Himal Press 
KATHMANDU: In a landmark boost for infrastructure development in Karnali Province, banks and financial institutions committed nearly Rs 100 billion in debt financing for two major hydropower projects located on the Tila River in Kalikot on Tuesday.
The financial closure agreements for both the 440 MW Tila-1 and 420 MW Tila-2 projects were finalized on the same day, marking one of the largest single-day private sector energy financing milestones in the country.
Urja Tila Power Company signed a consortium financing agreement for the Tila-2 hydropower project, which is estimated to cost Rs 70.07 billion, on Tuesday. Everest Bank leads the consortium providing Rs 52.55 billion in loan financing to the company, while promoters are contributing Rs 17.52 billion in equity.
Prime Commercial, NIC Asia and Global IME serve as the co-lead banks in the consortium, which also includes commercial banks like Siddhartha, Nabil and Agricultural Development Bank, development banks like Muktinath Bikas Bank and Kamana Sewa Bikas Bank, and Nepal Infrastructure Bank.
The Tila-2 is a peaking run-of-river project utilizing a catchment area of 2,649.73 square kilometers and a gross head of 596 meters. The headworks sit in Tilagufa Municipality, while the powerhouse will be located downstream in Khandachakra Municipality.
A year-round blacktop road access, a 33 kV construction power line, and a planned grid connection point at the Phukot Hub, just 15 kilometers away, are the project’s salient features.
The company has signed a power purchase agreement (PPA) with the Nepal Electricity Authority (NEA) for 296.74 MW.
Tila-1 also achieved its financial closure on Tuesday. Promoter SC Power closed financing for the 440 MW peaking run-of-the-river project with a consortium led by NMB Bank.
It is currently the largest private sector–led project in Nepal to reach this stage. The consortium is providing Rs 44 billion to the company in loan financing, while promoters are putting in Rs 16 billion as equity investment.
Global IME, Himalayan and Prabhu Bank are co-leaders of the consortium, while Class ‘A’ banks like Rastriya Banijya Bank, NIC Asia and Agricultural Development Bank, development banks like Muktinath, Garima and Shine Resunga, and Nepal Infrastructure Bank are also in the consortium.
Tila-1 has signed a Power Purchase Agreement (PPA) with the Nepal Electricity Authority (NEA) and plans to export the remaining 142 MW to India by acquiring a power trading license for cross-border energy sales.
