Kathmandu. The investment modality of the 1,063-megawatt Upper Arun Semi-Reservoir Hydropower Project has been prepared under the aegis of Nepal Electricity Authority (NEA).

The estimated cost of the project is $1.75 billion (approximately Rs 214 billion) including interest and value increment during the construction period. The project will be financed by 70 per cent loan and 30 per cent by equity.

The company has proposed to hold 51 per cent of the equity and 49 per cent ordinary shares. Rs 36.67 billion will be collected from promoter shareholders and Rs 35.23 billion from ordinary shareholders.

The proposed 51 percent promoter shareholders include the state government, local government, NEA, Nepal Telecom, Employees Provident Fund, Citizen Investment Trust, Social Security Fund, HIDCL, insurance companies and NEA’s subsidiary companies.

The 49 percent of the shareholders will include those who are employed abroad and non-resident Nepalis, employees of promoter shareholders, project affected projects and the general public. Upper Arun Hydro-electric Limited has already been established for the construction of the project.

Rs 168 billion will be invested in the project through consortium of banks and financial institutions.

After the World Bank’s investment was in confusion, the government is going to develop Upper Arun with the investment of the banks and financial institutions within the country and Nepalis living in the country and abroad.

An agreement has already been reached between NEA, project promoter company and banks and financial institutions for investment of around Rs 53 billion.

The project will generate 4.53 billion units of electricity annually. The pre-construction works of the project are currently underway. Construction is underway to access 21 kilometers from the project’s powerhouse to the dam site, which is geographically remote and complex.

The road is under construction from the proposed powerhouse at Chhongrang near Gola Bazaar of Bhotkhola Rural Municipality-4 to the dam construction site near Chepuwa village of the same rural municipality-2.

The Koshi Highway has reached up to Chongrang. The project is constructing a 70-metre-long steel arch bridge over the Arun River to reach the project site from the Koshi Highway.