Salt Range power station

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Salt Range power station was a 330-megawatt (MW) proposed coal plant in Pakistan. The project was cancelled in 2016.

Location

The map below shows the location of Pind Dadan Khan, Jhelum, the approximate location of the proposed project

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Background

In September 2014 the Punjab government and China Machinery Engineering Corporation (CMEC) signed a memorandum of understanding (MoU) for mining coal in the Salt Range.[1] In March 2015, it was reported that CMEC had asked the Punjab government to set a coal price mechanism for reserves to be extracted the the Salt Range and used to fuel a 300 MW coal plant. Once such a mechanism was established, CMEC would file a tariff petition to the National Electric Power Regulatory Authority (NEPRA). CMEC planned to establish a 330 MW mine-mouth coal plant at Pind Dadan Khan, Jhelum, where the company planned to build a 1.87-million-ton mine. According to the press report, the company had not been able to secure confirmation of its request for a coal price mechanism despite having begun seeking the mechanism in November 2014. According to CMEC, Salt Range coal would be more expensive than the average benchmark of world coal. Because of the additional expense, the company would need a favorable coal price in order to proceed.[2]

Project included in China-Pakistan Economic Corridor

In April 2015, it was announced that Salt Range power station was among the projects included in the China-Pakistan Economic Corridor. According to the announcement, a "facilitation agreement" for the project had been signed between CMEC and the Punjab government.[3]

In May, 2015, The Nation reported that Nepra (National Electric Power Regulatory Authority) had accepted "one of the most lucrative tariff" agreements in the world for the project. The article noted, "According to sources it is the ambitiousness of the government to set up new electricity generation projects that foreign companies for asking for out of the way incentives and high tariffs, which are not offered anywhere in the world. There has been pressure from government to facilitate new projects, sources said."[4]

Cancellation

In May 2016 it was reported that China Machinery Enginee­ring Corporation (CMEC) was bowing out of the project. CMEC reportedly lost interest in the plant because of issues relating to feasibility of producing enough energy for running a 330MW project and a tariff allowed by the National Electric Power Regulatory Authority that was lower than its expectations.[5]

In May 2017, Pakistan and China announced that this project was being dropped from the CPEC Energy Cooperation Project.[6]

Project Details

  • Sponsor: China Machinery Engineering Corporation (CMEC)
  • Parent company:
  • Location: Pind Dadan Khan, Jhelum district, Punjab province, Pakistan
  • Coordinates: 32.583333, 73.05 (approximate)
  • Status: Cancelled
  • Gross Capacity: 330 MW
  • Type:
  • Projected in service:
  • Coal Type:
  • Coal Source: mine-mouth
  • Source of financing: Chinese banks under Sinosure insurance coverage, with equity raised by China Machinery Engineering Corporation with its own funds or via equity loan[4]

Articles and resources

References

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External resources