Public Finance

Group# 6

Nandi Pur Power Project

Group Members
Sherbaz, 17-ARID-2689
Muhammad Mubeen, 17-ARID-2669
Haroon Nazar, 17-ARID-2648
Muhammad Mudasir, 17-ARID-2670
Sohail Ahmad, 17-ARID-2691
 Introduction
Name Nandipur Power Project
Status Completed in March, 2015
Duration of Project 2008-March,2015, but stopped and restarted in 2013
Owner Government of Punjab
Constructed By China Dongfang Electric Corporation
Run by Nandipur Thermal Power Generation Company Ltd.
Area of Serving Punjab
Location Nandipur, Gujranwala, Punjab, Pakistan
Operational Since March,2015
Usage Primary: RLNG, Secondary: Furnace
Production Capacity 425 MW
Cost Initially Rs.27bn but project finished at Rs.58.42bn
 Need & Decisions
Power Shortfall in 2008 15% less than Demand
Power Shortfall in 2013 Demand: 15,000MW; Supply: 9500MW,
5300MW Shortfall
So, there was need of this Power Plant and project resumes in 2013
Production Capacity 425 MW (with potential of 525 MW)
This was first proposed in 2008
Constructed by China Dongfang Electric Corporation
Financed by Punjab Government
Initial Cost Rs.23bn with 10% down payment to
Dongfeng
Final Cost Due to delays, project ended at Rs.57.4bn
 Structure of Plant (Feasibilty)
 It can be ran in both Simple Cycle and Combined Cycle Modes
 It consists of 3 gas turbines and 1 steam turbine
 GE (France) gas turbines, three, with capability of 4.95MW each
 DEC (China) steam turbine, one, with 138.8 MW capability
 It will produce 425MW on Furnace Oil and 460MW from Natural Gas
 Heat recovery steam generator (HRSG),
 Balance of Plant (BOP) equipment (like pumps and motors), and others
have been supplied by DEC from China
 HSFO has been used instead of LSFO, which damages combustion system
 On-site ten oil storage tanks, each of 10,000 ton capacity,
 Eight for furnace oil and two for HSD, supported with a fuel oil treatment plant
 Plant system performance is not in compliance with Design Specifications and Contractual Obligations
 Cost of Plant (Implementation)
 Cost Discrepancies
 $847.016m Final Cost
 $574m quoted by government
 $329m approved by ECC

Operation and Management

 $7m Service Charges
 Plus $15m Spare Parts

Per Unit cost

 Rs.12 per Unit
 Monitoring
 The O&M cost of other thermal power plants was average
 Rs0.02500 (Muzaffargarh plant),
 Rs0.06890 (Guddu plant) and
 Rs0.13590 (Jamshoro plant) per unit (kWh)
 But Nandipur Costs Rs.12 per Unit
 Company wasn’t even asked to ensure Guaranteed Working of Plant and Machinery
as defined efficiency parameters after 18-24 months of COD
 Lots of Data given by NEPRA is forged and doesn’t tells the real story which is happening now
 Irregularities
 Rs. 80bn in Irregularities
 Rs.17bn Loss is being caused
 Delays in Finalization costed Rs.4.5bn
 Rs.3.8bn were lost due to non conversion to gas from furnace oil
 Irregular and Excessive Payments costed Rs.1.2bn
 Contract in violation of Procurement Rules cost Rs. 46bn
 Other losses,
 the irregular appointment of the managing director of the project,
 uneconomical generation,
 poor performance and
 the illegal resumption of work with blacklisted firm M/S Dongfang
 loan agreement of Rs5.3 billion with Local Banks
Summary of Presentation