Karachi June 08 2021: Lalpir Power has received an amount of PKR6.2 billion including mark up income of PKR1.7 billion from the power purchaser in the form of one-third cash, one-third Government Ijara Sukuk, and one-third Pakistan Investment Bond.
This amount constitutes the first installment of 40 percent of receivables at the cut-off date of November 30 2020. As per management, amount received will be used to clear short term borrowing and clear company’s payables.
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Lalpir Power has received this amount as an agreement signed with Central Power Purchase Authority (CPPA-G). According to the agreement, the Company has voluntarily reduced its Capacity Purchase Price (CPP) and Variable O&M by 11 percent. Furthermore, 50 percent of the reduced CPP shall not be indexed with USD Exchange rate and US CPI. Whereas remaining 50 percent of reduced CPP shall continue to be indexed with USD Exchange rate and US CPI. Moreover, company has waived off interest on interest in return. However, if the FIFO principle is not followed then the company’s right to charge interest on interest will be resumed.
Company has to make its plant available for 248 days after expiration of its PPA in compensation of Liquated Damages imposed by the purchaser. The shutdown period of the complex on account of non-availability of fuel has been treated as Other Force Majeure Event (OFME) under the PPA. During this extended period, the company will only be able to bill energy cost from the power purchaser.