China and Australia will invest in West Seti Hydropower project, the biggest hydro-electric project of Nepal with the capacity of 750 mega watt, an official from the Chinese Embassy to Nepal confirmed Kathmandu Saturday.

"The construction of the project, worth of 1.2 billion US dollars, is likely to begin in the coming dry season (mid- September this year)," Ma Dongsheng, second secretary of the embassy's economic and commercial counselor's office, told Xinhua.

The Nepali government had granted approval to the Snowy Mountain Engineering Corporation (SMEC) of Australia to develop the project in 1994, which has been working for that project for the past one decade and has been renewing its license annually.

China National Machinery and Equipment Import Export Corporation and the SMEC will invest 70 percent and 30 percent respectively for the project, Ma revealed.

The ministry is waiting for a formal letter from SMEC and the Chinese side has agreed on the Engineering Procurement Contact, he noted.

Chinese and Australian investors have signed agreement between themselves recently, and they have to get the production license from the Nepali government to start the project.

The project is supposed to be completed within five and half years and is expected to yield the benefit of 29 million US dollars in the first year of operation.

The entire power generated will be sold to India at 4.95 US cents per unit, which is cheaper than other hydro-electricity project of Nepal and the power purchase agreement has already been signed with Power Trade Corporation of India about one year ago, he added.

Source: Xinhua