Upper Tamakoshi Hydropower Limited (UTHL) has made an initial public offering (IPO) for locals affected by the Upper Tamakoshi Hydropower Project in Dolakha district. UTHL, a subsidiary of the Nepal Electricity Authority (NEA), is the developer of the 456 MW plant.

The company on Tuesday issued a public notice inviting the residents to apply for 10.59 million ordinary shares worth Rs1.05 billion. This is 10 percent of the total shares that the company has set aside for project affected locals.

According to the notice issued by UTHL, Dolakha locals can apply for the shares of the hydropower project from July 8-25. They have to apply for a minimum of 30 shares each while the maximum has been fixed at 300 shares. The residents have been categorized into three classes: severely affected, moderately affected and less affected. The highest number of shares have been set aside for the severely affected, and the moderately affected and less affected will get progressively fewer shares.

The three categories of affected locals will get shares in the ratio of 3:1.4:1, according to the notice issued by the company. This means if the severely affected are awarded 300 shares, the moderately affected and less affected will get 140 and 100 shares respectively.

After the shares have been distributed to project affected locals, the company will make an IPO for the general public. UTHL has set aside 15.88 million ordinary shares worth Rs1.58 billion for the general public which is equivalent to 15 percent of the total shares of the company. The general public can apply for a minimum of 50 shares each while the maximum has been fixed at 1,000 shares.

UTHL decided to IPO with 95 percent of the construction work on the project completed. However, the plant is likely to miss its completion deadline as the Indian contractor assigned to execute the hydro-mechanical works has been working very slowly. At least one of the plant’s six turbines should be churning out power by December 2018 as per the deadline set by the government. The entire project needs to come online by April 2019. But that does not look like happening.

The company said it would be difficult to complete the project within the deadline due to dillydallying by the Indian contractor Texmaco Limited. As part of the hydro-mechanical works, the Indian company needs to build gates at the intake of the dam and fit the penstock pipe in the tunnel.

Although the contractor is currently constructing the gates at the intake, it is yet to start installing the penstock pipes. The penstock pipes deliver water from the dam into the turbines in the powerhouse to generate electricity. Irked with the delay by the Indian contractor, the project office is persuading it to subcontract some of its tasks to different contractors to complete the construction on time.