Deal #6532 Version #76001

2013-03-01

Accessed on 02/01/2015

2013-12-13

Vientiane Times report: "The Lao government has decided to revoke the agreement with a Russian company to develop Xekong 4 hydropower project in Xekong province after discovering that the company failed to comply with the conditions attached. Minister of Energy and Mines Dr Soulivong Daravong confirmed the agreement with the Region Oil Company of Russia was revoked while clarifying numerous issues to the ongoing National Assembly (NA) session on Thursday. His clarification was made after NA members raised questions regarding the project delay that lead to the relocation of local villagers to make way for the project construction. But when villagers moved out, there was no sign of any progress made in the project construction. Dr Soulivong said “We have revoked the agreement with the company because they do not comply with the agreements and we have yet to grant the project to another new developer.” The minister confirmed that there will be a new company assigned to develop the project but the government wants to review the existing form of the project development. Under the existing plan, the project will flood a coal mining area located near the dam site. “What we were doing is to review whether we will allow the project development that will result in the coal area being flooded or whether we should reserve the coal area.” “Our assessment found that we should not allow the project to flood the coal area,” he said. Dr Soulivong proposed to build two dams to replace the originally proposed one, those being Xekong 4A and Xekong 4B, but the revenue from the two smaller dams will be less. In 2005-2006, Region Oil and the Lao government signed four memorandums of understanding to develop three hydropower projects - Xekong 4, Xekong 5 and Nam Kong 1 - a combined investment of about 12 trillion kip (US$1.5 billion). The Lao government signed the project development agreement with the Region Oil on June 26, 2008. The company held an 80 percent share and the Lao Holding State Enterprise (LHSE) the remaining 20 percent. The original Xekong 4 project was designed to have an installed capacity of 300MW, with the electricity to be exported to Thailand. NA member for Xekong province Mr Khamdaeng Kommadam told Vientiane Times on Thursday that they supported the government's decision to revoke the agreement because “the company cannot possibly” develop the project. Mr Khamdaeng said “This is a government project but it is only located in this province. The most important thing the minister said is that the project will flood the coal area and that's why he proposed to build two dams.” Meanwhile Xekong provincial authority has relocated hundreds of people from villages to be affected by the planned development of the Xekong 4 dam despite the fact the project has yet to start. In September this year, Head of the provincial Integrated Rural Development Office, Mr Visaem Xayseuksa told Vientiane Times that since the work to develop the project has not yet started, compensation from the investors has not been received. “However, the provincial authority decided to go ahead with the relocation of those to be affected,” Mr Visaem said. “Once the project starts to be developed the investors are expected to compensate the displaced villagers.”"

2013-08-17

Vientiane Times report: "A major foreign energy developer, China International Water & Electric Corporation (CWE), is conducting a feasibility study into the Nam Kong 1 hydropower project in Xekong province. CWE General Manager to Laos Mr Li Kai ( left ) shakes hands with EDL Managing Director Mr Sisavath Thiravong after signing the agreement. The company signed a memorandum of understanding (MOU) for the project with Electricite du Laos (EDL) on Thursday, after receiving approval from the government on August 9. The MOU allows the investor to conduct studies including assessments of the potential social and environmental impacts of the plant as well as other issues, according to an EDL report at the signing ceremony. The study is expected to be completed within 18 months, a handout noted. All the expenditure for the study will be CWE's responsibility. The signing was attended by Energy and Mines Deputy Minister Dr Khammany Inthirath and EDL-Generation Public Company Managing Director and CEO, Mr Bounoum Syvanpheng."

2013-08-23

Around 11 a.m. on 15th August, 2013, the MOU signing ceremony for the Nam Kong 1 HPP was held at the headquarters of EDL in Vientiane, Laos. Witnessed by the Deputy Minister of Energy and Mines of Laos and the Deputy Minister of Planning and Investment of Laos, Mr. Li Kai, General Manager of CWE Laos, and Mr. Sisavath THIRAVONG, Managing Director of EDL, signed the MOU on behalf of the parties. The Nam Kong 1 HPP, located in Attapeu Province in southern Laos, is designed with an installed capacity of 150 MW. According to the MOU, the hydropower station and its appurtenant transmission lines and substations will be developed by CWE in the mode of EPC. This Project is expected to greatly improve power shortage of Attapeu Province and surrounding areas and bring about sound economic and social benefits. Present at the signing ceremony were officials from the Ministry of Energy and Mines of Laos, the Ministry of Planning and Investment of Laos, EDL, and staff of CWE Laos.