Tanahu Hydropower signed contract with Indian firm

Kaligadaki Corridor Transmission Line

Dec 29, 2018

Tanahu Hydropower Limited, the wholly owned subsidiary of state-owned power utility Nepal Electricity Authority, has selected KEC International to construct the transmission line to evacuate electricity generated by Tanahu Hydropwer Project.

The Tanahu Hydropower Limited (THL) on Wednesday, signed a contract worth $6.78 million and Rs218.4 million with the Indian firm to construct a 220kV double circuit power line stretching from Damauli, Tanahu to Bharatpur, Chitwan. As per the contract, the Indian company has to build the 33.5-km long transmission line within 1122 days.

The contract will only be effective once the THL releases the advance payment to the contractor. According to THL Managing Director Pradip Kumar Thike, the company will soon release the advance payment to mobilise the contractor at the project site, thereby making the contract effective.

Once mobilised, the Indian contractor will fix the alignment through which the power line will pass. “After the alignment is fixed, we will know about the volume of land required to pull the cable and erect the tower for the power line,” said Thike. “Then we will start the land acquisition process.”

The THL is developing the transmission line to evacuate the electricity generated by the 140MW storage project with loan assistance from the Asian Development Bank, the Manila-based multilateral lender.

Although the THL is moving along with the construction of the power line project, development of the Tanahu Hydropower is still in limbo after Cooperativa Muratori e Cementisti di Ravenna, the Italian contractor appointed to implement civil works of the scheme got into a liquidity crisis.

In October, THL signed a contract with the Italian company to execute the first package of the 140 MW storage hydropower plant which includes the formulation of a detailed design and the construction of the headworks.

However, before releasing the advance payment to mobilise the contractor at the project site, CMC Ravenna landed in a liquidity problem, putting project officials in a dilemma over their next step. Although the Italian contractor is asking the THL to release the advance payment, saying it will start the construction,  project officials are reluctant to do so as they fear the CMC might misuse the fund without deploying it in the construction of the hydropower plant. According to Kulman Ghising, managing director at the Nepal Electricity Authority, the parent company of the THL, they are currently in consultation with the Energy Ministry before taking any decision on the matter.

The Tanahu Hydropower Project will be one of the biggest reservoir-type projects in the country with an estimated annual energy generation capacity of 587.7 gigawatt hours in the first 10 years of operation. The project can generate energy for six hours daily during the dry season. The THL is developing the project using a credit facility extended jointly by the Asian Development Bank, Japan International Cooperation Agency and European Investment Bank. The project is estimated to cost $550 million.

 

Bibek Subedi

Source: The Kathmandu Post