PAKISTAN: May financial close for Kabirwala power project

26 April 1996

Sceptre Power or the US says that it is confident of reaching financial close for its 144-MW power project by early May. The power station is to be built in Kabirwala, near Lahore, by Sceptre Power, the local Fauji Foundation and Intrag of the US.

The estimated cost of the project is $170 million. Sceptre says that debt financing will come to $127.5 million. The developing group is in final negotiations with three lenders. The Asian Development Bank (ADB) will provide a direct loan, ABN AMRO will provide funds under ADB's co-financing agreement and the Export Development Corporation of Canada will provide export credits. Equity participation will come from the Fauji Foundation and the US Horizon Energy, a subsidiary of the National Fuel Gas Company of the US, with ADB also keeping a small share.

The venture has secured fuel supply agreements with the government's Oil & Gas Development Corporation and power purchase agreements with the Water & Power Development Authority (WAPDA). The plant will use low British thermal unit (BTU) gas which Sceptre Power says has no other commercial or domestic use in Pakistan. Construction of the plant is expected to start by August.

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