Oracle Power PLC (LON:ORCP) has submitted a collective payment of approximately US$50,000 to the Private Power Infrastructure Board (PPIB) of the Pakistani Government, as the registration fee for processing an application for a Letter of Intent (LOI) in relation to the group’s proposed mine and power plant at Block VI in Thar.
The AIM-listed firm - which is developing a combined lignite mineral resource and mine mouth power plant in the Thar desert in the south-east of Sindh Province, Pakistan - said the funds have been spent under the pre-development funding agreement reached with its consortium partners Beijing Jingneng Power and PowerChina International.
The group said each party has contributed funds in proportion to their intended shareholding, with Oracle paying US$6,000 and its partners approximately US$44,000.
The company said the LOI, when approved, is issued along with a Notice to Proceed so that the applications for a Generation Licence and Upfront Tariff can be made to the National Electric Power Regulatory Authority.
Following this, PPIB issues a Letter of Support, which allows the Power Purchase Agreement (PPA) to be finalised with the Central Power Purchasing Authority as well as the Implementation Agreement (IA) with the Government of Pakistan, which, inter alia, guarantees payments under the PPA.
Naheed Memon, Oracle’s CEO, said: "This is the first time that our Chinese partners have injected capital towards project development on the ground.
“This payment to the Pakistani regulators reaffirms their interest and the consortium's eagerness to progress the project.
"We will keep shareholders informed as further milestones are achieved."
In afternoon trading, shares in Oracle Power were 3.2% higher at 0.32p.
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