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Ministry of Power Brochure

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Ministry of Power Brochure Upcoming infrastructure project pipeline in Sri Lanka As per new Ministerial Allocations in the Gazette issued on 09 August 2020 Ministry of Power Extension of the Lakvijaya Coal Power Plant - additional 300MW - approx. USD 450 Mn The largest power station in Sri Lanka and the only coal plant in the country. Fully owned by the Govt. of Sri Lanka (GoSL) through Ceylon Electricity Board (CEB). 900 MW capacity was commissioned in 2011. The GoSL is currently in discussion with China Machinery Engineering Corporation (CMEC) to carryout this extension. CMEC was the Engineering Procurement and Construction (EPC) contractor that was responsible for development of the Lakvijaya Power Plant as well. The conversion of Kalanithissa Thermal Power Plant to a LNG Power Plant (Sojitz Kelanitissa/ former AES Kelanitissa) 163 MWcapacity - one of the initial Independent Power Purchase agreements (IPP) in Sri Lanka - 20 year. The Power Purchase Agreement (PPA) will expire in 2023 and expected to be operated as a CEB plant until 2033. Currently owned and operated by Sojitz Corporation, Japan. The plant is currently running on Diesel/Heavy Fuel (i.e. diesel-fired combined cycle power plant). It requires additional investment to convert to LNG Power Plant. Estimated at USD 921Mn - inclusive of the Land Based Terminal cost and the Floating Storage Regasification Unit (FSRU); as per CEB Long Term Generation Expansion Plan 2020 - 2039 Ministry of Power Expansion of Kerawalapitiya Power Plant Phase 01 - 300 MW capacity - comissioned in 2007/2010. Currently, it is an IPP till 2035 owned by West Coast Power Ltd (major shareholders include GoSL. EPF, LECO, Lakdhanavi Ltd/ LTL holdings plus other shareholders). It has the ability to operate using Diesel/Heavy Fuel and LNG (limited adjustments required). Phase 02 - 300 MW capacity - RFP process carried-out in 2016/17 for a 20 year Build-Own-Operate-Transfer (BOOT). Estimated cost USD 175-300 Mn. LTL Holdings a 100% subsidiary of the state owned Ceylon Electricity Board was the lowest rate bidder GCL China Windforce and RenewGen was the second lowest consortium of bidders in a controversial move, the previous govt. decided to award the project to this consortium in 2019, but the awarding was never completed. The awarding was initially done in 2018 to LTL, but other bidders opposed the decision and appeared on Procurement Appeal Board (PAB). Subsequent efforts were taken to award the project to China’s Golden Concord Holdings (GCL) led consortium amid political backing, which was also opposed by complaints to PAB. Phase 03 - Only at conceptual stage The government has declared its intention to follow a process of international competitive bidding for setting up the LNG plant and associated projects. However, there is lack of clarity on how this would be done . State Ministry of Power Encourage private sector participation in renewable energy projects. Almost all projects to be funded by the GoSL Broadlands Hydro Power Uma Oya Hydro Power Moragolla Hydro Power Plant by 2020 (35 MW) Plant by 2021 (122 MW) Plant by 2023 (30 MW) All projects as per CEB generation expansion plan 2020-2039. Thalpitigala Hydro Power Seethawaka Hydro Power Plant by 2024 (15 MW) Plant by 2024 (20 MW) Mannar Wind Park 2024 (100MW) Wind farms Solar park Hydro CEB is in the process of project development with the assistance of Asian Development Bank (ADB). Ponneryn Ponneryn Mannar, Monaragala and Pooneryn (North West, Mannar South East regions) Solar parks up to 800 MW Moragalla The feasibility study has been conducted to develop a renewable Broadlands Uma Oya energy park in Pooneryn peninsula – mix of Wind and Solar Siyambalanduwa Seethawaka (a combined capacity of ~350 MW). Additionally, a 100MW solar park is also proposed in Siyambalanduwa, Monaragala. International Finance Corporation (IFC) is providing transaction advisory services to both projects. State Ministry of Power CEB recently closed tender for establishment of 150MW solar power parks in 20 locations. 230 participants Anuradhapura Habarana Polonnaruwa Maho Vavunathivu Average offer is USD 6 cents Kurunegala Madampe Pannala Mahiyanganaya Ampara Veyangoda Estimated total investment is Kolonnawa Kosgama USD 150mn Beliatta Mathugama Deniyaya Galle Beliatta Matara Ministry of Energy Latest exploration in Mannar basin carried-out by Cairn India in 2015. Expedite LNG exploration Ceylon Petroleum Corporation (CPC) and Minister of Petroleum and Petroleum Resources Development are main stakeholders of the process To be funded by state funding through CPC Expansion or upgrading of existing Sapugaskanda Addittionally, Sinopec Corp (China Petroleum and Chemical Oil Refinery Corp) has expressed interest on setting up of new refinery facility in Hambantota (focusing on bunker fuel) Out of the 99 tanks, 15 are utilised by Lanka Indian Oil Company Trincomalee tank farm (LIOC) development Rest of the tanks were proposed to be developed as a JV with CPC and LIOC for a long period of time - but yet to materialised Identified in CEB Generation Expansion Plan 2020 - 2039 Develop waste to energy Two waste to energy projects currently progressing with projects private partnerships (special off-take rates approved in the PPA) - Karadiyana and Muthurajawela, each having energy generating capacity of 10-12MW. Due to lack of funding, we understand that one project has been stalled. Ministry of Highways Port Access Elevated Highway Project (5.3 km) The proposed highway connects Central Colombo to the island-wide highway network. It will provide direct access to main airport. It is an ADB funded project (under the South Asia Subregional Economic Cooperation-SASEC facility). Estimated commissioning by the end of 2020. New Kelani Bridge to Athurugiriya Expressway (2 Phases - Total 17.8 km) Stage 1 - NKB to Rajagiriya Stage 2 - Rajagiriya to Athurugiriya 6.9 km 10.9 km The first stage was proposed as a Build–operate–transfer (BOT) project by the previous government. The Expression of Interest (EoI) process was completed, and the Request for Proposals (RFPs) process was delayed more than 3 years. The new government has indicated interest to award both stages to one developer as a package. Feasibility studies and EIA has been completed for both stages. The land acquisition has been completed for the first stage. It appears that there have been expressions of interest to carry out this project on an EPC basis for the government. Ministry of Highways Northern / Central Expressway (4 Phases - 178.9 km) It will provide an alternative route to one of the most congested and highly utilized road networks in the country (Colombo-Kandy A2 Highway).) Stage 1 - Kadawatha to Meerigama (37.1km) Est. cost LKR 160 Bn The first stage is debt-financed by the EXIM Bank of China. The EPC awarded to the China National Machinery Import and Export Corporation (CMC) - is pending due to lack of financing to facilitate the local cost component. This section has been delayed several years due to these funding constraints. Stage 2 - Meerigama to Kurunegala and Ambepussa link road (49 km) Est. cost LKR 135 Bn The second stage will be financed by domestic banks and constructed by 15 local companies. It is expected to be completed by the end of 2020. Stage 3 - Pothuhera to Galagedara (Kandy) (32.5km) Est. cost LKR 150 Bn For the third stage, the GoSL is seeking EPC developers who can come up with attractive financing support. This section has been delayed several years due to funding constraints. Previous funding arrangement by Japan's Tokyo Mitsubishi Bank was canceled after lengthy negotiation efforts, due to stringent terms from the lender. Stage 4 - Kurunegala to Dambulla (60.3 km) Est. cost LKR 166 Bn For the fourth stage, the GoSL is seeking EPC developers who can come up with attractive financing support for the project. Latest reports indicate that stage 3 and 4 will be carried out using BOT arrangements (approved by Cabinet). Ministry of Highways Ruwanpura Expressway (4 Phases - Total 73.5 km) Stage 1 - Kahataduwa - Stage 3 - Kahengama - Ingiriya Bela section 26.3 km 12.7 km Stage 2 - Ingiriya - Stage 4 - Bela - Palmadulla Kahengama section section be 21 km 13.9 km The GoSL is expecting to award this construction to local EPC contractors and finance using local bank funding. The feasibility studies and Environmental Impact Assessments (EIAs) have been completed. Ministry of Ports Expand Colombo port with new investments East Container Terminal (ECT) - a Memorandum of Cooperation (MoC) was signed in May 2019 among the three governments of Sri Lanka, Japan and India to develop the terminal. Sri Lanka Ports Authority (SLPA) will retain 100% ownership, while the Terminal Operations Company (TOC) conducting all terminal operations is jointly owned; Sri Lanka retains a 51% stake, and the joint venture partners hold a 49% stake. However, this arrangement is being re-looked/reviewed by the new government, and maybe amended. The first phase of the ECT was completed with an USD 80 Mn loan from the Bank of Ceylon (BOC) in 2015 (by SLPA). The second phase of development is expected to be financed by a USD 500 Mn loan from Japan. The new government's policy on the financing of this project is awaited. Expand Hambantota port with new investments Currently operating as a joint venture - Hambantota International Port Group (Pvt) Ltd (HIPG), with a JV partnership of the Sri Lanka Ports Authority (SLPA) and the China Merchants Port Holdings Company Limited (CMPH). Develop Hambantota industrial zone A land extent of 1,235 acres has been allocated for the construction of the zone. CMPH was expected to invest USD 600 Mn for the development of the harbor and the industrial zone. An oil refinery, a LNG power generation station, steel and cement factories, and a shipyard is planned built in the allocated 50 square km industrial zone with involvement of other private investors.
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