PDA template only for export-oriented hydro projects: NIB

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    Power development agreementsKATHMANDU, Feb 23: The Office of Nepal Investment Board (ONIB) has disclosed that the project development agreement (PDA) template that is on the verge of finalization is only meant for export-oriented hydropower projects.

    “The PDA template that is under discussion is not for projects that are for domestic consumption purposes,” said Radhesh Pant, chief executive officer at ONIB. “We will soon develop a different template for that purpose.”

    Interacting with media persons at a program held on Friday, Pant said that ONIB was working towards tailoring PDAs with individual power developers for four mega hydropower projects that have a total installation capacity of 3,050 megawatt.

    The projects on hand for PDA negotiations with developers include the 900 megawatts Arun III, 650 MW Tamakoshi III, 900 MW Upper Karnali and 600 MW Upper Marsyangdi.

    ONIB has been holding regular discussions with the power developers who are engaged in the development of the above-mentioned four export-oriented mega projects.

    GMR is engaged in the development of two projects, namely Upper Karnali and Upper Marsyangdi. Sulej Jal Vidyut Nigam is developing Arun III and SN Power has Tamakoshi III in its bag. Sutlej and GMR are Indian companies while SN Power is a Norwegian power developer.

    ONIB, which came into existence more than a year ago to carry out the implementation of mega projects on a fast-track mode, doesn´t have any PDA template for the 750 MW West Seti Hydropower project. West Seti is the only project that is meant for domestic consumption.

    “We will soon develop a PDA template for West Seti,” Pant added. A Chinese company, Three Gorges, is engaged in the development of West Seti. Project evaluation for West Seti will be completed in the next few weeks, according to Pant.

    Meanwhile, George Davies, director of hydro cluster at the Centre for Inclusive Growth (CIG), shed light on the detailed structure of the PDA. He skipped any explanation of how exactly the PDA template now under discussion protects the national interest of Nepal. “The PDA has provisions that guard the country´s interests,” Davies had said in his presentation.

    Davies made it clear that the risk was borne by the developer in most cases.

    The interaction program, that was basically organized to make clear what the PDA is and how it protects the national interest, also touched base on other projects, including Chemical Fertilizer Plant, Nijghad Second International Airport and Solid Waste Management, among others.

    “We want the best of best international developers to come to Nepal,” Pant said, highlighting the importance of mature and detailed homework before actually signing a deal for project development.

    Source : REPUBLICA