KATHMANDU: A financial agreement has been finalized for the construction of the 61.11 MW Nar Khola Hydropower Project in Manang, with Singati Hydro as the principal investor.

The deal was formally signed on Monday by Batu Lamichhane, Chair of Nar Khola Hydro Energy Pvt. Ltd., and Arpan Pokhrel, Chief Regional Credit Officer of Kumari Bank.

The project will utilize the waters of the Nar Khola and Soti Khola rivers in Narpa Bhumi and Naso Rural Municipalities.

The promoter company, Nar Khola Hydro Energy Pvt. Ltd., has completed all necessary procedures, including a Power Purchase Agreement (PPA) with Nepal Electricity Authority.

The financing is led by Kumari Bank and co-led by Nepal SBI Bank, with Agriculture Development Bank, NIC Asia Bank, and Muktinath Development Bank participating as member banks.

The Nar Khola project features a gross head of 588.82 meters, an 8-kilometer headrace tunnel, and is expected to generate 366.48 GWh of electricity annually.

Water from the dam and headworks in Narpa Bhumi will be transported via a penstock pipe through a tunnel to the powerhouse in Naso, where electricity will be produced and transmitted to the under-construction Dharapani substation in Manang.

The total project cost is estimated at Rs 12.84 billion, including Rs 9.63 billion in bank loans and Rs 3.21 billion in equity, with Singati Hydro Energy Ltd. serving as the main equity investor.