KARACHI, May 29: The World Bank has assured support both financial and technical for the proposed 1,000MW power plant based on Thar coal to be set up as public private joint venture.

The assurance was given by World Bank Vice President Praful C Patel at a recent meeting with the Sindh Chief Minister. He said that the power generation through cheaper resources other than oil and water was the main priority of the bank’s development agenda. He said that the WB would help in arranging financing from the IFC for the project.

The Sindh mines and minerals department has already invited expressions of interest (EoIs) from both the local and international investors for the joint venture to be set up on the basis of 75:25 equity.

The Sindh government would provide 50 per cent of the equity.

The last date for submitting EoIs is June 15 after which a committee would scrutinise offers and submit its recommendation to the government.

Sources at the department said that encouraging enquiries had been received and China, Indonesia, and some Gulf countries have shown interest in the proposed joint venture with technical assistance from Australia and Germany.

The department made a presentation to the WB vice president, which indicated that in Pakistan share of coal in power generation is just 0.1 per cent against 40 per cent in the world. Poland and South Africa are on top in coal power generation with 93 per cent followed by Australia 80 per cent, China 78 per cent, India 69 per cent Kazakhstan 70 per cent and Morocco 69 per cent.

Sindh has 175 billion metric tons coal deposits in Thar, which are enough to produce electricity for three centuries.

The WB was informed that two bankable feasibility studies had been carried out by Shenhua Group of China in 2003 for Thar Block 11 and by RWE of Germany. The Chinese study suggested a tariff of 5.75 cents with production based on open cast mining. The second study suggested a tariff of 7.18 cents.

The WB was informed that the vital infrastructure, including roads, electricity, communications and water supply, was in place up to the coalfields in Thar and Nagarparker granite areas.

Construction of an air strip is at designing stage while construction of Thar Lodges was under way to provide modern accommodation to the investors and engineers.

It was further informed that so far six blocks of cola in Thar and three blocks in Sonda have been explored at a cost of Rs500 million.

The proposed joint venture project has been envisaged on debt equity ratio of 75:25. The eligible parties would be required to invest at least $200 million. The size of mining operation for the coal-based power project will be six million tons per year.