Shimla :In a major step towards building the 600 MW Kholongchu hydro electric project in Bhutan by Shimla based power PSU SJVN Ltd a shareholders agreement was signed in Bhutan, officials said here Wednesday.
It was signed by R.P. Singh, CMD, SJVN and Dasho Chhewang Rinzin, Managing Director of Druk Green Power Corporation.
This is the first hydro electric project being developed by a Joint venture company of two PSUs of both the countries, to be implemented in Bhutan, under build, own, operate and transfer (BOOT) model.
In April this year the two parties have already signed an inter government to execute the project.
R P Singh said this is a run of the river scheme located on Kholongchu river in Bhutan.
On completion it will generate 2568 million units of energy. The project is estimated to cost Rs 3868.87 crore which will be shared in the ratio of 50:50 by the two joint venture partners, Singh.
It will provide 12 per cent of the saleable energy to Bhutan free of cost as royalty energy during the first 12 years of commercial operations.18 per cent energy thereafter for the remaining concession period.
The project will be financed under a debt equity ratio of 70:30. For the 70 per cent saleable energy generated, long term power purchase agreements will be entered into with the beneficiaries and the balance power shall be sold through market mechanism.