West seti project: House panel favours CTGI, seeks some changes in MoU
KATHMANDU, MAR 25 -
The parliament’s Natural Resources and Means Committee (NRMC) has indicated that it stands in favour of the development of West Seti hydroelectric project by China Three Gorges Corporation International (CTGI), calling for rectification of a few legal and procedural lapses in the memorandum of understanding (MoU) with the Chinese company.
However, the NRMC, which is currently probing the West Seti deal, has a list of conditions that it wants the government to honour. “We are for the development of the project as per the deal signed with the Chinese company by correcting shortcomings in the deal,” said Gagan Thapa, a member of the NRMC. He added that the committee wanted to extract maximum benefits for the country in the West Seti deal.
NRMC Chairperson Shanta Chaudhary echoed Thapa. “Terminating the MoU would cause more harm to the national economy. But we need to correct mistakes in the deal,” said Chaudhary.
The NRMC is now asking the government to hand over the responsibility of concluding the deal with CTGI to the Investment Board. As per the Investment Board Act, hydropower plant of 500 MW and above comes under the board’s purview. The board has been formed to provide one-window solution to potential investors in mega projects.
The NRMC has asked the Ministry of Energy (MoE) to come up with a detailed energy management plan on West Seti, while directing the Nepal Electricity Authority to prepare a timeline for the construction of 500-km transmission line.
The committee also wants the locals to be allotted more shares, raising the exiting 2-5 percent in the MoU between the government and the CTGI up to 15 percent.
The committee will also be keeping close eye on the power purchase agreement (PPA) with the CTGI. “We will raise the issue of risk sharing while signing the PPA in dollars,” said Thapa, referring to the PPAs of Khimti and Bhotekoshi, which were signed in dollars that resulted in the NEA bearing the exchange rate risk.
According to Thapa, there has been abuse of authority on the part of the MoE as the negotiation team formed to prepare financial and technical concept for West Seti directly signed the MoU with the Chinese company. “The ministry neither has consulted with the Investment Board, nor has it held talks with other two companies interested in the project,” said Thapa.
According to the NRMC, MoE’s clarification does not answer their queries. The committee had earlier asked the Energy Ministry to clarify for bypassing the board in going ahead with the CTGI.
In a letter sent to the parliamentary panel, the MoE had said negotiation with the Chinese company was moved forward after discussions with Prime Minister Baburam Bhattarai, as the board was not operational at that time. Now, the committee has summoned Finance Secretary Krishna Hari Baskota and Investment Board CEO Radesh Pant on Sunday to discuss the rationale behind signing the MoU with CTGI.
Source: Kantipur
