Tapal Energy Limited

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Tapal Energy Ltd., a joint venture between Ameejee Valeejee & Sons (80.1%) and Wartsila Diesel (19.1%), developed a 126-MW Diesel-Fired Power Plant, located approximately 28 km from Karachi in the Sindh Province. The project was constructed under a fixed-price, lump-sum EPC contract with Power Construction Company B.V. Wartsila Diesel Pakistan (WDP) provides operations and maintenance services and Stork-Wartsila Diesel (SWD) is the equipment supplier. WDP and SWD are subsidiaries of Wartsila Diesel. Construction commenced in December 1995 and the plant was expected to become operational during 1997. Financial closure took place in 1995. The project has a debt/equity ratio of 75:25. The project has a 22-year PPA with the Karachi Electric Supply Company (KESC) and a 22-year fuel supply agreement with the Pakistan State Oil Co. (PSOC). Estimated project Cost information is $130.0 million. In its fiscal year 1998, MIGA issued a guarantee of $8 million to Wartsila Power Development, Inc for its equity investment in Tapal Energy Limited. MIGA’s guarantee covers the risk of expropriation. In November 1997, Sithe Mauritius purchased a 24% equity stake in Tapal Energy Limited. Sithe Mauritius was a subsidiary of Sithe Asia Holdings Limited, which was itself a JV between Sithe Energies Inc. of the United States, AIG Asian Infrastructure Fund LP and the Government of Singapore Investment Corp. Also, in November 1997, Marubeni Corp. of Japan purchased a 25% holding in Tapal. Tapal family retained a 31% stake in the project company while Wartsila Diesel retained a 20% stake. In November 2003, Marubeni Corp. acquired 100% of Sithe Asia Holdings Limited, thereby increasing its holding in Tapal Energy Limited to 40%.