Nepal scraps $2.5b hydropower facility deal with Gezhouba
Nepal has scrapped a $2.5 billion deal with China Gezhouba Group Corp to build the country’s biggest hydropower plant, citing lapses in the award process, the energy minister said.
“The cabinet has canceled the irregular... agreement with Gezhouba Group to build the Budhi Gandaki hydroelectric project,” Energy Minister Kamal Thapa, who is also the country’s deputy prime minister, said on Monday in a twitter post in Nepali after a cabinet meeting. He did not give further details.
Nepal’s rivers have vast, untapped potential for hydropower generation, but a lack of funds and technology has made Nepal lean on neighbor India to meet annual demand of 1,400 megawatts.
Nepal awarded a contract to develop the $2.5 billion Budhigandaki Hydroelectric Project to Gezhouba, the Xinhua News Agency reported in May.
Gezhouba did not immediately respond to a faxed request for comment and did not answer telephone calls.
China has been investing in hydroelectric projects in Nepal in recent years. In 2016, Upper Madi Hydropower Project, a China-Nepal joint venture company, started generating power, said the Xinhua report.
China and India are jostling for influence with aid and investment in infrastructure projects in Nepal.
Kathmandu has cleared a 750 MW project to be built on the West Seti River by China’s Stateowned Three Gorges International Corp.
It has also permitted two Indian companies to build one hydropower plant each, both capable of generating 900 MW of power each.