KARACHI: Hub Power Company (Hubco) has joined hands with big foreign and domestic construction firms to diversify business as it views Karachi’s garbage and drinking water crisis as a business opportunity.
Hubco and FWO Enjazat of the UAE are interested in collaborating to capitalise on scores of business opportunities and develop business partnerships across multiple sectors in Pakistan and abroad. Their focus will especially be on energy, water recycling and desalination, infrastructure development and mining.
“Hubco has signed a memorandum of understanding with FWO Enjazat LLC to explore collaboration on various business opportunities,” Hubco Company Secretary Shaharyar Nashat said in a notification sent to the Pakistan Stock Exchange on Friday.
FWO Enjazat is a partnership between Pakistan’s engineering group Frontier Works Organisation (FWO) and private officer of Sheikh Ahmed Dalmook Al Makhtoum. Both are large-scale developers and have multiple businesses across Pakistan, Africa, the Middle East and South Asia and is based in the UAE.
Hubco Chief Executive Officer Khalid Mansoor told The Express Tribune that a number of initiatives were under development phase for the joint venture.
“One of them is Karachi’s garbage of over 16,000 tons per day. It can potentially be utilised to produce 200 megawatts of electricity and 200 million gallons of water per day,” he said.
“Sea water desalination can be done as much as one wants. Karachi’s water deficiency stands at around 550 million gallons per day; we may set up water projects under public-private partnership.”
His statement came weeks after Finance Minister Miftah Ismail announced a 50-million-gallon-per-day water desalination plant for Karachi during presentation of the federal budget for 2018-19.
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Mansoor said Hubco was already running a power project in Hub, Balochistan and simultaneously the city was an ideal location for a water desalination project for the company. All the projects would be initiated soon, but the start of development phase may take some time because of the requirement of government approvals and other formalities, he said.
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“Our (Hubco and FWO Enjazat) interest and strategy are common,” he said. “We have discussed business opportunities in Pakistan, the Middle East and Africa. We have identified opportunity areas in Pakistan and they have identified opportunities in the Middle East and North Africa.”
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He emphasised that they would undertake technically and economically viable projects on debt-equity ratio of 75:25. The 25% equity would be equally contributed by the three investors.
Mansoor pointed out that diversification from an energy and power company to an energy, water and construction concern was a natural process for Hubco. “Majority of the independent power producers (IPPs) in the Middle East are independent water and power producers (IWPPs) as well,” he said.
Hubco remains the single largest IPP in the country. It is executing energy projects worth $3.5 billion in collaboration with Chinese firms under the China-Pakistan Economic Corridor (CPEC). Besides, it is already active in coal-mining in Thar and is setting up a mine-mouth power project in the desert city.
Published in The Express Tribune, May 27th, 2018.
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