TEL successfully achieves commissioning! Collective power generation of HUBCO, its group increase to 3251 MW

Thar Energy Limited has successfully achieved commissioning, with the Commercial Operations Date (COD) to take effect from October 1, 2022, according to a filing by Hub Power Company Limited to the exchange.
TEL is a joint venture between The Hub Power Company Limited (HUBCO), Fauji Fertilizer Company Limited (FFC), and China Machinery Engineering Corporation (CMEC), formed for the purposes of establishing a 330 MW Mine-Mouth Coal-Fired Power Generation Complex at Thar Block II, District Tharparkar, Sindh, Pakistan (the “Project”) under the China Pakistan Economic Corridor (CPEC).
According to the notification, “The Project has successfully achieved commissioning, with the Commercial Operations Date (COD) to take effect from October 1, 2022, in terms of the Power Purchase Agreement dated July 27, 2017 (the “PPA”) entered into between TEL and the Central Power Purchasing Agency (Guarantee) Limited.”
With this achievement, the collective power generation capacity of the HUBCO and its group companies has increased to 3251 MW through the plants spread over Balochistan, Punjab, Azad Jammu, and Kashmir, and Sindh.
The Project will be generating low-cost energy from indigenous Thar Coal thus reducing the burden on national foreign exchange resource. Completion of the Project would have not been possible without the support extended by the Government of Pakistan, the Government of Sindh, the Government of China, and all other private stakeholders.
In August, Sindh Chief Minister Syed Murad Ali Shah had inaugurated the 330 MW HUBCO power plant which he said added 990 MW coal-fired power to the national grid to empower Pakistan with cheapest and indigenous source of energy.
The Sindh govt became the major shareholder in the first Thar coal mining company SECMC and also provided the financial guarantee required by Chinese lenders to achieve the financial close of the mine.
Shah said that his government had provided continuous support to Thar coal IPPs as well as mining companies and had ensured the provision of necessary infrastructure, including roads, bridges and on top of it Mai Bakhtawar Airport, so that these projects can function smoothly.
He said the government was also working to ensure ramp up of mine quickly and utilization of Thar coal for energy needs of other industrial sectors including cement, fertilizers and others.
Thar Energy Ltd. is a 330 MW Coal Fired Power Project based on Thar Coal and a part of China Pakistan Economic Corridor (CPEC). The Project is a joint venture among Hub Power Company Ltd (Hubco), Fauji Fertilizer Company Ltd (FFC), China Machinery Engineering Corporation (CMEC) and has been completed at a cost of US $520 million
It may be noted that foreign financing for the project was arranged from a Chinese syndicate, led by China Development Bank whereas local financing has been arranged via a syndicate led by Habib Bank Ltd.
The project started construction in May 2018 from sponsors’ equity without waiting for financial close to ensure the earliest utilization of indigenous Thar Coal.
The financial close of the project was achieved in January 2020. The project experienced delays due to delays in loan disbursement from Chinese lenders and later due to COVID-19 pandemic. – ER/MD