ISLAMABAD: The Private Power and Infrastructure Board (PPIB) is poised to decide the fate of the 300MW coal-fired power project in Gwadar, proposed by M/s CIHC Pak Power Company Limited (CPPCL), during its board meeting scheduled for Thursday (today), official sources told Business Recorder.
The development comes as the government has already approved a 100MW solar photovoltaic (PV) project in Gwadar, which will utilize confiscated solar panels recovered by the Federal Board of Revenue (FBR) — signaling a shift towards cleaner energy in the region.
The proposed coal project, a key component of the China-Pakistan Economic Corridor (CPEC), is currently mired in financial and regulatory challenges. In a detailed communication to PPIB Managing Director Shah Jahan Mirza, CPPCL Chairman Zhao Bo expressed serious concerns over delays in approvals, foreign exchange losses, and currency conversion restrictions, rendering the project commercially unsustainable in its present form.
Zhao highlighted that the company had already submitted its Performance Guarantee (PG) on March 21, 2025, meeting all prerequisites to extend the project’s Letter of Support (LoS) until March 31, 2028. Despite this, the firm received a notice from PPIB demanding a Financial Closing Date (FCD) extension fee, which CPPCL termed inconsistent with Clause 5 of the 2019 LoS, exempting sponsors from such fees in cases of government-induced or unforeseen delays.
Citing force majeure conditions, Zhao argued that the delays stemmed from regulatory and administrative bottlenecks, referencing Clause 3A of the 2018 Fee Regulations, which permits fee waivers when project delays are beyond the sponsor’s control — especially under the revised Indicative Generation Capacity Expansion Plan (IGCEP).
The company stated it has already invested over USD 22 million in project development — more than twice the threshold approved by NEPRA — and paid USD 1 million in PPIB processing fees. Imposing further charges, Zhao warned, could jeopardize the project’s continuity.
To prevent further setbacks, CPPCL has agreed to pay the USD 150,000 extension fee under protest, while reserving the right to seek compensation or pursue legal remedies. The firm urged PPIB to uphold the original LoS intent and ensure the project’s inclusion within the broader CPEC energy framework.
In addition to the Gwadar project, today’s PPIB Board meeting will also deliberate on key matters including Engro Powergen Qadirpur Limited’s gas depletion mitigation plan, IT interventions under EDEIP, ICT initiatives under the National Electricity Plan 2023–27, and PPIB employees’ service regulations 2025. The Board will also review audited accounts for FY 2023–24, the PPIB Annual Report 2023–24, and a code of conduct for board members and employees.
Story by Mushtaq Ghumman
