China’s Sinohydro Corporation is expected to be awarded the estimated $165 million contract for the construction of 99.8 megawatts Tamakoshi V hydropower project, a wholly-owned subsidiary of the Nepal Electricity Authority (NEA), in Dolakha.

The developer of the 456 MW Upper Tamakoshi hydropower project, Sinohydro Corporation, appeared to be the lowest bidder to construct the civil and hydro-mechanical components of the project, according to a senior executive of Tamakoshi Jal Vidhyut Company, the project implementing agency.

The financial bids were opened on Tuesday. The amount proposed by the company, however, has not been disclosed.

Civil works include the excavation of a headrace tunnel, a surge tank, a vertical shaft, a short pressure tunnel, an underground powerhouse and a spillway.

Hydromechanical works will comprise the design, manufacturing, installation, and commissioning of gates, penstock, valves, and gantry cranes.

Binod Bhandari, chief of Tamakoshi Jal Vidhyut Company, said the contract for the four-year project would be signed within two months after fulfilling other formalities.

The project implementing agency said that the groundwork is likely to begin at the end of the current fiscal year, or in mid-July.

The bids were invited on July 25 last year.

The run-of-river hydroelectric plant is designed to be operated as a lower structure of a cascade. It does not need its own dam, because it takes its water directly from the tailrace tunnel of the 456MW Upper Tamakoshi hydroelectric project.

Two Chinese companies–Sinohydro Corporation and China Gezhouba Group Corporation–were shortlisted earlier this month for financial evaluation for the construction of the project.

The final selection of a contractor had, however, been delayed by a month after a complaint from one of the firms not shortlisted for the financial evaluation of the project.

Four companies presented the technical proposals.

The project will be constructed under the engineering, procurement and construction (EPC) model, according to Bhandari.

Under an EPC contract, a single contractor takes responsibility for all components like design, engineering, construction and procurement.

The contract binds the contractor to deliver the project by the stipulated time frame and at the predetermined price, regardless of any possible cost overruns.

The project implementing agency also said that bids for the electro-mechanical component would be invited in the second package.

The power produced from the project will be fed into the 220kV transmission line of the Upper Tamakoshi Project.

The underground powerhouse will be made at Suri Dobhan in Bigu Rural Municipality-3.

Currently, the project is building houses for employees of the project as well as the main offices.

Of the total investment, 30 percent will be through equity and 70 percent through a loan.

“The project has already signed a memorandum of understanding with the Employees Provident Fund for an investment of Rs13 billion,” said Bhandari.

“It will, however, take time for the final agreement.”

The Upper Tamakoshi project has proposed investing 10 percent in the project, while there will also be investment from the locals.