KARACHI, June 25: Karachi Electric Supply Company (KESC) on Monday June 25, signed a Joint Development Agreement (JDA) with Sindh Coal Energy Limited (SCEL) and Oracle Coalfields PLC (Oracle) of UK which is engaged in Coal exploration, mining and production, for establishing a coal-based power plant, reference to tapping the indigenous Thar coal reserves for power generation.
This JDA defines the respective responsibilities of each party and marks another key milestone for KESC following the signing of an MOU with Oracle on 12th December 2009 for the Thar Coal Power Project- a venture that aims to develop a mine-mouth coal-powered generation facility at Block VI Thar Coal Fields having an initial capacity of 300 MW and potential upside of 1100 MW.
At the signing ceremony, both parties expressed their commitment towards ensuring the successful implementation of the JDA and agreed to coordinate their efforts to promote and develop the project. The integrated arrangement, as stipulated by the JDA, will enable KESC to secure a long-term fuel supply from SCEL at competitive prices while SCEL will own and operate the mine which will be integrated with the KESC mine-mouth power plant.
With the signing of this strategically important agreement for coal based power generation by utilizing readily available indigenous coal reserves, KESC aims at not only bridging the prevailing power demand - supply gap, but also has an objective towards translating this benefit into a lower tariff end user tariff, as compared to power generation via the 3.7 times more expensive furnace oil.
Sindh Coal Energy Ltd and Oracle have completed the coal-mine feasibility study and are in the process of carrying out an Environment and Social Impact Assessment whereas KESC is engaged in short-listing proposals received from leading international consulting firms for design of the Power Plant.
Mentionable here is the fact that KESC has already, earlier in the year, signed a JDA with Bright Eagle Enterprises (BEEGL), a Hong Kong based investment company sponsored by Chinese and Korean investors. This project aims to achieve the coal conversion of KESC's 1260 MWs (210MW x 6) Bin Qasim Power Station to being coal-fired. The Feasibility Study for this Project has been finalized by Knight Piesold. KESC is in the process of selecting the EPC contractors and simultaneously finalizing arrangement for coal supply from Indonesia along with provision for indigenous Thar Coal.