ISLAMABAD: The Federal Government is mulling granting tax exemptions to Virtual Pipeline LNG import terminal by Gwadar Gasport Limited (GCPL), a joint venture of Pakistan GasPort, Al-Qasim Gas and Jamshoro JV, well informed sources in Petroleum Division told Business Recorder.
Sharing the details, the sources said that Petroleum Division has consulted the stakeholders and moved a draft summary titled “exemption from custom duty and sales tax for Virtual LNG Pipeline project” on February 9, 2023 to National Tariff Commission. This matter is on agenda of next Tariff Board meeting.
GPA has issued NOC to GGPL to carryout required studies on berth-3 at Gwadar Port. Gwadar International Terminals Limited (GITL) informed GPA on May 2, 2023 that due safety dictates, LNG project advancement needs establishment of a dedicated berth. GPA, COPHCL and GITL will present actionable plan during next review.
On establishment of a 5-MMT/ annum oil refinery and petrochemical project at Gwadar, the sources said, Prime Minister Office (PMO) has established a Committee under Secretary Petroleum for project oversight, which held multiple meetings. COPHCL has informed Petroleum Division that refinery will be established by East Sea Group, Donghai Group and Hualu Engineering Technology on 100 acres of land earmarked in GFZ (phase-II). Pre-feasibility has been completed and a detailed feasibility is being worked out. COPHCL has been asked to approach OGRA for obtaining licence for setting up the refinery.
This update has been shared with Federal Steering Committee on Gwadar Initiatives headed by Minister for Planning, Development and Special Initiatives, Ahsan Iqbal.
The meeting directed that COPHCL should expedite the licensing process and the sub-leasing of the land on priority. Gwadar Port Authority (GPA) has been requested to coordinate with COPHCL and provide update on project.
Regarding Oil Blending Facility (ship-to ship transfer) at outer anchorage of Gwadar Port, the meeting was informed that GPA Board has accorded provisional approval to COPHCL. Petroleum Division has accorded no objection and OGRA will issue licence once pre-requisites are completed by the company. The project company will share concrete investment plan and timelines.
The meeting also directed Power Division to wholesomely review 300-MW imported coal-fired project at Gwadar and address impediments in order to achieve Commercial Operation Date (COD) no later than December, 2025(i.e., 36 months) with financial closure by December 2023.
Power Division will also share action plan for commencement of physical work in next progress review.
Chairman Gwadar Port Authority (GPA) stated that M/s CHIC and COPHCL are already in agreement to develop a dedicated coal debarkation facility at Gwadar Port for this purpose while complying with the international standards of safety and environment. Ministry of Maritime Affairs will review the associated port development plans and present PC-1/II during next review meeting.
On connectivity of Gwadar with up North via Eastern, Central and Western alignments of CPEC routes, the meeting was informed that N-30 Basima-Khuzdar Road is likely to be completed by August 2023 as 96 per cent work is already finished.
The meeting was further informed that M-8 section (Awaran-Naal) was awarded in July 2022; however, mobilization pended due to non-release of funds. National Highway Authority (NHA) informed that Rs 1.5 billion proposed for re-appropriation in 4th quarter of CFY which is now ending, will pay for first part of mobilization advance, after payment of mobilization advance, groundbreaking will be conducted any time at the end of current month or first week of July 2023 as part of “decade of CPEC celebrations”.
Regarding New Gwadar International Airport (NGIA), the meeting was apprised that airside infra-pavements, runway, taxiway, apron and airfield lighting system) are 100 per cent completed except Nav-Aid facilities. Operationally required components on part of landside are 55 percent completed.
All essential arrangements for landing of test flights through VFR are ready since March 23, 2023. Test flights landing to be confirmed from PM Office.
A thorough commercialization and marketing strategy for NGIA is being finalized which will be shared after Aviation Division/ PCAA approval. Desalination plant (0.3 MGD), three Chinese and two Pakistani companies submitted their bids, which were opened on March 31, 2023. However, due to exuberant bid of Rs 3.9 billion, PCAA has recommended that the Chinese side may enhance grant amount from 19.32 million RMB to 98 million RMB for desalination plant. Project will be completed as per approved timelines.
About commencement of international flights from Quetta and work on Turbat airport, the meeting was informed that main runway of Quetta airport is substantially completed. PCAA will present progress on-site during Planning Minister’s visit to Quetta.
Turbat airport expansion is under way, contractor mobilized and work will be completed by October 2023.
Maintenance, dredging at Gwadar: As on May 16, 2023, 323295 cum has been dredged. PSDP funds amounting to Rs 3.6 billion are required in FY 2023-24 for timely completion of project. Sponsors will discuss funds requirement with MoPD&SI. Maritime Division will hold a Steering Committee meeting (established under PMO instructions).
Integration of Gwadar Smart Port City Master Plan (GSCMP) with Gwadar Port Master Plan: Director General Gwadar Development Authority (GDA) and Chairman GPA informed the meeting that the plan has been superimposed. Development strategies for both city and port are required to be formulated by GDA and GPA.
GDA has also informed that list of PC-1/II required for implementation of GSCMP is in final stages of formulation. Details of PC-1/II are required for development of port as master plans.
Development of breakwater at Gwadar Port: PC-1 of the project was discussed in CDWP which was not found feasible. Ministry of Maritime Affairs (MoMA) directed for taking further actions to come up with revised PC-II and PC-1. This project included in agenda of 11th JCC meeting of CPEC.PC-II required to be shared by end of October 2022 with Chinese side, which is still pending. Framework agreement, as approved by Federal Cabinet was shared with the Chinese side for completing the project as EPC. Minister for Planning, Development and Special Initiatives reiterated the Prime Minister’s directives on expediting project.
Studies on making Gwadar Port competitive: Studies on making Gwadar Port more competitive substantially completed by GPA (federal PSDP funded). Feasibility studies on capital dredging of berthing areas substantially completed with GoP (PSDP) funding. MoMA was requested for holding a special review of conclusions, recommendations. Development strategy will be presented during next review meeting. However, progress on revival of interactive projects like LPG shipping etc is required.
Development of Gwadar Free Zone (GFZ): The meeting was apprised that efforts are required to be made for full population of GFZ( phase-1). Huafa Urban Operation Gwadar has been completed last month whereas Agven Private Limited will commence trial production this month. Han Geng Trade Company has also been completed. Hai Xin Cold Storage project will also be completed during current month. For GFZ (phase-II) two companies (fertilizer and pharmaceutical) are in final stages of completion. Their inauguration will be planned with decade of CPEC ceremonies. China Overseas Ports Holding Company Pakistan Limited (COPHCL) is currently planning to sign a MoU with Reko Diq project to discuss how to set up a site in the Gwadar Free Zone and export of iron ore from Gwadar. Issues related to NOC, visa, utilities, taxes etc. to be promptly followed up. Monthly progress of GFZ is to be provided to CPEC Secretariat as per promulgated format. COPHCL will present action plan and KPIs for year 2023-24 during next review.
Copyright Business Recorder, 2023