HUBC, LPL gear up for critical contract termination talks

By MG News | October 09, 2024 at 03:21 PM GMT+05:00

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October 09, 2024 (MLN): After Lalpir Power Limited (PSX: LPL), the directors of Hub Power Company Limited (PSX: HUBC) have also called an emergent board meeting to discuss the premature termination of some critical contracts.

According to their respective notices issued by both the power producers, the contracts under review include the Implementation Agreement, Power Purchase Agreement, Fuel Supply Agreement, and related Guarantee.

This follows discussions initiated by both LPL and HUBC with a Task Force constituted under the Prime Minister's Office, along with other Independent Power Producers (IPPs).

HUBC shared that these agreements were scheduled to expire in March 2027. An early termination of these contracts reflects a strategic shift related to power generation, payments, or fuel supply.

According to media reports, certain IPPs are dissatisfied with the pressure during negotiations, and disputes remain over capacity payments and government defaults.

The resolutions of the emergent meeting of HUBC and LPL will likely clarify the next steps and the way forward.

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