Tanahu Hydropower – the developer of 140-MW Tanahu Hydropower Project located in central Nepal – has terminated the contract signed with Cooperativa Muratori e Cementisti di Ravenna (CMC) that was appointed to execute one of the important components of the power plant.
The storage type project – the wholly owned subsidiary of Nepal Electricity Authority (NEA) – today dispatched the termination letter to the Italian contractor – though it will delay the project – after it failed to mobilise the work force despite repeated directions from the employer.
The NEA in October had selected two contractors – one CMC and another Chinese – for the $550 million hydropower plant. The project appointed CMC and asked it to start work by February 11. But CMC asked for advance payment before it starts the work. According to the managing director of the project Pradeep Kumar Thike, the project couldn’t release the advance payment because the Italian contractor didn’t submit the full bank guarantee to qualify for such payment. "Therefore, we had no other option but to send the contract termination letter to the CMC,” Thike, said, adding that the project will initiate a new process to appoint another contractor. "But it will delay the project by at least six months."
Though, the Chinese contractor – Sinohydro Corporation hired to execute hydromechanical and electromechanical works under the second package of the project – has started work at the site, the construction of the entire project will be affected as the tasks of the two contractors are interrelated.
Earlier, Melamchi Water Supply Development Board has also terminated the contract with the Italian contractor after it failed to come back after the warning notice.
The reservoir-type project – with an estimated annual energy generation capacity of 587.7 gigawatt hours in the first 10 years of operation – can generate energy for six hours daily during the dry season. The project is being developed with credit facility extended jointly by the Asian Development Bank (ADB), Japan International Cooperation Agency (JICA) and European Investment Bank (EIB).
The storage type project – the wholly owned subsidiary of Nepal Electricity Authority (NEA) – today dispatched the termination letter to the Italian contractor – though it will delay the project – after it failed to mobilise the work force despite repeated directions from the employer.
The NEA in October had selected two contractors – one CMC and another Chinese – for the $550 million hydropower plant. The project appointed CMC and asked it to start work by February 11. But CMC asked for advance payment before it starts the work. According to the managing director of the project Pradeep Kumar Thike, the project couldn’t release the advance payment because the Italian contractor didn’t submit the full bank guarantee to qualify for such payment. "Therefore, we had no other option but to send the contract termination letter to the CMC,” Thike, said, adding that the project will initiate a new process to appoint another contractor. "But it will delay the project by at least six months."
Though, the Chinese contractor – Sinohydro Corporation hired to execute hydromechanical and electromechanical works under the second package of the project – has started work at the site, the construction of the entire project will be affected as the tasks of the two contractors are interrelated.
Earlier, Melamchi Water Supply Development Board has also terminated the contract with the Italian contractor after it failed to come back after the warning notice.
The reservoir-type project – with an estimated annual energy generation capacity of 587.7 gigawatt hours in the first 10 years of operation – can generate energy for six hours daily during the dry season. The project is being developed with credit facility extended jointly by the Asian Development Bank (ADB), Japan International Cooperation Agency (JICA) and European Investment Bank (EIB).
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