GOVERNMENT OF SINDH MINES & MINERAL DEVELOPMENT DEPARTMENT

PC-II

DEVELOPMENT OF OPEN-CAST MINING IN THAR COAL FIELD

ESTIMATED COST RS.5000.00 MILLION

SINDH COAL AUTHORITY
(GOVERNMENT OF SINDH)

PC-II 1. 2. Name of Project Authorities Responsible: i) Sponsoring ii) Executing Development of Opencast Mining in Thar Coalfield. Mines & Mineral Development Department, Government of Sindh Sindh Coal Authority will coordinate

implementation of the study with the consulting company(s) (International designing, engaged Competitive planning, through Bidding) ICB for and

development

operation & maintenance of an opencast coal mine at Thar coalfield. 3. 4. Location of the Project Capital Cost of the Project District Tharparkar, Sindh Rs.6000.00 Million Rs.120.00 million (consultancy charges @ 2% of the estimated cost for preparation of TOR and designing and costing of open-pit mining) 5. Proposed date of commencement and completion. Agencies other than sponsoring authority in the project. After approval of PC-II, the scheme would require a period of 36 months for its

completion and start of mine operation. 6. The scheme would with be carried out in

consultation

concerned

federal

government agencies / Geological Survey of Pakistan by engaging a consultant firm through ICB (International Competitive Bidding). 7. Objective of the study The main objective of this project is to develop a surface mine (open pit mine) for extraction of coal which are buried under the surface of earth and in this connection mining will be carried out in the area having less overburden

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and better seam thickness. Study including surface Mine designing and planning and development of Open Pit / Open Cast Mine at Thar coal field area for extraction of around 6.00 million tones of coal per annum (mine strip ratio 7.1:1) or as suggested by the consultant to meet fuel requirements of 1000 MW mine mouth power station per ton pit head extraction cost and selling prices of coal, recommend appropriate technology based on evaluation of various technologies and

reasoning therefor. Explored areas are available for carrying out the mining activities / operations at Thar coal field area which has been explored by Geological Survey of Pakistan and Sindh Coal Authority. However, the consultants will be at liberty to select and recommend any other area for the study, if considered more suitable by them. Study shall further more determine the most economic and efficient technology to operate the mine. The investigations will also take into consideration the environment

aspects. Investigations will determine the mine mouth cost and the delivered cost per tonne of Thar coal i-e mine mouth cost and selling price and also prepare a detailed financial analysis which determines the cost of development and operation of the mine and the finance-ability of the mine development.

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8.

Scope of the study

Scope of work for the Project comprises all activities necessary for the following: (a) Design, plan, develop, finance, insure,

own jointly with Government of Sindh, operate and maintain open cast mines sufficient for [30 years] producing 6 (six) million tons per annum “as received” coal; (b) obtain all necessary permits, licenses,

consents and enter into agreements wherever necessary and pay all necessary fees,

royalties, local duties; (c) supply and sell guaranteed coal

quantities at the coal sell point within the coal field boundaries identified by the sponsors and agreed by Government Sindh to agency/entity identified by Government of Sindh, at the rates as mentioned under Memorandum of

Information (Annexure-II); (d) initiate environment mitigating

measures in accordance with the Pakistan Environmental Protection Agency (PEPA) Act, 1997, inter alia, relating to environmental protection, environmental impact and social soundness requirements assessment, of the and all the and

legislation

environmental guidelines and standards issued under or pursuant to the said Act;

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(e)

Settlement of displaced population in with internationally accepted

accordance norms; (f)

refilling the used mines to make it to a

cultivatable and habitable grade; (g) Any other scope not included herein but

subsequently agreed between sponsors and Government of Sindh (h) transfer the developed mines and drying

plant at the end of [30] years to Government of Sindh free of cost and free of all liens and encumbrances. Phase-IV : Mining stage : The coal will be extracted by using surface mining method “opencast”. In loose strata, only drilling blasting will be adopted. Special care shall be taken for controlled blasting to minimized vibration to avoid rock rupturing and to prevent from slope failure. Open pit optimization, output and man power planning, quality control and conservation, mine

scheduling, slope stability analysis, productivity and maintenance of Heavy Earth Moving Machinery, inpit crushing and conveying, continuous conveying. surface mining, high angle

Mine and in all production

schedules the annual waste volumes have been adapted to a certain extent in order to smoothen the overburden removal capacity

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and thus the number and size of equipment needed over the different phases of mine development and mine position maps have been prepared for the basic alternatives to show the mine advance during the project lifetime of about 30 years. 9. Administrative control The project will be overall monitored by Director General, Sindh Coal Authority and will be supervised by a Project Coordinator at site nominated by the Chairman, Sindh Coal Authority Board.

A

Steering

Committee of the

to study

monitor would

the be

implementation

constituted with the approval of Sindh Coal Authority Board. 10. General Description Location of the Project The Project is located at 24º 43’45” North Latitude and 24º49’30” and East Longitude 70º 17’35” - 70Vº 24’30”. Its mean altitude above sea level is 90 meters. Oct-Mar with meanlowest temperature of 16.4º C are the cooler months, and Apr-Sep with mean-highest

temperature of 43.8º C are the warmer months. Accessibility is through a 418

kilometers road system from Karachi. Route of the road is via Thatta, Badin and Mithi. The Project area is sparsely populated and the total population is about 1000 souls.

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Coalfield Descriptions

The huge Thar coalfield is spread over an area of about 9,100 sq. km. The USGS & GSP investigated 4130 sq. km. and Sindh Coal Authority investigated 130 sq. km. through M/s. China Northeast Coalfield Geological Survey Bureau. Besides, exploration for development of additional two blocks is also under progress. Maximum cumulative thickness of coal

bed/seam is 36 meters. Whereas, the thickest coal seam is 22.18 meters between 150 and 203 meters depth. Thickness of overburden varies from 114 to around 200 meters.

The weighted average chemical analysis of Thar coal, on as received basis, is as follows: Moisture Ash Volatile Matter Fixed Carbon Sulphur Heating Value 46.77% 6.24% 23.24% 16.66% 1.16% 5,774 BTU/Lb.

Thar lignite is suitable for electric power generation and would a less expensive and sustainable source for power generation General Perspective Thar coal being the biggest deposit in the country is receiving priority attention to meet fuel requirements of the country. The required infrastructure including metalled roads, water supply line, electricity, optical fiber line

(telephone) is available upto coalfield. Besides, a Broad-gauge Railway Line from VarvaiIslamkot-Mithi-Naukot-Mirpurkhas-Hyderabad 6

a less expensive and commercially feasible option, assessment of water resources of Thar coalfield with reference to long-term water requirements of Thar coal development

program are also receiving priority attention to support its smooth exploitation. To facilitate foreign investors Thar Lodge at Islamkot is under construction and survey for airstrip at village Sive-jo-Tar and Bhope-jo-Tar stand completed. Pakistan governmental aim is to increase its industrial output over the next decades. Major energy resources with a high potential to support the energy production shall be

implemented in that regard to substitute imported fuel for power generation and further more include positive effects on employment, infrastructural development and the national trade balance. Keeping in view the energy shortfall and increasing demand of the country, and to attract the private as well as foreign investment for development of Thar coal the mining is considered essential so as to take the buried coal out and could utilize for power generation to meet the shortfall of electricity in the country and turn the industries on coal. Justification Sindh has been endowed with a natural gift of coal, which is 99% of the country’s total coal deposits. Being less expensive, a reliable sustainable source for power generation, need to be developed and given priority. 7

Share of coal globally in power generation and as a primary fuel, is 38% and 26%

respectively. For considering indigenous coal based projects, it is a pre-requisite to

determine suitability of use of coal as a raw material/fuel in industries etc., of coal mining per tone pit head coal extraction cost and selling price of coal, else, this deposit, a national treasure, will remain buried for ever. Potential benefits of Thar coalfield development Benefits of an indigenous fuel are countless. The major benefits of development of coal as a fuel, would be: Sustainable, reliable and less expensive

indigenous fuel (coal) Saving in foreign exchange otherwise required for import of oil as a fuel including for power generation Employment generation effect and massive economic activity Step towards a self-reliant economy Investment in coal mining will generate

employment and economic activity in the country; whereas, money spent on imported fuel would generate economic activity in the fuel producing / exporting countries. Congestion caused at the ports in handling of

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import of oil and impact of transportation of oil from ports to project sites also, would be avoided by developing coal as a fuel including for power generation. 11. Physical and Financial planning of the project. Requirement of material and Personnel a) Details of personnel required (gazetted and nongazetted) b) Break of the project Terms of reference and cost break-up would be prepared by a consultant. Requirement of personnel would be prepared on the recommendations of the Consultant. Applications for pre-qualifications invited and evaluated by a committee. Cost break-up would be prepared by the consultant.

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Prepared by

(Muhammad Hassan Brohi) Deputy Director (Tech.) Sindh Coal Authority

Verified by

(Saqib Bashir Dahar) Secretary Sindh Coal Authority

Checked by

(Mumtaz Ali Qureshi) Director General Sindh Coal Authority

Approved by

(Muhammad Younus Dagha) Secretary Mines & Mineral Development Department Government of Sindh

Karachi September 29, 2008 9

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