Kathmandu. The investment modality has been prepared for the construction of the 454-megawatt Kimathanka Arun Semi-Reservoir Hydropower Project in Bhotkola Rural Municipality-2 of Sankhuwasabha district with domestic capital.

The project will be constructed at an estimated cost of Rs 97.94 billion including interest during the construction period. Of the total cost of the project, 70 per cent i.e. Rs 685.55 million would be borrowed and 30 per cent i.e. Rs 29.38 billion would be managed through equity.

The government has proposed to take loan from hydroelectricity investment and development company HIDCL, Employees Provident Fund, Citizen Investment Trust, Social Security Fund, insurance companies and banks and financial institutions.

The proceeds from the equity will be collected by issuance of shares to promoters of the company, Nepalis in foreign employment, local residents of project-affected districts, members of extremely poor families and general public.

Minister for Energy, Water Resources and Irrigation, Physical Infrastructure and Transport, and Urban Development Kulman Ghising took information about the proposed investment modality and directed to update the estimated cost of the project and immediately forward the financial management process accordingly.

Stating that the power generation company has license for power projects but has not been able to construct any project, Minister Ghising said that the Kimathanka project should be constructed by the company itself for the long-term income and sustainability of the company.

MD Ghising directed the company board of directors to immediately approve the proposed investment structure of the project and the corporate equity plan of the company accordingly.

A total of Rs 73.14 crore has been spent on the study and pre-construction of Kimathanka Arun. Land has already been acquired for the construction of the project office and staff camp. Compensation and compensation have been determined for acquiring land required for the construction of dams, reservoirs, power houses and other structures. It will cost around Rs 45 crore.

The project will generate 2.69 billion units of electricity annually. Out of this, peak and off-peak energy is 473.1 million and 353.3 million units respectively in winter and 1.86 billion units during the rainy season. The project will generate revenue of Rs 16.91 billion annually from the sale of electricity.

Promoter shareholders of the company have 30 percent stake in the company, Nepal Electricity Authority (NEA), Employees Provident Fund (EPF) and Nepal Telecom (10 percent), Citizen Investment Trust (5), HIDCL (4) and Rastriya Life Insurance Company (2 percent). 29 percent of the shares have been set aside for the general public.