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Business Recorder
24-07-2025
- Business
- Business Recorder
NTDC's split into new entities: World Bank seeks amendments to project agreements
ISLAMABAD: The World Bank has called for amendments to existing project agreements to replace the name of the National Transmission and Despatch Company (NTDC) with the three newly-created successor entities. In a letter addressed to the Secretary of the Economic Affairs Division (EAD), the World Bank's Operations Manager for Pakistan, Gailius J. Draugelis, rated the overall implementation progress of the National Transmission Modernization I Project as 'Moderately Satisfactory.' A Bank implementation support mission visited Pakistan from June 16 to 26, 2025, to review the project's status. According to the Bank, most components—excluding the Islamabad West Substation (IWS)—are progressing well and are expected to be completed by the end of 2025. $400m investment in reactive power compensation: 10-year transmission plan discussed with World Bank The IWS contract, a critical part of the project, is now slated for completion in November 2026. Total disbursements under the project stood at $183 million as of June 30, 2025, with improvement needed in FY26. Progress toward achieving the Project Development Objective (PDO) also remains 'Moderately Satisfactory.' The mission outlined several key findings and actions requiring close attention from the Ministry of Energy (Power Division) and NTDC's senior management. The World Bank noted that NTDC was recently restructured into three entities: Independent System Market Operator, the National Grid Company of Pakistan, and the Energy Infrastructure and Development Management Company. As legal agreements are currently signed with NTDC, the government—via the EAD—must formally notify the Bank and request amendments to the legal documentation to reflect this change. The IWS contract was the last major component to be awarded. To accommodate its completion, the project's closing date has been extended to December 31, 2026, aligning with the contractor's 30-month schedule. During the mission, the Bank emphasized that NTDC and the contractor must ensure completion and handover by the revised deadline. Given the project is in its eighth year of implementation, securing another extension beyond 2026 is considered highly unlikely. The Bank clarified that the deadline extension applies solely to the IWS contract. All other sub-projects were already in advanced stages and expected to be completed during FY2024–25. However, several activities are progressing more slowly than anticipated. The mission and NTDC agreed that all other contracts must be completed by December 31, 2025. To support timely implementation, the Bank emphasized the importance of regular coordination among contractors, consultants, NTDC field teams, and the Project Management Unit (PMU). These interactions would help identify and resolve issues, including contract amendments for time extensions and scope changes. Notably, such interactions have been limited to Bank missions. The PMU has now agreed to hold monthly review meetings starting July 15, 2025, and will maintain full staffing until project closure. Regarding contract change order management, the Bank acknowledged that NTDC has resolved the issue of contractors operating without valid agreements. However, some recently extended contracts are again nearing expiry before work is completed. A similar issue is affecting five contracts under the Enterprise Resource Planning (ERP) component. NTDC has assured the Bank that all necessary contract extensions will be finalized by mid-July 2025, and that no further work will be done without valid contracts. The mission noted steady progress in the ERP system implementation, aimed at modernizing NTDC's operations. Several modules are scheduled to go live within the next two months, with full rollout expected by December 2025. To ensure successful adoption, the Bank urged NTDC to improve communication with staff regarding system benefits, impacts, and rollout timelines. NTDC has agreed to update employees regularly through emails and other media. Addressing the right-of-way issue on the 500kV Nowshera transmission line, the Bank stated that construction had been delayed for over a year due to denial of access to tower location No. 23. While NTDC has secured verbal consent from the landowner with help from the district administration, the Bank has advised obtaining written consent and a formal agreement to prevent future disputes. NTDC is also required to finalize all related documentation and payments before resuming construction. Regarding compensation payments for IWS, NTDC had previously committed to clearing all outstanding payments by May 31, 2025, but some remain pending. These involve small amounts that affected persons are reluctant to collect due to the cost or effort involved. Following government practices, the Bank has advised NTDC to consider alternatives such as mailing cheques or depositing funds with the Deputy Commissioner's office for disbursement. NTDC has now committed to completing these payments by August 15, 2025. Finally, the World Bank commended both the Government of Pakistan and NTDC for efforts to resolve security challenges that had disrupted project activities in Balochistan. The mission was informed that the contractor for the Loralai and Sibi substations had received necessary security assurances and resumed construction at the sites on June 23, 2025. Copyright Business Recorder, 2025
Business Recorder
04-07-2025
- Business
- Business Recorder
Fund reallocation for timely completion sought: World Bank backs govt, Wapda on T5HP extension
ISLAMABAD: The World Bank has reaffirmed its full financial support to the Government of Pakistan and WAPDA for the completion of the Tarbela Hydropower Project Extension-5 (T5HP), citing the need for fund reallocation to ensure timely completion. In a letter addressed to Secretary Economic Affairs, Dr. Kazim Niaz, World Bank senior official Gailius J. Draugelis commended the hospitality extended by WAPDA and its project teams during the recent visit of the Bank's Executive Directors to the historic Tarbela Dam, the Tarbela Fourth Extension Hydropower Project (T4HP), and T5HP. Tarbela Dam, the world's largest earth-fill dam, remains a key infrastructure landmark. The T4HP has added 1,410 megawatts (MW) to Pakistan's power grid since its commissioning in 2018, generating over 28,000 GWh of clean electricity and saving the country approximately $3.5 billion in foreign exchange. Additionally, the project has enhanced the long-term sustainability of the dam by protecting critical tunnels from sedimentation for the next 50 years. World Bank team visits Tarbela 5th extension hydropower project The Bank expressed satisfaction with the progress of the hydropower component being implemented by WAPDA. It noted that both the Tarbela 5 Project Implementation Consultants (T5PIC) and the contractors—Power Construction Corporation of China (PCCCL) for civil works, and Harbin Electric International/Harbin Electric Company (HEVHEC) for electromechanical (E&M) works—have been performing well. PCCCL has nearly completed the vertical shaft of the raised intake during this low-flow season and has opened the portal inside Tunnel 5, marking a critical milestone. The next phase involves connecting this portal with the vertical shaft through a connection tunnel. While overall progress on the powerhouse is satisfactory, the World Bank has asked WAPDA to closely monitor construction of the erection/loading bay, which is crucial for the upcoming E&M installations. The Bank urged WAPDA and T5PIC to ensure that rehabilitation work on the bulkhead and service gates of Tunnel 5 begins no later than August 2025. According to the revised contract schedule, generation units in T5HP are expected to be commissioned by the end of 2026. The Bank emphasized that timely rehabilitation of the service gate is essential for smooth commissioning. Electromechanical works are also progressing steadily. Installation activities will accelerate once the erection/loading bay is completed. The Bank has asked WAPDA and T5PIC to (i) monitor the timely delivery of E&M equipment to ensure the majority is on-site by end-2025; and (ii) direct the contractor to finalize the schedule for completing the works at the T4 switchyard, including shifting transmission lines that affect construction of the T5 Transmission Line (T5TL) towers. The World Bank acknowledged improvements in project oversight, noting that the Project Manager has significantly enhanced construction sequencing and physical progress through timely technical decisions. However, it also advised WAPDA to manage the T5PIC consultancy contract efficiently to ensure sufficient budget for continued supervision by key experts for the duration of the project. The Bank highlighted the need to reallocate approximately $50 million from the E&M component to the civil works component under both the IBRD and AIIB loans, despite the project having an undisbursed balance of around $299 million. This reallocation is critical to prevent financing constraints in FY2026. The World Bank reiterated its commitment to supporting WAPDA and the government in completing T5HP. It acknowledged the expected financing gap due to unforeseen geological conditions, gate rehabilitation costs, and price escalations. Regarding the T5 Transmission Line (T5TL), which connects the T5HP switchyard to the Islamabad West Substation (IWS) and T1–T4 switchyard, the Bank noted that the contract—awarded to Netracon Technologies (Pvt.) Ltd.—is under implementation. The contractor has completed 148 tower foundations and erected 129 towers, and has pledged to deliver all remaining equipment by July 2025. The Bank urged NTDC, T5PIC, and the contractor to finalize the remaining line route, tower quantities, and foundation designs, particularly near Gawari Sand Quarry and close to the IWS. It also asked NTDC to ensure immediate commencement of conductor stringing and full compliance with the Resettlement Action Plan as foundation and erection works progress. The Bank emphasized its intent to support Pakistan's long-term transmission expansion through a proposed multi-phase program to boost energy security. With IWS set to receive 1,530 MW from T5HP and 2,160 MW from Dasu Hydropower Stage-I in the coming years, the Bank has advised NTDC to plan the power evacuation accordingly, including evaluating the expansion of the 765kV transmission system to Lahore, Faisalabad, and other major load centres. The sources said, the issue of reallocation of funds will also be discussed at a meeting between the World Bank and Government's line Ministries on Friday (today). Copyright Business Recorder, 2025
