Oracle Power PLC's (LON:ORCP) boss has told investors that the first quarter was “a very constructive phase” for the company, and said it is confident there will be no significant adverse impact of coronavirus on the timelines for the development at the Thar project.
In an update, chief executive Naheed Memon noted that Oracle Power's progress on commercial and operational objectives has not been stymied amidst the pandemic.
"The strategic importance of an integrated mine, power and coal-to-gas and liquid project in our region of focus cannot be overstated,” Memon said.
“There is a huge inherent demand in Pakistan for cheaper energy which can be generated domestically to mitigate the current reliance on imports, which significantly impacts the economy and can create inflationary pressure.
“In addition, the potential of coal gasification into fertiliser projects and coal to liquids is paramount to addressing food security issues and reduce fuel imports into Pakistan,” Memon added.
He noted that Oracle believes Thar is the only project supported by the China-Pakistan Economic Corridor (CPEC) organisation for both power generation and gasification.
Oracle has had meetings with regional government officials and CPEC. In February, a consortium agreement was signed, and, a letter of intent (LOI) was submitted by Oracle and its partners to the Private Power and Infrastructure board.
Approval of the LOI, confirming the government's intention to purchase power, is expected to be the next major step required to develop the project because it will allow progress towards financial close.
“In the context of the (coronavirus) COVID-19 pandemic, it is prudent to expect possible delays,” Memon added.
“However, we are hopeful that the process will be completed before the next Joint Coordination Committee meeting which is expected by the middle of this year or earlier.
“In the meantime, Oracle and its partners are continuing to work towards finalising the Joint Investment Agreement and Shareholders Agreement.”