950828

Financial close deadlines not met

Private power projects to

lose millions in

bank guarantees

AMANULLAH BASHAR

KARACHI: Most of the power projects in the private sector, may lose their bank guarantee money estimated in millions of rupees, due to their failure to meet their financial close deadlines.

The bank guarantee provided by these power projects was at the rate of one lakh rupees per megawatt.

The projects whose deadline for financial close has already expired and their guarantee money is mostly likely to be forfieted are:

"Power Generation System" a project of 116 megawatt. Its deadline expired on June 27.

Kabirwala, of 144 megawatt, deadline expired on June 22,

North Electric Co., deadline expired on July 6.

S.E. Ltd of 115.2 megawatts, deadline expired on August 3.

David Power Project, deadline expired on July 10.

Japan Power Generation Ltd., 120 megawatts, deadline expired on July 27.

Multan Power Project, 119 megawatts, deadline expired on August 10.

Security Electric Power, 310 megawatts, deadline expired on July 17,

Wakgas Power Project, of 800 megawatts, deadline expired on June 22.

Uch Power Project, 584 Megawatts, deadline expired on June 22.

Fauji Power Project, 350 megawatts, deadline expired on June 28.

Habibullah Energy, deadline expired on July 17.

Some more power projects, whose last date for meeting the financial close are approaching fast, include ABB/Star, 206 megawatts. Its last date is Sept. 18. Another project Tractrabele of 463 megawatts, is also facing a deadline on Sept. 18.

After the Hub Power Project which is successfully close to its completion target, only Kohinoor Power Project, based at Raiwind, has hit the target. This project will be producing 120 megawatts of power.

The federal cabinet recently approved a proposal to give an extension of three months as a grace period to project which failed to meet their financial close, provided they doubled the amount of bank guarantee.

Responding to the offer of the government, only a few projects responded doubled their guarantee, while the majority of these projects are in the doldrums due to financial constraints.

Informed sources told Business Recorder that this sorry state of affairs was a sequel to the disturbed law and order situation which has scared the international lenders who are hesitating to come forward with financial assistance to these projects.