HIDC studying possible financing of three hydropower projects

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    KATHMANDU, MAY 07 –

    Hydroelectricity Investment & Development Company LimitedHydroelectric Investment and Development Company (HIDC) has been conducting studies to possibly finance three more hydropower projects after funding the 42 MW Mistri Khola project.

    The government-owned company established to finance hydro projects has been reviewing the documents of Upper Dordi (25 MW), Lower Modi (30 MW) and Khani Khola I (25 MW). The capacity of Khani Khola I is being enhanced to 40 MW. A consortium of banks led by Nepal Investment Bank Limited (NIBL) has sought HIDC financing for Upper Dordi and Lower Modi while Prime Bank wants financing for the Khani Khola project.

    A high-level HIDC official said the company was reviewing the documents of the three projects, and that it would take about a month to reach a decision whether to finance them or not.

    Last November, HIDC decided to finance the Mistri Khola project as its first venture after its risk management committee gave the go-ahead.

    Anuj Mani Timilsina, deputy general manager heading the corporate banking division of NIBL, confirmed that they had asked HIDC for financing  for two projects. “HIDC has said it could provide up to Rs 600-700 million which is equivalent to the amount our bank is investing in these projects,” he added.

    The Upper Dordi project is in the initial stage of construction  while construction of a tunnel at the Lower Modi project is underway at present.

    Upper Dordi, a run-of-the-river type project, has an annual energy generation capacity of 138.39 GWh, including 22.84 GWh dry energy and 115.45 GWh wet energy. The project based in Lamjung in western Nepal is being promoted by Liberty Energy Hydropower Company.

    Similarly, construction of Lower Modi is estimated to cost US$ 80 million. The project, which is located in Parbat district in western Nepal, has a capacity of 9,900.0 kW. The project is being developed by United Modi Hydropower Company.

    HIDC has also decided to invest in the Dhalkebar-Muzaffarpur cross-border transmission line by acquiring a 14 percent stake in Power Transmission Company Nepal which will build the Nepali portion of the project.

    The central bank has allowed HIDC to finance hydropower projects identified by banks as a consortium partner initially while it gains technical expertise. The company has recently decided to finance any project with a capacity of more than 15 MW.

    The company decided to chip in Rs 1 billion as a partner in the consortium of commercial banks led by Nabil Bank which is financing the Mistri Khola project. Nabil Bank has pledged Rs 1 billion, Nepal Investment Bank Rs 700 million, Nepal Bank Rs 500 million, Laxmi Bank Rs 400 million, Clean Energy Bank Rs 300 million and other banks Rs 340 million. The banks will finance 75 percent of its total cost while the promoters will invest the rest.

    Source : The Kathmandu Post