PESHAWAR, Nov 20: The NWFP government and a Chinese construction firm on Wednesday signed an agreement to build an 81-megawatt hydropower generation project that officials said would save one billion rupees per annum.

“This is a major achievement,” NWFP Governor Syed Iftikhar Hussain said soon after the signing ceremony at the Governor’s House. The agreement was signed by director general, Sarhad Hydel Development Organization (SHYDO), Muhammad Yunis Marwat, and a representative of the China International & Electric Corporation and Associated Technologies Ltd. Cabinet ministers and senior government officials were also present at the ceremony.

The construction of Malakand-III Hydropower Project would cost Rs6.379 billion, including Rs2.264 billion to be spent on civil work. The project would be completed in three years.

“We have sufficient funds. I don’t think we need any loan,” Mr Iftikhar told newsmen.

The project would generate 553 giga watt per hour (GWh) annually and also facilitate the irrigation of barren land of about 20,000 acres in Bazai area.

The NWFP governor said that this was the first medium level power generation project undertaken by the province. He said the electricity generated from the project would be utilized in power industrial estates to be established close to the area to boost industrialization and generate job opportunities.

He said the government knowing the shortage of water reservoirs in NWFP had embarked upon a plan to build small dams for which Rs1.5 billion had already been allocated.

He said the government also intended to utilize at least 50 per cent of the Rs6 billion Barani Area Development Project for the construction of small dams and water reservoirs to cope with water shortages and generate cheap electricity.

The SHYDO managing director said the electricity generated from the project could either be sold to Wapda or provided to industrial estates on concessional rates or could be transmitted to other areas by using Wapda’s transmission line. “We don’t see any problems there,” he said.

He said that electricity would be enough for power industrial estates in Gadoon and Hattar. “We will see a big boost in industrialization. Cheap electricity would be an incentive for investors to invest their money in NWFP,” he remarked.