Iran to Lend Pakistan 55m Dollars for Power Transmission Line

Dec 29, 2008 - BBC Monitoring

The Export Development Bank of Iran will extend credit of 55m US dollars to the National Transmission and Despatch Company (NTDC) and Pakistan Electric Power Company (PEPCO) for construction of a 70-km transmission line in Pakistan.

The offer was made by an Iranian delegation led by Minister for Energy Parviz Fattah during a meeting with a Pakistani delegation led by Minister for Water and Power Raja Pervaiz Ashraf here on Monday to discuss bilateral cooperation on existing power-sector projects related to import of electricity from Iran.

The balance 50 km on the Iranian side will be constructed by Iran. Both sides expressed keenness to accelerate progress on the power import project as consultants have already been engaged to carry out the feasibility study for the import of an additional 1,000 MW from Iran, for which a memorandum of understanding has already been signed.

The Iranian minister, while stressing the need for enhancing bilateral cooperation, offered the supply of more electricity from Iran. He offered to export electricity from its port at Chabahar, which is nearest to the Gwadar port, where a power plant of 500 MW is being constructed by Iran and will be ready within the next six months. He said that Iran was already supplying electricity to many countries including Syria, Tajikistan and Iraq and was also keen to export the required electricity to Pakistan.

Iran also expressed its interest to build a dedicated 1,000-MW gas power plant at Zahidan near the Pakistan border for the export of power to Pakistan.

The delegation was briefed by the Ministry of Water and Power authorities on the current power situation; short-, medium- and long- term measures being taken by the government of Pakistan to bridge the gap between demand and supply; future plans to inject more electricity into the national grid to end the energy crisis; and the potential projects being offered to investors in the coal, hydroelectric and renewable energy sectors. The salient features of the power policy and liberal incentives for private investors were also highlighted in the briefing.

Pakistan is currently importing 40 MW from Iran for the coastal areas of Baluchistan. The import of power is being enhanced by an additional 100 MW for the Gwadar port, for which an agreement has already been signed.

It was informed that Messrs Sunir of Iran will construct the transmission line on both sides of the border, for which negotiations on the award of the contract are in progress.

Raja Pervaiz Ashraf said the government of Pakistan would welcome such an initiative, extend full cooperation and work out the modalities. He said that Pakistan was interested in purchasing more power transformers of various capacities from Iran, with speedy delivery. He said that Pakistan is blessed with immense natural resources for exploration; thereby, a lot of attractive investment opportunities are available for the acceleration of business in the areas of hydroelectric power projects; irrigation; transmission lines; and thermal and renewable energy projects including wind, solar and biomass energy utilization. He also offered the services of Nespak, which is a leading consultant in the power sector, to undertake the engineering consultancy services of large projects in Iran.

Both sides expressed their interest and resolve to enhance bilateral cooperation and agreed on a strict timeline and milestones to carry forward the already initiated projects in the shortest possible time.

Originally published by Associated Press of Pakistan news agency, Islamabad, in English 1615 29 Dec 08.