The senior representatives of JP Morgan Mr. Asif Raza- Managing Director, Global Corporate Bank CEEMEA along with Mr. Imran Zaidi- Managing Director, Global Corporate Bank MENA and Mr. Amin M. Khawaja, Chief Executive Officer, Pakistan called on Federal Minister for privatisation Mohammedmian Soomro, Senior officials of the Ministry also attended the meeting. The JP Morgan is one the the world’s largest investment banks and advising the consortium of Qatar Investment Authority (QIA) which showed keen interest for the privatisation of NPPMCL.
The meeting was held in the backdrop of the privatisation of two RLNG Power plants of Haveli BahaderShah and Balloki. Government has initiated a process of implementing economic reforms in the power sector, as a part of the reform, Ministry of Privatisation is pursuing privatisation of state-owned entities to promote and enhance capital formation outside government budget and to improve efficiency through competition, accountability, managerial autonomy and profit incentives. The process of privatisation of two RLNG plants was slowed down due to the Covid-19 pandemic, there was a considerable progress made as 12 parties were pre-qualified in April-2020. The process restarted after Covid-19 restrictions were relaxed, currently the Ministry is pursuing debt-refinancing and recapitalization for NPPMCL, with local banks.
The MD (JPMorgan), expressed that their consortium Qatar Investment Authority (QIA) is a strong contender for investment for the said power plants. The representatives inquired about the current volume of circular debt, payment due to the IPPs and the huge receivables of NPPMCL, which could have strong bearing/ negative impact on the potential investment in the sector. Federal Minister Mohammedmian Soomro said, that the meetings regarding these issues are held with the Ministry of Energy and Finance Division, He also told that the local banks and DFIs are considering to provide the significant portion of debt for NPPMCL.
It was also briefed that the Ministry of Privatisation has resolved various key issues to make this transaction viable, these include Approval of CCI for inclusion of Power Plants in Privatisation List ECNEC approval for project costing, transfer of the land for NPPMCL from Punjab Government, approval of the COD tariff determination, amendments in the Canal and Drainage Rules approved from Punjab Government, conversion of Land Use of both Power Plants approved by local government, water Usage Agreements with Punjab Government and also drafted scheme for De-merger of NPPMCL into two separate companies prepared for submission to SECP.
Federal Minister said that owing to the positive response from the investors the transaction will hopefully be completed in this FY. The representatives from JP Morgan said that for the wider interest of the country we wish to bring investment in power sector.
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