REC, PFC sign pact to finance hydropower project in Bhutan

State-owned entities REC Ltd and Power Finance Corporation (PFC) have entered into a pact with Bhutan-based Kholongchhu Hydro Energy Ltd (KHEL) to finance a 600-megawatt hydroelectric project at Trashiyangtse in the neighbouring country. KHEL is a 50:50 joint venture between SJVN India and Druk Green Power Corporation (Bhutan) set up for developing the 600-MW Kholongchhu hydroelectric project in the eastern Bhutan, REC Ltd said in a statement on Wednesday. REC Ltd along with PFC has signed memorandum of understanding (MoU) on March 9, 2021, with Kholongchhu Hydro Energy Ltd for financing of 600-MW hydroelectric project at Trashiyangtse, Bhutan, the REC statement said.

"The project is proposed to be funded in a debt-equity ratio of 70:30 and as per the MoU, REC would extend rupee term loan of Rs 2,029 crore. The balance debt shall be extended by PFC (Rs 2,029 crore), NPPF, Bhutan (Rs 200 crore) and Bank of Bhutan (Rs 200 crore)," it said.

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