Karot Power Co. Ltd. and Pakistan's Private Power and Infrastructure Board have signed an agreement for the development of the 720-MW Karot hydropower plant.
The project will be developed by Karot Power, which includes China Three Gorges-subsidiary Three Gorges South Asia Investment and Associated Technologies of Pakistan.
The new facilities will be located on the Jhelum River near the village of Karot in Kahuta tehsil 65 kilometres from Rawalpindi city. The plant includes an underground powerhouse that will generate electricity from four 183-MW Francis turbine units.
The project is being developed under the Power Policy 2002 on a build-own-operate-transfer basis, with a concession period of 35 years (5 years of construction, 30 years of operation). The project is expected to be operational by 2020.
Energy generated at the plant will be sold to the National Transmission and Dispatch Company under a 30-year power purchase agreement (PPA). The project is expected to generate 3,436 GWh annually.
The total project cost is currently estimated at US$2 billion and is expected to be funded with 20 percent equity (US$400 million) and 80 percent debt (US$1,600 million). The debt financing for the project is expected to be provided by a consortium of Chinese lenders and IFC.
In late August, we reported that China Three Gorges Corporation is seeking IFC financing for the project. The proposed IFC investment is for up to US$100 million A Loan for IFC’s own account.