Engro likely to invest $21.37m in upcoming Thar power project
The project will have a generation capacity of around 330 MW
(Web Desk) – Engro Corporation on Monday decided to make an investment of around 21.375 million dollars in an upcoming electricity project at Thar having a generation capacity of around 330 MW.
Engro Corporation through a statement to Pakistan Stock Exchange, informing its investors that its wholly owned subsidiary Engro Energy Limited plans to invest $21.375 million or Rs 2.50 billion via subscription of ordinary shares in Siddiqsons Energy Limited which is a special purpose vehicle established to set up a 330MW of Thar coal fired power generation facility in Block-II District Tharparkar, Sindh.
Furthermore, Engro Corp has also entered into a Project Management agreement with this SPV which would allow it to manage the projects undertaken by Siddiqsons Energy LImited.
As per working total project will cost 500 million with debt and equity ratio of 75pc:25pc. Analysts from different brokerage houses estimated that Engro’s equity share in SPV would be around 17 percent.
The project is likely to commence operations in June 2021. Along with this, the core objective of the company is to bring more players on Thar coal platform.
Topline Securities in its note about the project said that the company was carrying cash amount of Rs 65 billion or $565 million as of March 2018 and it has also applied for “Letter of intent and rights” to develop 350MW of wind and solar power plant in Balochistan. Moreover, management is also considering investing in logistics, ecommerce and transmission business.
