ISLAMABAD -   Water and Power Development Authority (Wapda) has signed two contracts worth Rs179.4 billion with China Gezhouba Group Company (CGGC) for the construction of main civil works of stage-I of Dasu Hydropower Project.

The signing ceremony was attended by Federal Minister for Water and Power Khwaja Asif, State Minister Abid Sher Ali and WAPDA Chairman Lt Gen (R) Muzammil Hussain. Dasu Hydropower Project General Manager/Project Director Javed Akhtar and CGGC representative Tan Bixuan signed contracts on behalf of their respective organisations.

The cost of the contract on MW-01 is Rs115 billion and MW-02 is Rs64.4 billion. The contract MW-01, which would be completed in about five years, includes construction of main dam, appurtenant structures and hydraulic steel structures. The contract MW-02 comprises construction of underground power complex, tunnels and hydraulic structures. Dasu Hydropower Project (DHP) includes the construction of a 4,320MW hydropower plant on the Indus River near Dasu town in Kohistan District of Khyber Pakhtunkhwa (KP) province. The project is located approximately 74km downstream of the Diamer Basha Dam, 240km upstream of the Tarbela Dam and 345km from Islamabad.

The run-of-river hydro power project is being developed in two stages, stage-I, having a generation capacity of 2,160MW, include the installation of six hydropower units rated at 360MW each, while stage-II will also have the same capacity. The project will be completed in two stages in five years and would contribute more than 12 billion units per annum to the national grid. The stage-II, after its completion, will also provide another nine billion units to the system.

While addressing the ceremony, Khawaja Asif said that the government is committed for optimal utilisation of hydropower resources for generating low-cost electricity to eliminate load-shedding and provide relief to the people. The DHP is a manifestation of this commitment, he added.

He said World Bank (WB) is partially financing stage-I for which loan agreement of $580.40 million IDA-I credit and partial credit guarantee of $460 million signed and effective from November 2014.

Wapda is in process of arranging commercial financing from foreign sources for remaining project process. The agreement of Rs144 billion will be signed with local commercial banks during the current month, he added. International banks would provide $800 million. Agreement with the banks for the credit of $350 million will be signed next month, he added.

The minister said that Indus Water Treaty 1960 is a sacred document, and it should be implemented in letter and spirit. He said that if India deviates from the treaty at any stage, mechanism is available with Pakistan to stop that deviation and ensure its enforcement.

Replying a query, the minister said that KP would get Water Usage Charges (WUC) in accordance with the current mechanism being implemented by the Wapda. He said in 2013 there was a lot of clamor about the loadshedding but it was subsequently lowered in 2014, 2015 and 2016 and will further reduce during this summer. Since 2013, every summer, the government has provided improved power supply to the consumers, he added.

The minister further stated that 969MW Neelum-Jehlum Hydropower Project would start generation during first quarter of 2018, adding that work would also start on two more mega projects ie 1.2 MAF Mohmand hydropower project and ground breaking of Daimar Bhasha dam. He said that financing is available for both projects and the government intends to start work on both projects immediately.

Regarding the tariff of DHP, the minister said that it is premature to discuss tariff which is to be determined by the National Electric Power Regulatory Authority (Nepra). He also dispelled the impression that China is sending its prisoners as workers in Pakistan. He further said he would not blame anybody for delay in DHP, saying that when Pakistan Muslim League-N came into power, they have the choice to either do Dasu or Diamar Bhasha but the government opted to work on both projects. He said, now both projects are a reality.

While responding to another question, he said that transmission lines are available for those projects which are under construction. He said transmission lines have not be upgraded in some areas fearing that some people take very little time to steal old silver wires. He further stated that the government’s target is to add 10,400MW in the system by 2018. Presently, gap between demand and supply is around 5,000MW or 5,500MW but early 2018 there would be sufficient generation to fill demand supply gap.

Earlier, the Wapda chairman, in his welcome address, said that the 3,420MW run of the river project requires $6.2 billion funding while the cost of stage-I is $4.2 billion. However, he said, phase –II of the project would be completed after Daimar Bhasha is completed.