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- 30% of power in Pakistan supplied by IPP's
- Tariff calculated based on guaranteed 15% ROE including construction phase
- IPP regime highly favourable
- All contracts guaranteed by GOP
- No income tax
- Tariff adjusted to decreases in USD/PKR exchange rate
- Initial project was to refurbish an existing power station; detailed engineering study found that refurbishment was not feasible
- Revised LOI executed with GOP July 2009; revisions to detailed engineering study underway to finalize plans for construction of a new facility
- Frontier and PEL each hold a 50% interest in the power project
- Debt financing available for up to 80% of project cost
- GOP has approved supply of 10 MMcf/d of high Btu gas to blend with Kandra SML gas; SSGPL has confirmed availability of 5 MMcf/d
- Plans for 2010 include LOS, tariff negotiations, and financing
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