Embassy of IndiaThimphu, Bhutan

Embassy of India

Thimphu

Press Release: Kholongchhu Hydroelectric Power Project in Trashiyangtse set to begin construction

Press release : 600 MW Kholongchhu Hydroelectric Power Project in Trashiyangtse set to begin construction.

Taking further the stellar Bhutan - India cooperation in Hydroelectric Power Generation, contracts for major construction works for the 600 MW Kholongchhu Hydroelectric Power Project were awarded yesterday by the Project Management. These works include construction of the Dam, Power House, Intake structures, Head Race Tunnel and the Water Diversion structures. The total value of the contracts awarded is Nu./Rs. 20.2763 billion.
One of the contractors for the project is a Bhutanese construction company, M/s Rigsar Construction Pvt Ltd. It has been awarded a major contract packages amounting to Nu./Rs. 4.346 billion in a joint venture with an Indian Company. The contract conditions further provide for offloading of minimum 20% of entire works (Nu./Rs. 4 billion) to local Bhutanese contractors, which will help in technology and skill development of local contractors in Bhutan.

The details of Contracts being awarded are as under:

Contract package KC-1 comprising of construction of Dam, Diversion tunnel, power intake, Desilting chambers and 2303 meter of Head Race Tunnel has been awarded to M/s Jai Parkash Asociates Ltd. for an amount of Nu./Rs. 9.72 billion.

Contract Package KC-2 comprising of Part Head Race Tunnel and Chaplangchhu Diversion works has been awarded to a 50:50 Joint venture of M/s Valecha Engineering and M/s Rigsar Construction Pvt Ltd, for an amount of Nu./Rs. 4.348 billion.

Contract package KC-3 comprising of construction of Power House, Surge shaft, Pressure shafts, BVH and part of Head Race Tunnel has been awarded to M/s Jai Parkash Asociates Ltd. for an amount of Nu./Rs. 6.210 billion.

The Kholongchhu HEP is the first joint venture project being implemented under the Intergovernmental Agreement on Development of Joint Venture Hydropower Projects, signed in April 2014. The concession agreement for the 600 MW Kholongchhu hydroelectric project in eastern Bhutan was signed between the Royal Government of Bhutan and the project developer, Kholongchhu Hydro Energy Limited (KHEL) in June 2020.

Kholongchhu Hydroelectric Power Project will be the seventh hydropower project to be built in Bhutan with financial support from the Government of India. The project is being financed under a debt equity ratio of 70:30, wherein the debt will be raised by the Joint Venture Company and the equity would be divided equally between Satluj Jal Vidyut Nigam ltd. (SJVN) and Druk Green Power Corporation (DGPC). Government of India is providing DGPC’s share of equity in the JV company as grant. The project is being built at a cost of Nu./Rs. 54.818 billion. The project is stated to be completed by March 2026