Thar Coal & Energy Board

Government of Sindh

www.sindhcoal.gos.pk

Thar coalfield is approximately located between Latitudes 24o15’N and 25o45’N

Longitudes

69o 45’E and

70o 45’E

in the south eastern part of Sindh

Coal Fields of Pakistan & Thar

Sindh 186 billion tons

Punjab 235 million tons Balochistan 217 million tons KPK 90 million tons Azad Kashmir 9 million tons

Field Reserves Bn tons

Moisture %

Fixed Carbon

Volatile Matter

% Ash %

Sulphur %

Calorific Value Btu/lb

Rank

Lakhra 1.328 28.9 28.0 25.2 18.0 4.7 to 7.0 4622 to

7,552

Lignite A to B

Sonda 7.112 34.0 27.9 25.2 15.0 1 to 2.8 6762 to

11029

Lignite A to B

Badin 1.358 15.4 to

29.8

29.8 to

39.8

31 to

36.3

8.2 to

14.6 3.4 to 7.4

6740 to

11100

Lignite A to B

Thar 175 46.8 23.4 16.7 6.2 0.9-1.2 5,774 Lignite A

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Sindh Coal - Chemistry

• Distance from Karachi 395 Km

• Identified Area 9100 Sq. Km

• Total Reserves at a depth of 155-200 Meter 175 Bn Tons

• Cumulative Coal seam Thickness 24 Meter

• 12 Blocks developed after detailed drilling 1192 Sq. Km

• Each Block’s estimated Coal reserves 2.0 Bn Ton (approx)

• Potential of each block (approx) 4000-5000 MW for 30 Years

Thar Coal – At a Glance

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Thar Coal - means to Energy Security for Pakistan

Energy issues in Pakistan

• Rising energy demand

• Significant energy shortage

• Energy Mix out of step with world norms

• Historical trend of high oil prices

• Natural gas demand exceeding supply mainly due to use by industry & transport sectors

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Desirable Scenario

• Should provide reliable and predictable supplies

• Should be more indigenous and less dependent on foreign supplies

• Should be cheap and affordable

• Should provide energy security

Thar Coal – the Ultimate solution

Bridging power generation gap via Thar

For a mine size of 6.5 Mt/a an investment of USD 1 Bil is required, this capacity is sufficient to fuel 1200MW of Power Plants (investment of USD 1.7 Bil)

With increasing mine size the power tariff will be lowered as coal price will be lower

7 8 9

13

18

21

0

5

10

15

20

25

Domestic Gas Thar Coal Imported Coal LNG RFO HSD

Usc

/Kw

h

Levelized Tariff

Source : SECMC Feasibility report 6

Thar Coal Potential

Thar

PAKISTAN

• Thar Desert contains the world’s 7th largest coal resources:

1% = 25% Thar Coal Resource

175 Billion Ton = 50 Billion TOE = 2000 TCF Total Thar Coal Resource More than Saudi Arabia 68 times higher than & Iranian Oil Reserves Pakistan’s total gas reserves

Source:: GSP data/report – Energy equivalent is based on Shenhua report/RWE

Pakistan’s Power Generation Capacity in 2013

Location of Thar Coal Field

• Development of Block II alone would bring in investment of 10 Bn USD

• Total potential of generating 100,000 MW of electricity for over 200 years

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Global Lignite Qualities

Country Moisture %

Ash %

Volatile Matter % Sulphur %

Australia 65.5 0.6 17.6 0.1

Bosnia 51 2.0 30.3 0.05

Germany 55 10 19.2 0.2

Greece 52 15.1 18.8 0.2

India 48 6.1 25.6 0.6

Kosovo 51 15 20.8 <1.0

Pakistan (Thar)

46 7.0 28.0 0.7 - 1.1

Poland 52.8 9.8 20.0 0.6

Serbia 45.5 17.0 22.5 0.49

Thailand 30-35 10-28 32 0.8-1.5

Turkey 50 16 22.8 1.7

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Deposit Stripping Ratio

(m³ : t)

Heating Value

(MJ/kg)

Thar 6.6 : 1 11.6 (5000 Btu/lb)

Kosovo 1 : 1 7.8 (3350 Btu/lb)

Rhenish Area,

Germany

4.9 : 1 8.9 (3830 Btu/lb)

Hambach, Germany 6.3 : 1 10.5 (4510 Btu/lb)

Hungary 9 : 1 7.1 (3050 Btu/lb)

Greece 10:1 5.02 (2159 Btu/lb)

Comparison of Thar Lignite with other Countries

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Block

Area Sq.

Km

Total

Reserves

bn ton

Moisture %

Ash % Vol.

Matter % Sulphur

% Fixed Carbon

%

I 122 3.56 43.13 6.53 30.11 0.92 20.11

II 79.6 2.24 48.89 5.21 26.55 1.05 19.68

III-A 99.5 2.00 45.41 6.14 28.51 1.12 19.56

III-B 76.8 1.45 47.72 9.30 25.49 1.15 16.79

IV 82 2.47 43.24 6.56 29.04 1.20 21.13

V 63.5 1.39 46.82 8.92 38.24 1.20 13.26

VI 66.1 1.65 48.32 7.62 36.22 1.52 16.6

VII 100 2.17 48.27 8.03 25.30 1.16 25.30

VIII 100 3.03 49.57 7.78 24.32 1.44 18.10

IX 100 2.86 48.60 5.92 29.03 0.96 15.73

X 100 2.87 48.99 6.35 30.79 1.17 13.54

XI 101 1.61 49.97 8.07 24.16 1.61 17.26

XII 100 2.34 50.82 5.71 25.00 1.11 17.26 10

Thar Coalfield Blocks & Characteristics

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• Developed 12

• Allocated 6

– I: Sino Sindh Resources Ltd

(Pak-China) SSRL

– II: Sindh Engro Coal Mining Company SECMC

– III: Asia Power (UK) AP

– IV: Harbin Electric HE(China)

– V: UCG

– VI: Sindh Carbon Energy Ltd (Oracle, UK)SCEL

Thar Coal Blocks

Thar Coal based Power Projects

Block Investment Firm Total coal

Potential of Block Bn Tons

Power Projects Initiated/Planned MW

Expected COD

Block-I SSRL (China-Pak) 3.657 2X660 2018-19

Block-II SECMC Pakistan 1.584 Phase-I 2X330 2017-18

Phase-II 2X330 2019

Phase-III 4X660 2021

Block-III Asia Power UK 2.007 2X660 2019-20

Block-IV Harbin Electric China

2.572 2X660 2019-20

Block-V UCG Project 1.394 2X50 Phase I: 8-10 MW

2016-17

Block-VI Oracle Coalfields (UK)

1.423 2X330 2019-20

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Status of Mining & Power Projects at Thar Coalfield Block Status/ Timelines

Block-I: Sino-Sindh -Global Mining Open-pit Coal Mining of 7.8 MTPA up and 2 x 660 MW Power Plant Estimated Project Cost (Mine): US$ 0.95 bn Estimated Project Cost (Power): US$ 1.9 bn

• MoU between SSRL & Shanghai Electric Power signed • Coal Supply Agreement in place. LoI approved by PPIB • Land & Socioeconomic survey completed • ESIA has been completed by EMC • Feasibility stage coal tariff has been approved by TCEB • China Coal Technology and Engineering Group Corp, (CCTEG)

has majority stake in mining part of project for 7.8 mta mine at Thar Coalfield Block-I

• Financial Close is due in Q1 2017, followed by Construction Period of 36 months.

• COD is expected to be attained by 31st December 2019 • LOI from ICBC & Sinosure at place for mining • Application for Upfront Tariff for Power Plant submitted to

NEPRA • Negotiations underway with ICBC & CDB which are the

institutions having shown willingness in providing necessary debt financing.

• Chinese EPC contractors have provided firm commitment for equity participation

• Remaining equity has already been committed by project sponsors

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Status of Mining & Power Projects at Thar Coalfield Block Status/ Timelines

Block-II: SECMC (JV: 51% GoS; 49% Engro+ affiliates) Project: Open-pit Coal Mining of 3.8 MTPA up to 7.8 MTPA (Phase-I) and 2 x 330 MW Power Plant. Project Cost (Mine): US$ 0.85 bn Project Cost (Power): US$ 1.1 bn

• Land acquired for 8 years of Mining. EPC Contract signed • Coal Supply Agreement with Engro Power Thar Ltd. signed. • Financial Close is achieved in April, 2016

• Contract & Financial Close Stages Coal Tariff Approved by TCEB • Rs. 50 bn Agreements for Local Financing signed • Mining & Power EIA issued • Overburden removal has begun – 3 years to reach Coal seam

• Mine depth achieved 64 m till January, 2017 • Dump height achieved 30 m till January, 2017 • Over burden removal progress is 22.8 million BCM till

January, 2017 • 3 OB Ramp has been constructed • Maintenance workshop construction is in progress • Dewatering Activities are carried out, 20 wells are

completed out of which 8 have also been tested and accepted

• Resettlement Action Plan has been approved • Working to develop the technical Feasibility Study (FS) for Mine

expansion up to 13.3 Mt/a & beyond • SECMC is contemplating to expand mine to 19 mtpa by 2022

Blocks Status/ Timelines

Block-V: UCG Pilot Project Under Ground Coal Gasification Project & Power Plant

38 bore holes drilled Test Burn in Dec. 2011-Syngas being produced 5 MVA started with 8 Gensets since 28May, 2015 10 MVA with 16 Gensets by April/May, 2016

Block-VI: Oracle Coalfields, PLC (UK) Open-pit Coal Mining of 4 MTPA and 2 x 330 MW Power Plant Project Cost (Mine): US$ 0.672 bn Project Cost (Power): US$ 0.743 bn

• Feasibility Stage Tariff has been approved by TCEB. • Aiming for Financial Close in 2017. • Start of Mine development to begin by 2017. • JDA Signed with SEPCO China for Mining & Power Plant of 330

MW on mine mouth. • Signed an agreement with Yanzhou Coal Mining Company Ltd

for participation in mining project. • The Company is in final stages of discussions with Sinosure and

other equity providers for securing debt. • For Land Acquisition the Company has hired the Services of

Hagler Baily Pakistan in accordance with the Resettlement Framework Policy of Sindh Government.

• The ESIA has been approved by SEPA in January, 2014.

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Status of Mining & Power Projects at Thar Coalfield

Blocks Status/ Timelines

Block-III A&B: Asia Power Group Ltd.

•Selected through ICB held in 2013-14 •Planned Project:

•Mining 6 mtpa •Power 2 x 660 MW mine-mouth power plant

• Feasibility Study being carried out by the Company.

Block-IV: Harbin Electric Company China

•Selected through ICB held in 2013-14 •Planned Project :

•Mining 6.5 mtpa •Power 2 x 660 MW

•Feasibility Study being carried out by the Company.

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Status of Mining & Power Projects at Thar Coalfield at Feasibility Stage

Institutional Development

• Creation of Thar Coal and Energy Board - one stop organization - 2008

• Thar Coal and Energy Board Act, 2011

• Approval of Fiscal Incentives & Protections

• Coal Pricing Regulatory Regime

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• Chief Minister Sindh Chairman

• Federal Minister for Water & Power Vice-Chairman

• Federal Minister for Finance Member

• Federal Minister for Law and Justice Member

• Deputy Chairman, Planning Commission Member

• Federal Secretary, Water and Power Member

• Chief Secretary, Govt. of Sindh Member

• One Female MNA from Thar Region Member

• Three Provincial Ministers Member

One Eminent Person Member

Secretary Energy Dept. Member

• Managing Director, TCEB Member/Secretary

Composition & Members of the Board of TCEB

• Coalfield declared as SEZ and ‘Projects of National Security’

• 20% ($ Based) IRR to firms which achieve Financial Close before

30th June 2017 for Mining Projects based on indigenous coal

• Zero duty on import of coal mining equipment and machinery

• Exemption on withholding tax on dividend for 30 years

• Exemption on withholding tax on procurement of goods and

services during project construction and operations

• Exemption for 30 years on other levies including special excise

duty, federal excise duty, WPPF and WWF 19

Fiscal Incentives - Development of Local Coal

Coal Pricing Regulatory Regime

• Coal Tariff is essential for the development of the entire Thar Coal enterprise, mainly addressing the needs of enabling (a) Financing of the Project, and (b) finalizing coal off take arrangements for coal supply.

• To be effective it must be done in a manner which is legally implementable and commercially sustainable.

• TCEB has been mandated to determine and control the price of coal extracted from Thar Coalfields, under Section 5(m) of the TCEB Act 2011.

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Update on Transmission Line –Thar to Matiari

The scheme is to provide 500 KV quad bundle circuit

transmission line from Thar to Matirai (250 kms)

Status: Lot-I: (110 Km of T/Line)

Work Awarded 09-12-2015

Towers Foundations 11 out of 320 completed

Date of Completion September, 2017

Status: Lot-II: (140 Km of T/Line)

Work Awarded 03-06-2016

Towers Foundations 37.5 out of 369 completed

Date of Completion December, 2017

THANK YOU

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