Groundbreaking ceremony held as InfraCo Asia's first Nepal hydropower project enters construction phase

/Kabeli A GB Mar 2017/Kabeli_VIP_imageInfraCo Asia Development Pte. Ltd., part of the Private Infrastructure Development Group, and its Nepalese project partner, Butwal Power Company (BPC) staged a groundbreaking ceremony in remote eastern Nepal on Thursday 23 March 2017 to mark the start of construction on the Kabeli A Hydropower Project.

The 37.6MW run-of-river project is InfraCo Asia’s first hydropower development in the country.

L-R: Equicap Asia MD, Mr Vivek Gupta, InfraCo Asia Director, Mr Tantra Narayan Thakur, Kabeli Energy Ltd Chair, Mr Pradeep Kumar Shrestha, InfraCo Asia CEO, Mr Allard Nooy, World Bank Nepal (Acting) Country Head, Mr Franck Bessette, DfID Nepal Senior Economic Advisor, Mr Strahan Spencer, Kabeli Energy Ltd CEO, Mr Sher Singh Bhat

Over 300 people gathered for the symbolic occasion. Representatives of the government of Nepal attended, as well as representatives of the government of the United Kingdom, which provides funding support through InfraCo Asia with the governments of Australia and Switzerland.

/Kabeli A GB Mar 2017/Strahan_Spencer_with_Chinese_contractorsMr Strahan Spencer, Senior Economic Advisor with the UK's Department for International Development in Nepal  and Mr Franck Bessette (Acting) Country Head for the World Bank in Nepal spoke at the groundbreaking event and met with developers and contracted personnel.

InfraCo Asia is contributing US$8m towards the Kabeli A project development costs as a Joint Venture Partner. The total project cost of US$99.5m will be funded through both domestic and foreign debt and equity, including support from the World Bank, the International Finance Corporation (including the Canadian Climate Change Program), Nepal’s Hydroelectricity Investment and Development Company Ltd. (HIDCL) and NIC Asia Bank, as well as funding from InfraCo Asia’s sister facility, InfraCo Asia Investments, and further investment by BPC. In 2012 the project utilised a grant amount of US$87,000 provided by the Technical Assistance Facility (TAF), also part of PIDG.

/Kabeli A GB Mar 2017/Kabeli_RiverThe Kabeli A Hydropower Project will generate 205GWh of electricity per year, and will benefit around 1.6 million people through better access to a more reliable, affordable power supply. Nepal currently imports around 400MW of power from India, as peak demand of more than 1300MW is met with just under 850MW of installed capacity, resulting in frequent blackouts, which impact productivity. The project will also create an estimated 60 long-term jobs.

Community members from the Taplejung and Panchthar districts surrounding the Kabeli A project site came by bus and on foot to attend the groundbreaking ceremony by the Kabeli River, eager to witness the formal marking of project implementation.

/Kabeli A GB Mar 2017/Teacher_at_Kabeli“I am very excited to be here for the groundbreaking ceremony, because I know the project is going to help our communities grow. There will be more jobs, and more reliable electricity,” Tirthakumari Waiba, a teacher from Panchthar District, told InfraCo Asia as part of a series of interviews filmed to capture local insights on the day of the groundbreaking.

Throughout the event, religious ceremonies and blessings took place alongside the Kabeli River.

Guests of honour, including InfraCo Asia CEO, Mr Allard Nooy, walked a short distance along the river bank to a small, raised hill where shovels awaited to turn the soil and formalise the construction phase of Kabeli A’s development through a symbolic groundbreaking and the laying of a foundation stone.

/Kabeli A GB Mar 2017/Allard_Nooy_groundbreakingIn his speech during the event, Mr Nooy noted the importance of working in Nepal alongside a respected local partner.

“The co-operation behind this project comes down to the individuals’ shared passion and commitment, as well as their complementary capabilities. We look forward to continuing to work closely together as the Kabeli A project materialises into the vision we all share,” Mr Nooy said.

“I would like to thank both the Central Government Authorities and the communities here in the Taplejung and Panchthar Districts for their  crucial support of this project.”

The project company, Kabeli Energy Limited (KEL), is majority owned by the joint venture company formed by InfraCo Asia and BPC in 2012 to jointly develop identified hydropower projects. Mr Pradeep Kumar Shrestha, of the Panchakanya Group of industries in Nepal chairs KEL and represents the Butwal Power Company. Mr Sher Singh Bhat was recently appointed as the project company’s Chief Executive Officer. Equicap Asia Management Pvt Ltd, as InfraCo Asia’s contracted developer, is managing all project development activities, in close cooperation with BPC.

/Kabeli A GB Mar 2017/Kabeli_A_crowd“We are proud to be able to lead the project to this stage and enable Nepal to unlock its vast hydropower potential and create better access for its population to reliable, affordable, clean energy.” Equicap Asia Managing Director, Mr Vivek Gupta, said.

Zhejiang Hydropower Construction and Installation Company (ZHCIC) from China has been awarded the Civil and Hydro-Mechanical works for the project. Under a limited notice to proceed, the ZHCIC team has been mobilised for initial civil construction activities, including construction of access roads and camps. Chongqing Water and Turbine Works from China will be implementing the Electro-Mechanical works for the project.