LAHORE Though the incumbent government is trying hard to arrest power issue across the country in a bid to give relief to the masses but traditional red-tapism and other hurdles have not only delayed the two power generating projects for further two years but has also increased its overall cost. According to details, both Nandipur and Chichon Ki Maliaan power projects having 450MW capacity each have become the gory example of red-tapism as delay has raised cost of construction up to unbearable losses. Nandipur power project is a oil-fired project located at Nandipur under the umbrella of Pepco. The project initial cost was $329 million and was awarded to Dong Fang Electric of China, one of the largest manufacturers in China for power equipment whose contractual ceremony was held in January 2008. Pepco had released 10pc down-payment in May 2008 and Letter of Credit established in October 2008 while Dong Fang was responsible for export credit financing. BNP Paribas/HSBC consortium lent under this structure with an export cover by French export credits agency (Coface) and China Exim Bank/Sinosure for the foreign currency part. It is worth mentioning that lenders required the financing documents and the sovereign guarantee issued by Finance Ministry and approved by Ministry of Law but unfortunately Law Ministry refused to approve finance documents at a time when construction was going on. That was why local and foreign lenders both stopped funding. As a result, the equipment (almost 4,500 packages) are still lying with Karachi Customs putting the project to complete halt in November 2010 after contractor served a legal notice of demobilisation. The equipment at Karachi accrued huge amount of demurrage estimated to be Rs700 million. However, recently ECC has waived off duties on these equipments and also waived demurrage charges off advising Law Ministry to issue its opinion. Nonetheless, one-and-half-year delayed project would now cost at least $90-$100 million more to finish besides depriving the country of total 450MW (total 900MW) electricity. It is pertinent to note that had Law Ministry issued its opinion in time, the project would have been operational in April 2011, instead of 2013 for generating electricity. Likewise, Chicho ki Maliaan power project is a gas turbine that would run on furnace oil. The contract for this project was signed in April 2008 with a total cost of $355 million. As lenders stopped further funding on Nandipur power project, that was why this project never got off as lenders required that all documentation and opinions be in place before proceeding. As delay has raised the cost of construction, so Dong Fang, contractor asked for an increase of $70 million in contract price. The issue was settled at $40 million increase but now it is also not applicable. The project has been demobilized which was originally targeted to be completed in February 2012. To restart the project will now cost another $100 million more at least, and will result in a further delay of at least 2 years.