CPEC to help Pakistan achieve economic turnaround, says CPHGC CEO
KARACHI: China Pakistan Economic Corridor (CPEC) is a symbol of long-term friendship and economic cooperation between China and Pakistan and it will help achieve turnaround of the economy.
These views were shared by Chief Executive Officer, China Power Hub Generation Company Pvt Limited (CPHGC), Zhao Yonggang while talking to Business Recorder on Wednesday.
Yonggang said CPEC is much beyond the trade route for Pakistan. Apart from building crucial infrastructure for the long-term needs of Pakistan, CPEC project would assist bridging the energy gap which is the major impediment to the steady economic growth of Pakistan.
“Availability of affordable energy for the industries in developing countries like Pakistan is the top priority of the government as it wants to see economic turnaround in the country, said Zhao Yonggang. We have learnt it from our experiences in China that economical energy production and affordable availability to the industries is the key to long-term industrial growth,” he added.
CEO CPHGC Zhao Yonggang said CPHGC is a joint venture company formed by two sponsors, China-based company China Power International Holding Limited (CPIH) and Pakistan-based company Hub Power Company Limited (HUBCO). CPHGC has been set up as the special purpose vehicle (SPV) for 1,320 MW coal-fired power plant in Hub, Balochistan. The estimated cost of the project is $2 billion.
Zhao Yonggang said CPHGC’s coal-fired power project would produce energy at an estimated cost of around 8 cents per kWh which is cheaper than the current cost of energy production in Pakistan. This will save hundreds of millions of dollars for the country every year and industries and public would also benefit by the lower energy bills.
SPIC is already working on several projects of strategic importance in Pakistan. He said Pakistan is a high priority investment destination for SPIC and it is also exploring the possibility of more investments in projects in Karachi.
SPIC wants to invest more in Pakistan like it recently invested through its subsidiary Shanghai Electric in K-Electric, which is Pakistan’s largest electricity distributor. “We need to remove the misperceptions about foreign investment. We should realize that new investment in power projects would help country move forward and achieve greater economic prosperity. If we provide attractive investment environment to foreign investors they would prefer to reinvest the profits and expand their operations in that country.”
CPHGC CEO informed that a delegation of China Development Bank recently visited the CPHGC project site and reviewed the progress on the project. They also visited PPIB officials in Islamabad and have submitted their report to the higher management of the Chinese Bank. We are fully confident to secure US$ 1.5 billion loan for this project by a consortium of Chinese Banks lead by China Development Bank of China.
“CPHGC has selected two EPC contractors for this project that include NWEPDI (North West Electric Power Design Institute) & TEPC (Tianjin Electric Power Construction) Consortium whereas Jetty EPC is CHEC (China Harbor Engineering Company Ltd.) which is operating in Pakistan for the last 20 years,” Zhao Yonggang said.
Talking about the import of coal for the 1,320 MW project, Zhao Yonggang stated that coal would be imported from South Africa and Indonesia. CPHGC is planning to construct a barge jetty to provide approximately 4.3 MTPA of coal to the plant.
The jetty will be connected to the shoreline through a trestle and causeway.
To avoid any delay in the project, CPHGC has started the civil work on the project site in August 2016. The ground levelling, land marking, security infrastructure, temporary jetty and accommodations for the workers have been made and we would start pouring concrete in the foundation structure of the power plant from this month. “Currently, over 650 workers are working on the project site out of which 500 are locals” said Zhao Yonggang.