A letter of interest (LoI) has been issued to PEL as the "Main Sponsor" of the Kandra power project, by the Private Power and Infrastructure Board (PPIB), Ministry of Water and Power, in January 2008 and was extended in June 2009. A feasibility study for the Kandra power project is being undertaken for submission to the PPIB by August, 2010.
The EPC (engineering, procurement and construction) activities to energise the power plant within a period of about three years will be initiated after obtaining a letter of support (LoS) on the acceptance of the feasibility study by the PPIB. The sources added that the government of Pakistan, on the basis of the Economic Coordination Committee of the Cabinet''s decision taken on I September 2005, allocated five MMSCFD pipeline quality gases for blending with processed Kandra gas to generate 60 MW of electricity.
Subsequently, in its meeting on May 10, 2007, the ECC decided that Low Btu gas fields (below 600 Btu) would be entitled to allocation for pipeline gas subject to the condition that 50 percent of the heating value for power generation is provided by the Low Btu Gas as fuel.
Based on this policy guideline, the PEL is expected to be allocated an additional five MMSCFD pipeline quality gas, so that 120 MW power is generated, using a blend of pipeline gas and processed Kandra gas, each gas stream providing 50 percent in heating values for power generation.
The Kandra Gas Field, owned and operated by the PEL, has an Initial Gas in Place (IGIP) in the "proved plus probable" category of 2.13 trillion cubic feet (Tcf), which is more than sufficient for the fuel requirements of the proposed Kandra power plant for more than 30 years.
The Kandra Power Company plans to commission the combined cycle of 120 MW power plant in Sindh, with two new gas turbines of 40 MW each and two new heat recovery steam generator (HRSG) along with a new steam turbine each of 40 MW (Total 80 MW + 40 MW = 120 MW). The official said that the PPIB had also supported the PEL''s request for allocation of an additional five MMCFD gas for 120 MW power plant with the following benefits:
-- Bigger contribution to National Grid in time when the country is facing acute power shortage, and relatively lower tariff due to economy of scale. Additional five MMCFD pipeline quality gases from the SSGC''s system would be for 15 years starting from January 2012 and thereafter on best effort basis.
Allocation of five MMCFD additional gas from SSGC system for commingling with low Btu gas from Kandra field will help generate additional 60 MW desperately needed power and utilisation of the said field, which is dormant at present. However, it was argued that to ensure timely utilisation of gas, it would be prudent to link allocation of gas with similar milestones/ conditions as earlier set by ECC in case of the 1PPs namely DHA Cogen, Aiden Venture and Tri-star Modaraba.
The official said that the Finance Division, Planning and Development Division and Ministry of Water and Power had also supported the proposals made in the summary. He revealed that the proposal made in the summary had been submitted for consideration and approval of the ECC of the Cabinet on Tuesday.