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There is enough energy trapped in reserves to satisfy energy needs of Pakistan for next hundred years

Islamabad, May 07, 2014 (PPI-OT): Shamsuddin A. Shaikh, CEO – SECMC said that at an estimated 170 billion tons, there is enough energy trapped in the reserves to satisfy the energy needs of Pakistan for the next hundred years. The reserves are buried deep under the desert sands and are separated by the reservoirs of fossilized aquifers. While there is high moisture, the Sulphur content of Thar coal is low, making it environmentally more attractive.

Pakistan is fortunate to have abundant coal reserves that are equivalent to the combined oil reserves of Iran and Saudi Arabia in energy equivalent terms, and have the capacity to produce 100,000 MW of electricity for 200 years.

Shams further added that The Thar coalfield with a resource potential of 175 billion tons of coal covers an area of over 9,000 sq km in the Thar Desert in Tharparkar district, in south-eastern part of Sindh.

At the optimum capacity of 4,000 MW, power produced from Thar Coal can yield a tariff of approximately 6.0 cents/Kwh. This is the cheapest of the options currently available with our decision makers. Additionally, it is approximately 50% cheaper than RFO based power generation.

Sindh Engro Coal Mining Company (SECMC), a Joint Venture between Govt. of Sindh and Engro Corporation, has been working on the project for the past 4-5years. Engro as managers of the project have been working on the technical and commercial aspects whereas Govt. of Sindh is developing the requisite infrastructure for the project.

As developer of Thar Block-II, SECMC plans to expand the mine in phases and reach a sustainable capacity of coal output for the production of 4,000 MW for more than 50 years. Phase – I of the project envisages mining operation of 3.8 mn tons per annum of coal to be utilized by mine-mouth 660 MW power plants for 30 years A wholly owned subsidiary by the name of Thar Power Company (THARCO) was incorporated in 2013 with the objective of developing the power plant designed to operate on Thar coal.

The total investment for the integrated project is estimated to be US$ 1.7 billion where China will fuel the project with investment, labour and machineries. Subsequent to Government of Pakistan’s consent to provide Sovereign Guarantee for Debt portion of mining subject to Government of Sindh being the majority shareholder in SECMC, the JV agreement has been amended to increase shareholding of GoS to 51%. However, management control of the project will remain with Engro.

Speaking of the project’s current status, Shams said that the Company has achieved substantial progress on the mining and power project during the year. Firm EPC bids have been received from leading Chinese firms and final announcement is expected by end of this month. 6000 acres of land has been acquired for which no resettlement is required.

A public hearing of Environment and Social Impact Assessment (ESIA) was held last month to apprise the stakeholders on environmental and socio-economic impacts of the Power Plant project, approval is expected by next month.

Environment approval for Mining Project was received last year. Finally, on April 30, 2014, the works for 113 million cubic meter overburden removal in Thar Block – II took start. Furthermore, infrastructure requirements including water, transportation and power transmission line from Thar to Matiari are being pursued actively with relevant authorities/agencies. The integrated project is expected to come online by Dec 2017.

Shams said that this major breakthrough has only been made possible through the instrumental support provided at all forums by Government of Pakistan, Government of Sindh, Engro and other investors. A number of local industrial groups and investors are going to join hands with SECMC to make this project a reality and drive Pakistan on-track towards energy self-reliance.

In his closing remarks, Shams Shaikh added that Thar truly is the most viable power generation option for Pakistan. Development of indigenous Thar Coal Reserves offers a fortune-turning proposition for Pakistan, which will not only address the severe power shortage crisis in medium to long term but also bring energy security to the country.

The project will also bring immense socio-economic benefits for the poor people of Thar as the project will catalyze the creation of social assets – medical facilities, educational institutions, and infrastructural development and job opportunities.

For more information, contact:
Sindh Engro Coal Mining Company (SECMC)
8th Floor, Harbor Front Building,
Marine Drive, Block 4, Clifton,
Karachi, Pakistan
Tel: +92-21-111-211-211

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