Government to ramp up coal production to 19m tonnes annually
* Plan to enhance Thar coal production will help country generate 3,300 MW electricity
ISLAMABAD: The government is devising a plan to scale up annual coal production to 19 million tonnes during the next six years.
In the wake of growing demand of Thar coal, the Sindh Engro Coal Mining Company (SECMC) has started evolving a plan to enhance coal production to 19 million tonnes till 2022, which will enable the country to generate 3,300 MW electricity.
Savings against foreign exchange reserves will surge to $ 3.4 billion dollars annually till 2030, as local coal production will serve as an alternative for import. However, production capacity of coal will be increased in 6 phases.
Increase in coal production will help bring down the cost of electricity, as the cost of coal is included in power production by 50 to 60 percent.
With increasing coal production to 19 million tonnes from Thar, the cost of Thar coal will go down by 50 percent as compared to its elementary cost in terms of burning value.
Initially the cost of per MMBTU coal is above $6. It will be available at $3.3 once the coal production capacity reaches 19 million tonnes, and at $2.5 per MMBTU from 2031 onwards.
According to sources, the government has so far splashed out $500 million on $3 billion mining and construction of power plant project. The construction of the power plant is continuing on fast track basis, besides mining project. The construction work of mine, which was to be completed within 42 months, is expected to be completed within 38 months.
The cost of the project has decreased by 10 to 15 percent owing to a devaluation in the Chinese currency and reduction in the price of diesel. The estimate worked out against investment in mining project has decreased from initial estimate of $845 million to $735 million.
Sindh Engro Coal Mining CEO told daily Times that the Thal Nova and the Thal Energy Limited would pour in more investment to the tune of $1.5 billion in the Sindh Engro Coal Mining project. "Investment of $1 billion will be made in power plants and $500 million in mining. Owing to this investment, power production from Thar coal will scale up to 1,320 MW. Two more companies are keen to invest in electricity generation projects. They are likely to join the project by 2022. Their participation will surpass 2,300 MW power generation from Thar coal.
The Engro powergen Thar is investing $1.1 billion in the project of power generation from Thar coal. The Sindh government owns 51 percent share.
The Sindh Engro Coal Mining Company will provide 3.8 million tonnes coal annually against investment of $845 million in mining. The Sindh government is making an investment of more than a $ 1 billion for providing infrastructure facilities for the project.
On the other hand, experts have expressed fear that growing reliance of country on the coal projects for power generation will pollute environment.
However, work is underway on fast track basis on coal projects under the China-Pakistan Economic Corridor (CPEC) while China has stopped work on multi-million megawatt coal projects after indication to use alternative power resources.
