Myagdi Khola hydropower progress slow, company seeks extension of operation date

Physical progress on the 65 MW hydropower project being built by Hydro Village Limited on the Myagdi Khola has remained limited to about 16 percent.

Since the project's scheduled commercial operation date lapsed this past August, the company has requested an extension of that date. Of the roughly 8.1-kilometer tunnel, about 21 percent has been excavated over the past five months.

The run-of-river project was originally designed for 57.3 MW but its capacity was later increased. With the capacity increase, the estimated project cost has risen from about 10.74 billion rupees to nearly 12.97 billion rupees.

The company plans to raise about 75 percent of the total investment through loans and the remaining 25 percent from its own equity. Delays in building the Dandakhet substation and the Dandakhet-Rahughat 132 kV double-circuit transmission line pose a risk to power evacuation, though progress on the transmission infrastructure is ahead of the project itself, and it is expected to be ready before generation begins.

Meanwhile, credit rating agency ICRA Nepal has maintained the company's long-term loan rating at [L]BB- and its short-term loan rating at [A]4. The company's long-term loan limit stands at nearly 9.75 billion rupees. Mohan Bikram Karki and Bhogendra Kumar Guragain are among the company's main promoters.