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Abraaj acquires majority stakes in Jhimpir wind power project

The Abraaj Group, a clean energy generation company, has entered into a definitive agreement to acquire majority stakes in Jhimpir Wind Power project. It may be noted that initially JPL Holdings (Pvt) Limited wholly-owns a 50MW wind power project in the Jhimpir wind corridor in Southeast, Pakistan.

In this wind corridor of Jhimpir having a predictable wind speed some five wind power projects are already in power generation connected to the national grid. The Jhimpir wind corridor is an established area for wind projects with 550MW+ of capacity already operational and a further 1 GW+ added under the construction and development phase.

Meanwhile, the Abraaj Group has entered the project, which had achieved financial close in August 2016 and is expected to commence operations in the first quarter of 2018.

The project will be powered by General Electric wind turbines, with the Huadong Engineering Corporation appointed as the EPC contractor and GE providing the overall operations and maintenance for the project.

“Our investment into the Jhimpir wind corridor marks our second transaction under Abraaj’s dedicated clean energy platform,” said Sev Vettivetpillai, Managing Partner and Global Head of Abraaj’s Thematic Fund Business. With a shortage of over 6,000MW and rising power consumption in Pakistan , we are excited by the sheer size of the clean energy infrastructure opportunity, enabling government policies and the potential of the Jhimpir wind corridor, he further added.

“Having invested across the energy value chain in growth markets, including the power sector in Pakistan, we look forward to growing our renewable footprint and consolidating our presence in the sector,” said Vettivetpillai.

According to Saad Zaman, Partner at The Abraaj Group, with investment of Abraaj into JPL Holdings we naturally look forward to building on the momentum we have gained from the financial closure achieved on our first wind project in Pakistan.

Saad Zaman said: “the attractive renewable power policy framework implemented by the government has created a strong impetus for the private sector to invest in clean energy. Leveraging on our combined operational capabilities, project management experience and know-how, we will successfully develop the Jhimpir wind corridor project and enhance power generation in Pakistan.”

It may be mentioned that Abraaj Group has comprehensive investment experience across the energy value chain and has invested $1 billion in 10 investments in growth markets. In October 2016, Abraaj entered into a definitive agreement to divest its 66.4 percent shareholding in K-Electric to the Shanghai Electric Power Company Limited, marking one of the largest private sector transactions in Pakistan and representing one of the global power industry’s most well-recognized operational turnaround stories.

UPCOMING WIND POWER PROJECT IN PAKISTAN

Wind power generation capacity of Pakistan is projected to increase from 250 to 1,530MW within a year as 22 windmill projects are in the pipeline.

The cheap and environmental-friendly wind energy, introduced late in Pakistan, is gaining popularity as it ensures quick return in a short cycle of three years.

Pakistan has a 1,046km coastline in the South (Sindh and Balochistan), but most of the wind power projects are currently being installed at Gharo-Keti Bandar and Hyderabad wind corridor.

Official sources said that nine wind turbine generator (WTG) projects are in advanced stage of development, while the other nine are under-construction and four have got their letters of intent (LoIs), while many more projects are under process and firmly documented. The estimated energy potential of the wind corridor is 50,000MW. Besides Gharo, several other sites have been identified in coastal areas of Balochistan and Northern areas.

Presently, five projects each with 50MW capacity are operating at Gharo-Jhimpir wind corridor. However, the nine other WTG projects, which are in the phase of development will produce 450MW and those in the stage of construction will produce 480MW wind energy. Similarly, four projects which have been given LoIs will produce 350MW.

Mohammad Kasim Hasham, whose company Uni-Energy has recently been awarded Letter of Interest (LoI), said that with 100 percent foreign financing the total cost of wind power project comes to $107.50 million, and in case of local financing the cost is estimated at $113 million. The annual operational and maintenance cost in both the cases is only $2.196 million.

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