Water and power minister Raja Nadir Pervez, quoted by the official APP news agency, said the action against these companies had been taken on charges of corruption and violation of terms of agreements while some other companies had offered to bring down their tariffs.

No comment was immediately available from the affected companies, which in the past have denied any wrongdoing alleged by the government such as offering bribes and kickbacks for contracting high tariffs they must charge for their electricity from the state distribution utility Water and Power Development Authority (WAPDA).

There is no private power distribution in Pakistan. The company that had its contract cancelled is the Southern Electric Power Company, sponsored by Canada's British Colombia HydroInternational with a generation capacity of 112 mw at its Raiwind plant in the central province of Punjab.

Pervez said notices for termination of power purchase agreements on corruption charges had been issued to six companies -- Uch Power (525 mw), Kohinoor Energy Ltd (120 mw), Sabha Power (109 mw), AEC Lalpir (337 mw), AEC Pak. Jen (337 mw) and Habibullah Coastal (123 mw).

Notices had been sent to two companies -- Sabha Shipyard (274 mw) and Power Generation System (110 mw) -- on technical grounds.

These companies have 90 days for their defence, APP quoted Pervez as telling local reporters. "If they fail to clarify their positions their contracts will stand cancelled."

"Sufficient material is available to establish our point of view in a court of law that the corruption has been committed in Pakistan by some of these projects," Pervez said.

The remark seemed to suggest the government expects the companies to go to law to challenge its action, which follows months of tussle with 19 independentpower producers (IPPs), most of which have foreign participation, on tariffs the official regards as too high.

Pervez said some IPPs had offered to cooperate with the government and reduce their rates.

Prime minister Nawaz Sharif's government accuses the previous government of former prime minister Benazir Bhutto of receiving bribes and kickbacks for agreeing to pay high tariffs to the IPPs and wants the companies to cut their rates by between 25 and 30 per cent.

Bhutto and the IPPs deny any wrongdoing and the companies say the power-purchase rates, originally agreed at 6.5 US cents per one kilowatt-hour unit, are not too high and say they cannot make such a big reduction. But they say the crisis could be resolved if they were allowed to import their own oil rather than buy from a state-run distribution company at higher rates, increase their production capacity and export surplus power to India. Opposition politicians have accused Sharif's government of harassing power companies to get falseconfessions, a charge denied by government spokesmen.