Laxmi Bank concludes financial closure agreement to fund 4.95 MW Upper Piluwa Khola -3 Hydropower Project; leads consortium of 2 banks to extend credit of Rs 65.59 crore
A consortium of two commercial banks led by Laxmi Bank has signed a Facilities Agreement with Mabilung Energy Ltd. on February 22, 2021, to finance a 4.95 MW run of the river Upper Piluwa Khola -3 Hydropower Project being constructed at Piluwa River and Sikhuwa River of Sankhuwasabha District. The project is being built at the cost of around NPR 937 million.
Mabilung Energy signed the Power Purchase Agreement with Nepal Electricity Authority on March 26, 2019, and the project received Generation License from the Ministry of Energy on July 24, 2020. The company is promoted by Asian Life Insurance Co. Ltd., Guheswori Merchant Banking & Finance Ltd. along with individual promoters where Mr. Rajesh Lal Shrestha is the Chairperson.
The banks have committed to financing 70% of the project cost (NPR 655.90 million) with the remaining 30% invested through equity. The project finance (term loan) commitments from the banks are:
- Laxmi Bank NPR 399.90 million
- Machhapuchchhre Bank NPR 256 million
Mabilung Energy (with a capacity of 4.95 MW) expects to contribute around 28.417 GWh of power annually to the nation and it is expected to come into operation in February 2022.
According to NEA’s review report for FY 2019/20, a total of 15 new projects developed by the Independent Power Producers (IPPs) with a combined installed capacity of 135.39 MW were commissioned in the FY 2019/20. This has increased the total number of IPP-owned projects in operation to 98 with a combined installed capacity of 696.17 MW.
