Thar Block VI power station
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Thar Block VI power station is a proposed 1,320-megawatt (MW) coal plant in Pakistan.
Contents
Location
The map below shows the location of Thar Block-VI, the mining area where the plant will be built in Sindh province.
Background
In November 2013, Oracle Coalfields signed a Memo of Understanding (MOU) with Chinese construction company SEPCO to develop a 600 MW coal plant at Thar coalfield Block-VI. Under the agreement, SEPCO will conduct a technical feasibility study and an environmental impact study over a six month period. SEPCO will finance up to 70 percent of the debt for the power plant and will provide enough equity funding to make it hte majority shareholder in a special purpose entity formed to own the plant.[1]
In September 2014, Oracle and SEPCO signed a Engineering, Procurement, and Construction (EPC) agreement, following receipt from SEPCO of outline bids for the construction of the integrated mine and power plant. SEPCO has proposed securitising up to 85% of the cost of the two EPC contracts with support from Sinosure, the China Export & Credit Insurance Corporation, and certain Chinese banks.[2]
In March 2015, Oracle Coalfields extended its EPC framework agreement with SEPCO. The exclusive agreement now runs until the end of 2015. According to World Coal, discussions have been started with Chinese finance house Sinosure on proposals to securitise up to 85 percent of the cost of the two EPC contracts.[3]
In March 2015, it was reported that the project would be included in the China-Pakistan Economic Corridor (CPEC), projected to finance around US$33.8 billion in energy projects.[4][5] However, the project was not included among the projects included in the China-Pakistan Economic Corridor.
In June 2015, Oracle and SEPCO formed Thar Electricity (Private) Ltd, with a 90-10 equity split; the two companies signed a consortium agreement in October 2015. In November 2015, a "letter of no objection" was issued for the project by the Central Power Purchasing Authority. As of March 2016, Thar Electricity (Private) Ltd had registered the project with the PPIB, and was working towards financial close of the project, as well as negotiating the EPC contract with SEPCO.[6][7] The plant is planned for completion in second quarter 2021.[8]
In June 2016, Oracle reached an agreement on coal pricing with the government of Sindh.[9]
In July 2016, Pakistan's water and power ministry, frustrated with the slow pace of this and other projects, warned Oracle that if it didn't have the project "completed" (presumably meaning construction being underway) by December 2018, it would be dropped from the CPEC.[10]
In June 2017, the project was elevated to the priority list of projects under the China-Pakistan Economic Corridor (CPEC) and was listed as 1,320 MW, with the first phase being 660 MW.[11] Oracle was continuing to work on completing the project's environmental impact assessment, as well as lining up financing and pursuing land acquisition and resettlement. The company stated that "progress with potential Chinese partners is taking longer than we hoped, but detailed discussions are under way with several State-owned Enterprises, as financing partners and as EPC contractors."[12][13]
In November 2017 Oracle signed a Memorandum of Understanding (MoU) with Sichuan Provincial Investment Group Co. Ltd (SCIG) and PowerChina International Group Ltd (PowerChina) for investing in, setting up, constructing, owning and operating the coal plant. The MoU specifies that the project will be funded in cash by the Parties from Chinese banks, and that it is proposed that SCIG, PowerChina and Oracle will have equity holdings in the project of 78%, 10% and 12%. respectively. Oracle hopes to reach financial close in the first half of 2018.[14]
In November 2018 the National Electric Power Regulatory Authority’s proposal to reduce the guaranteed 14 to 17% rate of return for different technologies to 12 to 16% was criticized by Oracle Power, which wants the higher rates grandfathered in for companies with existing agreements. Oracle Power argues that any change will discourage investments in independent power projects. President Imran Khan’s new government has vowed to review what it argues were overly generous concessions for power projects as public opposition to Chinese-backed infrastructure projects and associated debts grow.[15]
A December 17, 2018 updated list of "Upcoming IPPs" by the Ministry of Water & Power states the plant will be commissioned in June 2023. The issuance of the notice to proceed (NTP) and letter of intent (LoI) is "in process".[16]
In January 2019, the size of the first phase was increased from 600 to 700 MW, and the project was changed to supercritical technology.[17]
As of December 2019, completion was still scheduled for 2023.[18]
Ownership
In June 2015, Oracle and SEPCO formed Thar Electricity (Private) Ltd, with a 90-10 equity split; the two companies signed a consortium agreement in October 2015.[19][20]
In November 2017 Oracle signed a Memorandum of Understanding (MoU) with Sichuan Provincial Investment Group Co. Ltd (SCIG) and PowerChina International Group Ltd (PowerChina) for investing in, setting up, constructing, owning and operating the coal plant.[21]
In December 2018, Beijing Jingneng Power Company replaced Sichuan Provincial Investment Group as the project's majority owner.[22]
In April 2019 the project's sponsors adjusted their shares of the project, with Beijing Jingneng Power Company shifting 5% out of its ownership share to PowerChina.[23]
Website
- SSRL Thar Mine Mouth Oracle Power Plant (1320MW) & Surface Mine, CPEC-Energy Priority Projects
Project Details
- Sponsor: Thar Electricity (Private) Ltd
- Parent company: Beijing Jingneng Power Company (73%), PowerChina (15%), Oracle Coalfields (12%)
- Location: Thar Block-VI near Singhara village, Thatta district, Sindh province
- Coordinates: 24.8408017, 70.3150749 (approximate)
- Status: Pre-permit development
- Gross Capacity: 700 MW (Units 1 & 2: 350 MW)
- Type: Supercritical
- Projected in service: 2023
- Coal Type: Lignite
- Coal Source: Integrated 4.2 mtpa coal mine[2]
- Source of financing: Chinese banks
Articles and resources
References
- ↑ "Oracle signs MOU with Chinese power group SEPCO," London Stock Exchange Market News, 21 November 2013
- ↑ 2.0 2.1 "Oracle makes progress on Thar coalfield potential," World Coal, 25 September 2014
- ↑ "Oracle Coalfields extends agreement with SEPCO," World Coal, 17 March 2015
- ↑ Philip Whiterow, "Oracle Coalfields' Thar project included in new Pakistan/China development zone," Proactive Investors, March 11, 2015
- ↑ "Oracle Coalfields PLC: China Pakistan Economic Corridor," London Stock Exchange, 11 March 2015
- ↑ Oracle Coalfields makes progress with Thar Coalfields Block VI in 2015, World Coal, 18 Mar. 2016.
- ↑ 2015 Annual Review, Oracle Coalfields PLC, accessed July 2016.
- ↑ "Upcoming IPPs," Pakistan Private Power and Infrastructure Board, accessed Nov 2016
- ↑ Oracle Coalfields told coal price for Thar power station, Proactive Investors, 17 June 2017.
- ↑ Five CPEC projects face the axe, Express Tribune, 20 July 2016.
- ↑ "Sindh's Oracle Coalfields speeds through, placed on CPEC priority list," CPEC, June 9, 2017
- ↑ Oracle encouraged by nearby power plant, Asia Miner, 11 May 2017.
- ↑ Oracle Coalfields reports solid progress at Thar project, Digital Look, 8 June 2017.
- ↑ "Oracle signs MoU with major Chinese firms to advance the Thar project," World Coal, 21 November 2017
- ↑ "Investors oppose proposed cut in returns to power projects," Pakistan News, Nov 24, 2018
- ↑ "Upcoming IPPs," Private Power & Infrastructure Board, Ministry of Power, updated December 17, 2018
- ↑ Oracle Power gets approval for larger power station at Thar in Pakistan, Proactive Investors, 17 Jan. 2019.
- ↑ "Upcoming IPPs," Private Power & Infrastructure Board, Ministry of Power, updated December 12, 2019
- ↑ Oracle Coalfields makes progress with Thar Coalfields Block VI in 2015, World Coal, 18 Mar. 2016.
- ↑ 2015 Annual Review, Oracle Coalfields PLC, accessed July 2016.
- ↑ "Oracle signs MoU with major Chinese firms to advance the Thar project," World Coal, 21 November 2017
- ↑ Oracle Power shares jump on teaming up with Chinese coal power player, S&P Global, 20 Dec. 2018.
- ↑ Oracle Power’s Chinese partners revise stake in Thar project, The News, 30 Apr. 2019.
