More bidders expected for BPC privatization

January 12, 2001
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Kathmandu, Jan. 12: In its bid to transfer the public sector enterprises into private hands, the government is mulling to privatise the country’s first and foremost Power Company which “is playing a very significant role for the development of hydro power in the country.”

So far six power companies – Independent Power Company of Britain, Intercraft of Norway, Pacific Hydro Company of Australia, Sanima of Russia and two power companies from India and China – have responded to a tender bid for the privatisation of the Butwal Power Company (BPC) which is celebrating its 35th anniversary today.

According to general manager of the BPC Kiran Malla, the last date of the tender bid that ends on January 31 may be recalled since other companies are expected to join the bid.

However, Malla put forward the clarifications regarding the tax payment controversy that is attributed to the lack of response from the bidders.

“The reason why there are few companies responding to the bid is its controversy over tax payment regarding the Aandhikhola project,” Malla said.

“In the Electricity Act of the government there is the provision of ‘tax holiday’ but so far the mechanism is not clarified and we have fallen in controversy,” Malla told The Rising Nepal today.

“But the problem of tax will be over very soon and the privatisation process of the BPC will smoothly go ahead,” he said.

The BPC, country’s leading hydropower developer, owns and operates the 12 MW Jhimruk Hydropower Plant and the 5.1 MW Andhi Khola Hydropower Plant.

The Company has been supplying electricity to about 20,000 rural people in western districts of Palpa, Arghakhanchi, Pyuthan and Syangja under its rural electrification programme.

The Company has invested 140 US$ (15 per cent of the total share) to 60 MW Khimti Hydropower Project, owns 48 per cent shares in Nepal Hydro and Electric (P) Ltd., 20 per cent shares in Hydrolab.

The Company has been undertaking multi-disciplinary projects in hydropower and rural electrification, tunnelling, irrigation, environmental and socio-economic studies and project management.

Inaugurating today the 35th anniversary of the BPC, a joint undertaking of the government, Nepal Electricity Authority, Nepal Industrial Development Corporation and the United Mission to Nepal, Minister of State for Water Resources Ram Bahadur Gurung remarked that the BPC was mature enough to be privatised.

“Since it is one of very few profit making public enterprises, the BPC could contribute a lot even after it becomes independent and free,” Gurung said.

President of the BPC Bishwo Nath Sapkota said even if it is privatised, the Company should always be guided by the principal of the progress of the country through the development of hydroelectricity.

During the function, Minister for State Gurung felicitated senior internal auditor of the BPC Bishnu Prasad Shrestha recognising his contribution for the promotion of the Company.