ECC to Consider Amending KAPCO’s Power Agreements Today

The Economic Coordination Committee (ECC) of the Cabinet, scheduled to be held on Wednesday (April 14) will consider a summary of the Power Division for the approval of the amendment to the Facilitation Agreement and Guarantee Agreement with the Kot Addu Power Company Limited (KAPCO).

The Cabinet Committee on Energy and Economic Coordination Committee of Cabinet had approved the report of the Implementation Committee which was mandated to convert the MoUs signed with IPPs into binding agreements.

Sources told Propakistani that the Cabinet had ratified the decisions of CCoE and ECC vide its decision dated 1st December 2020 and approved the report along with the Master Agreement and PPA Amendment Agreement with KAPCO.

KAPCO is an independent power producer privatized under the applicable privatization laws but operated outside the typical power generation policy framework for IPPs.

For the purpose of execution of the Master Agreement and PPA Amendment Agreement, in terms of MoU agreed with KAPCO, any amendments in the Facilitation Agreement thereto were to be signed by the Privatization Commission.

The power division communicated this position to the PC, however, the commission responded that due to certain procedural impediments the said amendments could not be prepared and signed by a designated official of the Privatization Commission and requested that, in respect of KAPCO being an IPP, any further agreement or amendments to the Facilitation Agreement and GOP Guarantee should be signed by the Power Division.

The concession framework for the purposes of privatization was prepared and approved by Privatization Commission and accordingly, the Facilitation Agreement and GOP Guarantee with KAPCO were signed by Privatization Commission on behalf of the President of the Islamic Republic of Pakistan at the time of its privatization on June 27th, 1996.

The ECC meeting would also consider a summary of the Power Division on the waiver of minimum 66 percent Take-or-Pay commitment in Power Purchase Agreements and Gas Supply Agreements of three LNG public sector power plants and placement of firm gas commitment finalized based on annual production plants of the power sector.

IT will also give approval to the technical supplementary grants for the establishment of four mother and child hospitals in Punjab.

Source: Pro Pakistani