The Government of Pakistan is likely to cancel the 300 MW imported coal power project at Gwadar, as the Chinese company overseeing the project, M/s CIHC Pak Power Company (Pvt) Ltd (CPPCL), has hesitated to move forward without a further upward revision in tariff. According to sources in the Private Power and Infrastructure Board (PPIB), the company must provide a final decision by September 18, 2024, or the government will take independent action.
Managing Director of PPIB, Shah Jahan Mirza, issued the ultimatum in a letter to the CEO of CPPCL, citing continued delays and lack of progress, despite several extensions and support from the Government of Pakistan. The Letter of Support (LoS) was issued to CPPCL on August 23, 2019, with a Financial Closing (FC) deadline of April 2020, extended multiple times due to challenges like obtaining acceptable tariffs and lender agreements.
Despite these efforts and groundbreaking in 2019, no significant progress has been made. With the latest tariff revision to 9.0818 cents/kWh, higher than other similar projects under CPEC, CPPCL remains unsatisfied and has not commenced construction. The government has now set a firm deadline for a response regarding the future of the project.
