Project Management

of a Power and
Energy Company

TABLE OF CONTENTS
PAKISTAN: AN OVERVIEW OF POWER SECTOR...................................1
1.1 POWER SECTOR IN PAKISTAN................................................1
1.2 INDICATIVE FORECASTED DEMAND AND SUPPLY..................2
1.3 MAIN PLAYERS OF PAKISTAN POWER SECTOR......................3
1.4 OBJECTIVES OF POWER POLICY PAKISTAN...........................3
1.5 SCOPE OF POWER POLICY PAKISTAN....................................3
1.6 PROJECT PROCESSING FEATURES........................................4
1.6.1 SOLICITED PROPOSALS......................................................4
1.6.2 PROCESSING OF RAW SITE PROPOSALS...........................5

CHAPTER 2......................................................................................6

THE PROJECT NAME, SPECIFICATION................................................6

2.1 PROJECT NAME AND SPECIFICATION....................................6
2.2 THE PARENT COMPANY STRUCTURE.....................................7
2.3 HABIBULLAH GROUP DIRECTORS..........................................7
2.4 QUETTA POWER PROJECT:....................................................8
2.5 RESPONSIBILITIES OF DIRECTORS........................................8
2.6 FUTURE ENDEAVORS: CAPACITY EXPANSION OF THE
EXISTING 157 MW COMBINED CYCLE GAS POWER PLANT AT
QUETTA.......................................................................................9
2.7 AFFILIATED COMPANIES HABIBULLAH GROUP......................9

CHAPTER 3:...................................................................................11

HYDEL POTENTIAL IN BALUCHISTAN..............................................11

CHAPTER 4....................................................................................14

PROJECT TEAMS, CONTRACTORS AND SUB CONTRACTORS...............14

3.1 ORGANIZATION CHART OF HEL PARENT COMPANY.............14
3.2 ALSTOM POWER EPC CONTRACTOR....................................15
3.3 ALSTOM EMPLOYEES BY REGION........................................15
 3.3 ALBARIO ENFINNERING LTD................................................16
3.4 LIST OF FAMOUS PROJECTS PAKISTAN...............................16
3.5 ALBARION AND HABIBULLAH ENERGY LTD..........................17

CHAPTER 5....................................................................................18

PROJECT PLANNING IN BRIEF.........................................................18

CHAPTER 6....................................................................................19

MAJOR STAKEHOLDERS & SCORING MODELS..................................19

6.1 BANKS.................................................................................19
6.2 CONTRACTORS....................................................................19
6.3 GOVERNEMENTAL BODIES...................................................19
6.4 HISTORICAL FINANCIAL RATIOS FOR THE RECENT YEAR. . .19
6.5 SCORING..............................................................................19
6.6 SPECIALIST FIRM FOR CONDUCTING THE FEASILBLITY
STUDY.......................................................................................20

CHAPTER 7....................................................................................22

CONFLICT & NEGOTIATION ISSUE...................................................22

CHAPTER 8....................................................................................23

PROJECT SCHEDULING...................................................................23
8.1 PROJECT MANAEBMENT......................................................26
8.2 PROJECT HUMAN RESOURCE REQUIREMENT......................26
8.3 THREE PHASE PROGRAM.....................................................27

CHAPTER 9....................................................................................28

PROJECT COST ESTIMATION...........................................................28

9.1 FEAAILBILITY OF THE PROJECT..........................................28
9.2 PROJECT COST ESTIMATION...............................................29

CHAPTER 10...................................................................................31

PROJECT PC I, PC II, PC III AND PC IV SPECIFICATIONS......................31

10.1 PC I.......................................................................................31
 10.2 PC II (SURVEY AND FEASIBILY STUDIES)............................33
10.3 PC III (ANNUAL TARGETS AND PROJECT REPORTING) (1ST
JULY OF EACH YEAR)................................................................34
10.4 PC IV (PROJECT COMPLETION REPORT).............................35

CHAPTER 11...................................................................................37

WORLD BANK COMMENT ON PAKISTAN ENERGY SECTOR:................37

CHAPTER 1
 PAKISTAN: AN OVERVIEW OF POWER
SECTOR

1.1 POWER SECTOR IN PAKISTAN

Pakistan is a progressive nation with a buoyant economy is located in one of the most
important economic zones of the world and provides excellent combination of natural and
human resources for the prospective investor.
The generation, transmission and distribution and retail supply if electricity is presently
undertaken by 2 units namely WAPDA and KESC. The power wing of WAPDA is being
restructured with the ultimate goal to make power sector stronger.
The transmission system of WAPDA and KESC are interconnected through 220 kV
double circuit line. Presently total installed electricity generation capacity is about 19478
MW. The future forecast for electricity demand is about 5500 MW in future. This will
further increase in the year 2010.

Figure 1
1.2 INDICATIVE FORECASTED DEMAND AND SUPPLY GAP

Figure 2
1.3 MAIN PLAYERS OF PAKISTAN POWER SECTOR

Water & Power Development Authority (WAPDA )

Natioanl Electric Power regulatory Authority (NEPRA)
Sind Coal Authority (SCA)
Private Power and Infrastructure Board (PPIB)
Karachi Electric Supply Corporation (KESC)
Geological Survey of Pakistan (GSP)
Pakistan Electric power Company (PEPCO)
Ministry for petroleum and natural resources
Provincial private power cells
Fuel research center
Provincial Inspectorates of mines
Mine Rescue & Training centers
Independent Power Procedures

1.4 OBJECTIVES OF POWER POLICY PAKISTAN

1) To provide sufficient capacity for power generation at least cost, and to avoid capacity
shortfalls
2) To encourage and ensure exploitation of indigenous resources which include
renewable energy resources, human resources, participation of local engineering and
manufacturing capabilities.
3) To ensure that stake holders are looked after in progress
4) To be attuned to safeguard the environment

1.5 SCOPE OF POWER POLICY PAKISTAN

Private sector projects
Public sector projects
Public-Private partnership projects
Projects developed by public sector and then divested
1.6 PROJECT PROCESSING FEATURES
1.6.1 SOLICITED PROPOSALS

Sr. Activity Typical time

1 Submission of 30
prequalification
documents by sponsors
2 Evaluation of 30
prequalification
documents
3 Approval of PPIB Board 15
& notification to pre-
qualified bidders
4 Issuance of RFP to 15
bidders
5 Present minimum 120
functional specification
6 Evaluation of bids, 60
approval of PPIB board
7 Approval of NEPRA and 21
ECC
8 8POSTING OF 10
performance guarantee
9 Issuance of Letter Of 5
Support by PPIB

1.6.2 PROCESSING OF RAW SITE PROPOSALS

Figure 3
 CHAPTER 2
THE PROJECT NAME, SPECIFICATION

2.1 PROJECT NAME AND SPECIFICATION

PROJECT NAME 157 MW Natural Gas Fired Combined

Cycle Power Project

LOCATION Shekhmando, Quetta

PARENT COMPANY Habibullah Energy Ltd.

MAJOR CONTRACTOR Alstom , Albario

NAME OF POWER PURCHASER WAPDA

DATE OF AWARD OF PROJECT July 31st, 1994

DURATION OF Approximately 3 years

REHABILITAION/CONTRACTION
PERIOD

TOTAL CAPITAL COST OF US $155 million

PROJECT

FINANCING MIX (20,80) (Equity, Debt)

APPLICANT SHARE OF EQUITY 50% voting equity

TYPE OF PLANT Natural gas- (High BTU)

EQUAL CONTRIBUTOR El Paso Corporation. Joint venture of

HEL and El Paso

START OF PROJECT COMMERCIAL OPERATIONS: October 1999

2.2 THE PARENT COMPANY STRUCTURE
HEL group was founded by Hafiz Mohammad Habibullah. HEL is a part of Habibullah
Group was established in 1987 as an unlisted public company, formed under companies
Ordinance act. The company’s objective was to develop power projects in the country. In
Pursuance of the Government of Pakistan’s policy to encourage private sector for power
generation, HEL was the first to take initiative for 157 MW Natural Gas Fired Combined
Cycle Power project. - Quetta, Pakistan.

2.3 HABIBULLAH GROUP DIRECTORS

Mr. Saeedullah Khan Paracha
 Currently, MD Habibullah Coastal Power Pvt. Ltd.
 MD, HEL
 Chairman HEL mines
 Partner H.M Habibullah Co.

Mr. Hamidullah Khan Paracha

 Director, Tandlianwala Sugar mills
 Partner, H.M Habibullah Co.
 Director, Matiari Sugar Mills
Mr. Tariq Saifullah Paracha
 Senior VP Habibullah coastal power Pvt. Company

2.4 QUETTA POWER PROJECT:

In pursuance of the Government of Pakistan’s policy to encourage private sector for
power generation , Immortal Energy ltd. Was the first to take initiative for the
establishment of 157 MW Natural Gas Fired Combined Cycle Power Project-Quetta ,
Balochistan. The initiative for establishing of the power plant was undertaken at the
invitation of the Gov. of Pakistan and in London Investment conference in 2005 where
Federal secretary invited Immortal Energy Group to come forward and establish the
power plant at Quetta, Balochistan in the private sector. This project is located in
Shekhmando, Quetta which is the best and ideal location for a power project. WAPDA’s
grid station is hardly at a distance of 2km.
The plant has excellent thermal efficiency through combined cycle system which
involves major equipment which inter-alia encompasses:
Gas Turbines & accessories
Steam turbine
Waste Heat recovery
Air Cool Condenser
Fuel Gas Compressor
Water Treatment Plan

The implementation agreement, power purchase agreement between HEL and WAPDA
were finalized.
2.5 RESPONSIBILITIES OF DIRECTORS

 Responsible for management and supervision of Immortal Energy Ltd. which

operates 157 MW power generation plant at Quetta.

 Formulation of policy framework for best interest of company affairs.

 Providing guidelines for day-to-day operation of Quetta Power plant.

 Resolving day to day major issues pertaining to WAPDA vis-à-vis Quetta power
plant.

 Attending and presiding over the Board of Directors meeting in USA or Pakistan.

 Providing directives to professional staff in resolving financial and technical issues

with WAPDA and PPIB.
2.6 FUTURE ENDEAVORS: CAPACITY EXPANSION OF THE
EXISTING 157 MW COMBINED CYCLE GAS POWER PLANT
AT QUETTA

HEL intends expanding/duplicating the existing plant capacity by another 157 MW using
the proven design & engineering already used at the existing Plant.
A major portion of the natural gas for the proposed expansion could come from gas fields
of Zarghun and Khust (near Ziarat), which are being developed by Mari Gas Company
Ltd. We would also need additional gas allocation by the Ministry of Petroleum &
Natural Resources.

The Proposed expansion of the Quetta Power Plant would help:

 Minimize WAPDA’s’ financial losses considerably by reducing the heavy

transmission losses
 Overcome load requirements
 Strengthen/stabilize WAPDA’s Grid System in the region
 Reduce the voltage fluctuations
 Provide electricity in surrounding/adjacent regions
2.7 AFFILIATED COMPANIES HABIBULLAH GROUP
Habibullah Coastal power Private Company
Tandlianwala Sugar Mills Ltd. HEL

A Power generation company

A Sugar Manufacturing company
Habibullah Mines Pvt. Ltd. A Power Project Development Company
A Coal Mining Company

Figure 4
 CHAPTER 3:

HYDEL POTENTIAL IN BALUCHISTAN

Pakistan’s industrial growth and development depended substantially on the availability
of reliable electric power. About half of the nearly 140.5 billion people (2001 population
estimate) have no access to electricity; this huge population base provided an ideal
opportunity for expansion of electricity generation. Since the 1980s, power supply has
lagged behind demand, resulting in major load shedding of up to 30 per cent of peak
demand. A government-initiated study on power shortages conducted in 1994 highlighted
that an additional generation capacity of about 9,800 MW was needed by year 2020. Of
this additional capacity, 4,600 MW was under construction, or in the early stage of
planning by the government sector while the balance of 5,200 MW was recommended to
be installed by the private sector Pakistan’s power-generating capacity grew from 119
MW at the time of partition from India in 1947 to almost 17,664 MW in 2004. In the total
installed capacity, the share public sector was around 70 per cent and the private sector
30 per cent. The generation, transmission, distribution and retail supply of electricity in
Pakistan was undertaken mainly by two government-controlled public sector utilities:
WAPDA and the Karachi Electric Supply Corporation (KESC). WAPDA supplied power
to all of Pakistan except the metropolitan city of Karachi and some of its surrounding
areas, which were supplied by the KESC.
The private sector included sixteen independent power producers (IPPs) established on
a Build, Own and Operate (BOO) basis, mainly under the private power policy
announced by the Government of Pakistan in 1994.
Figure 5
Figure 6
 CHAPTER 4
PROJECT TEAMS, CONTRACTORS AND SUB
CONTRACTORS
Alstom power has very vast experience in power generation as EPC contractor. Alstom
has worked in the development of various power generation plants including
rehabilitation, maintenance and installation, These power generation are located in
Pakistan and all over the world. In Pakistan Alstom has been operating in power business
since 1957. Their share in MW installed was 15%.
Albario O&M contractor is the official representative of General Electric USA in
Pakistan. It is engaged in operation and mainteenace.

3.1 ORGANIZATION CHART OF HEL PARENT COMPANY

Chairman

Managing Director

Director Operations

Project Project Director

Engineer I Engineer II Coordination
IIIIII
 3.2 ALSTOM POWER EPC CONTRACTOR
At ALSTOM, we offer a comprehensive capability, possessing the broadest scope of
power generation systems, equipment and services in the industry. Our customers enjoy
the maximum of options plus the most economical, environmentally friendly and
advanced technologies. The services provided them include:
 Combined Cycle Plants 
 Conventional Steam Power Plants 
 Steam Cycle add-ons
 Nuclear Conventional Island
 Repowering and Rehabilitation
 Electrical & Control Systems
 Turbo machines Portfolio
Alstom Structure
ALSTOM's Power Sector is organized in 2 Sectors: Power Systems, and Power Service
3.3 ALSTOM EMPLOYEES BY REGION
 Figure 7

3.3 ALBARIO ENFINNERING LTD

It was created in 1964. The Head Office is located in Lahore. It has an experience of over
5 decades in Pakistan’s Energy sector. It has executed projects in the following areas:
 Thermal power station
 Hydel power Generation
 Civil construction
 Sponsor/developer
 Electro mechanical contracting services
Its Customers are:
 WAPDA
 PARCO
 NRL
 OGDC,PPL
 SSGC
  Pakistan Railways
 FGFC FFC
3.4 LIST OF FAMOUS PROJECTS PAKISTAN
Installation 60 MW East Pakistan
Installation 60 MW Chitagong
CM&U 4*25 MW GT WAPDA, Faisalabad
Erection, and installment of 4*40 MW hydro power station at warsak
Supply & Installation of 2*100 MW Hydro Power station at Mangla
Installation 4*33 kv grid stations

3.5 ALBARION AND HABIBULLAH ENERGY LTD.

O&M Subcontractor for GEII managing Operation and maintenance of the 126 MW CC
HEL power plants.
Responsibilities are:
Human Resource Management
Plant Operation
Plant Maintenance
General plant administration
Sponsor/Developer
100 MW wind turbine Power project Balochistan
Summar Gah 28 MW HPP-NWFP LOS
6 MW HPP- Canal Fall in Punjab
 CHAPTER 5
PROJECT PLANNING IN BRIEF

PROJECT SCHEDULES

Cost Schedule Tentative USD 155 Million

Financing Pattern 80%Loan, 20 % Equity
Local Sponsor HEL
Equity Composition HEL USD $ 10 Million National
trading Co. USD $ 47 Million LOS by Equity Commitment Letter

Internal Rate Of return 21% guaranteed

Tariff WAPDA will provide high Tariff
 CHAPTER 6
MAJOR STAKEHOLDERS & SCORING
MODELS
6.1 BANKS
Muslim Commercial Bank Ltd, Karachi
Muslim Commercial Bank Gari Khata, Hyderabad
Investment Corporation of Pakistan, Karachi
Bank of Scotland, Ireland
Barclays Bank London

6.2 CONTRACTORS
Alstom and Albario as EPC contractors
6.3 GOVERNEMENTAL BODIES
PPIB
WAPDA
6.4 HISTORICAL FINANCIAL RATIOS FOR THE RECENT
YEAR
Current ratio 4.60
Net Profit margins 28X
Return On Assets 65x
Return on equity 79x

6.5 SCORING
Weights assigned
Category Factors
Technical Strength A. Experience in 50%
conducting feasibility study
B. Power project 50%
Experience
 Financial Strength A. Previous experience
100%
1) Power project financing 80%
track record
2) Credit references 20%
B. Capability 100% 80%
1) Credit Rating
2) Credit references 20%

Total score is like: 0.55*(Category 1 score) + 0.45*(category 2 score)

Total score of category 1 = 0.50*(Score factor A) + 0.50 *(Score Factor B)

Power projects over .75 x MW

Role of applicant Points/project
Initial Partner 12/8
EPC Contractor 14
O & M Contractor 10

6.6 SPECIALIST FIRM FOR CONDUCTING THE

FEASILBLITY STUDY
Lameyer International GmbH is recognized as an independent firm of consultants by
WB, European Banks and Regional Development Banks. It offers a wide variety of
consulting engineers.
It uses software like SAP R/3 for financing, controlling and project management. It has
Re/master program to design the new equipment needed to convert a pure stem power
plant to combined cycle and stimulates performance. It uses PROJECT TIME
SCHEDULING PROGRAMS LIKE PROJECT COST CONTROLLING AND
RESOURCE PLNANNING PROGRAMS. The project management software it uses
gives:
Evaluation sheets
Bill of quantities
Specifications
 Site inspection and test schedules
It also uses a PROJECT MANUAL which defines all the procedures and details for
coordination of activities.

CHAPTER 7
CONFLICT & NEGOTIATION ISSUE
For many years investments projects in the province of Balochistan have been subjected
to uncertainties and abnormal conditions. The crisis led by Akbar Bugti over the pipeline
issue made Balochistan an insecure investment option. Therefore, knowing the conditions
(gas pipeline); El Paso was advised to insure its plant and operational equipment by a
firm. There were many issues regarding all this. El Paso insured its plant and other
equipment, hence taking into account the uncontrollable and uncertain conditions in
Balochistan. The uncertainty factor did not only come from the Bugti side, but also the
border and political government crisis prevailing in Quetta. It was a wise decision by El
Paso to make secure all of its assets, plant and equipment. However, the insurance
negotiation and the amount in dollars is a business secret and the information is
confidential. Nothing much information is available about the dollar value of the
insurance and other specifications. The main conflict rose with the Habib Ullah Energy
Ltd., which was resolved after a couple of months and the final decision were hence
taken. El Paso has taken certain decisions in other parts of the world, especially stagnant
world economies. Government where such highly uncertain conditions exist, El Paso has
insured its plants everywhere.

CHAPTER 8
PROJECT SCHEDULING
Figure 8

Figure 9
Figure 10

Figure 11
 Figure 12

Figure 13

8.1 PROJECT MANAEBMENT

Training
The project includes Training of operating staff for a certain period and certain foreign
experts will be coming. During the final stage of erection, a practical training will be
given by the instructor for 5 hours.
Engineering
Project Management in Pakistan and civil engineering was also included in the project.
The costs of the civil works including the preparation of site were estimated on the basis
of offers on local conditions. The costs for erection and commissioning as well as
contractor’s risk insurance were included in the project.
The operating assistance during the first years of expatriate specialist assisted the local
staff in operation and maintenance of the plant. During the period of assistance, the
specialist transferred the duty so that the operation takes place effectively.

8.2 PROJECT HUMAN RESOURCE REQUIREMENT

Both h skilled and unskilled man power was needed in the project. Skilled man power
comprised experienced staff. The staff was headed by electrical and mechanical engineers
having 15-20 years experience. Locally recruited staff comprised manager, asst manager,
engineers and unit operators. On-the-job training was provided for about 6 months.
8.3 THREE PHASE PROGRAM
The assistance by experts followed a 3 phase program.
Phase 1 Experts supervised the operating staff and were responsible for operation of
project
Phase 2 Experts transferred responsibility from counterparts.
Phase 3 Local operating staff was advised by experts.
During phase 1, experts wee 100% responsible for performance of the plant. During
phase 2 the warranty linked with contractual responsibility expired.
 CHAPTER 9
PROJECT COST ESTIMATION

9.1 FEAAILBILITY OF THE PROJECT

There were many factors that influenced the feasibility of the project. These include:
۞ Interest rates
۞ Maturity of loans
۞ Exchange rates
۞ Taxes and fees
The project cost was determined on the following basis.
PROJECT COST: It included cost of plant, equipment and services for the power
station excluding import fees
TOTAL COST: project cost plus import fees and preproduction cost
IMPORT FEES: IQRA, Surcharge, import license fee
PREPRODUCTION COST: Interest during construction, commitment fees, and
export credit agency premium
Unit rate: one KWH in Rs.
Financing scheme: Equity: 20 % of project cost
Debt: 80% of project cost

Depreciation period: 25 years with salvage value of 25 years

Contraction period: 30 months
Preproduction cost: Interest payable on capital investment which is utilized during the
construction period
The interest and fees on utilized amounts were accumulated and repaid with the loan. The
repatriation, of principles, interest and fees was calculated on semi annual basis.

9.2 PROJECT COST ESTIMATION

A Top down approach was used in the project cost estimation. For some parts of the
project where debt equity structure and other specifications were made. Work Element
costing was also used where cost of each per unit is prescribed. Direct cost for resources
and machinery were charged directly to the project and not subject to over head charges.
The charge for machines was tread as operating cost.
For example:
Parameters like ……………. Were used in cost calculation:
Price
Price Rs. 383
Heating value 5750 BTU/LB
Energy sold 919,800,000 KWH
Equity 20 %
Debt 80%

COST OF PROJECTS:
This was conducted somewhat in a top down fashion. It comprised:
Equity (local) (10%) 20%
Foreign (10%)
WB window 30%
Export credits 38%
Commercial loans 12%

COST OF THE PROJECT FURTHER INCLUDED: (IN 1000 RS)

FOREX 3,022,230
Local portion 625,580
Project cost 3,647,810
Import fees 453,355
Interest and fees during construction 704,455
Total preproduction cost 1,157,790
Total cost 4,805,600

Operating costs:
The se include
۞ Fuel cost
۞ Salaries
۞ Insurance
۞ Supplies, chemicals, disposal
۞ Interest on working capital
۞ Leases and rent
The operating costs include salaries in foreign currency for foreign experts to operate and
supervise the plant mainly in firs t years.
Work element costing
Fuel cost is determined like:
822k130 t/a Rs./t=0.3423 Rs. /KWHr
The salaries for local staff are determined as:
12,750,000 Rs. /a = 0.0139 Rs. /KWH
Insurance:
70,511,000 Rs. /a = 0.0767 Rs. /KWH

Ist year of operations = 18328,000 Rs. /a = 0.0199 Rs/kwh

Second year of operations = 17,042,000 Rs. /a = 0.0186 Rs/kwh
Third year of operation = 9,753,000 Rs. /a = 0.0106 Rs/kwh

CHAPTER 10
PROJECT PC I, PC II, PC III AND PC IV
SPECIFICATIONS

10.1 PC I

The some of the particulars of PC 1 form of the project are:

1 Name Of Project Habibullah Coastal Power Company Quetta
power project
2 Location Quetta, Balochistan
3 Authority Responsible for
a) sponsoring Habib Ullah Energy ltd.
b) Execution
c)Concerned federal Ministry PPIB , WAPDA
4 Project Objectives and its relationship
with sectoral objectives  Minimize WAPDA’s’ financial
losses considerably by reducing the
heavy transmission losses
 Overcome load requirements
  Strengthen/stabilize WAPDA’s Grid
System in the region
 Reduce the voltage fluctuations
 Provide electricity in
surrounding/adjacent regions
 To build d and operate a power plant
of suitable size
 To reduce critical power shortage
during winter time

5 Description, Justification and technical Net electrical output, Price

parameters Energy sold in KWH, Depreciation period,
construction period
6 Capital cost estimates Project cost + import fees and production
cost i.e. 4805,600 (in 1000 of Rs.)
7 Annual Operating and maintenance These include Fuel cost, salaries, Insurance,
cost after project completion Supplies, disposal, Spares & Maintenance,
Interest on working capital, leases and rents,
transport cost :
These re : 0.41 Rs. KWH
8 Financial Plan and mode of Financing Equity (20) (10% Local) (10%Foreign)
WB : 30%
Export Credits: 38%
Commercial loans: 12%
9 Projects Benefits and analysis
a) Financial
b) Social Benefits
c) Employment generation, direct and
indirect
d) Environmental Impact
10Management Structure and manpower The management comprises acting
requirements including specialized skills management and BOD. The structure
 during operation and maintenance stage comprises the head office management and
operating staff at Quetta. The plant
management is responsible for operations
and maintenance. Manpower requirements
include:
PRODUCTIOBN STAFF: (Plant
Superintendents), Section manager, Section
manager electrical control, PA to
Superintendent)
OPERATING STAFF: (Chemical
engineer, Assistant chemists, Unit
operators, Field operator, FO Boiler plant,
FO Water treatment,)
ADMINISTARTION: (Manager,
Accountant, finance and purchase, Clerk,
typist, Accountant Personnel)
11 Additional projects required to None
maximize socioeconomic benefits from
the project

10.2 PC II (SURVEY AND FEASIBILY STUDIES)

Things discussed briefly under PC 2 are:
1 Name by which Feasibility will be Lahmeyer International LI an independent
conducted firm of consultants. It covers a range of
advisory, planning and design services, with
core in power generation. The services
comprise surveys, investigation, feasibility
studies, risk assessments, environmental
impact assessment studies etc.
2 Administrative Authorities, responsible Habib Ullah Energy ltd. El Paso , Albario,
for sponsoring and execution
3 Details of feasibility study
a) General description
b) Implementation period
c) year wise estimated cost
d) Man power requirements
e) Financial Plan
4 Expected outcome of feasibility study
Alstom EPC contractors
The implementation period was 30 months,
The aim of feasibility study was to conduct
costs and factors both strategic and financial
which occurred. The factors involved
interest rates, cost of plant, FOREX rates,
taxes, insurance fees, total cost, unit rates
import fees, preproduction costs, export
agency credit premium, surcharge, IQRA ,
mode of financing , (already discussed),
manpower requirements, (already
discussed) and investments costs. The
period of contract was approximately 3
years. The sources of financing are already
discussed. (20 % Equity, 30 % WB, Export
credits 38%, 12% commercial loans). Local
as well as foreign personnel are also
discussed in the project.
The expected outcome of the feasibility
study was the estimation of cost and
schedules, Personal required and other
specifications.

10.3 PC III (ANNUAL TARGETS AND PROJECT

REPORTING) (1ST JULY OF EACH YEAR)

Name of project Habibullah Coastal Power Company

Quetta power project
Approved Cost
Expenditure unto end
PSDP allocations
FEC 1 USD = 18.596
 LEC Operating cost in years of operations
Year 1----- 457,469
Year 2------456,183
Year 3------448,894
Year 4------439,141
Year 5-10 ------439141
11-25------------439141
The cash flow analysis shows that
discounted cash flows for 10 years.

10.4 PC IV (PROJECT COMPLETION REPORT)

Name of Project Habibullah Coastal Power Company

Quetta power project
Implementation period as per PC 1 Date of project award July 31 1994
Date of financial closing April 4 1996
Duration of contraction 3 years
Commercial operation date of each unit
1999
Actual
Capital cost Planned USD 155 million
Actual USD 180 ( Changes due to FOREX,
interest payments, amortizations, unit costs
variable as well as fixed)
Financial results based on actual cost The IRR was 21 %.
Actual Time 6 years
Planned time 4 years

Most of the things of PC I, PC II, III and IV are discussed in detail in the entire report in
form of chapters. The last chapter provides only the summarized version of the
components of PC forms in Pakistan. The rest of the components of PC 1, PC 2, PC 3 and
PC 4 pro forma are discussed in quite a detail in the project report. The last chapter world
Bank comment and lessons learned provide a feedback on energy sector investments in
Pakistan.

CHAPTER 11
 WORLD BANK COMMENT ON PAKISTAN
ENERGY SECTOR:

Beginning in 1987, Pakistan requested assistance from the World Bank to increase
private sector participation in the energy sector. An initial framework of incentives to
attract private investment in the energy sector was put in place in 1988 which addressed
the following constraints:
۞ • The absence of a comprehensive policy framework concerning incentives, fiscal
treatment, repatriation of profits and capital, availability of foreign exchange, and
pricing;
۞ • The lack of long term financing for projects with long gestation periods and
economic life; and
۞ • The inadequacy of the institutional arrangements for the review, negotiation and
approval of private sector projects.
In July 1992, the Government of Pakistan (GOP) adopted a Strategic Plan for power
sector privatization. Under this plan, the Water and Power Development Authority
(WAPDA), the main electric utility in the country, would be unbundled into separate
generation, transmission and dispatch, and distribution companies and gradually
privatized. The private sector would be invited to construct and operate new thermal
generation plants, and an independent regulator would be established.

In support of this policy, the World Bank approved the US$150 million Private Sector
Energy Development Project (PSEDP 1) in June 1988. Its objectives were to:
(i) Assist Pakistan in mobilizing, from the private sector, the resources required to meet
the anticipated deficit in power supply; (ii) establish incentives to encourage private
sector participation; and (iii) establish an institutional framework required to facilitate
private sector transactions in energy on a sustainable basis.
The Second Private Sector Energy Development Project (PSEDP II) was approved in
November 1994 for US$250 million. It replenished the Long Term Credit Fund
(originally known as the Private Sector Energy
Development Fund) established under the first project with the objective of continuing to
(i) assist the Government in mobilizing additional private sector resources; and (ii) build
on the institutional and policy framework established to facilitate private sector

REFERENCES

Stephen P. Robbins, “Organizational Behavior”, 11th Edition, Prentice Hall of India,

2005
Jack Meredith, Samuel J. Mantel,” Project Management”, A managerial Approach, 5th
Edition, John Wiley & Sons Inc
Statement of Qualifications, HEL: Volume 1 & 2
Julia M. Fraser, “Lessons Form the Independent Power Sector Experience in Pakistan”,
Energy and Mining Sector Board discussion paper, World Bank Group