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Hydro plants cancelled or not cancelled?

Pakistan’s Ministry of Water & Power has strongly pleaded with the country’s government to restore plans for two hydro plants that were cancelled earlier this year.

In a summary to the Cabinet Committee on Investment, the authority that cancelled the projects, the ministry has recommended that performance guarantees should be restored and that the Letters of Support, which lapsed in November 1998, should be revived for one more year.

The Pakistan government cashed performance guarantees of Rs4.68M for the BS Link 1 project in January. BS Tail was also cancelled, but as its sponsors obtained a civil court injunction its performance guarantee of Rs3.6M could not be cashed.

The Ministry argued that the project sponsors have spent considerable time and money on developing the two projects, and were issued firm commitments. The Ministry further argued that although the two projects were small (together they total 20MW), they would bring in income for the Punjab government and would significantly add to the experience of the Pakistan organisations involved.

BS Link was sponsored by UK and US companies, while BS Tail was sponsored by local company Shaukat Consulting Services.