Four BFIs investing Rs. 10.5 billion in 90 MW Nadi Hydro

By A Staff Reporter,Kathmandu, Feb.2: Four banks and financial institutions have finalised the financial management of the 90-megawatt Marsyangdi Nadi Hydropower Project to be built on the Marsyangdi River.

The BFIs have agreed to invest Rs. 10.50 billion for the construction of peaking run-of-the river (PROR) hydropower project on the Marsyangdi River which flows through Palungtar Municipality in Gorkha district, Rainas Municipality in Lamjung district and Bhanu Municipality in Tanahun district.

The investment agreement was signed Friday under the leadership of Kumari Bank Limited.

A loan agreement was signed in the presence of Anup Acharya, Chairman of MA Power Pvt. Ltd., and Ram Chandra Khanal, Chief Executive Officer of Kumari Bank Limited, as a joint investment between Kumari Bank Limited, Prabhu Bank Limited, Agricultural Development Bank Limited and Siddhartha Bank Limited.

Although an agreement has been reached between the four financial institutions at present, it is said that other banks and financial institutions will also invest in the project within some time. The project, which is estimated to cost a total of Rs. 20.25 billion, including interest during the construction period, will have 75 per cent loan and 25 per cent equity investment.

According to the promoter company, Kumari Bank Limited will invest Rs. 4 billion, Prabhu Bank Limited Rs. 3 billion, Siddhartha Bank Limited Rs. 2 billion and Agricultural Development Bank Rs 1.5 billion in loan investment.

The equity investment will be borne by Anup Acharya, Haribabu Neupane and Deepak Baral. 

Chairman Acharya said that Dolma Impact Fund has also progressed the necessary due diligence study before making the equity investment. 

Under the promotion of same group, the construction of 22 MW Setikhola Hydropower Project is currently in the final stage of construction.

The project had a power purchase agreement with the Nepal Electricity Authority on October 18, 2023 and Required Commercial Operation Date of the project is fixed for May 2029.

The Clean Energy Consultants Pvt. Ltd. is technical consultant for the project. The preparation of the project's Detailed Project Report (DPR), Detailed Engineering Design and Contract Document is in the final stage.

The project's Environmental Impact Assessment Report (EIA) has been submitted to the concerned body for approval, the company chairman said.

The electricity generated from the project will be connected to the Nepal Electricity Authority's Markichowk Sub-Station at 220/132 kV, a distance of 11.6 kilometres, through a 220 kV single circuit transmission line from the power house.