Diamer Basha dam project hits a snag due to late payment

ISLAMABAD: The Diamer Bhasha Dam Project (DBDP) contractor, while expressing serious concerns over the late payment of $60 million, expressed its inability to maintain the normal pace of construction of the project if the payments” long-standing” are not settled.

According to Ministry of Water Resources sources, the contractor (Power China-FWO Joint Venture) of the Diamer Bhasha Dam Project (DBDP) has faced undue delay in settling pending payments due over the past few years. month, especially the foreign component worth about USD 60 million despite repeated reminders to the Water and Power Development Authority (WAPDA). However, the contractor has now warned WAPDA that if payments are not made it will not be possible to maintain the normal pace of construction on the DBDP, sources said.

They added that the project (DBDP) is in a very critical phase of diversion of the Indus River which is scheduled for April 2024, after which the construction of the dam will be and if this is delayed, it will have a direct impact on the completion of the project by February. -29 by one year, extending completion to 2030.

“The contractor has done everything possible to maintain its construction schedule as the overpayment has severely affected the mobilization of various overseas construction resources, including cofferdam equipment,” the sources said.

Sources also added that the DBDP, which is the most expensive dam in Pakistan’s history with an estimated cost of around US$14 billion, a year behind schedule apart from claims from contractors and consultants, will have a direct escalation impact of approximately 15-20%. amounting to Rs 400-500 million (with the current inflation rate) while the country will also be deprived of cheap hydel electricity of 4500 MW (approximate cost of Rs 300-400 billion) and a loss of 6.0 million acre feet (MAF) water reservoir for another year.

Sources further said that the government should settle the contractor’s dues at the earliest to save the Treasury from wasting further time in completing the dam and incurring additional costs. The contractor has to import various equipment from foreign countries and payment delays have affected the pace of construction, especially the diversion works, sources added.

It is pertinent to mention that the Diamer Bhasha Dam will have a gross water storage capacity of 8.1 MAF to irrigate an additional 1.23 million acres of land while it will have a live storage capacity of 6 .1 million acre feet (MAF) and it will generate 18,100 gigawatts. hours (GWh) of electricity per year after completion by February 2029.

The Diamer Basha Dam is being constructed on the Indus River, 40 kilometers downstream from the city of Chilas. The project is of paramount importance for the country’s water, food and energy security. The installed capacity of the Diamer Bhasha Dam will be 4,500 megawatts (MW) and a live storage capacity of 6.4 MAF.

The total estimated cost of the Diamer Basha Dam project is approximately US$14 billion, which includes construction of the dam and power plant, land acquisition, resettlement and other associated costs.

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