round 100 percent operation and the maximum quantity of naphtha required by the proposed IPP is 325,000 tons per year which amounts to one-third of the available current surplus. According to the firm naphtha production in Pakistan is expected to increase over the years with new refineries in the pipeline which implies that likelihood of non-availability of naphtha over the life of the project is almost non existent.

For the purposes of reference tariff, the petition to Nepra is proposed to be based on a reference price of naphtha at Singapore mean with an 8 percent discount. For actual calculation of fuel price component once the IPP starts commercial operations, it has been proposed that the average of Singapore mean for preceding 30 days be used with the actual price available to local refineries over the same period for export ie EPP.

The IPP is proposed to be set up as a Combined Cycle Power Plant with the proposed revised technical configuration of 2 X GE's latest state of the art LMS 100PA Gas Turbines along with 2 X HRSG and 1 X steam turbine. On this configuration, it has been assumed that the proposed IPP will have installed capacity of 240.52 MW at ISO conditions. On site conditions, this configuration is expected to generate gross power of 220.24 MW. The plant gross electric efficiency on ISO conditions is going to be over 50 percent.

Based on preliminary working and the key technical parameters, the firm is confident that the reference levelled tariff is going to be around 14.7 cents/kWh which is 4 cents/kWh cheaper than combined cycle projects which are proposed to be set up using RFO. The investors claim that despite the prevailing international financial situation as well as domestic issues, export credit agencies have shown a keen interest in providing major portion of debt required by the project.

The US Eximbank has already provided the Letter of Intent (LoI) to finance the gas turbines, which constitute the largest part of the EPC price. The Slovakian Eximbank has also shown keen interest in financing a major part of the remaining debt. The firm said based on regulatory consent for naphtha allocation and tariff approval, financial close for the project is being targeted within 6 months. The firm has requested the government to allocate 325,000 tons per year naphtha for Gulf Electric Power at EPP to AEVL.

Copyright Business Recorder, 2010

KARACHI (June 29 2010): Sindh government has decided to sign a joint venture with Al-Abbas Group for Thar Coal to set up a coal-fired power plant of 300MW-600MW, Business Recorder learnt on Monday. The decision was taken after Czech Republic expressed serious reservations on the non-serious response of Sindh government regarding Thar Coal project. But now the Czech Republic, partners of Al-Abbas Group, would invest 5oo million Euro in the project, sources have apprised.

Secretary Coal and Energy Development Department had chaired a meeting in this regard on June 26, 2010 and it was decided in principle to follow the cabinet's decision of a joint venture with Al-Abbas Group, sources said and added that it is expected that the agreement would be signed within 15 days. The joint venture of Sindh government and Al-Abbas Group would have an equity ratio of 40:60, they said.

A committee had been formed to examine and evaluate the joint venture, both in technical and financial terms, parameters and benchmarks on the basis of which proposals for other joint ventures of such nature could be approved. The project envisages generation of 600MW to 1000MW coal-based electricity and one or two percent of its profit would be used for the welfare of concerned area's residents.

Moreover, the sources said that the Sindh government had requested Czech Republic not to part ways with the Thar Coal project, and have also given assurance that no further delay would be done in getting the agreement endorsed. The official agency - Republic Export Credit Agency of the Czech Republic would provide Insurance Guarantee to the project to enable financial close.

Copyright Business Recorder, 2010

PESHAWAR (June 29 2010): Peshawar Electricity Supply Company (Pesco) will spend an amount of Rs 230 million on the purchase of power transformers for improvement in distribution system and lying of double circuit transmission line from Jamrud Grid Station to Regi Lalma Model was approved. The decision was taken in 52nd meeting of the Board of Directors (BoD) of the company held here at Wapda House, Peshawar with chairman Wing Commander Jamshed Savual (Retd) in the chair. The meeting was also attended by Chief Executive Officer Fesco Muhammad Wali, Khalid Rai, Iqtidar Hussain, Zahoor Ahmad Barlas, Board members, and Pesco's Director Public Relations Shaukat Afzal and Deputy General Manager Finance Anwar-ul-Haq Yousaf Zai also attended the meeting. Anwar-ul-Haq Yousaf Zai Secretary BoD presented a comprehensive report about the minutes of 51st BOD meeting and after detailed discussion Board of Directors approved these minutes. Board welcomed Muhammad Wali as Chief Executive Fesco and expressed the hope that Fesco will achieve in a better way under his charismatic leadership. On this occasion CEO Fesco Muhammad Wali informed BoD that immediately after he assumed the charge, he took result oriented steps which have brought betterment in company's performance and, as a result of these steps, 2 percent reduction in line losses and satisfactory improvement in recovery have been achieved in the month of May. He said that reduction in line losses and improvement in recovery are his main priorities. CEO said that we have planned 2 percent reduction in line losses and to bring recovery at 90 percent during the next year. CEO said that we have taken steps to make Fesco customer-friendly to resolve customer problems on priority and without any hurdle, soon the customers will observe remarkable and good change in Fesco working culture. BoD approved financial business plan O&M budget and 3 months investment proposal in Banks. Board also approved creation of two posts of Deputy Directors in Finance Directorate to cover financial matters in improved manner. Purchase of different kinds of conductors and transmission line towers was also approved to improve company power supply system. Fesco BoD has approved RS 230 million for the purchase of 20/26 MVA & 40 MVA power transformers to overcome overloading and low voltage complaints. Board also approved Rs 37.500 million for lying of double circuit transmission line from Jamrud Grid station to Regi Lalma Model Town. Fesco has also been assigned to electrify the remaining parts of Regi Lalma Housing Scheme due to its low cost and high performance. BoD keeping in view the over all security situation in the province, has approved risk allowance for security staff to provide relief to security personnel. Fesco BoD has approved the write off cost of different kind of transformers, which were stolen from various Sub Divisions. Board has approved submission of tariff petition for 4th quarter with Nepra for the financial year 2009-2010. Fesco Board of Directors hoped that employees would work with more devotion and spirit for the improvement of company. BoD also approved few technical and administrative matters.

Copyright Business Recorder, 2010