Thar Block VI power station

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Thar Block VI power station is a power station in the pre-permit stage in Singhara, Thatta, Sindh, Pakistan. It is also known as Oracle power station.

Location

Table 1: Project-level location details

Plant name	Location	Coordinates (WGS 84)
Thar Block VI power station	Singhara, Thatta, Sindh, Pakistan	24.840802, 70.315075 (approximate)

The map below shows the approximate location of the power station.

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Project Details

Table 2: Unit-level details

Unit name	Status	Fuel(s)	Capacity (MW)	Technology	Start year
Unit 1	pre-permit	coal: lignite	660	supercritical	2028 (planned)
Unit 2	pre-permit	coal: lignite	660	supercritical	2028 (planned)

Table 3: Unit-level ownership and operator details

Unit name	Owner	Parent
Unit 1	Thar Electricity Pvt Ltd [100%]	Oracle Power PLC [100.0%]
Unit 2	Thar Electricity Pvt Ltd [100%]	Oracle Power PLC [100.0%]

Project-level coal details

• Coal source(s): Thar Block IV

Background

Blocks in Thar coal field. Photo: Oracle Coalfields

In November 2013, Oracle Coalfields signed a Memo of Understanding (MOU) with Chinese construction company SEPCO to develop a 600 MW coal plant at Thar coalfield Block VI. Under the agreement, SEPCO was set to conduct a technical feasibility study and an environmental impact study (EIS) over a six month period. SEPCO was to finance up to 70 percent of the debt for the power plant and was to provide enough equity funding to make it the majority shareholder in a special purpose entity formed to own the plant.

In September 2014, Oracle and SEPCO signed an Engineering, Procurement, and Construction (EPC) agreement, following receipt from SEPCO of outline bids for the construction of the integrated mine and power plant. SEPCO proposed securitizing up to 85% of the cost of the two EPC contracts with support from Sinosure, the China Export & Credit Insurance Corporation, and certain Chinese banks.

In March 2015, Oracle Coalfields extended its EPC framework agreement with SEPCO. The exclusive agreement ran until the end of 2015. According to World Coal, discussions were started with Chinese finance house Sinosure on proposals to securitize up to 85 percent of the cost of the two EPC contracts.

In March 2015, it was reported that the project would be included in the China-Pakistan Economic Corridor (CPEC), projected to finance around US$33.8 billion in energy projects. However, the project was not included among the projects included in the China-Pakistan Economic Corridor.

In June 2015, Oracle and SEPCO formed Thar Electricity (Private) Ltd, with a 90-10 equity split; the two companies signed a consortium agreement in October 2015. In November 2015, a "letter of no objection" was issued for the project by the Central Power Purchasing Authority. As of March 2016, Thar Electricity (Private) Ltd had registered the project with the PPIB, and was working towards financial close of the project, as well as negotiating the EPC contract with SEPCO. The plant was planned for completion in the second quarter 2021.

In June 2016, Oracle reached an agreement on coal pricing with the government of Sindh.

In July 2016, Pakistan's water and power ministry, frustrated with the slow pace of this and other projects, warned Oracle that if it didn't have the project "completed" (presumably meaning construction being underway) by December 2018, it would be dropped from the CPEC.

In June 2017, the project was elevated to the priority list of projects under the China-Pakistan Economic Corridor (CPEC) and was listed as 1,320 MW, with the first phase being 660 MW. Oracle was continuing to work on completing the project's environmental impact assessment, as well as lining up financing and pursuing land acquisition and resettlement. The company stated that "progress with potential Chinese partners is taking longer than we hoped, but detailed discussions are under way with several State-owned Enterprises, as financing partners and as EPC contractors."

In November 2017, Oracle signed a Memorandum of Understanding (MoU) with Sichuan Provincial Investment Group Co. Ltd (SCIG) and PowerChina International Group Ltd (PowerChina) for investing in, setting up, constructing, owning, and operating the coal plant. The MoU specified that the project would be funded in cash by the parties from Chinese banks, and it was proposed that SCIG, PowerChina, and Oracle would have equity holdings in the project of 78%, 10%, and 12% respectively. Oracle hoped to reach financial close in the first half of 2018.

In February 2018, the companies secured the approval of the Pakistani Private Power and Infrastructure Board (PPIB) to develop a 700 MW coal based power plant at Thar Block-VI. The application was submitted in November 2017 and PPIB approved the Notice to Proceed and the Letter of Intent of Oracle's subsidiary Thar Electricity (TEPL). The power plant size, originally submitted as two 660 MW phases – for a total plant size of 1,320 MW – was increased to two 700 MW phases to "comply with new requirements in Pakistan."

In November 2018, the National Electric Power Regulatory Authority’s proposal to reduce the guaranteed 14 to 17% rate of return for different technologies to 12 to 16% was criticized by Oracle Power, which wanted the higher rates grandfathered in for companies with existing agreements. Oracle Power argued that any change would discourage investments in independent power projects. President Imran Khan’s new government vowed to review what it argued were overly generous concessions for power projects as public opposition to Chinese-backed infrastructure projects and associated debts grew.

A December 17, 2018 updated list of "Upcoming IPPs" by the Ministry of Water & Power stated the plant would be commissioned in June 2023. The issuance of the notice to proceed (NTP) and letter of intent (LoI) was "in process".

In January 2019, the project's change to supercritical technology was confirmed and the project was re-affirmed as a priority for the Pakistani government.

As of December 2019, completion was still scheduled for 2023. A December 4, 2020 updated list of "Upcoming IPPs" by the Ministry of Water & Power stated the plant would be commissioned in June 2026, three years later than previously noted. The project proposal was described as "under evaluation/consideration". (From 2019 to 2021, the government's website still listed the project as 1,320 MW instead of 1,400 MW.)

In April 2021, Oracle noted the company was still "awaiting clearance from the Ministry of Energy for construction of new power plants."

Pakistan’s Indicative Generation Capacity Expansion Plan 2021-30 approved by the National Electric Power Regulatory Authority in September 2021 listed "Thar Block VI-Oracle- Local Coal Based Power Plant (1,320 MW)" under its "New Generation Options" as a candidate generation technology "selected to be fed into the model." The project was not listed as a "committed" project.

An April 2022 update from the Ministry of Water & Power moved the project to the "candidate projects" category and removed previously stated information regarding evaluation and clearances. The 'candidate' status has been maintained as of December 2022 and as of March 2023 as well. A media report from June 2022 stated that the project to build a power plant and a coal-to-gas and coal-to-liquid facility at Thar Block VI was 'put on ice' by the authorities.

In September 2022, Pakistan’s Indicative Generation Capacity Expansion Plan 2022-30 did not appear to list the project. However in October 2022, Oracle stated that it continues the development of Thar Block VI Project and the the government is reviewing the demand for power from Thar coal and Oracle are in dialogue with them.

In April 2023, Oracle Power PLC announced that it has signed a cooperation agreement with Chinese state-owned energy company PowerChina to jointly develop a 1GW solar PV project in Pakistan on the unutilised land at Thar Block VI. Oracle later stated that the solar project was independent of their coal-to-power project.

In May 2023, it was announced that Oracle Power had signed an MOU with K-Electric (KE, a privately-owned power utility in Pakistan), the Sindh provincial government, and PowerChina for the off-take and development of a 2 x 660 MW coal-fired power plant in Sindh Province. Through the MOU, Oracle’s wholly-owned subsidiary Thar Electricity would reportedly assess whether to develop the power plant at Thar Coal Block VI or relocate the project to KE-owned land at Port Qasim in Karachi. If the project remained at Thar Coal Block VI, KE would potentially become the sole off-taker via a direct power purchase agreement.

In July 2023, the Thar Block VI coal plant was listed as an "Upcoming IPP" by the Private Power & Infrastructure Board (PPIB) of the Government of Pakistan's Ministry of Energy. The proposal was labeled as an Indicative Generation Capacity Expansion Plan "candidate project" through 2032.

In November 2023, the PPIB's "Upcoming IPPs" listings indicated that the proposed power station was "under review", and the expected completion date was now December 2028. In February 2024, the updated website did not provide further developments.

In March 2024, the project was described as being in a Letter of Intent stage, rather than an "advance" stage.

In June 2024, Oracle's 2023 Annual Report stated that non-binding offtake agreements were in place for Thar Block VI power station.

In August 2024, the power station's project cost was "yet to be determined".

Coal-to-gas & Coal-to-liquid strategy

In 2019, the project was also floated as a coal gasification to fertilizer project under the CPEC.

In April 2021, Oracle said "we have made meaningful progress with our Thar Block VI Project, specifically with the commercialisation framework for our coal-to-gas and coal-to-liquid strategy." For example, in February of that year, Oracle, in conjunction with China National Coal Development Company (CNCDC), jointly submitted a policy proposal for coal-to-gas and coal-to-liquid development in Pakistan to the Ministry of Energy. The policy proposal outlined the commercial framework through which the development of coal to gas and liquid at Thar Block VI could be fast-tracked "in order to address Pakistan's critical gas shortage and continued reliance on imported liquid fuels."

In July 2021, Oral said "[i]t is important to note that over the past year we also made progress towards expanding the scope of our Thar Block VI Project, encompassing more elements and advanced coal technologies to deliver coal-to-gas and coal-to-liquid. This strategy is aligned with Pakistan's internal projections and ambitions to become a domestic fuel supplier, reducing the reliance on imported liquid fuels and gas."

Ownership

In June 2015, Oracle and SEPCO formed Thar Electricity (Private) Ltd, with a 90-10 equity split; the two companies signed a consortium agreement in October 2015.

In November 2017, Oracle signed a Memorandum of Understanding (MoU) with Sichuan Provincial Investment Group Co. Ltd (SCIG) and PowerChina International Group Ltd (PowerChina) for investing in, setting up, constructing, owning and operating the coal plant.

In December 2018, Beijing Jingneng Power Company replaced Sichuan Provincial Investment Group as the project's majority owner.

In April 2019, the project's sponsors adjusted their shares of the project, with Beijing Jingneng Power Company shifting 5% out of its ownership share to PowerChina.

In May 2023, Oracle signed an MOU with K-Electric, the Sindh provincial government, and PowerChina to establish a collaborative framework for developing a 1,320 MW coal plant. In Oracle's press release on the MOU, Thar Electricity (Private) Limited was listed as one of the MOU parties and a 100%-owned subsidiary of Oracle Power. K-Electric and the Sindh Government would reportedly have options to be equity partners, and external equity investors would also be sought.

Opposition

As noted in other Thar project pages such as the Thar Block II power station's, proposals in the region have been met with strong objections and demands.

Financing

Oracle Power's 2023 Annual report referred to securing appropriate financing arrangements for the project in due course.

Articles and Resources

Additional data

To access additional data, including an interactive map of coal-fired power stations, a downloadable dataset, and summary data, please visit the Global Coal Plant Tracker on the Global Energy Monitor website.