Tuesday, June 25, 2024

AJK government signs agreement with Chinese firm to build 700MW Azad Pattan hydropower project

Agreements to bring the Azad Pattan power project closer to financial closure have been signed by the government of Azad Jammu & Kashmir and Azad Pattan Power Private Limited. The 700 MW hydropower project is part of the China Pakistan Economic Corridor and once completed, without relying on expensive fuel-powered plants, will help the region generate clean energy.

Azad Jammu Kashmir Power Secretary Zafar Mahmood Khan and Azad Pattan Power Private Limited CEO Li Xiaotao signed the project agreements, namely ‘GoAJ&K Implementation Agreement’ and ‘GoAJ&K Water Use Agreement,’ read a statement issued by the Energy Ministry. “The Azad Pattan project will not rely on imported fuel, with an investment of over $1.35 billion, allowing the country to move towards cheaper and greener power generation.”

These two agreements are only the latest in a series of agreements signed alongside the CPEC between the governments of Pakistan and China on power generation and energy use. In July, in the presence of Prime Minister Imran Khan, similar agreements were signed, including the Government of Pakistan Implementation Agreement, the Government of Punjab Water Use Agreement, and the Tripartite Power Purchase Agreement.

The Azad Pattan project is part of the 2002 Policy for Power Generation Projects and will be implemented on a Build, Own, Operate and Transfer (BOOT) basis for a period of 30 years by the Private Power and Infrastructure Board (PPIB). After this period, the project will be handed over free of charge to the government of Azad Jammu & Kashmir.

The project is being funded by a lender consortium comprising China Development Bank, China Construction Bank, China Industrial & Commercial Bank and China Bank, and by 2027 it is expected to contribute approximately 3,266 GWh per year to the national grid.

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