Daily Times reported that Sindh government is likely to annul all MoUs signed with different foreign and local companies for coal based power projects, except one company that has so far carried out developing work at satisfactory pace.

The report cited official sources in the Sindh mines & mineral department as saying that the new government has decided to take stern action against all firms on the suggestion of provincial cabinet held in past week. It added that the provincial government has cancelled around 4 MoUs so far and it has sent notices to other companies asking them to present financial feasibility reports at the earliest.

According to an estimate, the feasibility report for coal based project has a whopping cost of PKR 30 million. Sources added that majority of these companies are not financially sound to invest on coal based projects even investment through borrowing seems to be difficult task for them. The official said that "There are some companies who have inked agreements with government 5 years ago, but they have not started any development activity even for preparing financial feasibility report for any project."

It may be recalled that the Sindh government has signed 14 multiple MoUs with seven companies since 2002. Out of 8 companies that inked MoU with concerned ministries, only two companies have started drilling work in their respective areas.

Geologists believed that the estimated reserves at Thar are about 175.506 billion tonnes of coal and are sufficient to meet fuel requirements of Pakistan having a potential for generating about 100,000 MW of electricity. In Pakistan coal use is less than 1% as against 69% in India, 80% in Australia and 78% in China.