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Financial advisor sought for 1125 MW Dorjilung project in Bhutan

Druk Green Power Corporation (DGPC), Bhutan’s state-controlled hydropower plant operator and developer, invites expressions of interest by 23 January from eligible consulting firms or a consortium of firms to provide financial advisory services for the 1125 MW Dorjilung hydropower project.

Situated in the eastern Lhuentse and Mongar districts on the Kurichhu river, a tributary of the Drangmechhu that flows into India, the planned run-of-river project is anticipated to feature a 136.5 m-high gravity dam and a 15 km headrace tunnel, impounding a reservoir with approximately 44 x 106 m3. The project, including a transmission line of some 40 km to the Yangbari substation, has an estimated construction cost, excluding financial expenses, of US$ 1.4 billion as of 2022.

The World Bank is supporting Bhutan through an active US$ 4.3 million technical assistance grant “the Sustainable Hydropower Development Project”, which is executed by DGPC. The grant supports upgrading of technical feasibility (Detailed Project Report) and ESIA studies of the 1125 MW Dorjilung hydropower project and its associated transmission line to bring them up to World Bank bankability. The grant also supports capacity building and became effective in May 2022. As further support for Bhutan, in February 2023, the Government of Bhutan requested the World Bank to help convene the financing for the project. While the Government of Bhutan has stated that due to the strategic nature of the project a public financing is preferred, this should be balanced with the availability of public financing and strategic considerations relating to regional trade. DGPC with World Bank support is undertaking a preliminary assessment on financial structuring options, including identifying suitable project modalities, financial and risk-mitigation instruments, and financing options (the Preliminary Assessment). This work aims to optimize Bhutan’s fiscal benefits from the export of hydropower component while also maximizing domestic supply cost-effectiveness. The outcomes are expected to contribute as inputs to and integrate with the financial advisor’s work.

The model developed by Bhutan with the financial advisor for the project is expected to set a precedent for financing future hydropower endeavours in the country. By establishing such a precedent, Bhutan aims to establish a new standard for financing its remaining hydropower potential, fostering energy independence and sustainable economic growth.

The financial advisor’s primary objective is to develop a financial plan consistent with Bhutan’s strategic objectives and that can be implemented efficiently and cost-effectively to achieve financial closure. The financial plan is to be aimed at allowing Bhutan to maximize the country’s fiscal benefits from export of hydropower while also supplying cost-effective local electricity. To support a synergistic approach to project structuring and financing, the financial advisor will collaborate closely with the main stakeholders of the project, including DGPC, the Department of Energy, Ministry of Finance and other relevant arms of the Government of Bhutan. The detailed scope of work is mentioned in the ToR, refer Annexure – I [Terms of Reference-].

Interested bidders should have registration under applicable laws of the respective country, as well as at least ten years overall experience in the field of financial advisory services. The firm(s) should have successfully implemented at least one contract of public and public-private financing approaches for large hydropower with a value of more than US$ 1 billion within five years from January 2019 and have experience in advising public sector clients on financing major infrastructure projects in the South Asia Region. Experience in structuring, negotiating, and closing complex fully publicly financed and public-private partnerships of hydropower operations will be an added value.

The firm(s) will be selected in accordance with the Quality and Cost Based Selection (QCBS) method set out in the World Bank’s Procurement Regulations for IPF Borrowers” July 2016 Revised Nov.

Expressions of interest in English must be delivered in writing to the address below (in person, or by mail or by e-mail) by 3:00 PM (Bhutan Standard Time), on 23 January. For email submission, all documents shall be in PDF format.  For further information, contact: Sonam Wangdi, Director, Projects Department, Druk Green Power Corporation Limited, Post Box No. 1351, Motithang, Thimphu, Bhutan; Tel.: +975 2 330979; E-mail: