The Hub Power Company Ltd.

China-Pakistan Economic CorridorPower Projects

Round Table on EnergySerena Hotel, IslamabadSeptember 29th-30th, 2015

Nazoor Ali Baig

The Hub Power Company Ltd.

Table of Contents

• What does CPEC mean to Pakistan?• Our role to realize the benefits • Power industry opportunities• HUBCO project

The Hub Power Company Ltd.

What does CPEC mean to Pakistan

• It is the most important business deal for the country• Multi-year investment, worth USD 46 Billion• Opportunities in Energy, Communications, Infrastructure,

Gwadar, Etc.• Of the USD 46 Billion, 75% are planned for Energy sector• Absolutely critical for the growth of Pakistan’s economy

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Our role in realizing the benefits (1/2)

• Both countries stand to gain from this opportunity. However, it depends on the abilities of both parties and how they are exploited

• Government’s ability to improve the processes and regulations to remove barriers, allowing projects to move efficiently and effectively

• Investors collaborating with the government to improve the processes

• Government has and continues to play a key role in providing support when it comes to financing these projects

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Our role in realizing the benefits (2/2)

Pakistan’s play;• Prominent investor’s ability to pull the resources for

these projects, with country’s future in forefront• Pakistan has the Intellectual capital required to manage

this long journey, we need to stay focused• This is a very good opportunity for knowledge transfer

for the future, invest in the younger generation • Getting coal in the mix of fuels is the right move, need

to get cheaper fuel in the mix for global competitiveness• Hard work and adaptability is what we are very capable

of, and, will be the key to our success

The Hub Power Company Ltd.

Power Industry Opportunities

• This is the opportunity Pakistan has been waiting for to launch its economy with efficient, reliable, and economical power with stable grid

• Supported by infrastructure development for fuel transportation and grid stability

• Once the grid is stable, and with capacity meeting demands (i.e. reserve margin), along with the choice of fuel(s), one can think of market based pricing

• There are a number of projects on the horizon, and there will be challenges with each. Our goal should be to collaborate and learn from each other

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HUBCO Project (1/3)

• Project is 2x660 MW plant with dedicated Jetty for coal import, expandable to 6x660

• JV company formed with CPIH “China Power Hub Generation Co.”

• One of the projects in “Actively Promoted Projects” list in CPEC

• Started with 1x660 MW with seven bidders, now going to resubmit proposals for 2x660

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HUBCO Project (2/3)

• Regulatory

i. LOI submitted

ii. Upfront tariff approval awaited• Financial

i. Engagement of financial consultant

ii. Lead banks CDB & CEXIM

iii. Expected financial close Q2, 2016• Technical

i. FSR completed

ii. RFP issued

iii. ESIA completed

iv. Jetty Options being evaluated

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HUBCO Project 3/3

• Key areas to focus on from technical perspective– Safety• Higher pressures and temperatures• Explosive nature of pulverized coal• Ash handling

–Availability of the plant • Proven technology• Redundancies• Efficiency• Grid stability• Outage cycles• Auxiliary loads• Spares management