KOEN seeks Islamabad’s support as $1bn hydropower projects face uncertainty

South Korea’s state-owned Korea South-East Power Company (KOEN) has urged Pakistan to remove regulatory hurdles holding up nearly $1 billion in planned hydropower investments, citing delays in tariff determination and uncertainty over the country’s future power generation plan.

The development came during a meeting between Federal Minister for Commerce Jam Kamal Khan and a delegation of KOEN, held to discuss the company’s proposed investment in Pakistan’s hydropower sector and matters relating to its two projects in Swat.

The delegation was led by KOEN Chief Executive Officer Kim Min Young and included Jang Sungkyu, Deputy Chief Executive Officer; Javid Rashid Chaudhary, Chief Operating Officer; Asim Javed, Director of Finance; and Shahid Javid, General Manager of Project Development.

During the meeting, Asim Javed, Director Finance, gave a detailed presentation to Jam Kamal on KOEN’s investment profile in Pakistan, progress on its projects, financing arrangements, regulatory approvals and support required from relevant authorities.

The delegation informed the minister that KOEN has been investing in Pakistan’s energy sector since 2011. KOEN completed the 102 MW Gulpur Hydropower Project in March 2020 and subsequently initiated two hydropower projects under the Power Generation Policy 2015: the 229 MW Asrit Kedam Hydropower Project and the 238 MW Kalam Asrit Hydropower Project in Swat.

The delegation stated that major project-related studies and approvals have been completed, including feasibility studies, environmental approvals, land-related processes, IRSA consent and grid-interconnection studies.

It was further shared that approximately $1 billion in debt and equity financing has been arranged, while around $25 million has already been spent on project studies and development activities.

The KOEN delegation highlighted concerns regarding the pending tariff determination, inclusion of the projects in the draft Indicative Generation Capacity Expansion Plan (IGCEP) 2025–35, and the need for clarity regarding the future implementation of the projects.

The delegation noted that the projects could contribute to clean-energy generation, employment opportunities, local development and increased economic activity in Swat. It added that the company remains committed to Pakistan and is willing to align its commercial plans with the government’s future energy requirements.

Jam Kamal Khan appreciated KOEN’s continued interest in Pakistan and its confidence in the country’s long-term investment potential.

He said that Pakistan values its economic relationship with the Republic of Korea and welcomes foreign investment in renewable energy, sustainable infrastructure, technology, logistics and other priority sectors.

“Pakistan needs a stable, transparent and investor-friendly environment to attract long-term foreign investment. Clear communication and effective coordination among institutions are important for strengthening investor confidence,” Jam said.

The minister assured the delegation that the concerned federal ministries, departments and relevant authorities would be engaged to facilitate coordinated consideration of KOEN’s concerns.

He further noted that Pakistan is reviewing its energy requirements in light of existing capacity conditions; however, future opportunities are expected to emerge in green energy, industrial development, data centres and other growing sectors.

He assured KOEN that the Ministry of Commerce would continue to support constructive engagement between the company and relevant stakeholders.