Nabil-led consortium, Hydro Support sign deal on Madhya Kaligandaki Hydropower

KATHMANDU, JUNE 21 : A consortium of six banks has pledged to finance the 66.3 MW Madhya Kaligandaki Hydropower Project. The consortium, led by Nabil Bank, comprises five other members: Everest Bank, Nepal Investment Mega Bank, Nepal Bank, Rastriya Banijya Bank, and Prabhu Bank.

These financial institutions signed an agreement with the project's developer, Hydro Support Pvt. Ltd., which operates under the IME Group, during a program held today in the capital. Chandra Prasad Dhaka, Chairman of the group, and Gyanendra Dhungana, Chief Executive Officer of Nabil Bank, inked the deal on behalf of their respective sides.

The hydropower project is being constructed in the Annapurna Rural Municipality in the Myagdi district. The project is expected to be completed in the next four years.

Of the total estimated cost of Rs 12.93 billion (excluding interest during the construction period), 75 percent will be funded by the consortium, while the remaining 25 percent will be borne by Hydro Support.

Nabil Bank will finance Rs 3.12 billion, while Everest Bank and Nepal Investment Mega Bank are each going to invest Rs 2 billion. Similarly, Rastriya Banijya Bank and Prabhu Bank will fund Rs 1 billion each.

As per the Power Purchase Agreement reached between Hydro Support and Nepal Electricity Authority (NEA), the latter will buy electricity at the rate of Rs 8.40 per unit in the dry season and Rs 4.80 per unit in the monsoon season from the former.

The company plans to sell 139 gigawatt-hours worth Rs 1.9 billion in the winter and 277 gigawatts amounting to Rs 1.33 billion in the rainy season. In total, 407 gigawatts with a total value of Rs 2.42 billion will be sold in a year.