No plans to shelve power
State utility Tenaga Nasional Bhd said that it had no plans to shelve
its power project in Pakistan but said that delays in implementation pushed up the project
cost of phase I by $200 million.
It was replying to questions raised by the Kuala Lumpur Stock exchange
Tenaga said phase I of the Liberty Power Ltd project located in Daharki
in the province of Sindh was originally estimated at $ 250 million.
As a result of the delays, its commercial operation date was
rescheduled from August 1997 to December this year. The expected original return of 23 per
cent from the project was revised downwards to about 10 per cent, Tenaga said.
KLSE had queried Tenaga on a report in the Hong Kong based Asia Wall
Street Journal last week that delays in the construction of the plant would hurt the
group's earnings. The article also said Tenaga might make provisions in its accounts for
financial year 2000 if the project was shelved due to problems on tariff rate agreement
and the supply of gas.
According to Tenaga, the physical construction of the plant commenced
in early 1996, has been completed and it will be commissioned once gas is made available
and the tariff rate issue resolved. Liberty Power, a 470 mw gross capacity power station
is one of the major independent power projects in Pakistan.
The project was approved in July 1995 when the company obtained the
letter of support from the then Bhutto government for the implementation of the project in
two phases, of 235MW each.
The implementation and the power purchase agreement for phase I, was
signed in November 1995. "Current negotiations with the Pakistan government are in
respect of phase I of the project, as discussions on phase 2 have not started yet,"
The utility company also said it had increased its interest in Liberty
Power from an initial 20 per cent to 62 per cent in April 1998 to 100 per cent in mid-July
at the request of the Pakistan government.
Cotton output target set at 9.7m bales
Pakistan has increased its cotton output target to 9.7 million bales
from nine million for the current 1999/2000 fiscal year, an official report said. .
"The cotton production target for 1999/2000 has been fixed at 9.7
million bales, which is to be achieved from an area of 2.93 million hectares (7.4 million
acres)," said a report of the state Pakistan Central Cotton Committee obtained by
Reuters on Thursday.
Pakistan graples with economic fallout
Pakistan's fragile economy has suffered considerable damage from the
two-month conflict with India over Kashmir which broke out just when it had started
showing signs of a recovery, business sources said on Tuesday.
Businessmen said the crisis which triggered fears of an all-out war
between the arch foes hit the stock market, discouraged investors and put the brakes on
The crisis was defused by Prime Minister Nawaz Sharif's decision to
call back Islamic fighters from the Indian side of the disputed Himalayan region.
Business sources said a major factor behind Sharif's move was the
Heavily dependent on foreign loans, the economy could hardly have
sustained any further escalation in the conflict.
Pakistan's economy posted a low 3.1 per cent growth rate in the fiscal
year to June 30 against a target of 5.0 per cent due to international sanctions slapped
over nuclear detonations by the country in May 1998.
PARCO's White Oil Pipeline project
Pak-Arab Refinery Limited (PARCO) has said that the performance
guarantee of $30 million for White Oil Pipeline project has been arranged and PARCO's
bankers have already submitted a draft of the performance guarantee as per the prescribed
PARCO was clarifying a news item with Islamabad dateline captioned
"White Oil Pipeline project in jeopardy" published on July 17.
The company said that as soon as clarifications are received and the
necessary approvals obtained, the Performance Guarantee would be submitted.
In the meantime, the initial project related work such as
reconnaissance/detailed survey of the pipeline route, the front end engineering design
(FEED) activities and the environmental assessment study are being proactively planned
with the objective to commission the WOPP Pipeline by the scheduled dates desired by
government of Pakistan, it added.
Wheat support price by Sept
Agricultural Price Commission (APC) is actively framing various
proposals regarding increase in wheat support price for the fiscal 1999-2000 to be
finalized at a meeting next month.
The summery of the proposals, to be finally shaped at APC meeting in
August, will be sent to the cabinet for final approval, in September next, sources at the
Agricultural Ministry said on Monday.
BD offers expertise in tea farming
Bangladesh has offered to provide requisite technical and professional
assistance in the development and promotion of tea cultivation in Pakistan.
This offer was made here on Monday by the delegation of Bangladesh in
course of a meeting with the federal minister for food, agriculture and livestock, Abdul
Ginneries resume operations
More ginneries have resumed operations in the lower Sindh cotton belt
as arrivals of phutti from the fields are picking up daily but prices are stable despite
no let-up buying from the central Punjab ginners.
According to Karachi Cotton Association (KCA), about a dozen factories
have gone into production and more are ready to join them as prevailing prices of phutti
and lint cotton suit both the ginner and the spinner.