Korean companies asked to undertake $1.6bn of hydroelectric schemes in Pakistan

Pakistan’s Ministry of Commerce has asked South Korea to participate in two dam-building projects with a total value of $1.6bn.

The request was made during a video conference with Korea’s Ministry of Trade, Industry and Energy, held on Wednesday.

The larger of the two proposed dams is the $1.1bn Lower Spat Gah on a tributary of the Indus river, a 470MW scheme that Pakistan has been seeking to develop through public-private procurement for the past 10 years. 

Korea Hydro & Nuclear Power, a subsidiary of the state-owned Korea Electric Power Corporation (Kepco), has drawn up plans to form a special purpose company for the project. The Asian Development Bank will provide financial consulting and financing will be on a project basis.

Preliminary work on this scheme is set to begin next year, allowing the main works to get under way in 2023. Construction will be completed in 2029, after which Korea Hydro will run the plant for 30 years.

The second dam is the 215MW Asrit-Kedam project on the Swat River, on Pakistan’s North West Frontier.

This project also has a lengthy history. According to Pakistani publication Engineering Review, it was awarded to a local company called Yunus Brothers in 2007, but work was delayed by a Taliban insurgency.

In 2017 the Korean South East Power Company, another Kepco subsidiary, signed a memorandum of understanding to take over the work, but this was delayed by a legal challenge from Yunus Brothers in the Peshawar High Court.

Image: Pakistan’s Swat River (Power22/CC BY-SA 3.0)

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