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Saturday, May 18, 2024

CPEC Matiari-Lahore Transmission Line project delayed for 6 months

The launching of the flagship China Pakistan Economic Corridor (CPEC) 4,000mw South-North transmission line project has been delayed to September 2021, owing to a failed recent test. Being the first project of its kind international standards are being met.

Reportedly, the government has extended the Commercial Operation Date (COD) for 660kV HVDC Matiari to Lahore Transmission Line, of value $1.7 billion, by six months, after the negotiations with the relevant Chinese company.

According to the Memorandum of Understanding signed between National Transmission and Despatch Company (NTDC) and the Chinese company, Pak Matiari-Lahore Transmission Company Pvt Ltd (PMLTC), it is clearly mentioned in clause 6 that: “Both Parties shall complete their outstanding works at the earliest to guarantee that the extended COD (commercial operation date) will be realized not later than 01.09.2021”.

The 878 KM long 4000 MW project is being carried out by Pak-Matiari Transmission Company (Pvt) Limited, on a Built-Own-Operate-Transfer (BOOT) basis for a term of 25 years. The construction is done and the project is under the testing and commissioning phase.

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This major setback to this high-priority CPEC project will lead to inordinate delay in the power plants connected to this project which have the least cost generation before peak summer months, which may result in high tariffs for consumers.

The transmission line will borrow power from the new generation units located in the south including Thar coal-based projects.

On 25 July 2017, the Economic Coordination Committee (ECC) approved the Security Package Documents, such as, Implementation Agreement (IA) and Transmission Services Agreement (TSA) which were subsequently executed on May 14, 2018.

The operation and maintenance of the project fall upon NTDC, for which an O&M (operation and management) agreement was reached on 14 May 2018.

According to NTDC, the delay is due to technical testing reasons for which the EPC (engineering, procurement, and construction) contractor is responsible.

Furthermore, the agreed changes were primarily made on account of the reason that the project activities and certain obligations to be fulfilled by respective parties were impacted due to the Covid-19 pandemic, and consequently, the Commercial Operations Date (COD) of the project needed to be extended from March 1, 2021, to September 1, 2021, and corresponding changes were necessitated to be made in respect of testing/training modalities.

It must be kept in mind that it is the country’s first-ever high voltage direct current (HVDC) transmission line. Thus, the concerned parties are making sure that all international standards were being met in the new project and that the project is compatible with the existing system of the country.

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