ISLAMABAD: Discussions with banks to arrange commercial financing equivalent to $1.4 billion to cover local cost component of the Dasu hydropower project is yielding good results as Wapda has issued mandate to a consortium of local banks to make financing arrangements, according to a World Bank update.

The International Development Association (IDA) of the World Bank group has asked four foreign banks to arrange financing. These banks were short-listed through an expression of interest (EoI) recently.

The evaluation of the proposals received was currently ongoing and once a bank or several banks have been mandated for arranging the financing, the schedules for the origination of the foreign currency-denominated commercial financing will be updated. Such revised schedules will then also take into account the timelines for the conclusion of the major work contracts’ procurement and contracting process.

The update on the Dasu hydropower project says contractors for four preparatory works contracts have been mobilised, while bids for relocation of Karakoram highway are ready for award and procurement process for Kandia Uttar Gharah road and Uttar Garah-Tangir road has started.

Procurement process for major contracts was also on track and bids for main hydraulic structure and associated works, and construction of power house and tunnels are expected this month while pre-qualification application for 765kv double circuit transmission line and electro-mechanical are due in June and July this year.

Progress showed that independent panel of experts and project supervision consultants are on board while land acquisition and assessment unit has been established under district collector of Kohistan and land and property compensation rates have been approved to start the land acquisition process.

A credit of $588.4 million approved by the International Development Association and an IDA partial credit guarantee in the amount of $460 million has already been approved by the World Bank for the Dasu hydropower project.

Wapda is expected to contribute about $600 million to the project.

The Dasu hydropower stage one project is 2160W run-of-river Greenfield project located about 240km upstream from Tarbela dam on main River Indus. It will supply 12,222GWh annually and is part of least cost solution to mitigate power shortfall and reduce cost of generation in the country.

The project comprises six generating units of 360MW each and 350km, 765kV double circuit transmission line from Dasu to Islamabad.

Published in Dawn, June 12th, 2016