Pakistan's PM says confident GE will fix 'technical' issues with gas turbines

By Drazen Jorgic and Kay Johnson

ISLAMABAD (Reuters) - Prime Minister Shahid Khaqan Abbasi said on Monday that some of General Electric's flagship new gas turbines in Pakistan were still suffering from technical issues such as "vibration" but he was confident the American company will fix the problems.

The 9HA-class gas turbines are GE power division's newest and most prestigious product but last year a series of delays and outages interrupted their installation in three power stations vital to Pakistan's efforts to end electricity shortfalls.

GE has described last year's problems as "teething" issues, but the troubles have frustrated Pakistani officials and concerned analysts.

GE, undergoing a restructuring, saw its share price tumble below $16 on Monday for the first time since 2011.

Former petroleum minister Abbasi told Reuters it was normal for problems to arise in large projects with new technology but he had faith in GE to fix the problems.

"There have been technical issues. GE is working to resolve them, and there are issues that remain today. Some have been solved, some are still there. Those will get resolved," Abbasi told Reuters in an interview in the prime minister's chamber in Pakistan's Parliament in the capital Islamabad.

"I'm very confident that these will be very robust plants that will be a flagship for both GE and Pakistan."

The Pakistani power plants are being upgraded to operate at 1,200 MW combined cycle, having worked in simple cycle mode - delivering around 800 MW per power plant - for much of 2017.

Abbasi did not elaborate on how many of the six turbines operating in three 1,200 MW power plants were suffering installation difficulties.

"Some have vibration issues, some have technical issues, GE is working on that," said Abbasi, who is a trained engineer.

"These (power plants) are still with the EPC (engineering, procurement and construction) contractor under GE's supervision, so we don't have any liability for them at the moment."

China's Harbin Electric International Company and SEPCOIII Electric Power Construction Corporation are the contractors building the power stations.

In response to Abbasi's remarks, a GE spokesperson pointed to a statement the company issued to Reuters in December about last year's problems.

"Together we've encountered and communicated openly about launch challenges and readily resolved issues during this time - it's important to note that challenges are common with power plants of this size and complexity during the commissioning and early operations phase," GE said in the statement.

"We remain committed to supporting customer and site needs with the highest standards of quality and excellence," GE added.

The 9HA-class gas turbines entered the Guinness World Records for efficiency, based on the amount of electricity generated from natural gas at the power plant in Bouchain, France, where it was first put into commercial operation in 2016. Pakistan ordered six turbines in 2015.

GE's record efficiency of 62.2 percent has since been exceeded by rival manufacturer Mitsubishi Hitachi Power systems.

(Additional reporting by Alwyn Scott; Writing by Drazen Jorgic; Editing by Adrian Croft)