960410

Foreign investment

in Hubco project

rises by 50 percent

ANWAR RAJANI

QUETTA: Offshore investment in Hubco has increased by 50 percent the total foreign investment in the country, Chief Executive of Hubco D.M Woodroffe said here on Wednesday.

Addressing a Hubco seminar on "Private Sector Power Generation", he said the capital cost of the Hub plant was a little under 1000 million dollars. This compares favourably with the figures quoted for similar plants here and in the Middle East in terms of cost per megawatt. Confusion in respect of relative pricing is created when comparisons are made with unlike figures, he added.

The seminar has been organised for journalists mostly from Karachi and Quetta.

Woodroffe said when Hubco would go into commercial operation would increase the installed capacity of Pakistan by 13 percent. Given the low cost and high availability of power from the project, it was expected that in energy terms, the plant would generate some 20 percent of the country's total electricity needs. Much of the power would, however, be used to eliminate loadshedding rather than catering for increases in demand.

Under the Power Policy of 1995 which was based on the Hubco documentation and tariff, he said, investors were invited to express interest in developing projects within the country. This had proved remarkably successful in that to date 12 projects had closed with a net capacity of 2400 MW. The first of these was planned to be in operation in late 1997 and the whole capacity in service within two years. Discussions with the Private Power Investment Board were at an advanced stage with five projects, three of which are regarded as almost certain to close increasing the installed capacity of the country by some 3000 MW, excluding the 1292 MW net output from Hubco, he added.

He said that the first of the two transmission lines was physically complete supplying power for commissioning and construction of the second line was now well advanced.

Physical laying of the pipeline is proceeding well. Pumps and other equipment are about to be delivered and installed. We see no difficulty in PSO meeting their obligation to have the line in service by June. Were completion to be delayed, this would not present any immediate problem to the project. The first fuel oil tank on site has now complete and the on road un-load facility available, PSO have started delivering oil to Site. We have more than sufficient time to build up adequate reserves to keep the plant going and cover for any problem should it arise.

The Hub Power Company, he said, recognises its obligations to the country and to its immediate neighbours. "We intend to discharge our responsibilities professionally recognising these extend to our shareholders, the government and our neighbours. We are discussing with the Balochistan Rural Support Programme what initiative can be taken in respect of the local population", he said.

To a question, he said the project construction continue to be on programme, i.e. for commercial operation of the first machine by the end of June 1996 with the others following at three monthly intervals. Full commercial operation of the station is expected by the end of March 1997.

He said the level of dividend can only be set by the Board once the construction activity has been complete and the station is in full commercial operation. It is only at that stage that it can be certain that all the estimates were correct. However, our forecasts still lie within the ranges identified in the prospectus, he concluded.