Nepal decided to scrap the licence of West Seti Hydropower Limited to construct a 750-MW power project.
The government made the decision during a cabinet meeting, noting that for the last 16 years it was unable to rope in investors and the agreement of the company was amended 10 times. The company had been seeking grace time since long, saying it wanted to close all its finances.
The Asian Development Bank and China EXIM Bank that had earlier expressed their interest to invest in the project later said they would not.
According to the Nepalese government, the reasons the company gave for its failure to close its finances was not convincing.
The estimated cost of the project is $1.2 to 1.7 billion and most of the preliminary works such as Environmental Impact Assessment and Detail Engineering Report have already been prepared.
The Australian promoter of the project, Snowy Mountain Energy Corporation, had stopped funding the project's liaison office in Kathmandu and field offices in Doti and Dadheldhura last year.
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