PM Shehbaz Sharif inaugurates second phase of Thar Coal Mines Project

Provincial and federal governments must work together for new vista of development and prosperity, says CM Sindh

Picture source - Twitter @PakPMO

Prime Minister Shehbaz Sharif has inaugurated the second phase of Thar Coal Mines Project.

Sindh Chief Minister Syed Murad Ali Shah, while giving a detailed presentation to Prime Minister Shahbaz Sharif at the mine pit, Coalfield Block-II, said that Thar Coal was a game changer for Pakistan as it could yield exponential economic dividends of $4 billion annually alone from the export of 70 MTPA coal, apart from producing power, and syngas for fertilizer in the country.

CM Sindh said, “Therefore, we, the provincial and the federal governments, have to work together to tap its resources in the entirety to usher in a new vista of development and prosperity in the country.”

The presentation was attended by Foreign Minister and Pakistan Peoples Party (PPP) Chairman Bilawal Bhutto Zardari, federal ministers Ahsan Iqbal, Musaddiq Malik, Khurram Dastgir, Sindh Provincial Energy Minister Imtiaz Sheikh, chairman HUBCO, CEO SECMC Amir Iqbal and others.

Quoting the Geological Survey of Pakistan (GSP), the chief minister said that Thar Coal has 175 billion tons of coal reserves worth $29 trillion or more than the reserves of Saudi Arabia and Iranian Oil reserves. He added that the entire coalfield has been divided into 13 blocks, of which Sindh Engro Coal Mine Company (SECMC) was working in Block-II, a reservoir of two billion tons of coal, and SSRL was engaged in Block-I, a reservoir of five billion tons.

Tracing the history of Thar Coal, Shah said that it was discovered by GSP in 1991. “Moving on the fast track for an early harvest of the black gold, Sindh Government, and Engro Energy Ltd entered a Joint Venture Agreement in 2009, and in 2014 both Mine and Power Projects were included as China and Pakistan Economic Corridor (CPEC) – related projects,” he said and in 2015 the federal government issued Sovereign Guarantee for the Thar Coal Project and first Tariff Determination was issued for Thar Coal and Power Plants.

Murad Ali Shah proudly said that in 2019, 3.8 Mtpa Mine and 600 MW Mine Mouth Power Plant was commissioned in 2019 and production capacity was expanded to15.4 Mtpa powering 2640 MW in 2022.

The CM acknowledged the federal government’s support and said that it has been instrumental in enabling the Thar Coal and Power Project. He recalled that in January 2014, the then-prime minister, Nawaz Sharif, and President Asif Zardari had jointly performed a ground-breaking ceremony for the Thar Coal and Power projects.

“A $700 million Sovereign Guarantee was provided by the federal government backstopped by the Sindh government,” the CM said and added that 55 percent equity was injected by the Sindh government in SECMC and it incurred $700 million on development of infrastructure in Thar.

Murad Ali Shah said that Thar Coal has created unparalleled economic dividends for Pakistan. “Approximately 12.5 million tons of coal unearthed and about 12,500 GWh added to the national grid since the inception of the coal and power projects,” Shah said and added that it saved a forex of $2 billion per year for the country at the current price of $700 million by the end of 2022.

According to the CM, with the efforts of the Sindh government, a foundation of $7.5 billion investment, including $5.1 billion in power and $1.8 billion in mines under CPEC has been laid.  Murad Ali Shah disclosed that Thar Coal was currently the cheapest source of power. Quoting the current spot price as per the last notified by NEPRA rates, based on Thar coal Phase-II coal price, Murad Ali Shah said, power generation against the imported coal costs Rs37 per kWh, LNG Rs24, and Thar coals costs Rs17 per kWh. “This shows that Thar coal is the cheapest source of power generation,” he said.

The chief minister said that Thar Coal could yield exponential economic dividends by2030. He added that Thar Coal Block-1 was going to unearth 7.8 Mtpa (20 MPTA) for the generation of 1320 MW by December 2022 and would save $1.2 billion Forex annually.  He added that the conversion of Sahiwal, Port Qasim, and CPHGC plants to Thar Coal, 926 MTPA, would save the country $1.5 billion annual forex.

Shah said that three cement plants – Fatima, Bestway, and Pioneer- were interested in utilizing Thar coal for which tests have been successfully conducted and would save $2 billion in foreign exchange for the country annually. He added that coal gasification could be used to make Syngas (SNG) for fertilizers and would save $3 billion in foreign exchange if 60 MPTA were used.

On top of it, the export of 70 MPTA lignite coal to regional countries would save/fetch $4 billion annually.

The chief minister told the prime minister that major social initiatives have been undertaken in Thar.  He added that mine and IPPs in Block-II have pledged two percent and one percent of their profit respectively to the Thar foundation for Corporate Social Responsibility (CSR) over the life of their project.

Shah said that 60 percent or 3,303 of the total employment of Block-II were Tharis and they have been given Rs75 million in technical scholarships.  He added that 23 schools have been established where over 4,061 students, including over 1000 girl students, were receiving education. A 120-bed state-of-the-art hospital has been established under CSR, with an OPD of 150 to 2000 patients at Marvi Clinic daily.

The CM told the PM that 52 Thari women who were trained to drive dump trucks were successfully and proudly doing their job. He added that 11 Thari women were working as operators of RO plants. “We have installed 17 RO plants which are supplying clean water to 13 villages,” he said.

Hanif Samoon is a senior journalist based at Thar/Badin and contributes reports from different districts of Sindh to Minute Mirror. He has won a number of awards, including the Agahi Award twice for his stories on health and child rights. He tweets @HanifSamoon1 and can be reached through email at hanifsamoon@gmail.com

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