Tanahu Hydropower Project has started fresh preparations to call another tender after it terminated the contract with the Italian company — Cooperativa Munratori e Cementisti.

“As the Italian company didn’t return to work within the 28-day deadline given to it, we had to scrap the contract to pick another contractor in its stead,” said the Tanahu Hydropower Project’s Deputy Manager Bidur Adhikari, adding, “Work will start once the new contractor is selected after tender.”

Further, Adhikari also said they were mulling over foreclosing on the security deposit of the company. “As the company’s work did not seem effective, we’re thinking of foreclosing on the Rs 1.97 billion kept as security deposit,” he said.

There had been a contract agreement with Italian company—Cooperativa Munratori e Cementisti for 20.64 billion rupees to construct temporary and main dams and access road to the project site.

Though the contract was drawn up, the project had not released any amount in advance to the contractor.

The hydropower company, on the other hand, has signed a contract with the Chinese company, Sino Hydro Corporation to carry out the second phase of work of the 140MW-power plant.

The company is expected to construct the tunnel, power house and supply installation and operate the hydromechanical and electromechanical equipment.

The contract with the Chinese company was for 17 billion rupees.

As for the construction of transmission line from the powerhouse to Bharatpur, KEC International Limited of India had been chosen.

Meanwhile, the compulsion to select a new contractor for the first phase of work is likely to affect the timeline of the project expected to be completed by 2024.

The total cost of the project is estimated somewhere at 50.5 billion rupees.