GMR, IFC pact for hydropower project

GMR Energy Limited, a subsidiary of GMR Infrastructure Limited, the Bangalore-based infrastructure major, today signed a Joint Development Agreement (JDA) with the International Finance Corporation (IFC), the private sector lending arm of the World Bank, to jointly develop the Upper Marsyangdi-2 hydropower project (600 Mw) in Nepal.

According to a company statement, the 600 Mw Upper Marsyangdi-2 Project is in advanced stages of development. The total investment in the project is estimated at $1 billion (about Rs 6,200 crore) and is targeted for commissioning by FY 2021.

IFC would be the lead fund arranger for the project and it is likely to take equity stake in it. “GMR in is in talks with IFC for a possible stake in the project. However, there is no decision on it as yet,” a GMR official said.

The financial closure for the project will be achieved over the next one year’s time, he added.

The project is located on the Marsyangdi River, in the Manang and Lamjung districts of Nepal. Himtal Hydro Power Company Private Limited, a subsidiary of GMR Energy Ltd is currently undertaking the project.

The Government of Nepal has identified the proposed Upper Marsyangdi-2 as one of the National Priority Projects and the Investment Board of Nepal (IBN) is facilitating it. The project has completed all survey and investigation works, finalised the feasibility studies and has already received a majority of clearances from the Government of Nepal.

The Project Development Agreement is likely to be signed early next year, the company said.