Kathmandu: Construction of the main tunnel for the 106 MW Jagdulla Semi-Reservoir Hydropower Project, currently under development in Dolpa, has officially begun. Minister for Energy, Water Resources and Irrigation Biraj Bhakta Shrestha inaugurated the tunnel construction on Thursday during a ceremony held at Ila in Mudkechula Rural Municipality–4.
Speaking at the inauguration, Minister Shrestha expressed confidence that the project, being developed through the joint ownership and investment of the federal, provincial, and local governments, would become a milestone not only for Dolpa but also for the overall energy and economic development of Karnali Province. He stressed that close coordination among all three levels of government, the local community, and other stakeholders would be essential to complete the project within the scheduled timeframe.
Energy Ministry Secretary Sarita Kumari Dawadi noted that the project has been progressing smoothly thanks to the support of local communities. She emphasized the need for continued facilitation from all concerned agencies to ensure timely completion.
According to Sanjay Sapkota, Chief Executive Officer of Jagdulla Hydropower Company, the project is being developed under the People’s Hydropower Program by combining government ownership, local participation, and domestic financial resources, making it one of Nepal’s model hydropower projects. He said the project would contribute not only to electricity generation but also to the economic, social, and infrastructure development of Karnali Province.
The company stated that all works under Lot-1 have already been completed. It is currently developing two semi-reservoir hydropower projects in the Jagdulla and Mudkechula Rural Municipality areas of Dolpa: the 106 MW Jagdulla Hydropower Project and the 124.35 MW Jagdulla-A Hydropower Project, with a combined installed capacity of 230.35 MW.
The company also claims the projects have made significant contributions to regional infrastructure development. Using its own investment, it has already constructed a 100-meter permanent bridge over the Bheri River, access roads along the Triveni-Mudkechula-Jagdulla road section, and 10 Bailey bridges. According to the company, these structures have not only facilitated project construction but also improved local transportation and economic activities.
The expansion of road access has significantly improved transportation in Dolpa. While traveling from Nepalgunj to Dolpa previously took more than three days, the journey can now be completed within a single day. The company also stated that conditions have been created for the operation of overnight bus services between Dunai and Kathmandu.
The infrastructure developed under the project is also expected to provide long-term support for tourism promotion in destinations such as Rara, Shey Phoksundo, Jagdulla Lake, Upper Dolpa, Jumla, and Mugu.
According to the company, once the project comes into operation, the federal government is expected to receive approximately NPR 195 million in annual royalties, while the Karnali Provincial Government and the concerned local governments are each projected to receive around NPR 95 million annually.
The company stated that all major preparatory work for the 106 MW main project—including the detailed engineering study, Environmental Impact Assessment (EIA), land acquisition, Power Purchase Agreement (PPA), financial closure, and required regulatory approvals—has already been completed. Physical construction accelerated after the main construction contract was signed on August 11, 2025.
Similarly, the detailed engineering study for the 124.35 MW Jagdulla-A Hydropower Project has been completed, while the environmental study, PPA, financial closure, and regulatory approval processes are in their final stages.
The project is being developed under a majority government ownership model, with 51% ownership jointly held by government agencies, the Karnali Provincial Government, and local governments, while the remaining 49% will be owned by the general public. Of the public shares, 10% has been reserved for local residents, and an additional 3% will be allocated to landowners whose properties fall within the transmission line right-of-way, the company said.
The project has secured approximately NPR 16.66 billion in debt financing from domestic banks and financial institutions. The financial package has been arranged through a consortium comprising Nabil Bank, Employees Provident Fund (EPF), Hydroelectricity Investment and Development Company Limited (HIDCL), Laxmi Sunrise Bank, Everest Bank, and NIC Asia Bank.
Jalasarokar
