LAHORE: The Dasu dam and its allied structures of the stage-I will be completed in five years and it will add 2,160MW to the system at peak flows in the summer of 2021, hope the project authorities.

In a meeting on Tuesday, they briefed the Water and Power Development Authority (Wapda) on the timeline of the stage-I of Dasu Hydropower Project. The project management said they were confident that with the release of tender documents on Feb 12, the timeline for the start of construction of the main civil works, would soon be finalised and actual construction of the main dam would start by July 2016.

It was noted in the meeting that the stage-I of the project was estimated to cost $4.3 billion. The World Bank conceived an innovative approach to finance the project. In this regard, the World Bank has provided a loan of $588 million and partial credit guarantee of $460 million. It has also indicated to provide another IDA/IBRD tranche of $533 million and a partial credit guarantee of $460 million in 2017. All this covers approximately 25 per cent of the total project cost of the stage-I. As indicated in the Project Appraisal Document, about $2 billion commercial loan is to be obtained from the local as well as foreign banks by utilising World Bank’s partial credit guarantee.

The participants noted the World Bank had issued the no objection letter (NOL) after Wapda met the precondition of awarding the mandate to a consortium of seven local banks, led by Habib Bank Limited, for providing a Rs144 billion loan to be disbursed in five years. Wapda received approval of the guarantee from the government on Feb 10, while it issued the mandate on Feb 11.

Wapda received the NOL from the World Bank on Feb 12 and it issued the tender documents to the pre-qualified bidders the same day. The pre-qualified bidders belong to Korea, Turkey, China, Italy and Vietnam which are to submit their bids within 90 days of issuance of the tender documents. The total cost of the main civil works of stage-I is estimated to be $2.5 billion according to the Project Appraisal Document. Once the contract for main civil work is awarded, Wapda will initiate the pre-qualification process of electro-mechanical works.

Earlier, the participants were briefed that following five contracts of preliminary works, which were awarded earlier, the contractors have started the work at sites: the relocation of Karakoram Highway worth Rs14.538 billion; the construction of Right Bank Access Road worth Rs2.713 billion; the construction of 132 kilovolt (KV) transmission line from Duber Khwar Hydel Power Station to Dasu worth Rs1.583 billion; the construction of a project colony and allied infrastructure worth Rs4.8 billion; and the construction of resettlement sites and Shatial Museum worth Rs571.95 million.

Published in Dawn, February 17th, 2016