Neelum-Jhelum hydropower project suffers damage worth Rs22.5bn after tunnel collapse

The 969 MW Neelum-Jhelum hydropower project, which is non-operational since July 6, in the wake of blockage that appeared in the 3.5km Tail Race Tunnel (TRT), has seen an estimated damage of Rs22.50 billion (Rs2.50 billion construction cost and Rs20 billion as business loss).

“The project will now come on stream by the end of February 2023. Till February 2023, the project would brave a business loss of Rs20 billion,” a senior official of the Neelum-Jhelum Hydropower Company Limited (NJHPCL) told The News.

When asked as to who will bear the loss, either the government or NICL (National Insurance Company Limited), the official said that both the heads, TRT, and business loss, are covered under the insurance agreement, so Wapda will not bear the loss.

“NICL has a 7% share and a group of Chinese companies 93% in the insurance amount. And they will share the cost to be incurred on making the project operational.”

The official said since the CoD of the project ie April 2018, the insurance company is getting Rs1 billion from NJHPCL and so far, Rs4 billion have been received by the insurance company. Now they will pay the damage cost of Rs2.5 billion and a business loss of Rs20 billion.

The person said the Neelum-Jhelum hydropower project generates business of Rs48-50 billion.

“In three months of the summer season, four units (turbines) of the project become operational, in six months, three units and in three months of winter only one unit runs depending on flows of water.”

The official said that authorities have decided to purchase the maintenance vehicle for the inspection of the tunnel and complete the construction of the tunnel as soon as possible.

The initial report about the tunnel debacle suggests that on July 4, when the plant was running at its full capacity (969MW), an abnormal increase in water leakage was observed in the powerhouse, which was controlled through continuous drainage pumps.

Upon investigation, high water pressure in the TRT was observed. Accordingly, on July 5, it was concluded by the project consultants that an abnormal increase in TRT pressure and water leakages/seepage in the powerhouse are due to blockage in TRT.

Considering the safety of the power structure and all other equipment/machinery, units were shut down gradually. As a result, the powerhouse was shut down on July 6.

Immediately after this incident, China Gezhouba Group Company (CGGC), the contractor for the construction of civil works, was engaged in carrying out remedial works.

The firm immediately reached the site and a contract agreement was signed with it on August 5, and the work commenced on August 27.

The Neelum-Jhelum hydropower project was executed at the cost of Rs430 billion and it started functioning in April 2018 under the deep mountains in the AJK where the geology is neither predictable nor readable.

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