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Print Print 2022-07-20

Chinese firm serves notice on CPPA-G

  • Company demands payment of over Rs86 billion on immediate basis
Published July 20, 2022

ISLAMABAD: China Huaneng has served notice of non-payment to Central Power Purchasing Agency Guarantee (CPPA-G) pursuant to guarantee within 30 days.

In a letter to Managing Director, Private Power & Infrastructure Board (PPIB), Chinese company’s Vice President, Fan Jinda said that pursuant to section 1.5.1 of guarantee signed between Huaneng Shandong Ruyi (Pakistan) Energy (private) Limited (HRS) and PPIB on January 23, 2017, HRS is notifying the government of Pakistan through PPIB about non-payment by the CPPA-G of the overdue amount.

The company, in a letter written on July 15, 2022, had made a demand for payment of over Rs86 billion on immediate basis.

The company has cautioned CPPA-G that in case the overdue amount is not settled within 30 days from the submission of letter, it will have no alternative but to demand the amount from the government of Pakistan under the guarantee.

According to HRS, the total amount of overdue invoices on account of energy payments and capacity payments as on July 14, 2022 was Rs70,889,690,499 with an additional amount pertaining to delayed payment interest being Rs15,387,545,709. Thus, the overall overdue amount is Rs86,277,236,208.

Chinese energy company threatens to discontinue import of Afghan coal

After including undue amounts, total receivable outstanding amount was Rs94,605,704,431 which is the record receivable outstanding balance position since the commissioning of the project, pushing the company on the verge of suspension and inability to sustain further operations.

“Settle the entire overdue amount of Rs86,277,236,208 on an urgent basis,” said Vice President HRS, warning that consequences/ damages of any shut down of the power plant due to inadequate coal will need to be borne by CPPA-G. The company has also shared its letter with Chinese embassy in Islamabad, Chairman CEPC Authority and other senior officials of concerned Ministries.

Copyright Business Recorder, 2022

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