AUSTRALIA’S SNOWY MOUNTAINS Engineering Corporation (SMEC) has signed a project agreement with the Nepalese government for the development of the 750MW West Seti hydro project on the West Seti river in western Nepal. The agreement was signed after recent approval of the environmental impact assessment report. Under the agreement, SMEC has the right to control the whole water basin of the Seti river and sell power to India.

SMEC has been working on West Seti since 1996 and anticipates construction of the project to begin in 2004, with power generation in 2008. It is estimated that an average of 3.1B units of electricity will be generated annually. Nepal will receive 10% of the electricity generated for free, or the equivalent amount of gross revenue, and royalties on gross power generation from the Australian company.

The project will involve the relocation of 1530 households from the area to be submerged by the dam.

  West Seti is the largest hydro development undertaken by Nepal. Medium size projects such as Khimti (60MW), Indrawati (5MW), Upper Bhotekoshi (36MW) have already been taken up by the private sector.