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Thar coal project has potential to be the energy capital of Pakistan yet so much to be done for all future resettlement

Interview with Mr Shamsuddin A. Shaikh – CEO, Engro Powergen Ltd, Sindh Engro Coal Mining Company & Thar Power Company Ltd

PROFILE OF SHAMSUDDIN A. SHAIKH:

Mr Shamsuddin A. Shaikh is the CEO of Engro Powergen Ltd, Sindh Engro Coal Mining Company & Thar Power Company Ltd. Prior to his current position, Mr. Shaikh was Senior Vice President at Engro Foods. He is Chairman of the Board of Directors of Engro Powergen Thar (Pvt) Limited and Engro Powergen Qadirpur Limited while he also serves on the Board of Directors of Sindh Engro Coal Mining Company, Thar Power Company, Engro Powergen Limited; Engro Eximp Ltd &Engro Eximp Agri Products (Private) Ltd. Mr. Shaikh has an extensive career of 25+ years in Manufacturing, Sales, Commercial and Supply Chain at different levels and subsidiaries of Engro Corporation. He did his MBA from Colorado State University, MS in Industrial Engineering and BE (Mechanical) from NED University, Karachi.

ABOUT SECMC: Sindh Engro Coal Mining Company (SECMC) was formed as a joint venture between the Government of Sindh and Engro Powergen Limited (EPL). Other sponsors of the company are some of the largest companies in Pakistan and China including Thal Limited (a subsidiary of House of Habib), Hubco, HBL, China Machinery Engineering Corporation (CMEC) and State Power International China. The company was established with the primary objective of making effective use of the ample coal reserves in the Thar Desert to meet Pakistan’s power generation needs, spur economic development, and bring energy security to the country.

PAGE: KINDLY TELL US ABOUT THE PROGRESS OF THAR COAL BLOCK II:
SHAMSUDDIN A. SHAIKH:

Progress on all fronts including major construction activities, overburden removal, infrastructure and community reach initiatives remains ahead of schedule. On the mining front, more than 4.7 million BCM of overburden has been removed and current depth of the mine is 86 meters. Overall progress of the project is 42% vs the planned 38%. Similarly, on the power plant side, piling and foundations works have been completed and erection of steel structures is in progress. Overall progress is 32% vs the plan of 28%. Based on this progress, both SECMC and EPTL expect to achieve COD by 3rd June 2019, 4 months ahead of schedule.

PAGE: WHAT ROLE COULD THAR COAL BLOCK II PLAY IN THE ENERGY CRISIS OF PAKISTAN?
SHAMSUDDIN A. SHAIKH:

As the pioneering project in Thar, Block II has a vital role to play in further development of Thar and resolution energy crisis in Pakistan. It is home to 1% of the total reserves at Thar, which can generate4000MW for 30 years. SECMC plans to expand its mine to 22 Mt/a (enough to fuel 4000 MW) by 2023, making the project comparable to other large-scale mines in the world. As a first step towards this goal, SECMC plans to expand its mining project to 7.6 Mt/a by 2020 to serve two 330 MW IPPs, bringing the total generation from Block II to 1320 MW. Coal Supply Agreements have already been signed with Thar Energy Limited (a JV between Hubco and FFC) and Thal Nova Power Thar Limited (a JV between Thal Limited and Novatex) for supply of 1.9 Mt/a each. Construction for this expansion phase is expected to begin by the end of the year. In addition, SECMC has shortlisted potential off-takers for future Phases of mine expansion up to a mine capacity of 19 Mt/a and is in the process of finalizing its expansion plan to cater to this demand. However, SECMC’s role in the resolution of the power crisis is not limited to generation of power from the Block II. As the pioneering project, SECMC is willing to share its experiences and help in the development of other blocks at Thar to ensure that Thar fulfills its promise.

PAGE: COULD THAR TRANSFORM INTO ANOTHER DUBAI IN THE WORLD?
SHAMSUDDIN A. SHAIKH:

While it is difficult to say that Thar will turn into another Dubai, it certainly has the potential to become the energy capital of Pakistan. However, that said we have to realize that Thar at this point in time lacks even most of the basic facilities for healthcare, education, water etc. It is amongst the lowest ranked districts in the country on any Human Development Indices, so there needs to be a coordinated effort to ensure that Thar realizes it true potential and the local population directly benefits from the economic activity in the region.

For their part SECMC and EPTL are fully committed to ensuring that Thar fulfills its destiny to become energy capital of Pakistan and its people have access to quality education, health care and enjoy a quality of life second to none. The companies together have formed the Thar Foundation, a trust that plans to make sustainable interventions in the fields of healthcare, education, infrastructure, livelihood and disaster management while at the same time working to preserve the local culture of Thar.

On the healthcare front Thar Foundation is currently running the Marvi Clinic in collaboration with Indus Hospital focused on Mother and Child. This will graduate into a 100-bed state of the art Hospital at Islamkot by 2018. Similarly, Thar Foundation is working with TCF to set up 1000 kid schools in each taluka of Tharparkar. At this same time, it is in the process of reconstructing government schools in the villages in Block II and Gorano Reservoir area and running them in collaboration with Charter for Compassion to ensure provision of quality education to the locals.

 

It has also launched livelihood initiatives such as Dumper Driver Training for both males and females of the region, and vocational trainings such as scaffolding, pipefitting etc. to integrate the local populace into a thriving Thari economy.

To address a lack of clean water in the region it is setting up RO plants in villages in Block II and Gorano region. It is working with SECMC to ensure that the resettlement villages being constructed include all modern amenities and serve as a model for all future resettlement required for projects. The platform of Thar Foundation is also open to other companies working on coal projects in a region so that a coordinated effort can be made for the betterment of the locals. However, being a private sector organization, the Foundation alone cannot put Thar on the path to progress given the dire state of the region. The government will have to step up at some stage for Thar to fulfill its potential. There is a significant royalty that will be collected from the coal reserves at Thar. This can also be routed to hasten Thar’s progress. To sum up, Thar has the potential to be the energy capital of Pakistan, perhaps even the region but it will require a lot of hard work and resources for it to fulfill this potential.

PAGE: HOW WOULD YOU COMMENT ON THE TRANSMISSION LINE FROM SINDH TO PUNJAB?
SHAMSUDDIN A. SHAIKH:

The transmission line from Sindh to Punjab is a necessity given that most of the demand centers are located within Punjab whereas the generation projects are being set up in Sindh due to its proximity to fuel sources. With the additional capacity coming into the system, it is necessary to connect the supply to the demand centers for which the transmission line is an absolute necessity.

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