Saturday, 31 December 2011

China Three Gorges plans $15b investment in Pakistan

Chinese hydel power giant, China Three Gorges Project Corporation (CTG) has said that Pakistan is on the top of its priority for foreign investments, as the state owned firm plans to invest up to $15 billion for generating 10,000 MW power in the country. This was stated by the Chief Executive Officer of China Three Gorges First Wind Farm Pakistan, Wang Shenliang at the ground breaking ceremony of $130 million 50MW wind power plant in Jhimpir Thatta Sindh. The ground breaking of the project was performed by the Minister for Water and Power Syed Naveed Qamar and Chinese Ambassador Liu Jian. Chinese company is self financing the wind power project and the 1100 MW Kohala hydro power project in the country. Wang said, “As the CTG expands its overseas investment, our first priority remains Pakistan, and we are interested to generate 10,000 MW hydel and wind energy in
Pakistan”. He said the first project of 50 MW will be completed by late summer 2012. The firm is seeking additional land for a 450 MW project and has given its commitment to set up 1000 MW in Sindh in the next 3-4 years. It will be making all the investment through its own resources.
CTG has shown interest to invest in four mega hydropower power projects of Bhasha, Bunji, Kohala and Karot, provided the government removes legal bottlenecks in the award of contracts. Pakistan had already signed MoU CTG for the construction of 7100 MW Bunji Hydropower, while the contract for 1100 MW Kohala Hydropower project was awarded to it this year.
Speaking on the occasion, Chinese Ambassador Liu Jian said the project will further deepen the strategic and economic relationships between the two countries. He said China values its friendship with Pakistan and wants to further strengthen it by enhancing its investment in the country. Minister for Water and Power Syed Naveed Qamar said President’s look east policy was paying dividends, as CTG was working on wind and hydel power projects in the country through their own financial resources. He said the country has an estimated wind power potential of 50,000 MW and many more wind power projects will be coming during the next year. In October, the National Electric Power Regulatory Authority (NEPRA) approved Rs12.61 per kWh feed-in tariff for the foreign financed wind power projects while locally financed projects were offered Rs17.28 per kWh tariff which complete their financial close before December 2012. Pakistan has set a target of generating 1500 MW from wind power, with in the next three years. The minister said the government was also working on a policy to provide feed-in tariff for coal based projects that will help overcoming the power shortages in the country. The power generation of coal is half the price of expense furnace oil or diesel. Pakistan has huge coal reserves but has failed to tap them for power generation.
Chief Executive Officer of Alternate Energy Development Board (AEDB) Arif Alauddin said the CTG was the third wind power project in the country. Turkish company Zorlu and Fauji Foundation are also setting up 50 MW each wind power plants. He said looking at the pace of Chinese firm he would not be surprised if they beat their competitors by completing the project before their competitors. He said wind energy sector has started attracting the highest private sector investment as compared to other sectors of the economy. He said the year 2012 will be remembered as a year of renewable energy (RE) in Pakistan as they plan to inaugurate a project every month during the next year. He said the implementation agreement with Zorlu Energy is expected to be signed on January 03, 2012. He was of the view that they were successful in creating for the first time an investment protection, a financial instrument for repayment risk in the form of the counter guarantee from the Asian Development Bank, which was a key concern of the investors. The counter guarantee removed the last of the bottle necks - and the banks were now ready to invest in the sector. Commenting on the criticism on AEDB performance, he said critics ignore the fact that in China it is public sector investments that have increased the pace of renewable energy deployment, while India started implementing renewable energy projects in 1982 and now have a full fledged ministry with an annual budget of Rs1200 crore. Pakistan on the other hand had decided not to invest any public sector funds in the sector and all the investment was to come from the private sector. He said despite difficulties they have managed to attract Zorlu, LIMAK, LIMA and Kenisis from Turkey, Nordix and Azur from Germany, Lumen Energy from Dubai, Hartfort Energy and SSID from USA, NBT from Norway, and AEI from UK which have teamed up with Pakistani companies to set up wind and solar power generation facilities. Chinese companies SUNEC, CWE, SUNTECH, CHINT, Goldwind and Datang Renewable Energy are now serious players in the Pakistan market.
In 2008 there was not a single approved EPC contractor or turnkey supplier available in the country, now more than 7 top wind turbines manufacturers including Vestas (Denmark), Nordex (Germany), Seimens (Germany), General Electric (USA), Hyundai (Korea), Goldwind (China), Sunec (China) are offering turbines, fully backed by EPC contract and operation and maintenance for extended period.
Pakistan Today     

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