The OPEC Fund for International Development is providing a US$72 million loan in support of a major hydropower project in Pakistan.
The Mohmand Multipurpose Dam Project will add 800 megawatts to Pakistan’s installed hydropower capacity, and generate nearly 2.8 gigawatt-hours of electricity per year. The reservoir will have a storage capacity of 1,594 million cubic metres, and provide potable water to Peshawar, the capital of the Pakistani province of Khyber Pakhtunkhwa and its biggest city.
The project aligns with the national priorities of Pakistan Vision 2025, the country‘s development strategy. Total project cost is US$2.2 billion, and will be co-financed with the Islamic Development Bank, the Kuwait Fund for Arab Economic Development, and the Saudi Fund for Development.
Pakistan’s government is contributing around US$1 billion, through its own resources and from the proceeds of a green eurobond issued last year.
"The Mohmand Multipurpose Dam is a landmark project for Pakistan and is critical to a number of the country’s strategic national priorities," Aftab Ahmad Khokher, Pakistan’s ambassador to Austria, said at a loan signing ceremony in Vienna, alongside OPEC Fund director-general Abdulhamid Alkhalifa.
While boosting Pakistan’s capacity to produce clean, renewable energy, the dam will also contribute to the regional socio-economic development of the Khyber Pakhtunkhwa province, Pakistan’s third largest region, where nearly 80% of the population lives in rural areas.
The OPEC Fund for International Development is a globally mandated development institution that provides financing from member countries to non-member countries exclusively.
Pakistan's inaugural green eurobond was issued in May 2021 by the Water and Power Development Authority (Wapda). The US$500 million Indus bond had a tenor of 10 years, and was six times oversubscribed. Lead arrangers were J.P. Morgan, Standard Chartered, Deutsche Bank and Habib Bank.