PPIB to scrap Sonda-Jherruk project of DHCL

Islamabad: Private Power Infrastructure Board (PPIB) is likely to scrap 200 MW integrated coal-mining and power generation project of Dadabhoy Group at Sonda-Jherruk as the sponsors failed to obtain coalfield lease from Sindh government, official sources said.

On October 31, PPIB Managing Director Fayyaz Elahi warned that the PPIB would cancel the project approval if sponsors failed to finalise coalfield lease arrangement with the provincial government, the sources added.

'We are continuously pursuing the Sindh government for the issuance of lease approval, but they invariably respond that the summary has been sent for the Chief Minister's approval,' the sources quoted Dadabhoy Hydrocarbon Limited (DHCL) as stating in its latest communication with the Federal government.

The DHCL and its Chinese associate firm are worried over this delay in the issuance of lease from Sindh government and the Chinese company took up the issue with President Asif Ali Zardari during his visit to Beijing. The sources said the firm had asked the PPIB to pursue the Sindh government for its urgent approval for coalfield lease.

'As soon as the DHCL gets approval from provincial government, it will finalise their agreements with the National Electric Power Regulatory Authority (Nepra) and their Chinese associate without losing any time, for its implementation on fast track basis,' the sources quoted the company as assuring the PPIB.

The DHCL is not only spending time fulfilling formalities, but has also spent million of rupees for its planning, execution, consultancy, etc and is still busy fulfilling formalities, as required by different departments. Regarding the PPIB's formalities for performance guarantee and processing fee for issuance of the LoS, the DHCL has clarified that performance guarantee does not fall within its ambit.

According to power fast track implementation policy as approved by the ECC. In the light of the PPIB fast track implementation policy, the DHCL has approached Nepra for tariff determination and Sindh government for grant of lease.

'As the firm finalises the lease, it will finalise the determination agreement with the Nepra for its implementation because our arrangements are in progress with our foreign associate firms,' the firm added.

The sources said the DHCL had also requested the PPIB to pursue the Sindh government for issuance of lease at the earliest so that the DHCL could start work on the project.