The China Overseas Engineering Group (COVEC) has been awarded the construction contract for the headrace tunnel which will be 12 km long and 4.2 metres in diameter.

COVEC won the contract by being the lowest bidder. “Out of the six bids received, COVEC quoted a price of Rs 9 billion which is 14.8 percent less than the second lowest bid,” said Shiva Kumar Basnet, director of the project.

The government has allocated Rs 2 billion in this fiscal year’s budget for the project which is scheduled to be completed in four years.

The government plans to implement the project in two stages—diversion and irrigation components. The diversion component consists of the headwork, headrace tunnel and powerhouse while the irrigation component is being implemented through a separate project, namely the Babai Irrigation Project. As the project will be using a tunnel boring machine, Basnet claimed that the project would be completed on schedule. The tunnel boring machine will be a first for Nepal, the project said. It can dig 15-60 metres of tunnel daily.

The total cost of the project is around Rs 16 billion. The project has a capacity to irrigate 60,000 hectares of land round the year in Banke and Bardia districts and generate 48 MW of electricity.

During the dry season, the Bheri River flows at a speed of 79 cubic metres per second. The government has targeted providing irrigation facilities to the people of Banke and Bardia by diverting water from the Bheri to the Babai.

The tunnel boring machine system requires a power supply of 4 MW, and the project has planned to set up a diesel plant at its site.

The project is being developed with the government’s own resources. It is projected to generate Rs 4.50 billion in revenues annually—Rs 2 billion from electricity and Rs 2.50 billion from agriculture.

The Bheri Babai Diversion Multipurpose Project is one of the country’s ambitious projects. It is expected to ease the food crisis in the Mid-Western Region by increasing the production capacity.

The government had invited bids for the project in July 2012, but lack of resources and delays in appointing a contractor prevented the project from moving ahead.