Karachi’s Main Water Supply Source Dhabeji Pump Station to Have its Own Power Plant; Contract Awarded
(BE2C2 Report by Irshad Salim) — Karachi draws its water mainly from the Keenjhar Lake, a man-made reservoir about 150km from the city, which, in turn, gets the water from what’s left of the Indus River after it completes its winding 3,200km journey through Pakistan and into the Arabian Sea.
Through a network of canals and conduits, 550 million gallons of water a day (MGD) plus is fed into the city’s main pumping station at Dhabeji operated by the Karachi Water & Sewer Board (KWSB).
In December 2016, Sindh’s Chief Minister Murad Ali Shah laid the foundation stone of a new project for supply of additional 100 million gallons a day of water to Pakistan’s economic hub from the pumping Station which is located near Thatta.
The project comprises six additional pumps. Four pumps would be made operational while two more pumps would remain on standby.
The pump station however remains a cost center for the provincial government. It has been paying the electricity bills to K-Electric on behalf of KWSB which does not generate its own revenue, hence can’t undertake capital expenses (CAPEX) on its own.
The electric bill is a whopping monthly number– Rupee 55 crore (roughly US$5m monthly)– downtime, power interruptions, loadshedding, etc. notwithstanding.
Therefore, Murad’s government decided that the main pumping station for the largest city, Sindh’s capital, and the country’s financial capital should have its own power plant (captive power plant) so that its power needs (present and future) could be fulfilled and at a lesser cost. As for K-Electric? It will have additional power to supply and distribute among the populace and its commercial establishments– a win-win for all.
The move seems to be surging forward clockwise.
In February the KWSB awarded contract to a local outfit through international competitive bidding process for building, owning and operating a 50MW dual-fueled plant at Dhabeji pumping site. The independent private power (IPP) stakeholders would sell electricity to KWSB for Dhabeji at nearly 50 percent less cost than what K-Electric has been charging.
Speaking to BE2C2, the Chief Executive of Technomen Kinetic Saiyed Asif Mehmood said his firm was declared the lowest responsive bidder and was awarded the contract in February to build, own and operate (BOO) the plant. The EPC cost is around US60m and uninterrupted supply of electricity to the pumping station would be for approx PKR9/KwH as compared to Rs16.50 plus taxes, surcharges, etc. charged by K-Electric.
The savings thus expected to accrue on electric bills could fund other downstream projects or new water and sewer initiatives for the rapidly expanding megacity– one of the largest cities in the world.
The captive power plant will be operational at Dhabeji in 18 to 24 months, said Mr. Asif whose outfit is also operating a newly built and already operational 100MW gas-fired power plant at Nooriabad. The venture is on public-private partnership basis with the government of Sindh. Power produced at Nooriabad Gas Power plant is sold to K-Electric (at a substantially lesser rate compared to countrywide tariff for gas-fired plants rates) which in turn supplies electricity to the city.
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