Private/Public sector partnership with Engro for Thar Coal Development of Pakistan

Govt. of Sindh needs to be commended for its effort for the Private/Public sector partnership with Engro for Thar Coal Development. However there are many administrative and technical hurdles facing this project. (Dawn Sept. 10, 2009)

On the many administrative hurdles, I will reserve comments for another day and for now focus only on the two technical hurdles mentioned, namely the completion of a new feasibility study for Coal Mining/ Power Generation and the Availability of water for the Plant.

Why must we reinvent the wheel each time we need a wagon, why is this deal with Engro for a different block of Thar coal field which requires them to start all over with a new feasibility study, instead of block 1 that has already been thoroughly studied, for which the Government has paid millions of Dollars to Rheinbraun/RWE Power for a comprehensive study, which is on file since 2004.

What will another feasibility study at a cost of additional millions of Dollars and 2 years of time wasted tell us that are not already known from studies that have already been done which in a nutshell, affirm the following:

Block 1 has proven reserves of 1 Billion tons and only 180 Million tons of coal will be needed to operate a 1000 MW plant for 30 years, the various coal seams start at around 450 feet depth and occur up to 600/650 feet, that there are 3 ground water aquifers of which the base aquifer is highly pressurized and therefore the only viable option will be Open Cast mining and that can only be done by dewatering these aquifers.

A state of the art mathematical model simulating Thar coal area ground water conditions employing a “Finite element mesh” estimate that dewatering will require pumping out as much as 15 million gallons of groundwater per day to safely operate one mine producing 6 million tons of coal per year needed to generate 1000 MW of electricity.

coal_thar

Thar Coal Reserves of Pakistan

The following coal quality parameters also stand evaluated:

  • Coal Quality Lignite
  • Ash (avg) 7%
  • Sulphur (avg) 1.4%
  • Moisture (as received) 48%
  • Heating Value (as received) 5140 Btu/Lb.
  • Moisture (final) 12%
  • Heating Value (dry) 10280 Btu/Lb

All the other important Geotechnical Engineering criteria such as identification of the geologic units, their shear strengths, slope stability analysis etc, needed to assess feasibility of an open pit mine are more or less already established and the rest can be achieved either during the final design or modified as dictated by field conditions during the excavation and mining phase. This is how it is done, that is the nature of any large scale earth excavation project, deal and work with what nature throws at you in the field and modify your approach as needed.

2 years hence and Millions of more Dollars spent, the proposed new feasibility study for this joint venture, may at best, revise these coal parameters up or down by a couple percentage points which in the larger picture is inconsequential for a project of this magnitude and doesn’t bring us any closer to realizing the dream of power generation from Thar Coal, except feeling good that we are doing something, albeit useless.

This historical and watershed private/public sector project costing upward of $3 Billion is also dependant on being provided with 250 cusecs (Cubic feet per second) water from the Indus river irrigation system, for which the Govt. of Sindh has recently sanctioned RS. 176 Million (US $ 2Million) for a feasibility study. Prequalification of Consultants has been advertised under the World Bank Technical Assistance program.

Without being critical of anyone, it is important to understand this issue in the public interest. Everyone knows that there is a chronic water shortage in Sindh, 250 cusecs is a rather large quantity of water and Thar would be happy to have it but there are a few major technical issues, the most important of which is, where this water is going to come from to make this coal project work.

The Coal project is located near Islamkot in the Thar Desert, which is outside the Sukkur Barrage Command Zone; the nearest source of Indus water is Jumrao Canal which is a branch of Nara Canal, which in turn draws its water from Sukkur Barrage. Due to siltation of the Canals and degradation of the 77 year old regulatory system, water carrying capacity of both the Nara Canal and Jumrao Canal stands diminished.

In order to meet agriculture demand these canals are forced to carry water beyond their current capacity, as witnessed by canal embankment erosion/breaches and regulator washouts because of the overload. Therefore it will be impossible for either Canal to carry an additional 250 cusecs of water for Thar coal development, without massive remodeling of both Canals and their appurtenant regulatory systems. This will cost Billions and at least a 10 year time frame if not more.

Furthermore, Islamkot (Coal project area) is topographically located at a higher elevation than the canal system therefore conventional gravity channel flow of 250 cusecs of water to the coal project is not possible, the water (if it was even available) will have to be pumped upslope, the Capital and Operational costs are going to be prohibitive and with current electricity shortfalls where will the power for the pumps come from? Battling with the Indus River System Authority (IRSA) and other provinces for an additional 250 cusecs share of water for Sindh is going to be another nightmare.

In conclusion, if the Govt of Sindh/World Bank have an extra 176 Million Rupees/$2million to burn on this yet another useless feasibility study, they may do so by all means but no one should hold their breath and live under the illusion that 250 cusecs of extra water will magically appear from the river Indus system and we will all be finally seeing electricity from Thar coal because of it. If this water is what the Joint venture between the Govt of Sindh and Engro are relying on, than a careful rethink may be in order.

Zahoor A. Abbasi (zabbasi@live.com)

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