Thar Mining & Power Project

Project Information Pack

Sindh Engro Coal Mining Company



1 | P a g e

Table of Contents
1.0. Project Background ....................................................................................................... 2
2.0. Strategic Partnerships ................................................................................................... 4
3.0. Project Site .................................................................................................................... 5
3.1. Introduction of Thar .................................................................................................. 5
3.2. Meteorological Conditions of Thar ............................................................................. 6
3.3. Geology ..................................................................................................................... 7
3.4. Water Quality ............................................................................................................ 9
3.5. Coal Quality ............................................................................................................. 10
4.0. Mining & Power Project Update .................................................................................. 11
5.0. Infrastructure Projects Update .................................................................................... 12
6.0. Demographics ............................................................................................................. 15

2 | P a g e

1.0. Project Background
Engro Corporation Limited is one of Pakistans largest conglomerates with businesses ranging
from fertilizers to power generation. Currently Engro Corporations portfolio consists of
diversified businesses which include chemical fertilizers, PVC resin, bulk liquid chemical
terminal, foods, power generation and commodity trade.
Engro Powergen limited (EPL) was incorporated in 2008 as a fully owned subsidiary of Engro
Corporation to develop power projects in Pakistan; Engro Powergen is Engro Corps first
initiative into the countrys power sector.
EPL s first Independent Power Project (IPP) the Engro Powergen Qadirpur plant (217 MW
Combined cycle power plant), is widely recognized for being Pakistans first green power plant
and the only facility of its kind to reduce carbon emissions via the utilization of permeate gas.
EPL has entered into a strategic long-term partnership with the Government of Sindh (GoS) by
establishing Sindh Engro Coal Mining Company (SECMC) as joint venture , with an equity

Participation of 51 :49 for GoS & EPL respectively, to develop, construct and operate an open
cast lignite mine and mine mouth power plant in Block-II of Thar coalfields.
The company had planned to develop an open cast mine of 6.5 million ton per annum capacity
which would be scaled up to 22.5 million ton per annum subsequently. The power generation
was planned to be carried out independently by EPL, 1200 MW in the first phase to be
Picture 1 Signing of JV agreement for SECMC
3 | P a g e

increased to 4000 MW with the scalability of mine. The Bankable Feasibility Study (BFS) for Thar
Block II Coal Mining Project has been completed by internationally renowned Consultants.
However, as per revised project execution strategy it is planned to develop the project in two
phases, both to be executed by SECMC. Wherein, Phase 1 would comprise of 3.5Mt/a mine and
600 MW power plant. Whereas in Phase 2 the mine would be scaled upto 6.5 Mt/a and power
plant to 1200 MW.

Picture 2 Groundbreaking Ceremony of the Project performed on 14
th
March 2013


Picture 3 Chief Minster Sindh, Unveiling the Ground breaking Plaque


4 | P a g e

2.0. Strategic Partnerships
To add strategic synergy, Engro signed an MoU with KESC (Karachi Electric Supply Corporation)
for supporting 300 -600 MW power plant at Thar along with other projects of mutual benefit .

Picture 4 MoU signing ceremony for Projects of Mutual Interest
Furthermore, to demonstrate its commitment to the Thar project, Sindh Engro Coal Mining
Company as recently entered in to a Memorandum of Understanding with Pakistan State Oil
(PSO)

Picture 5 MoU signing ceremony between SECMC and PSO
Under the agreement PSO will share the equity portion of SECMC based on mutually agreeable
terms and also pursue the development of currently defined project options being pursued by
SECMC including coal mining and supply of Thar coal to GENCOs and development of coal
mining and power plant under the umbrella of SECMC.
5 | P a g e

3.0. Project Site
3.1. Introduction of Thar
The Thar coal field has total lignite reserves of 175 Billion tons which can be utilized to produce
100,000 MW for over 200 years. Given the large energy deficit and the lack of any reliable and
sustainable indigenous energy resources in the country, the Thar Coal Mining project presents a
tremendous growth opportunity. The reliability of this energy resource and the scalability
potential of the project make it one of the most suitable and sustainable growth propositions to
end the energy crisis and bring energy security to the country.



The Project site is located at Block II of Thar Coalfields (Latitude: 24
o
43 38 - 24
o
50 18 &
Longitude: 70
o
17 36 - 70
o
26 16), Thar Parker District, and eastern part of Sindh Province,
Pakistan. Thar block II has total lignite reserves of 2 billion ton. It is 20 Km from City of Islamkot,
near the villages of Singharo-Bitra.









175 Billion
Tons
Total Thar coal
resources
50 Billion TOE
More than Total
Oil Reserves of
Saudia Arabia &
Iran
2000 TCF
68 times higher
than Pakistan's
Total Gas
Reserves

Figure 6 Road Connecting Thar Block II to Islamkot
6 | P a g e












3.2. Meteorological Conditions of Thar
The weather station operated by the Pakistan Meteorological Department (PMD) nearest to the
project area is located at Mithi, about 60 km to west of the Block II.
SECMC established an Automatic Weather Station (AWS) on the site which is measuring the
wind speed, wind direction, ambient temperature, relative humidity, pressure, solar radiation,
and precipitation (the data of which would be shared with the Pre-qualified vendors only).

The Project is located in a semi-arid desert. The climate is subtropical, with summer lasting
from May to August and winter is from December to January. Rainy season is between July &
August (monsoon).
During the monsoon season the wind speeds can reach up to 6 m/s (maximum recorded in
history is 15 m/s). This can result in dust storms.
Temperature usually go as high as 50 C in summers and as low as 2 C in winters .


Figure 7 A Route Description of Block II from Port City of Karachi

7 | P a g e


3.3. Geology

The Thar Coal Field rests upon a structural platform underlain by relatively shallow granitic
basement rock of Precambrian age. This platform is dipping gently to the west-northwest and
the covering sedimentary rock sequence is thinning to the east-southeast. There is no fault
present within Thar Coal field area.










Stratigraphy

In the area of the Thar Coal Field the granitic basement is unconformably overlain by sediments
of early tertiary age termed the Bara-Formation. The coal seams under investigation are
developed in this formation.
The alluvial deposits of the Sub-Recent formation rest unconformably on the sediments of the
Bara Formation. The stratigraphic column is topped by dune sands.

Typical drill-hole profile of the Thar Coal Field is shown in the following Figure
Figure 8 Generalized Cross-section
8 | P a g e


Picture 9 Columnar Section

Following are some salient features of Thar Block II geology:
Ground Elevation varies from 80 to 100 m Above Mean Sea Level (AMSL)
Overburden thickness varies from 130 to 150 m
Main Lignite seam has the thickness of 18 m
Cumulative Lignite thickness varies from 22 to 32 m
03 Aquifers are present in the area




Dune Sand
Aquifer
Coal Seam
Roof Aquifer
Coal Seam
Floor Aquifer
50m
120 m
180m
Recent
(Dune Sand)
Sub-Recent
(Sand, Siltstone,
Claystone)
Bara Formation
(Claystone, Coal,
Carbonaceous
Claystone,
Sandstone)
Basement
(Granite)
9 | P a g e











3.4. Water Quality
All aquifers show brackish groundwater. The following Table shows the minimum/maximum
concentrations of main constituents of the three aquifers Dune Sand aquifer, Coal Seam
roof aquifer and Coal Seam floor aquifer.
Parameter Dune Sand Aquifer Coal Seam Roof
Aquifer
Coal Seam Floor
Aquifer
min max min Max min max
pH 7.5 8.6 8 8 7.5 7.8
TDS mg/l 1996 9500 5060 6870 4520 6650
Na mg/ 500 3520 1940 2080 1520 2182
Mg mg/l 10 240 206 235 99 178
Ca mg/l 11 320 290 339 149 206
K mg/l 9 58 32 34 27 80

Dune Sand
Aquifer
(50 m)
Coal Seam Roof
Aquifer
(120 m)
Coal Seam Floor
Aquifer
(180 m)
80AMSL
0 AMSL
-50
AMSL
-115 AMSL
Figure 10 Generalized Model of Thar Block II
10 | P a g e


3.5. Coal Quality
The total coal resources of Thar Block-II area were calculated in accordance with JORC code on
the basis of data obtained by drill holes. The total coal resources in the area are estimated to be
2 Billion tons, with proven resources of 414 million tons.
Based on detailed modelling of bore-hole data, following is the proximate (as received basis) &
Ultimate analysis of coal (dry basis):










Fe mg/l 0.02 0.68 0.1 1.0 0.1 0.16
SO
4
mg/l 180 712 374 458 229 450
Cl mg/l 975 4680 3830 3590 2490 3380
HCO
3

mg/l
185 768 173 183 171 348
NO
3
mg/l 11 155 0.02 1.21 1.15 1.8

Ultimate Analysis
C (%) 74
H (%) 6.1
N (%) 1
S (%) 2.5
O (%) 18

Proximate Analysis
Lower Heating Value
(LHV)
11.61 MJ/kg
Ash 7.8%
Sulphur 1.1%
Moisture 47.6%
Fixed Carbon 19.6%
Volatile Matter 25.10%
11 | P a g e

4.0. Mining & Power Project Update
Bankable Feasibility Study (BFS) for Thar Block II Coal Mining Project has been
completed by internationally renowned Consultants such as RWE-Germany, Sino coal-
China in compliance with International Standards.
BFS confirmed that total lignite reserve in Thar Block II are 2 B tons with exploitable
reserve of 1.57 B tons which can support 5,000 MW for 50 years. GoS has issued 30
years Mining Lease ( of 95.5 sq.km) to SECMC for Thar Block-II

Picture 11: Completion of Feasibility of Mining Project
Environment & Social Impact Assessment (ESIA) study was completed in 2010 by HBP
Pakistan & SRK UK. A public hearing meeting for ESIA was held on November 12, 2012
by SEPA (Sindh Environment Protection Agency) in Islamkot, District Tharparkar to
identify concerns of key stakeholders including local community, NGOs, academia,
media etc. All stake holders were briefed in detail about the mitigation which the Owner
plans to undertake during Project execution and operations. SEPA has issued an NOC
(No Objection Certificate) for the project.







12 | P a g e

5.0. Infrastructure Projects Update

Available Infrastructure
Thar block II can be approached through black top metaled roads from port city of
Karachi , by a route of Karachi to Sajawal (~100 km) to Badin (~80km) to Shadilarge
to Mithi(~100km) to Islamkot . From Islamkot to Thar Block II (~25 km)



A railway track exists around 150 km from Thar block II at Chor Railway station









Existing Railway Track
Proposed Railway Track
13 | P a g e

Planned Infrastructure
Effluent Disposal Scheme
To dispose dewatered effluent from mine an Effluent Disposal scheme is being
carried out by GoS, which would be fully operational by mid-2014
Detailed design has been completed by GoS Consultant, contract award for the
project is expected by mid of 2013
Effluent / Groundwater from Thar Block-II Projects will be disposed in the Salt Lakes
in or near the Rann of Kutch Area.

Railways Network
PRACS has completed a Preliminary Study for connecting Thar Coal fields to
Khokhrapar-Munabao rail network. Estimated Project Cost is PKR 33 B including
infrastructure, locomotives & wagons
GoS is being pursued to complete the PC-I for the above (Thar-Chor-Hyderabad
Link)and determine an economical freight for coal transport
Roads
Improvement Scheme of Roads Network from Karachi to Thar Block-II has been
approved in two Phases:
(i) Karachi - Thatta - Wango Mor
(ii) Wango Mor Islamkot

Detail design is in progress by Consultants. Prequalification of Contractors has been
completed. Priority packages have been identified for implementation in both phases.






14 | P a g e

Picture13: Airport under construction around 45 km from site.
Airport
Construction of Islamkot Airport is also going on as per plan and air strip is expected
to be ready by end July 2013

Transmission Line
NTDC has completed feasibility study for 1200MW 500kV dual circuit transmission to
evacuate power from the power plant

15 | P a g e


6.0. Demographics

Province of Sindh is home to around 24% of Pakistans population. Although the Thar Desert is
considered as one of the most densely populated deserts in the world, the district of Thar
parkar is sparsely populated with a population density of about 62 persons per sq. km,
compared to Sindhs population density of 299 persons per sq. km and that of Pakistan at 222
persons per sq. km.

















Picture 14 A tradional hut for living in Thar, called Chaunra
Figure 15 A Landscape of Thar Block II .
16 | P a g e



The population of the district of TharParkar represents less than 3% of Sindhs population and less than
1% of the countrys population.
Thar Block-II is currently inhabited by eight villages having 1,162 households, and an estimated
population of 9,000 people. These villages are inhabited by two major ethno-religious groups, Hindus
and Muslims (56% and 44% respectively). Each of these religious groups is further divided into various
castes.
The literacy rate in the Thar population of ages 10 years and above was 22%, with 31% of the male
population and 10% of the female population being literate .Youth literacy rates, which account for
population of ages 15 to 24, in the surveyed population were 19% on an overall basis and 31% and 6% in
males and females respectively. This shows that while literacy amongst males of ages 10 years and
above is the same as the literacy rate amongst male youth, female literacy amongst youth is less than
the overall female literacy.


17 | P a g e


Picture 16 A Primary School in A Village Of Thar Block Ii
TharParkar has been consistently ranked as one of the most deprived districts provincially and
nationally. Thar is ranked at 15th out of 16 districts in Sindh in terms of deprivation. The percentage
of population below the poverty line is around 30% for Tharparkar.
For the development of Thar coal fields , Government has provided infrastructure support ,
including the Widening and Strengthening of roads from Karachi to Thar, development of effluent
channel for mining effluent , and above all the project of AIRPORT CONSTRUCTION is under
execution phase, near Islamkot (around 45 km from Thar block II) , and it is anticipated to be
completed by mid of 2014. (See Picture 13)



18 | P a g e



Picture 6 : A Salt filled truck moving near block II Picture 7: Bulls & Cows roaming on roads
Picture 8: Electricity supply for some villages Picture 9 : Thari people using underground wells for their water need
Picture 11 A picture of Salt filled truck moving from thar to Karachi Picture 18 Bulls & Cows roaming on roads

Picture 19 Electricity supply for some villages
Picture 20 Thari people using underground wells for
their water need
19 | P a g e


Picture 21 : Camel Grazing

Picture 23: Thar Dwellings in a village
Picture 22: Peacock wandering in the desert
20 | P a g e


Picture 24: Cultural Heritage and tourist attraction of Nagar Parker (Granite Mountains)
The main source of dependence of people is Livestock and seasonal agriculture. Following pie chart
shows the occupations of people living in Thar .

Graph 1: Occupations of People of Thar