ROUSCH (PAKISTAN) POWER LIMITED

Rousch (Pakistan) Power Limited (RPPL) is a public limited company,

registered in 1995 in Pakistan. The Company being an Independent
Power Producer (IPP) has installed a thermal power plant on Build,
Own, Operate (BOO) basis using the combined cycle technology,
fired (initially) with residual furnace oil, having a gross (ISO)
capacity of 412 MW at Sidhnai Barrage near Abdul Hakim, district
Khanewal, Punjab, Pakistan.

In March 1994, Government of Pakistan (GOP) introduced a new

policy framework for the Private Sector Power Generation Projects
for attracting foreign and domestic investments.

In pursuance to GOP Bulk Power Tariff (BPT) Policy, the Sponsors

submitted their proposal for the establishment of the said power
plant to the Private Power & Infrastructure Board (PPIB) of GOP. Based on this proposal, PPIB awarded a Letter of
Support (LOS) on June 22, 1994 to Sponsors.

The Project sponsored by group of Rousch Companies of British Virgin Islands, Siemens Project Ventures of
Germany, and ESBI Ireland. The Project was further financed by Commercial lenders (ANZ London led consortium),
Hermes, DEG, and the funds contributed by the World Bank along with J-EXIM Bank.

RPPL has entered into a 30 years Power Purchase Agreement (PPA) with WAPDA and Fuel Supply Agreement (FSA)
with Pakistan State Oil (PSO). The role of WAPDA and PSO has been guaranteed by the GOP under the
Implementation Agreement. Siemens AG, Germany and Siemens Pakistan Engineering limited were the Construction
Contractors and ESBI Ireland is the Operation and Maintenance (O&M) Contractor of the Plant.

The Financial Close of the Project took place on March 31, 1996 at a total cost and funding of around USD 455
million. Construction started in September 1996 and the Plant was ready for interconnection on the 500 kV main
grid in March 1998, the first proposed Commercial Operation Date. However, a protracted dispute with the
GOP/WAPDA over tariff to be charged to WAPDA resulted in a commissioning delay and a cost overrun of around USD
105 million.

Project has since been completed over a period of 39 months with a total cost of around US$ 560 million, funded
with a debt equity ratio of 67:33.

The dispute which led to Project delay was finally resolved when the Company executed a Memorandum of
Understanding (MoU) with WAPDA in January 2000, thereby agreeing to reduce the tariff. Accordingly, WAPDA
recognized the Commercial Operation Date (COD) with effect from December 11, 1999. The Plant is in operation
since then with Initial Dependable Capacity (IDC) of 355 MW.

In support of declared policy of the GOP to convert residual fuel oil power plants to natural gas; the Company had
submitted a proposal for the conversion of its Complex to gas fired facility. GOP allocated the required natural gas
to the Company. The conversion works at the plant started from September 29, 2003 and the Complex was fully
converted to gas in January 2004. Accordingly, the Gas Operation Date was declared with effect from January 24,
2004 and the Dependable Capacity was achieved at 403.83 MW. With conversion of plant on gas, the gross (ISO)
capacity of the Plant has enhanced to 450 MW.

On 7th November 2006, Rousch Companies have disposed off all its remaining shares to Power Management
Company (Pvt.) Ltd. (PMCL), whereas, Siemens Project Ventures have sold out 33.98% of their shareholding to
PMCL. Through acquisition of these shares, PMCL now owns 59.98% of Company's shares. PMCL is 100% owned
subsidiary of Altern Energy Limited.
THE PLANT
The power plant is designed for base load operation, but also daily
startup and shutdown is considered. The plant is linked to the
national 500-kV transmission system between Multan and Gatti.

TURBINES
The power block consists of two Siemens V94.2 gas turbines and the
steam turbine with associated generators. The gas turbine generator
units are accommodated in one building.

Clean combustion air is provided by a pulse-air self-cleaning filter

system. The exhaust gas passes through a diverter damper either to
the bypass stack during single cycle, or through the boiler during
combined-cycle operation.

During combined-cycle operation the exhaust gas from the gas turbine units is routed through the heat-recovery steam
generator consist of heat exchanger modules generating high-pressure stream (HP) for feeding the steam turbine and
low-pressure steam (LP) for preheating the feedwater tank.

The steam turbine consists of a single-pressure single-flow HP section and of a double-flow LP section.

FUEL SUPPLY
RFO was being supplied mainly through trains to a large unloading station/facility inside the power plant area. The
necessary fuel oil storage tanks, along with a special fuel oil treatment plant are provided. The heavy fuel oil used to
be processed in the treatment plant and pre-heated to approximately 110°C before it get burned in the gas turbines.
Also an oil-soluble magnesium-base vanadium inhibitor used to be injected to prevent high temperature corrosion of
the turbine blades.

Since plant operation is converted to gas, the required quantity of gas is being supplied by SNGPL through its network
of mainline at a pressure between 600 to 650 psig, at minimum of 10°C. At base load operation gas requirement of our
plant is around 85 MMSCFD. SNGPL has installed gas metering station inside the premises of the plant which not only
keeps the record of gas consumption but also controls the gas supply. High Speed Diesel is also being kept as backup
fuel which could be used in the case of gas interruption.

COOLING WATER
The Cooling Water used in the condensors and for the auxiliary plant is drawn from the Fazal Shah Feeder through a
submerged concrete inlet channel to a siltation settling basin and then through an inlet channel to the circulating
water pump house. The canal water flows from the circulating water intake through the intake piping and valves to the
condensors. The water is discharged through further piping and valves into a culvert and seal pit before being
discharged into the Fazal Shah Feeder. The remainder of the auxiliary plant and systems are cooled by a closed circuit
water system using demineralized water.

I & C CONCEPT
The Rousch Power Plant has a central control room equipped with
TELEPERM XP, a proven and state-of-the-art process and control
system. The system ensures user-friendly, economic and reliable
plant operation. The automation system is divided into three levels:

• operations management level

• automation level
• process level
The operations management level is made in a redundant configuration. It contains the central operating and
monitoring, reporting and logging, archiving and data storage, and the visualization of the process.
ELECTRICAL CONCEPT
The turbine generators feed into the grid through the unit transformers and the 500-kV switchyard - an outdoor type
substation with one and a half breaker method using SF6 circuit breakers. Two unit auxiliary transformer provide the
plant auxiliary power supply from the generator leads to the 11-kV unit switchgear, related to each gas turbine
generator set.

In the event of the grid failure, the 3000-kVA black-start diesel generator set provides power to the most essential
loads and for the black-start of one gas turbine generator set.

The different 400-V AC switchgear are supplied by the 11-kV switchgear through the low voltage distribution
transformers.

Battery-backed 220-V DC systems are fed from the 400-V unit and common switchgear through rectifiers. Static
converters are used in order to step the 220-V DC down to a 24-V DC voltage level for the control and instrumentation
loads. A maximum of redundancy is achieved by using sectionalized switchgear with two source infeed and bus-coupling
facilities.

While the gas turbines are being accelerated with the frequency converters motoring the turbine generator sets, also
during stand still of the entire power plant, the plant auxiliary power is provided by the 11-kV unit switchgear from the
500-kV grid through the unit auxiliary transformers and with the generator circuit breaker open.

CONNECTION TO THE WAPDA GRID

Each generator is connected by a 21-5 kV/500 kV step-up transformer to a gas insulated switchgear outdoor substation
which in turn is connected to two overhead export lines designed and constructed by WAPDA. Two station transformers
supplied from the 500 kV substation provide power for start up of the Plant and for consumer services.

CIVIL ENGINEERING CONCEPT

The architectural statement made by the power plant is one of
careful use of external materials, textures and colours, which has
effectively reduced the visual mass of the major structures making
them more readily assimilated within the environs.

Local materials and methods of construction have been utilized

wherever possible, thereby providing a link between the new plant
and the existing architectural form.

Site planning ensures that the operational areas are well separated
from the residential and service facilities. In some instances, a
spatial barrier visually reinforced by the planting of local species of
bushes and trees is used, whilst in other situations boundary walls
are constructed. A less dense hard and soft contoured landscape
scheme covers the overall site, further softening the impact upon
the environment.

FINANCING ARRANGEMENT
The financing structure was developed and arranged by Australia and New Zealand Banking Group Limited (ANZ) of
London and National Development Finance Corporation (NDFC) of Pakistan (NDFC is subsequently merged with National
Bank of Pakistan-NBP). The loans for the Project has been provided by a group of commercial banks under the lead of
ANZ, London, Hermes coverage, and DEG of Germany. Further, a subordinate loan has been extended by the Long Term
Credit Fund (LTCF), being administratored by NDFC/NBP on behalf of GOP, which in turn was funded by the World Bank
and J-EXIM Bank. Initially, equity has been contributed by Rousch Group of Companies (33.25%), Siemens Project
Ventures (59.42%), and ESB of Ireland (7.33%). However, subsequently pursuant to 100% share sale trans-action by
Rousch Group of Companies and partial disposal of shares by Siemens Project Ventures, the current shareholding of the
Company comprises of Power Management Company (Pvt.) Ltd. (59.98%), Siemens Project Ventures (26.0%), ESB of
Ireland (7.33%), National Bank of Pakistan (4.61%) and others (2.07%).

The required financing was arranged/funded as under:

Sponsor's Equity US$ 187.615 million
DEBT:

• Commercial loan led by ANZ London USD 148.3 million

• Hermes Coverage loan, Germany USD 34.8 million
• DEG Germany DM 21.2 million; equivalent to Euro 10.84 million
• NDFC/NBP through LTCF USD 180.36 million, which was subsequently enhanced to USD 219.09 million as a
result of capitalization of interest.

Subsequently for gas conversion activities, following debt have been added/arranged:

• Backstop Loan from Siemens Financial Services, USD 11 million (this facility will be replaced with a New
Hermes facility of the same amount if and when made available to the Company).
• Supplier Loan from Siemens Financial Services, USD 12 million (which can be increased further by USD 5
million, if required).

The Company Loans Outstanding as of March 31, 2008 are as follows:

Amount in millions
1. Commercial Facility USD 12.97
2. Hermes Facility USD 23.32
3. DEG Facility EURO 0.95
4. Backstop Facility USD 6.49
5. LTCF USD 153.36
6. Supplier Loan USD 17.313

The Company has also entered into a Letter of Credit Facility Agreement dated 23rd September 2003 to obtain
revolving standby letter of credit for an amount of PKR 800 million which was subsequently been enhanced to 1,425
million in 29th March 2007, as security for the payments to be made to SNGPL. The facility has been provided by a
consortium of local banks namely, Bank Alfalah, NIB Bank Ltd (formally PICIC Commercial Bank), Soneri Bank Ltd and
Metropolitan Bank.

The Company has also entered into a Working Capital Facility Agent dated 29th December 2006 for an amount of Rs.900
million. The facility has been provided by the Consortium of local banks namely, Royal Bank of Scotland (formaly ABN
Amro Bank Pakistan Ltd.), Bank Al-Falah, Soneri Bank and Saudi Pak Bank.

SNGPL has also arranged a Letter of Credit for an amount of Rs. 610 million in favour of the Company, as security for
their payment obligations under the GSA, which is being renewed every year.

Interest rate SWAP agreement entered into with ANZ London on 24th June 1996 has expired in October 2005 and the
Company has entered into another such Arrangement for further period of 9 years with Standard Chartered Bank in
order to mitigate the floating interest rate risk. The SWAP has subsequently been novated to Royal Bank of Scotland
(formaly ABN Amro Bank Pakistan Ltd.) in 29th September 2006.

Through the insurance broker, AoN and Hubener GmbH the Company has renewed its IAR & CL insurance policy as well
as CGL Insurance Policy which are now valid up to 31st December 2009. In addition to these two policies, the Company
has also renewed its Sabotage & Terrorism insurance policy which is valid up to 30th June 2009.

THE AGREEMENTS

IMPLEMENTATION AGREEMENT (IA)

RPPL and GOP initially signed the IA on June 25, 1995. Thereafter, this agreement was amended and restated on
31.3.1996. The IA defines the rights and responsibilities of RPPL and GOP for the development, construction and
operation of the Project. The IA provides the framework under which RPPL has implemented the Project and sets out
the fundamental obligations of the RPPL and GOP with respect to such implementation. GOP extends the basic
benefits, incentives and waivers to the Company as announced under GOP's BPT policy. GOP guarantees the
performance obligations of WAPDA and PSO under the PPA and FSA respectively. This agreement and the rights and
obligation of the parties hereunder are being governed by and construed in accordance with the laws of England.

Subsequently, an Amendment No. 1 to the IA was executed on August 06, 2003 to incorporate the amendment
pertinent to gas conversion of the plant.

POWER PURCHASE AGREEMENT (PPA)

PPA was signed by Wapda and RPPL on February 25, 1995 and since then seven amendments (Amendment # 1 dated
26th May 1996, Amendment # 2 dated 14th July 1996, Amendment # 3 dated 21st August 2003, Amendment # 4 dated
27th August 2003, Amendment # 5 dated 3rd August 2004, Amendment # 6 dated 11th April 2005, Amendment # 7
dated 26th July 2007) have been carried out in this agreement. This agreement has a term of 30 years from COD. Like
IA, this Agreement is also being governed by laws of England. PPA sets out the principal terms and conditions of the
capacity and energy payments by WAPDA. RPPL is required to ensure availability to WAPDA equivalent to Dependable
Capacity of its plant. The tariff is payable by WAPDA in respect of each unit of generated electricity. The tariff due
under the PPA has been established on the basis that it will provide RPPL adequate revenues to meet its ongoing costs
and provide the opportunity of a return to its shareholders. The tariff will be paid by WAPDA under invoice
arrangements reflecting its individual components.

For each month, Capacity Payment is to be paid equal to the Capacity Purchase Price (CPP) in effect for that month at
60% of the Dependable Capacity, irrespective of net electrical energy delivered to WAPDA. For each month, Energy
Payment is to be paid equal to the product of the EPP and the number of kWh of electricity delivered to WAPDA during
that month.

Subsequently, a MOU was signed on 14th January 2000, between the WAPDA and RPPL in which the Commercial
Operation Date (COD) was agreed to be December 11, 1999, besides an agreement on reduction in tariff. The terms of
this MOU have been reflected in the PPA through an Amendment # 3 to the PPA, which was executed on August 21,
2003.

Through an Amendment #4 to the PPA and the Side Agreement, both executed on 27th August 2003, relevant provisions
of the PPA have been amended to incorporate the parameters related to the plant operation on gas. Likewise, through
an Amendment # 5 to the PPA executed on 3rd August 2004 relevant provisions of the PPA have been amended to
reflect the revised ISO rating (i.e. from 412 MW to 450 MW) of the Complex and other related technical aspects of the
Complex now operating on gas.

Through an Amendment # 6 to the PPA executed on 11th April 2005, definition of "Base Rate" which is used for the
purpose of computing Supplemental Charges on delayed payment has been amended. Likewise, through an Amendment
# 7 to the PPA executed on 26th July 2007, certain definitions related to LD calculations has been revised.

For each month, Capacity Payment is to be paid equal to the Capacity Purchase Price (CPP) in effect for that month at
60%

FUEL SUPPLY AGREEMENT (FSA)

The FSA was signed by PSO and RPPL on July 23, 1995 for a term equivalent to term of PPA. The FSA sets out the
principal terms and conditions of the sale by PSO, and the purchase by the company, of the fuel, diesel oil, greases,
lubricants and additives. PSO is responsible to supply required quantity / quality of RFO to the Complex at an agreed
place through rail / road. The specifications for fuel and diesel oil requirements of the Complex are set out in the FSA.
The specifications and price for greases, lubricants and additives are subject to agreement between the parties. The
Company places firm orders for fuel prior to each quarter. The price to be paid by the Company to PSO for fuel and
diesel oil purchased by it shall be the price established by the GOP under the Petroleum Products (Development
Surcharge) Ordinance 1961, as modified or re-enacted, and any charges will be passed through to WAPDA. The
Agreement is also being governed by laws of England.

Pursuant to allocation of gas and start of gas conversion activities, the Company plans to negotiate a new FSA for
supplying of HSD as back-up fuel for the plant, as RFO will not be used anymore.

GAS SUPPLY AGREEMENT (GSA)

The Company has entered into a Gas Supply Agreement (GSA) on July 01, 2003 with SNGPL whereby the gas supplier
has committed to supply the natural gas having calorific value between 910-925 BTU to the Company for an initial term
of 12 years
CONSTRUCTION CONTRACT
For construction of the Project, RPPL entered into two separate contract Agreements; one with Siemens AG of
Germany for the design, insuring, procurement, delivery of the power plant and execution of works as described in the
Off-Shore contract; and the other with Siemens Pakistan Engineering Company Limited of Pakistan for the installation,
construction, erection, commissioning, testing and completion of works as described in the On Shore contract. These
Contracts were executed on March 31, 1996 on the basis of a lump sum, fixed price, time certain contract. These
Contracts were governed by the laws of England. With the completion of project and achievement of COD on December
11, 1999, Provisional Taking-Over Certificate (PTOC) was issued to EPC Contractor on December 14, 1999, and
subsequently Final Taking Over Certificate was issued to EPC Contractor.

Pursuant to gas allocation, the Company has entered into a new EPC Contract with Siemens Germany on September 23,
2003 for designing, manufacturing, procurement, delivery and erection of plant and equipment, in order to convert the
plant to gas operation, which has since been successfully completed on 24th January 2004, and PTOC was issued on
18th February 2004.

OPERATION AND MAINTENANCE CONTRACT

The operation and maintenance activities of the plant have been assigned to ESBI contracting limited of Ireland. For
this purpose, the O&M Contract dated March 31, 1996 has been executed between RPPL and ESBI. The Contract sets
out the role and responsibilities of the Operator and the rights/obligations of the Company. The Contract has a term of
12 years from COD, which shall however, be automatically renewed every 3 years on the same terms unless either
party give written notice 9 months prior to expiry of each term. The Operator will assist in commissioning the plant and
operate and maintain the plant after the COD as per the terms of the Contract.

This agreement has been amended on September 23, 2003 in the form of an Amended and Restated Operation and
Maintenance Agreement in order to amend various provisions pertinent to gas operation.

CONVERSION OF PLANT ON NATURAL GAS

In response to GOP policy to convert residual fuel oil power plants to natural gas, the company had submitted a
proposal for the conversion of its complex to gas fired facility. After carrying out the physical conversion works,
commissioning tests, and the performance test, the Dependable Capacity Test was successfully carried out on January
22, 2004, which was also witnessed by Wapda officials. As a result of this test, Dependable Capacity of 403.83 MW was
achieved and the Gas Operation Date was declared from January 24, 2004. Since then plant is generally being
dispatched at base load by NPCC/Wapda, and is operating satisfactorily giving the expected results. As a result of last
ADC test carried out on 4th July 2007, the plant’s Dependable Capacity is 395.5 MW.

Updated on April 01, 2009

39-C/IV Block-6 P.E.C.H.S Karachi, Pakistan-75400

Tel : +921 21 4530641-2, 4535454-5, 4556755-6
Fax : +92 21 4535484
E.mail :rousch@rouschpak.com

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