NMB Bank collaborates with BO2 and Bakas Renewable Energy

Kathmandu, Oct 19. NMB Bank has signed a loan agreement with Bakas Renewable Energy Pvt. Ltd., a company promoted by forestry and environmental professionals in which Business Oxygen Pvt Ltd (BO2), Nepal’s first international Private Equity Fund with a climate focus promoted by International Finance Corporation (IFC) of the World Bank Group is making equity investment for developing a biomass pellet project at Ishworpur, Sarlahi District of Province No. 2.

The project has equity investment of NPR 5 crores from BO2 and remaining NPR 5 crores from Promoting Shareholders whilst NMB Bank will be providing debt financing of NPR 16 crores under term and working capital loan for production of Biomass Pellet, a premiere project dedicated to produce biomass pellets from unutilized forest floor biomass, saw dust and agricultural biomass. Biomass pellet fuel is a clean energy and an alternative to traditional means of domestic and industrial fuel such as firewood, petroleum products, LPG and coal. The project has a production capacity of 19,824 metric tonnes per year. Most of the raw materials for production are sourced from the forest floor of Sagarnath Forest Development Project based on the agreement with Forest Products Development Board.

Speaking at the virtual press meet organized to mark the association, Siddhant Raj Pandey, Chief Executive Officer of BO2 expressed, “This is one of our exciting projects that assists adaptive resilience and will help the economy with clean energy in numerous ways including being a substitute for coal”

“This project is highly relevant to Nepal. It helps emission reduction caused by forest fires, reduces industrial use of coal and fossil fuels as well as provides employment to the poor and vulnerable people living in neighborhoods of the forest area” said Santosh Mani Nepal, Chairman of BAKAS Renewable Energy Pvt. Ltd.

Kuber Mani Nepal, MD of Bakas Renewable Energy Pvt. Ltd., remembers the bad situation on fuel resources of Nepalese people during the blockade period, therefore, producing our own resources using modern state of the art technology can help to reduce the dependency on fuel resources and should be the priority of the country.

Sunil KC, Chief Executive Officer, NMB Bank shared his thoughts on NMB’s association with the project “We are delighted to be associated with the project of BO2 which aims to reduce carbon emission from coal and fossil fuels and promotes renewable energy resources. As a part of the steering committee of Partnership for Carbon Accounting Financial from Asia and a  member of Global Alliance for Banking on Values, our business model focuses on sustainable and value based banking projects encompassing renewable energy projects, M/SMEs, agribusinesses and projects focused on environmental preservation. The Bank is certain that projects such as these will translate in providing long term sustainable livelihood at the grassroots and we look forward to be a part of many such projects in the future”