Power generation from three hydropower projects operating along the Likhu River has been completely suspended for the past two days after local residents of Ramechhap and Solukhumbu launched protests against the company’s plan to issue shares at a premium price.

According to project promoter Pan Himalaya Energy Limited, electricity production from all three operational projects has come to a standstill due to obstruction by locals from project-affected areas. The shutdown has impacted a combined installed capacity of 161 MW, raising concerns over energy losses and investor confidence.

The affected projects include the 29.4 MW Likhu A Hydropower Project, 77 MW Likhu–1, and 55 MW Likhu–2, all of which had already entered commercial operation.

Premium IPO pricing becomes the center of conflict

The dispute centers on the pricing of the company’s proposed Initial Public Offering (IPO).

Pan Himalaya Energy has reportedly applied to issue shares to the public at a premium price, beyond the standard face value of Rs. 100 per share. However, residents from project-affected areas argue that they should receive shares at the par value of Rs. 100 per unit, rather than paying a premium.

According to Gelbu Sherpa, coordinator of the local struggle committee, the community’s primary demand is the immediate issuance of the delayed IPO and allocation of shares at the standard price.

He stated that locals received information suggesting affected residents may also be asked to purchase shares at around Rs. 218 per share, a move they oppose.

The committee further claims that concerns had already been formally submitted to relevant ministries, district administration offices, and local governments around 70 days ago, but no concrete response was received, leading to direct protest action.

Locals raise broader concerns beyond share pricing

Apart from the IPO dispute, local communities have demanded a complete audit of the company’s financial position and project valuation process.

Additional concerns include calls for long-term solutions to environmental impacts allegedly caused by tunnel construction, including water seepage problems in nearby settlements, and greater employment opportunities for local residents.

Company insists premium IPO process follows regulations

The company has rejected allegations of wrongdoing and maintained that the premium IPO process is being carried out under existing regulatory provisions.

According to the promoter, an application for premium issuance had already been submitted to the Securities Board of Nepal (SEBON) around two years ago and approvals from the Electricity Regulatory Commission have also been obtained.

The company argues that existing securities regulations do not require project-affected locals to receive shares strictly at face value.

It has also written to the Ministry of Home Affairs and district authorities in Solukhumbu and Ramechhap, describing the protest and production shutdown as unlawful interference.

Production halt causes multi-crore losses

The projects, promoted by the MV Dugar Group, were operating commercially before the disruption.

Company representatives estimate that the shutdown has already caused losses exceeding Rs. 4 crore within just two days.

According to company spokesperson Manohar Khadka, decisions regarding whether shares can be issued at a premium fall under the jurisdiction of SEBON and cannot be changed through public pressure.

Industry stakeholders have also expressed concern that shutting down operational infrastructure could negatively affect Nepal’s investment environment and weaken confidence among domestic and foreign investors.

IPPAN steps in for mediation

Following the escalation, the company has sought support from the Independent Power Producers’ Association Nepal (IPPAN) to help facilitate negotiations.

Newly elected IPPAN President Mohan Dangi said efforts have already begun to restore operations and resolve the disagreement through coordination with government authorities, including discussions with the Ministry of Home Affairs.

The outcome of the negotiations could become an important precedent for how Nepal handles future disputes involving premium IPOs and benefit-sharing expectations in infrastructure projects.

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