Oracle Coalfields said that a joint development agreement with Karachi Electric Supply to supply a new power station in Pakistan is a hugely positive step.

Oracle’s 80% owned subsidiary Sindh Carbon Energy Limited will provide coal and water to Karachi Electric under a long term deal.

Initially, this will fuel a 300 MW coal-fired power plant (with potential to be increased to 1,100 MW) to be constructed by KESC adjacent to Oracle's planned coal mine in Block VI of the Thar Coalfield in Pakistan.

The agreement supersedes a MoU signed between the two groups in 2009.

Mr Shahrukh Khan CEO of Oracle said “This is a hugely positive step in the development of Oracle's project in the Sindh Province in Pakistan. It follows shortly after the mining lease that the company was granted on 12 April 2012, and represents significant progress towards our goal of becoming a major coal producer in Pakistan. The agreement with KESC brings security in the form of a major purchaser for our product.”

SCEL can still supply other customers as long as they do not affect its obligations to KESC under the agreement. In phase 1 of Oracle’s mining area it had proven JORC coal reserves of 113 million wet tonnes from the JORC mineral resource of 529 million wet tonnes.

Source - Proactive Investor

(www.coalguru.com)