Pakistan will seek Chinese investment for 19 energy sector projects, including financing for the Iran-Pakistan gas pipeline, mega hydel projects and for tapping energy from the huge, but so far unexploited, Thar coal reserves. The issues would be taken up at the first meeting of the Pakistan-China Joint Energy Working Group on August 1-2 in Beijing.
An official source said there was near unanimity in the political and official circles that the present quagmire of energy crisis could only be countered if technological and financial assistance was gained from some advanced country. He said under the prevailing international financial crisis, only China has the expertise and finances available to invest in the energy security in Pakistan. The government has firmed up 19 projects, including four power generation projects of about 2,297MW, a coal power project of 405MW, one project for development of infrastructure, mining and power generation of Thar coal, four projects of small and medium dams, five projects of transmission lines and power distribution, a project for alternative energy and two projects of the Geological Survey of Pakistan.
“There are no concerns over the strategic issues which usually arise due to foreign investment in the energy sector as it requires massive surveying,” the source said, adding that it also increased their influence in domestic economic matters. Chinese usually don’t raise security issues which are used by western companies to increase the project costs, he said. The electricity load shedding during the last three years is estimated around 25 percent of the system demand, which has led to an estimated decline of two percent in the GDP per annum, even though around 30 percent of the population has no access to electricity at all.
Water and Power Minister Syed Naveed Qamar would be leading the Pakistani delegation at the two-day talks where Chinese public and private companies would be invited to invest the development of Pakistan’s power sector. The government would be seeking technical assistance, financing and engineering procurement contracts for these projects. The government plans to complete all these power generation projects within three to five years to regain energy security.
Chinese hydel power giant, China Three Gorges Project Corporation (CTGPC) has made an offer of a $15 billion-investment in the power sector. CTGPC Chairman Cao Guangjing had made this offer to the government during his visit to Pakistan in April this year. An Energy Working Group was constituted to pursue an MoU between Pakistan and China to promote cooperation in the field of energy. Under the MoU, which was proposed by National Energy Administration of China to establish bilateral energy cooperation mechanism, the Energy Working Group will be assigned the task of carrying out cooperation in the areas including oil and gas, coal, conventional power, nuclear and renewable energy etc.
Moreover, during the visit of the Chinese Premier Wen Jiabao in December 2010, under Energy Cooperation mechanism, it was decided that China will provide financing and cooperation for conventional, renewable and civil nuclear energy projects, to be identified by Pakistan. Both the countries have termed JEWG an important opportunity which will further strengthen the bilateral relations between Pakistan and China.
