ISLAMABAD: Pakistan is seeking a push for early mobilisation of Chinese contractors to start construction of 1,100MW Kohala Hydropower Project (KHP) and increased financial support for under-construction 969MW Neelum Jhelum Hydropower Project (NJHP).

Sources said the Chinese contractors CWE – a subsidiary of Three Gorges Dam – had been showing less interest in going ahead with the $2.2 billion Kohala project and dilly-dallying on mobilising its machinery and workforce to start it even though the project had been negotiated through official channels of the two governments bypassing public procurement rules.

An official said the crucial two-day session of the Pak-China Joint Energy Working Group (PCJEWG) opening here on Monday would revolve around the $3.6 billion NJHP and $2.2 billion KHP even though it would take up 19 projects involving a total cost of over $12 billion.

Despite repeated contacts, Wapda authorities were not willing to comment if the Chinese firm was reluctant to go ahead with the construction of Kohala project. Water and Power Secretary Imtiaz Kazi, however, did not agree that the Chinese company was showing hesitation on the project and said the main purpose of the session was to remove bottlenecks in various projects.

Responding to a question, Mr Kazi said he would not speculate on specific projects that would come under discussion on Monday but the two sides would discuss enhanced cooperation between the two countries on about 15 energy sector projects.

Answering another question, he said the Chinese firm was on board the KHP and things would hopefully crystallise during the next two days. He hoped the agreement would also be reached on the Neelum-Jhelum project on which Pakistan was seeking increased financial support.

Until last week, the Chinese Exim Bank was reluctant to provide $448 million to the NJHP unless Islamabad covered the currency fluctuation loss arising out of US dollar’s declining value.

A background contact by President Asif Ali Zardari with the Chinese leadership is reported to have changed the situation in Pakistan’s favour, an official privy to the fresh developments told Dawn.

Now, the representatives of the Chinese Exim Bank would also be attending the PCJEWG and have indicated to provide $448 million for the project.

“In fact, we are now asking them to increase their financing to about $500 million,” said a senior official who hoped the breakthrough would be achieved in the first round of meeting with Water and Power Minister Syed Naveed Qamar.

The NJHP that has achieved 34 per cent physical progress has been facing financial constraints following delays in finalisation of loan agreement with the Chinese Exim Bank, the official said. He said a problem with the PCJEWG session was that the Chinese delegation included a comparatively lower level representation that would need to go back to the leadership for a final decision.

The two-day session would also discuss 19 projects, including coal, hydropower, water sector and alternative energy projects.

Diamer-Bhasha dam is also on the agenda while two coal-based power projects, including a 1,000MW project on Thar coal led by Engro Corporation where Chinese financing was of crucial importance. Another 100MW coal project of Sino Sindh is also on the agenda.

The group was constituted in 2010 during a visit of the Chinese prime minister to Islamabad to look into options of assisting Pakistan in resolving its energy crisis. The first meeting of the group was held in Beijing in July last year that discussed various areas, including Chinese cooperation in joint ventures, financial and technical assistance to take up energy projects.

The two sides are also expected to make progress on creation of a $10 billion Energy Infrastructure Fund with the Chinese support to provide funding to various projects. The fund is also proposed to be utilised for at least two major high-tension transmission lines with involvement of Chinese companies.

Some of the major projects that would come under discussion include Sindh Engro Mining and Power Project, Sonda Jherruk Coal Project, AES Imported Coal Project, Diamer Bhasha Hydropower Project, Neelum Jhelum Hydropower Project, Kohala Hydropower Project, Bunji Hydropower Project, Suki Kinari Hydropower Project, Kotli Hydropower Project, Madian Hydropower Project, Nandipur Combined Cycle Thermal Power Project, Chichoki Mallian Combined Cycle Thermal Power Project, 500 KV Transmission Line for evacuation of power from 747 MW Guddu Power Project, 220 KV Transmission line to transmit power from 404 MW UCH- II Thermal Power Project, 500 KV Transmission Line Project for dispersal of power from Sindh Engro Thar Coal Power Project, 500 KV Transmission Line Project for Neelum Jhelum Hydropower Project, 500 KV Transmission Line Project for evacuation of power from Tarbela Hydropower Fourth Extension Project, mapping of renewable energy resources (such as wind, solar, biomass, waste, geothermal, small and micro hydel projects) in new geographical areas of Pakistan, technology transfer for wind and other renewable energy projects, support, technology transfer, standardisation, of off-grid and decentralised renewable energy applications and geothermal mapping of Pakistan, and the Geological Survey of Pakistan’s project to geologically map Pak-China border areas.