Nishat Power Ltd Amends IPP Contract With Govt

Nishat Power Limited (PSX: NPL) has amended its Power Purchase Agreement, Implementation Agreement with the federal government.

In principle, the amendment means that the existing tariff will now be converted to a ‘Hybrid Take and Pay’ model.

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In its earlier filing dated December 4, 2024, the salient terms and conditions were revealed as under:

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The Amendment Agreement shall be effective from November 01, 2024;
The indexation mechanism of O&M has been changed;
Tariff of Cost of working capital and O&M has been rebased;
The return on Equity tariff component will be paid in a hybrid take and pay mode.;
Insurance premium tariff is capped at 0.9% of EPC Cost;
The Company will Share profits till FY’23 and it will be adjusted, against receivables from CPPA;
GOP will unconditionally withdraw Arbitration under Arbitration Submission Agreements;
The undertaking provided to the Power Purchaser by the Company to retain its receivables till the conclusion of Arbitration under ASA shall be returned;
Payment of outstanding receivables as of October 31, 2024, within in 90 days of approval of the Agreement by the Cabinet;
Waiver of Delay Payments till Oct 31, 2024; and
LCIA Arbitration clause in PPA will be substituted with Islamabad seated Arbitration under the local laws.