The Lalpir Power Complex, () is a power plant complex located in

Mehmood Kot Mehmood Kot ( ur, ), ( Punjabi: ) or Mehmood Kot is a city in District Muzaffargarh, Punjab, Pakistan Pakistan ( ur, ), officially the Islamic Republic of Pakistan ( ur, , label=none), is a country in South Asia. It is the world's L ...

Punjab Punjab (; Punjabi: پنجاب ; ਪੰਜਾਬ ; ; also romanised as ''Panjāb'' or ''Panj-Āb'') is a geopolitical, cultural, and historical region in South Asia, specifically in the northern part of the Indian subcontinent, comprising ...

Pakistan Pakistan ( ur, ), officially the Islamic Republic of Pakistan ( ur, , label=none), is a country in South Asia. It is the world's List of countries and dependencies by population, fifth-most populous country, with a population of almost 24 ...

. The plant sells electricity to the

Central Power Purchasing Agency Central Power Purchasing Agency-Guarantee (CPPA-G) is the market operator in Pakistan Pakistan ( ur, ), officially the Islamic Republic of Pakistan ( ur, , label=none), is a country in South Asia. It is the world's List of countries an ...

or else receives capacity payments based on the

power purchase agreement A power purchase agreement (PPA), or electricity power agreement, is a contract between two parties, one which generates electricity (the seller) and one which is looking to purchase electricity (the buyer). The PPA defines all of the commercial te ...

which is set to expire in November 2027. After the expiration, the government can buy power on a take-and-pay basis. The fuel is supplied by

Pakistan State Oil Pakistan State Oil (); reporting name: PSO) is a Karachi-based Pakistani state-owned petroleum corporation involved in marketing and distribution of petroleum products. It has a network of 3,689 petroleum filling stations, out of which 3500 out ...

, which will continue to supply until November 2024. After that, Lal Pir has to arrange the fuel themselves. It was incorporated in 1994. Lal Pir 1 produces 362 MW of electricity whereas Lal Pir 2, which is also known as PakGen Power, produces 365MW of electricity. It is owned by

Nishat Group Nishat Group ( ur, ) is a Pakistani multinational conglomerate company which is based in Lahore, Pakistan. The company was founded by Pakistani business magnate Mian Muhammad Yahya in 1951. Mian Muhammad Mansha is the current chairman of the gr ...

. It is listed on the

Pakistan Stock Exchange The Pakistan Stock Exchange ( ur, , abbreviated as PSX) is a stock exchange in Pakistan with trading floors in Karachi, Islamabad and Lahore. PSX was classified by MSCI as a frontier market on 8 September 2021. The PSX was established on 11 ...

History

Lal Pir power complex was established by the

AES Corporation The AES Corporation is an American utility and power generation company. It owns and operates power plants, which it uses to generate and sell electricity to end users and intermediaries like utilities and industrial facilities. AES is headquart ...

in 1994 and consists of a single residual fuel-oil boiler and a steam turbine generator. Nichimen Japan was hired as an EPC contractor. In 2010,

and a consortium acquired the two plants, AES Lalpir and PakGen from AES Corporation. Nishat Group became the controlling sharesholder of the company with a 50 percent shareholding, whereas Abu Dhabi Investment Council (ADIC), which is owned by the

Government of Abu Dhabi The Government of Abu Dhabi ( ar, حكومة أبوظبي) is the subnational authority that governs the Emirate of Abu Dhabi, one of the seven constituent monarchies which make up the United Arab Emirates. The executive authority and head of the ...

, acquired 30 percent of the shares, and The City School received 20 percent of the shares.

Lal Pir 1

In April 1994, the project's final financing was completed with the

International Finance Corporation The International Finance Corporation (IFC) is an international financial institution that offers investment, advisory, and asset-management services to encourage private-sector development in less developed countries. The IFC is a member of t ...

(IFC) signing a $49.5 million debt/equity package on April 7. The total project cost was estimated at $350 million. The IFC provided a $40 million loan and acquired a 10 percent equity stake in AES Lal Pir, a subsidiary created by AES Corporation to operate the plant, with AES retaining a 90 percent ownership. The

Bank of Tokyo was a Japanese foreign exchange market, foreign exchange bank that operated from 1946 to 1996. In January 1996, it merged with Mitsubishi Bank to form The Bank of Tokyo-Mitsubishi (now MUFG Bank). Its headquarters was in the Nihonbashi district o ...

London London is the capital and largest city of England and the United Kingdom, with a population of just under 9 million. It stands on the River Thames in south-east England at the head of a estuary down to the North Sea, and has been a majo ...

also arranged a ¥20,250 million ($209 million) loan from international commercial banks, guaranteed by the Export-Import Bank of Japan (Jeximbank). In December 1997, the facility began commercial operations, following the establishment of a 30-year

with the

Water & Power Development Authority The Pakistan Water & Power Development Authority (WAPDA; ur, ) is a government-owned public utility maintaining power and water in Pakistan, although it does not manage thermal power. WAPDA includes Tarbela and Mangla dams among its resources ...

(WAPDA) and a fuel supply agreement with

which was signed in 1994. In 2013, Lalpir Power was listed on the

Karachi Stock Exchange The Karachi Stock Exchange ( ur, or PSX-KSE) was a stock exchange located in Karachi, Pakistan. Since 1947, it has been located at the Stock Exchange Building on I. I. Chundrigar Road. It has now been consolidated in the Pakistan Stock Exchan ...

following an initial public offering at a strike price of PKR 22.

Lal Pir 2

In February 1996, AES Transpower, a subsidiary of

based in the United States, finalized the financing for the construction of the Lal Pir-2 power station in

Muzaffargarh Muzaffargarh (Urdu and pa, , , Fort of Muzaffar) is a city in the province of Punjab, Pakistan. Located on the bank of the Chenab River, it is the capital of the district with the same name. It is the 39th largest city of Pakistan by populatio ...

Punjab, Pakistan Punjab (; , ) is one of the four provinces of Pakistan. Located in central-eastern region of the country, Punjab is the second-largest province of Pakistan by land area and the largest province by population. It shares land borders with the ...

. The project was undertaken by AES Pak Gen, a wholly-owned subsidiary of AES Transpower. The financing for the project included a $40 million buyer's credit facility from the Export-Import Bank of Japan (Jeximbank) and an additional ¥14,203 million ($133 million) loan. The

arranged and syndicated the loan among 15 private financial institutions. The Japanese

Ministry of International Trade and Industry The was a ministry of the Government of Japan from 1949 to 2001. The MITI was one of the most powerful government agencies in Japan and, at the height of its influence, effectively ran much of Japanese industrial policy, funding research and di ...

provided insurance coverage for this portion of the financing. The

(IFC) also contributed to the project's financing by providing a direct loan of $20 million, assisting in arranging a $50 million syndicated loan with

Dresdner Bank Dresdner Bank AG was a German bank and was based in Frankfurt. It was one of Germany's largest banking corporations and was acquired by competitor Commerzbank in May 2009. History 19th century The Dresdner Bank was established on 12 Novemb ...

and

ING Bank The ING Group ( nl, ING Groep) is a Dutch multinational banking and financial services corporation headquartered in Amsterdam. Its primary businesses are retail banking, direct banking, commercial banking, investment banking, wholesale bankin ...

, and making an equity investment of $9.5 million. AES itself invested $85.5 million in equity. The total estimated cost of the Lal Pir-2 project was $350 million. The power station, with a capacity of 365 MW, was constructed on a

build–operate–transfer Build–operate–transfer (BOT) or build–own–operate–transfer (BOOT) is a form of project delivery method, usually for large-scale infrastructure projects, wherein a private entity receives a concession from the public sector (or the priva ...

(BOO) basis and is the second AES facility in Punjab. It is equipped with a steam turbine and uses residual fuel oil. Nichimen Company of Japan was awarded the turnkey contract, and

Mitsubishi Heavy Industries is a Japanese multinational engineering, electrical equipment and electronics corporation headquartered in Tokyo, Japan. MHI is one of the core companies of the Mitsubishi Group and its automobile division is the predecessor of Mitsubishi Mo ...

(MHI) supplied the major equipment. The station began commercial operations in December 1997 after signing power purchase agreements with the

(WAPDA) and fuel supply contracts with

. In 2011, PakGen Power, also known as Lal Pir-2, was listed on the

following an

initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...

at a strike price of PKR 19 per share.

Shareholding pattern

Lalpir Power Company

References

External links

Lal Pir Power

Pak Gen Power
{{Nishat Group AES Corporation Nishat Group 1994 establishments in Pakistan 2010 mergers and acquisitions 2013 initial public offerings Electric power companies of Pakistan Companies listed on the Pakistan Stock Exchange Muzaffargarh District