SECMC Proposition for coal conversion rejected

Sindh Engro Coal Mining Company Prepared a proposal which was rejected by the private power and infrastructure board. The proposal was prepared for the conversion of three imported coal fired projects to Thar coal. The proposal was rejected because it was not fulfilling the requirements asked by the board regarding commercial, legal and environmental aspects.

SECMC asked for a testing of the newly proposed project to convert imported coal independent power producers (IPP) to Thar coal. The managing director of the board in return argued by saying that according to the conditions set by the power division of the Ministry of Energy a complete financial possibility study was required which covered technical legal and environmental aspects in order for the project to progressively go ahead and be viable at the same time. These terms were shared with SECMC. The managing director also stated that the financial evaluation which is said to be done for the project only covers the base costs and technical analysis of the project whereas according to the terms of references the financial assessment needs to include cost benefit analysis, sensitivity analysis, impact on overall tariff, impacts on tariff with incremental conversion as well as the total assessment of saving made over the remaining term of the project. The SECMC was asked to hire international analysts for the assessment of such matters.