ISLAMABAD, July 8: The Underground Coal Gasification (UCG) Project at Thar is seriously suffering because of the apathy of federal authorities and diversion of funds towards unapproved projects, according to renowned scientist and the Planning Commission’s Coordinator for Science and Technology, Dr Samar Mubarakmand.

Briefing the Senate Standing Committee on Petroleum and Natural Resources on the Thar field’s UGC, Dr Mubarakmand said over the past two years the project had been given only 10 per cent of the amount allocated for it.

He said it was ‘the best coal’ in the world for gasification that can produce ‘cheapest electricity’.

Senior officials of the Sindh government explained various stages of investment for power generation and infrastructure development to the committee, headed by Senator Mohammad Yousuf.

Dr Mubarakmand said contrary to a general perception that UGC was an unviable option, more than 40 countries, including Russia, China and South Africa, had been producing electricity from underground coal gasification for more than 30 years because of its low capital expenditure. The expenditure comes to $0.9 per watt compared to $1.6 per watt on coal power projects based on coal mining, $4 per watt on solar energy and $3 per watt on wind.

The electricity produced through UGC at Thar would cost about Rs4 per unit (kwh) while the cost is Rs18-19 per unit of thermal power stations. The carbon content of Thar coal, commonly known as lignite, was 28pc. This is considered best for power generation.

The thickness of the Thar coal and its powdered form was best for underground gasification and it had been confirmed by leading scientists from China and the United Kingdom who have visited Thar and analysed the project design and specifications.

“The Chinese professors after staying at Thar for two weeks have said that Pakistan can produce thousands and thousands of megawatts of electricity from Thar,” he said.

Dr Mubarakmand quoted one of the Chinese professors as having said: “It appears these (Thar) reserves are meant for UCG with cheapest cost.”

Apart from power production, he added, the Thar coal through underground gasification could be utilised for conversion to naphtha, diesel, waxes, car fuel, fertiliser, town gasification, food preservatives, rayons and a number of other chemicals. He said the conversion of Thar coal into town gas would cost only half of the current cost of Sui gas.

Dr Mubarakmand said the approved cost of the Thar UGC pilot project, that he was engaged in, was approved at Rs8.8 billion for setting up of a 100mw power plant in 2010 by former prime minister and then power minister Raja Pervez Ashraf and former finance minister Shaukat Tarin after visiting the project, but it was provided with only Rs1 billion so far.

Of the total approved cost, the project was released 10pc of what had been allocated for 2010-11. Another 10pc had now been allocated by the current government. This shows that the government was not interested in the project, he added.

Too little too late

“Releasing too little and too late did not help the project”, Dr Mubarakmand said when asked by senators why the project had not reached the final stage of power generation.

He said a power plant of 8mw could be set up within six months if funds were made available. A number of international firms from China and South Africa had come to Pakistan for Thar coal conversion to diesel production, but the government’s response had not been encouraging, he added.

Sindh’s secretary for coal and energy development, Ejaz Ahmad Khan, said the government had so far developed 12 blocks at Thar coal while many other blocks were yet to be developed. The Thar desert contained the world’s seventh largest coal reserves estimated at 175 billion tons, equivalent to 50 billion tons equivalent of oil — more than the oil reserves of both Saudi Arabia and Iran or about 2,000 trillion cubic feet of gas, which was 68 times higher than Pakistan’s total gas reserves. In reply to a question, he said the total value of reserves from 12 blocks so far developed was notionally estimated at about $687 billion.

Three investors — Sindh Engro, Global Mining of China and Oracle Coalfield of UK — would start producing coal and generate electricity from 2015-16.

The secretary said the average power generation cost from Thar coal was estimated at eight cents per unit compared with 18-19 cents per unit of furnace oil-based thermal plants. He said 17pc of coal-based power generation throughout the world was based on the quality of coal that is available at Thar and, hence, it was by no means an unviable option.

The scientist called upon the federal government to provide Rs22 billion for the establishment of transmission line to transmit electricity to be produced at Thar to the national grid because most of the investors were now asking about the facilities to transmit energy from Thar power plants before they invest there.