New Minister of Energy and Mining appointed

(KPL) Mr Soulivong Daravong, former Minister of Planning and Investment was appointed as new Minister of Energy and Mines. 

The official ceremony was took place at the Ministry of Energy and Mines last Friday with the witness of Prime Minister Bouasone Bouphavanh and other high-ranking officials. PM Bouasone highlighted the complicated and challenges of energy and mines sectors which is a significant part to put national economy upward. 

The main duty of the ministry till to 2010 is to attract foreign investment in the construction of about 6-8 small-scale hydropower dam with the ambition to generate 3,000 megawatts, said PM Bouasone. 

In addition to the expansion of electricity network from north to south covered by 70 percent of total area nationwide. 

The Ministry of Energy and Mines should cooperate with the investors in the survey of mining as the basic information to serve the bid or the property for compromising loan for infrastructure construction, he advised.

Electricity law needs to be amended to comply with economic growth

(KPL) The draft law on electricity needs to be amended to support the market-oriented mechanism and the electricity expansion, said Acting Minister of Energy and Mining Somboun Rassombath.
This was an explanation of Mr Somboun when he attended the fourth day of National Assembly Session of sixth legislative on 27 November.
The old version of the law on electricity, enforced in 1997, consisted of 12 chapters, 56 articles, considering as an important tool for public administration, electricity business development in Laos and was attractable investments from local and foreign investors. This law was a great contribution to the poverty reduction.
Presently, the socio-economic development has developed and market-oriented mechanism has also moved forward, particularly the electricity production activities. In order to support the development and expansion of infrastructure as well as economy in the new era, it needs to amend the electricity law to comply to realistic conditions with the national economic growth and international law in the region, he added.
Mr Somboun proposed the amended draft of law and arrangement regarding to charter, articles and content, and other term to be appropriated or not?.
In 1995, the number of the nationwide total household access to electricity amounted to only 30 percent (200 megawatts) now the number increases to 60 percent.

New hydropower plant set for southern Laos

(KPL) A consortium of foreign companies will proceed with a hydropower plant on the fringe between Champassak and Attapeu provinces, following a two-year feasibility study.
The SK Engineering and Construction, Korea Western Power and Ratchaburi Electricity Generation Holding signed an agreement with the Ministry of Planning and Investment last week to develop the Xe Pien-Xe Namnoi hydropower plant project.
Under the agreement, the companies will spend another 18 months designing the plant, selecting an exact location and assessing the social and environmental impacts of the project.
The Lao government has established a committee to assess the project and decide whether to grant a concession agreement which would allow investors to begin the construction of the power plant, it said.
The power plant will have a generation capacity of 390 MW and will be able to produce about 1.776 Gwh annually. The project is expected to cost about 500 million USD.
If the project proceeds, the Lao government will hold a 24 percent share in the project and will take over the full ownership on the plant after 25 years.

Power pact to receive assistance

MANILA — Japan and the Asian Development Bank (ADB) will help develop a financing plan for a US$240 million power transmission project that will enable Laos to export hydro-electric power to Viet Nam.

The Japan Special Fund will provide, through ADB, a $1 million grant, while the Lao and Vietnamese governments will each contribute $150,000 to develop the plan.

The financing plan will involve the preparation of two loans, one each for Laos and Viet Nam. The loans will be structured and scheduled to suit the commercial operations schedule of the 11 hydro-power projects that will provide the 1,000 MW of electricity targeted for export.

The model and arrangements for the operation and maintenance of transmission facilities will also be drawn up.

Xavier Humbert, senior energy specialist of ADB’s Southeast Asia Department, says the estimated cost of developing the power transmission facilities will be around $150 million in Laos and $120 million in Viet Nam.

Roughly $55 million has been included in ADB’s 2010 lending programme for financing the project but a budget plan for the development of the power transmission facilities still needs to be finalised, Humbert said. It will be completed after discussion with potential co-financiers in both countries.

The power transmission project has four components: a 65-km, 500kV double circuit transmission line to be built from the Ban Sok substation in Laos to the Viet Nam border; a 100 km, 500kV double circuit transmission line from Loas to the Pleiku substation in Viet Nam; a 500/230 kV Ban Sok sbustation in Laos; and an upgrade of the Pleiku station.

According to ADB, Laos has only tapped 663MW of its 18,000 MW hydropower potential.

"Maximising the countrys hydroelectric power potential is challenging due to financing constraints," says Humbert. "The government recognises this, and has been strongly promoting private sector involvement."

Given soft domestic demand, most of Laos’ hydropower is targeted for export. Earnings from the exports, in turn, help fund projects that provide rural areas with electricity as well as various social development projects and poverty reduction efforts.

In contrast, Viet Nam is faced with an alarming electricity supply deficit because of an average annual growth rate of 7.5 per cent over the last decade. The nation’s Sixth Power Development Plan (2006-2020) estimates domestic power demand to rise 16 per cent annually from 2006 to 2010, by 11 per cent a year from 2011 to 2015, and by 9 per cent annually until 2020.

To meet this demand, Viet Nam is turning to its neighbours, including Laos, to purchase electricity. In March, both countries signed an agreement transferring as much as 5,000 MW by 2020. — VNS

15th meeting of the MRC Council Meeting held

(KPL) The Mekong River Commission held the 15th meeting of the MRC council and the 13th Donor Consultative Group Meeting in Vientiane Capital on 7-8 November.

The meeting was chaired of Standing Deputy Prime Minister, Mr. Somsavat Lengsavad. And the event was attended by members of MRC council, delegations and representatives of Myanmar and development partners.

On the occasion Mr. Somsavat greeted welcome the delegation of the MRC council for working visit to Laos. Mme. Khempheng Pholsena, Council Chair for 2008-2009, also a Minister and Head of the Lao Water Resources and Environment Administration, said the Mekong River is revered as the 'mother of water' in Laos, as it nurtures and nourishes the rice fields and fish that form the background of the traditional economic and culture.

She added that cooperative resource and use sustainable water resources management are vital to sustaining the economic growth of the economies of the Mekong countries, and that in these matters the MRC is of great value to its member states.

This organization has an innate interest in balancing the use of the Mekong Basin's resources for the countries' mutual benefit and people's well-being with the need to preserve them for future generations to come, she said.

It also has the knowledge base and technical expertise to help us gain maximum benefit from these resources in the most sustainable manners.

The MRC Council, composed of ministers from each of the four Member States of Cambodia, the Laos PDR, Thailand and Vietnam, is the highest level of commission and meets once a year to make policy decisions and give guidance to the various programmes run by the MRC to implement the 1995 Agreement on Cooperation for the Sustainable Development of the Mekong River Basin.

For the first time the Council meeting held a session with the Donor Consultative Croup, the countries and organisations that provide most of the MRC's funding. Jeremy Bird, Chief Executive Officer of the MRC Secretariat, stressed that the perspective of these development partners on the activities of the MRC, and their views on matters of substance, is extremely important. Over the days of meeting, the four countries and development partners discussed the permanent location of the MRC Secretariat, financial matters, and the progress of programmes such as the Basin Development Plan.The meeting is also discussing recent high-profile events to concern the MRC, including the Regional Multi-Stakeholder Consultation on the MRC Hydropower Programme, also held in Vientiane in September, and the floods that occurred along the Mekong in Laos and Thailand during August.

The Hydropower Consultation marked the first time the issue has been discussed in detail by the four countries in the presence of a broad rang of Stakeholders, including participants from China and Myanmar. Mme. Khempheng praised the MRC's for taking a leading role, saying it is important to have a body that can give impartial and expert advice on this issue and serve as an avenue fro the Member States to jointly discuss and plan their developments.

Moreover, she continued, it can deliver views and information based on its knowledge and expertise and using the tools and processes established under the 1995 Mekong Agreement. In this context it is the role of the MRC to help counties build the needed capacities and institutions to make informed decision.

At the same day, the Danish Government signed an 18 million Danish Kroner (US$ 303 million) funding agreement over a two year period to support the work of the Fisheries Programme of the Mekong River Commission.

The agreement was signed by Mr. Peter Lysholt Hansen, Ambassador of Denmark to Vietnam and Lao PDR, on behalf of the government of the kingdom of Denmark and Mr. Jeremy Bird, Chief Executive Officer of the Mekong River Commission Secretariat.

The German Federal Ministry for Economic Cooperation and Development (BMZ) also signed a Euro 3 million (US$ 4.43) commitment over a two and half year period (December 2008-May 2011) for technical cooperation through GTZ to support the work of Mekong River Commission (MRC). The commitment was signed by Ms. Kerstin Henke, Country Officer for Lao PDR, Cambodia, MRC, on behalf of the German Federal Ministry of Economic Cooperation and Development and Mr. Jeremy Bird.

Mr. Bird thanked the German and Danish Governments for their continued and general support of the MRC's work and said the new technical cooperation would be of great assistance in helping the MRC achieve the goals set up in their 2006-2010 strategic plan.

Nongbouakham villagers are making more money

(KPL) The villagers of Nongbouakham village, located close to Nam Theun 2 Hydroelectric project are now enjoying a higher standard of living because of the building of infrastructure and socio-economic development by this company and the villagers are using them, said the headman of Ban Nongbouakham, Nakai district of Khammouane province, Mr. Pin Soulasith.
This village is made up of the amalgamationnof four villages, Ban Nongbouakham, Ban Sobhear, Ban Sobma and Ban Namnien and this came about because the land of the villagers were acquired for the construction of this dam.
The vacation of their villages were made on 23 March 2007 and on this day all the people of the four villages, 330 of them from 63 households and 70 families went to reside in their new village.
The NT2 gave the villagers new houses, artisan wells, a primary school, a kindergarten, an integrated health center, an agricultural centre, a demonstration farm that only use organic fertiliser, electricity and also land for farming on the basis of 0.66 ha per family.
Now that they are in this new village many of the villagers are engaged in fishing, farming and general works and their average income per year is two million kip. Therefore, they are enjoying an increase in income as they were making an average of 500,000 to 600,000 kip per year when they living in the dispersed villages.

Nam Theun 2 to produce electricity for export to Thailand by late 2009

(KPL) The Nam Theun 2 Hydropower project is expected to produce electricity for export to Thailand according to the plan on 15 December 2009.
The statement was released yesterday at the 3rd annual stakeholders forum in Thakhek, Khammouane province. Speaking at the opening ceremony, Mr. Somboune Rasasombath, Acting Minister of Energy and Mining, Chairman of the Steering Committee for the Construction of the Nam Theun 2 Project, said that the Nam Theun 2 project is the number one priority as far as the Lao PDR is concerned. The development of this project has taken quite a long time, starting with surveys and feasibility studies conducted in the 1980s. However, in the beginning of the 1990s, the Lao government together with foreign investors decided to examine and prepare for development options that involved joint venture between the state and private sector. But the construction of this project only started in mid-2005, and is now being conducted in full swing after receiving support from the World Bank; this was toward the end of March 2005.
The Nam Theun 2 Project has an installed capacity of 1,080 MW, of which 955 MW is for sale to Thailand, and 75 MW is for local consumption. When the construction is complete, the Nam Theun 2 will produce on average 5936 GWh of energy per year, thus annually generating no less than US$ 200 million.
The direct revenue of the government throughout the concession period amounts to around US$ 2,000 million or about US$80 million per year. In addition to a large amount of the direct revenue, the Nam Theun 2 will create indirect benefits for local people in many ways through socio-economic activities.
These will include rural development initiatives, establishment and upgrading of public utilities, in a sustainable way raising the standard of living of more than 5,000 poor household that practise slash-and-burn cultivation on the Nakai Plateau. The biodiversity in the catchment area of the Nam Theun 2 is to be managed and protected for more than 25 years.
Mr. Somboune added that every year during the construction phase, the project provides income and upgrades skills for 5,000-7,000 workers. During this period, technology is transferred to Lao workforce, employments are created, and local people are encouraged to provide services.
The 3rd annual stakeholders forum held to provide the participants with different kinds of information, including strong points and shortcoming as well as achievements in the implementation of the Nam Theun 2 Project.
It also provided an opportunity to all participants to give feedback and recommendations that can help improve the plan for implementing the project in the future with high level of effectiveness.

Xieng Khuang province: electricity to cover 8 districts by 2010

(KPL) The electricity du Laos, Xieng Khuang branch has now expanded the 24 hour electricity use to 10,050 families in 4 districts of Paek, Khoun, Phoukoud and Phaxay.From now to 2010, the electricity du Laos of Xieng Khuang province has planed to extend its network to cover 8 districts or 50% of its total population.Mr. Sisouphan Phommachanh, Deputy Head of the Electricity du Laos of Xieng Khuang province disclosed that so far his organisation has expanded the electricity network with medium voltage to 238 km, 160 km of low voltage and installed 131 transformers. Today the people in Phoukoud and Phaxay districts has already access to the electricity. Mr. Sisouphan added that his organisation is extending the electricity to people of Kham district and the people in 9 villages of Thatom district will use the electricity at the end of 2009.

Hongsa Lignite developers approve US$16 million in compensation

(KPL) At least 390 families in five villages living near Hongsa Lignite Power Plant Construction Project site in Sayaboury province must be removed at the end of this year, before starting its construction work at the beginning of 2009, a local official said.
These families will be removed to resettlement area of Napong village, development area in Hongsa district, Sayaboury following the Lignite Power Plant approved more than US$ 16 million to them.
The Hongsa Lignite Power Plant Construction Project has been jointly invested among Laos, Ban Pou Company of Thailand, Ratchaboury Comapany and Chinese companies.
Mr Sisoupoy Kongsanith, Deputy Governor of Sayaboury province said that developers of the Hongsa Lignite Power Plant Construction Project has agreed to compensate impact people in order to hope long-term benefits.
Initially it approved over US$16 million to 390 families.
He said that each family would receive compensation in accordance with real condition. He believed that one family will get at least 50 million kip.
Thai investor invested in the Lignite Power Plant in Sayaboury province, with an expectation of investment amounted to US$1 billion with generation capacity of 1,800 Megawatt.

Theun-Hinboun Power strikes loan deal for expansion project

(KPL) The Theun Hinboun Power Company Limited (THPC), the owner of the 220-MW Theun Hinboun Hydropower Project located on Nam Theun and Nam Hinboun river basins in Borikhamsay Province, approximately 280km from Vientiane, signs loan agreements worth USD 600 million to support the construction of the Theun Hinboun Expansion Project on October 8, 2008 at the Conrad Hotel in Bangkok.
Dr. Prasarn Trairatvorakul, President of Kasikorn Bank, Dr. Apichai Boontherawara, Managing Director of the Export - Import Bank of Thailand, Mr. Jeckie Surtani, Head of Project Finance Asia, KBC Bank, N.V. As well as representative from BNP Paribas, Australia and New Zealand Banking Group Limited, Bank of Ayudhya Public Company Limited, Siam City Bank Public Company Limited and Thanachart Bank Public Company Limited, signed the loan agreements with Dr. David L. Michaels from THPC. The signing ceremony was also witnessed by Mr. Viraphonh Viravong, Director General, Department of Electricity, Ministry of Energy and Mining, of the Lao PDR, Mr. Khammany Inthirath, Managing Director of Electricite du Laos, and Mr. Jan Cedewell, Director Project Development Stathraft as a sponsor of the Expansion project.
According to the press release from THPC, the Company's original 220MW hydropower project started construction in 1995 and commenced commercial operation in March 1998, from which date substantially all of the electrical energy produced thereof has been supplied to Thailand under a long-term power purchase agreement with the Electricity Generating Authority of Thailand. In the past 10 years, Theun Hinboun Power project has been a stable source of revenue to the Government of Lao from taxes, royalties and dividends received from the 60% ownership in the Company through the Electricite du Laos.To meet with the increasing demand for power of both Thailand and the Lao PDR, in 2007 THPC has decided to expand its existing 220MW generating capacity to 500MW. The loan will be used to finance the construction of an upstream dam to create storage reservoir to allow the project to utilize the significant water resources which are currently being spilled by the existing project facilities, creating a new tunnel to divert water to the power house located downstream, and installing additional turbines to increase the existing capacity by 280MW from 220 MW to 500 MW by 2012. the project calls for an investment of USD 665 million and the construction will take 4years from 2008 to 2012.
Once completed, the Theun Hinboun Power Project will have a combined capacity of 500 MW, approximately 88% of which will be for sale to Thailand with the remaining for local consumption in the Laos .

Vietnam to invest in hydropower construction in Laos

(KPL) A feasibility study of Nam Theun 4 hydropower construction project will be operated in central province of Bolikhamsay, by a Vietnamese company after inking in the MoU last week.
The Memorandum of Understanding (MoU) was signed here between the Ree Power Plant Company of Vietnam and Ministry of Planning and Investment.
The company will conduct 18 month-study to determine the viability of the project.
The company will sign a further agreement with the government if the study shows the project to be economically viable.
If the project goes ahead, the plant will have an installation capacity of about 180MW.
Laos has the potential to generate a total of about 26,600MW of power from hydro sources, excluding the mainstream Mekong River.
Of this, about 18,000 MW is technically exploitable. About 12,500MW can be potentially generated by sources in the major Mekong sub-basins and the remainder in minor Mekong or non-Mekong basins.
Less than 2 percents of the country's hydropower potential has been developed over the past 30 years, according to the Energy Promotion and Development Department.

Champassak, 26 villages access electricity during couple of years

(KPL) Twenty-six villages have accessed electricity since 2006. The province plans to have 118 villages across the province use electricity by 2012.
Mr. Niphone Viengpasard Head of Champassak Administration Office, governors from 10 districts in the province and relevant officials held a meeting on the electricity expansion in the province during the last few years.
The province puts priority to electricity expansion to focal development areas and the villages, which have potential tourist sites and used to be revolutionary bases.
At least 7.8 million US dollars will be spent for the expansion of electricity during the next four years. Twenty per cent of the fund injecting into the expansion is from the government and the rest 80% from the World Bank and Nam Theun II Hydropower Project and the Electricity du Lao.

MRC countries debate hydropower management

More than 200 representatives from member countries of Mekong basin, domestic and international organisations along with the private sector are discussing how to sustain the development of hydropower dams in the Mekong region.

The discussion in Vientiane is hosted by the Mekong River Commission (MRC) Secretariat for regional multi-stakeholder consultation on its hydropower programme. The meeting is taking place from September 25 to 27.

“Hydroelectricity has long been recognised as one of the cleanest, most sustainable and, in the long run, least expensive methods of generating power,” said MRC Joint Committee member for the Lao PDR, Mr Chanthavong Saignasith.

He acknowledged there could be negative impacts associated with hydropower and said it was important the Lower Mekong countries were able to study the benefits and costs associated with dam construction before making decisions.

The MRC provided decision-makers in the four Lower Mekong countries with a sound knowledge platform, enabling them to assess the gains and impacts of each hydropower proposal in a basin-wide context, he said.

This included scientific input from many different fields and sources across the Mekong region and beyond, from village-level fisheries research to international navigation experience. The MRC sources and provides such data, and also assesses plans for various power-generating scenarios through integrated modelling tools.

“The MRC hydropower programme is being designed to assist this decision-making process, and to help set up mechanisms that can make sure countries' concerns are addressed as approved projects are implemented,” said Chief Executive Officer of the MRC Secretariat Jeremy Bird.

He said the creation of a framework for regional and cross-sector cooperation on hydropower gives great impetus to sustainable development in the Lower Mekong Basin .

“The MRC believes that developing cooperation and dialogue between countries, at multiple levels of society, can help ensure the growth of the hydropower industry is managed in a way that conserves environmental resources and the livelihoods of the people that depend on them,” he said.

Acting MRC Communi-cations Officer Aiden Glendinning stressed the importance of consultation in the decision-making process.

“It is very important to understand that if a country wants to build a dam on the Mekong , it needs to write a letter to the MRC which we can pass on to other members for discussion and agreement,” he said.

Mr Glendinning said at a press conference yesterday the MRC's role was to arrange meetings for the four members of the lower Mekong countries - Cambodia , Lao PDR, Thailand and Vietnam - to discuss the development of hydropower dams. China and Myanmar are dialogue partners of the MRC.

He said regarding the contribution to flow, 16 percent of water came from China , two percent from Myanmar , 18 percent from Cambodia , 35 percent from Laos , 18 percent from Thailand and 11 percent from Vietnam . The volume of water in the Mekong is about 475 cubic kilometres a year, which equals 6,500 cubic metres per person per year.

“Dams will block fish migration and create an unnatural situation for fish, but dams can also provide protection from flooding, store water during the rainy season for use in dry season agricultural activities, and produce electricity,” Mr Glendinning said.

“Meanwhile, you have to share the benefits. That means not only benefits for people near the reservoir, but you have to plan for the sustainability of hydropower and consider ways to help people who live downstream to benefit as well.”

Presentations were made by participants from all stakeholder sectors, including national electricity enterprises from the MRC member states, environmental advocacy groups, developers, and national Mekong committees.

Hydropower industry experts from China and outside Asia also attended the consultative meeting. Various different perspectives emerged, and these will help inform the MRC hydropower programme and encourage wider consultation, thus contributing to development outcomes.

By Vientiane Times
(Latest Update September 26, 2008)

2 villages in Pek district access electricity

(KPL) Two villages of Ban Nongpet and Ban Khangvieng in Pek district, Xiengkhuang province have connected to electricity.
The opening ceremony on electricity use was held at Ban Khangvieng last week with the attendance of Acting Governor of Xiengkhuang province, Mr. Vengthamone Phommachanh, local authorities and people.
The electricity installation commenced in April and completed in July with an investment of around 2.5 billion kip (US$ 300,000) by the Electricite du Lao.

113 families of Soukhoumma district access to 24-hour electricity supply

(KPL) 113 families of Ban Nongdengneua, Soukhoumma district, Champassak province, has now accessed to 24-hour electricity supply.
The electricity network construction project for Ban Nongdengneua started in July, 2007 with 700 million kip of budget, 260 million kip of which was the contribution from local people.
The construction included the installation of low- and medium-voltage electricity system in which an 8-km long 22-Khz electricity network was built and installed a 160 KVA transformer.
Ban Nongdengneua, one of nine villages in Soukhoumma district, comprises 1,855 people and 347 families.
Local villagers live on rice farming and animal raising.

Energy and mines minister dies

Lao Minister of Energy and Mines, Dr Bosaikham Vongdara, died yesterday at the age of 60.

According to a press release from the government, Dr Bosaikham's health deteriorated this week.

Dr Bosaikham, who was also a member of the Party Central Committee, was offered extensive medical care by a team of local and foreign doctors but sadly died yesterday morning.

Dr Bosaikham was born on April 15, 1948 in Phonsavanh village, Paek district, Xieng Khuang province. He married Ms Vansy Vongdara and they had two children.

Dr Bosaikham joined the revolutionary movement in 1974 and worked as a technical official at the Central Economic Affairs Office in Viengxay, Huaphanh province until 1975.

From 1978 to 1982, he studied in the former Soviet Union and obtained a Doctorate in Geology. He was a secretary of the Lao student youth union while in Moscow .

From 1996 to 1999, he was Ministry of Industry and Handicraft Office Head and Party committee member for this ministry.

He was the Lao Trade Union President in 2005 and was e lected to the Party Central Committee in 2006.

Dr Bosaikham was Minister of Energy and Mines from 2006 until his death.

The Party Central Committee, National Assembly and government agreed to hold a memorial service to pay tribute to him. It started yesterday and will continue until Sunday in a hall of the Prime Minister's Office in Vientiane .

The Party Central Committee Secretariat has appointed a committee to host the memorial service for Dr Bosaikham. Minister of Labour of Social Welfare, Ms OnchanhThammavong, has been named committee president and Minister of Education Dr Somkot Mangnomek as vice president.


By Vientiane Times
(Latest Update July 25, 2008)

NA approves Hongsa power plant amid environment concerns

The Hongsa lignite-fired power plant pr oject was yesterday given in-principle approval by the National Assembly, despite its concern the project could negatively impact the environment and livelihood of local people.

One of their main concerns was the health of people who lived in surrounding areas, as the plant will emit carbon dioxide as part of the electricity production process. The members encouraged the project to use clean technology as much as possible.

NA members urged the government to continue doing a detailed study on the negative and positive impacts of the project, whilst demanding reasonable compensation for the 367 families from five villages who would have to be resettled.

NA member for Champassak province, Mr Kisin Sinphan-ngam, said the living standards of the 367 families must be improved.

“They need to have enough land to support themselves,” he said.

“If they don't, this project will only increase their poverty.”

NA member for Khammuan province , Dr Bounnhong Khinsamone, said Laos had not reaped the full benefits of foreign investment in the past. He gave the example of companies that had promised to employ Lao workers, but later claimed local workers did not have the necessary skills and so imported foreign labour instead.

The Lao Holding State Enterprise General Manager, Dr Somboune Manolom, accepted the project would have some negative impacts but claimed the benefits would be far greater, boosting the country's economy while reducing poverty.

Electricity production will begin in 2013, with the project costing about US$3,900 million.

The country will receive more than US$2,500 million over a 25 year period through share dividends and taxes.

The Lao government will hold a 20 percent share in the project, worth US$196 million. About US$100 million of the value of the government's share will be borrowed from the EXIM Bank of China and the remainder from th e China Development Bank.

Almost 13 million tonnes of lignite will be excavated to supply the plant each year, totalling 325 million tonnes over the 25 years of the project concession.

There is estimated to be about 713 million tonnes of lignite in the 12sqkm of land allocated to the project. This is sufficient to continue fuelling the power station for an additional 25 years after the concession period ends.

The project is expected to create jobs for about 10,000 people, of which 80 percent will be Lao.

Local people will also benefit from infrastructure development including roads, schools, irrigation, hospitals, markets and electricity.

Villagers will not need to be resettled until the project commences work in the areas they live in.

The government has set up an environmental management committee to resettle villages affected by the project to ensure its effectiveness.

Article 9 of the electricity law stipulates that hydropower development projects with an installed capacity of more than 50,000 kilowatts must be approved by the NA.

The law on water and water resources further stipulates that any changes to water flow also need approval from the NA.

The Hongsa lignite project will have a generating capacity of 1,800 megawatts and will change existing water flow, meaning the project requires approval by the NA.



By Somsack Pongkhao
(Latest Update July 25, 2008)

Champassak to stop using Thai electricity next year

Champassak province will stop buying electricity from Thailand in 2009, according to Champassak Provincial Electricity Department Deputy Manager, Mr Khoune Bouaphengphanh.

“We will produce enough electricity for domestic use once the new Xexet 2 hydroelectric power station is complete,” he said.

When the plant begins operating it will supply all of Champassak's power demands, as well as generating electricity for the southern provinces of Attapeu, Saravan, Xekong, and Savannakhet.

“At present the province buys electricity from Thailand during the dry season from November to March, because we cannot generate enough for our use at this time of the year,” Mr Khoune said.

“The Xexet 2 plant began construction in 2005 and when it is finished in 2009 we will have electricity all year round and can sell it to the four provinces nearby.”

There are 10 districts in Champassak province, and more than half of the 926 villages receive electricity from the provincial branch of Electricite du Laos.

The branch plans to expand the grid system in rural areas to reach another 119 villages over the next six years, with funds allocated from the World Bank, according to Mr Khoune.

By 2010, the provincial electricity department expects the grid will reach 70 percent of villages in Champassak province.

Mr Khoune said an ambitious goal for Laos would be to provide electricity to 75 percent of rural families by 2020. Currently 80 percent of the Lao population lives in rural areas, but only 43 percent of these people have access to electricity.

Solar panels are becoming important assets for poor families who cannot yet access the national electricity grid, he said. Champassak province is located in southern Laos and shares borders with Thailand and Cambodia.

By Khonesavanh Latsaphao
(Latest Update July 15, 2008)
http://www.vientianetimes.org.la/FreeContent/FreeContent_champassak.htm

Namkene hydropower dam construction in Kasy to take shape

(KPL) The Vientiane province Planning and Investment Division and the SV Group Company on July signed an MOU on feasibility study in the construction of a hydropower dam along Namkene river in Kasy district, Vientiane province. The dam will have an annual installed capacity of 10 million kW/h, worth US$5 million. The signing ceremony took place at Vientiane province Planning and Investment Division which was signed by Head of Vientiane province Planning and Investment sector, Mrs Singkham Dongsavanh and Director of the SV Group Company, Mr Phanthachith Inthilath.
The Namkene hydropower electricity construction area is 1 km far from Kasy district's urban north and is about 15 km far away from Road No. 13 North in Phachao village. The transmission line of the Namkene hydropower plant will connect the electric grid directly in Kasy district.
The construction of this dam impact a few environment and living conditions of local people due to villagers would not have removed.
The logs have already cleared from the flooding area.

Delayed budget supply, a barrier of Nam Ngum development project

(KPL) Many problems of Nam Ngum reservoir Development project need to be dealt particularly in the promotion of agriculture production linking to the use of budget supply seems to delay.
So the authorities of Nam Ngum reservoir Development project gathered at Lao Plaza hotel to discuss on the development of the project work and solve troubles.
This project, a priority of the Government and pilot project for conservation and sustainable natural resources, particularly water resources protection which was financial support from many resources.
This project covers Xiengkhouang, Luang Prabang, Vientiane provinces and Vientiane Capital which a lot of state organization taking part in the project. By focusing on the improvement of people's living conditions living in reservoirs and upper part of Nam Ngum river linking to natural resource and environmental protection. Over the past six months of the project operation seemed many frameworks of the project have improved considerably and a lot of works have had progressively, particularly in the strengthen in purchasing, employment, coordination, inspection and other technical works of all project cells, Mr Khamchanh Vongphosy, Deputy Minister of Agriculture and Forestry applauded the project progress, who he gave a speech at the 7th meeting of Steering Committee of Nam Ngum Development Reservoir held at Lao Plaza hotel on 4 July.
He added that the project financial supplies did not implement on schedule, the village development fund connecting to eradication of slash-burn cultivation in some localities have not taken shape.
In addition, the releasing of loan to local farmers was quite low so they could not bring a few loan do anything causing a number of people lost opportunities of shifting fixed vocational job and family economic development. Despite the project works have already been divided to all provinces concerned to manage and respond all works was limited.
Mr Khamchanh urged the participants to brainstorm into the problems in line with realistic conditions of all localities.

Russian investor to start southern hydro projects

A Russian company expects to spend more than 6.8 trillion kip (about US$790 million) on two hydropower projects in two southern provinces of Laos.

Mr Oleg Kabardin ( left ) shakes hands with Deputy Minister of Planning and Investment Thongmy Phomvixay after exchanging agreements. --Photo Khamphanh

These will be the Nam Kong 1 plant in Attapeu province and the Xekong 4 plant in Xekong province.

“We hope to start building these plants next year,” General Director of Region Oil LLC, Mr Oleg Kabardin, said at a signing ceremony in Vientiane on Monday.

Region Oil LLC signed project development agreements (PDAs) with the Ministry of Planning and Investment in Vientiane at a ceremony attended by Deputy Prime Minister Dr Thongloun Sisoulith.

The Nam Kong 1 plant will have a dam wall 85.3 metres high and 386 metres long and will have an energy generation capacity of 469 GWh per year.

Investment in the plant will be 1.4 to 1.6 trillion kip (US$168 to US$186 million), according to a press release from the ministry.

The Xekong 4 dam wall will be 169 metres high and 1,027 metres long and the plant will be able to generate 1,901GWh per year.

The investment cost of this project will be about 5.3 trillion kip (US$604 million), according to the press release.

Both projects are currently governed by the PDA, which allows the investor to spend 18 months conducting additional surveys to obtain more details.

During this period the investor is required to revise previous studies, including the feasibility study and the environmental and social impact studies.

The investor will also discuss the power purchase price during this time and will make a purchase agreement with Electricite du Laos (EDL).

When these components are completed, the project will move forward to concession and shareholder agreements between the investor and the Lao government.

The investor will own the projects for 30 years after signing the concession agreement. The Lao government will hold a 20 percent investment share and the rest will belong to the investor.

Mr Oleg said the company had prepared a draft concession agreement for the government to sign and a draft power purchase agreement for EDL. Other drafts have been prepared for the purchase of electricity by Vietnam and Thailand .

The company is currently working on the design and technical systems of the two plants.

Region Oil LLC signed a memorandum of understanding with the Lao government several years ago to start studies on four hydropower projects, Nam Kong 1 and 3 and Xekong 5 and Xekong 4.

The company worked with Lao and Norwegian firms on the basic study for the Xekong 5 project. This study and a feasibility study have both been completed.

“We will have further discussions with the Lao government about the Nam Kong 3 project,” Mr Oleg said.

By vientiane times
(Latest Update June 25, 2008)

Malaysia signs on hydro plant

Rohas Euco Industries Bhd of Malaysia expects to spend about 870 billion kip (US$100 million) to construct the Nam Sane 3 hydropower project in Xieng Khuang province.

“The project will be a shared investment, with the Lao government contributing 25 percent and the investor 75 percent,” according to a press release from the Ministry of Planning and Investment.

The ministry signed a Project Development Agreement (PDA) with the investor in Vientiane last Thursday.

The PDA will allow the investor to spend 18 months conducting additional surveys to obtain more details about the project, which is planned for Mokmay district.

An official from the Energy Promotion and Development Department said during the PDA period the investor would have to revise previous studies, including the feasibility study and the environmental and social impact study.

“The investor will also have to discuss the power purchase price during this time,” the official said.

When those components are completed, the project will move forward to other agreements such as concession and shareholder agreements between the investor and the Lao government.

A power purchase agreement will also be made between Electricite du Laos (EDL) and the investor.

The dam will be about 75 metres high and 400 metres long. It is expected to generate 300 to 350 GWh of electricity per year, which will be sold to EDL for domestic consumption and export.

The project will be run by the investor for a 30 year period after the concession agreement is signed, according to the press release.

The PDA was signed after the investor completed a previous study that had been conducted after the signing of a memorandum of understanding with the ministry in June 2006.

Last week the Lao government signed an additional minute of understanding with a Vietnamese investor for a 3 trillion kip (US$332 million) investment in the Xekaman 4 hydropower project in Xekong province. This is scheduled to start in 2009 and is set to generate electricity in 2013 for export to Vietnam .

Laos currently has 11 major hydropower plants in operation and at least 36 smaller ones. These generate energy for both domestic and export markets and have a combined installed capacity of more than 670MW. The 36 smaller hydropower plants are all government investments.

These plants generate approximately 3.5 billion kWh per year, of which about 2.2 billion kWh is exported to Thailand .


By Phonsavanh Vongsay
(Latest Update June 23, 2008)

Supplements to MOU Sekaman 4 hydropower signed

(KPL) Supplements to a Memorandum of Understanding on a group of Vietnamese-invested hydro-power projects in Laos were signed in Vientiane Capital on June 16.
The signatories were Lao Deputy Minister of Planning and Investment Thongmy Phomvisay, and President of the Managerial Board of the Viet-Laos Power Joint-stock Company, Mai Huy Tuan. The signed accord on the group of Sekaman hydro-power projects No. 4 has developed from the former Sekaman 4 project signed with the Lao government in December 2006.
The projects will be based in Dakchueng district, Sekong province with a capacity of 200MW and an annual output of 900 million kWh.
They are scheduled to start construction in 2009 and begin operating in 2013. The Viet-Laos Power Joint-stock Company has signed contracts to conduct a feasibility study and invest in a number of hydro-power projects in Laos, including Sekaman 1, Sekaman 3 and Sekaman 4, with a gross capacity of 1,000MW and an annual output of over 4 billion kWh.
Once these projects are put into operation, the Viet-Laos company will export electricity to Vietnam

Study for Huaphan hydropower plant behind schedule

Construction of the Nam Sim hydropower project in Huaphan province was set to begin earlier this year, but this has not been possible because the feasibility study is not yet complete.

“We can't say when construction will begin because the investors are working slowly,” an official from the Contract Negotiation and Management Division of the Energy Promotion and Development Department said recently.

Work cannot begin on the small-scale hydropower plant until the study is complete. Norwegian investors signed a project development agreement with the government last year.

“The investors are working on additional surveys to obtain more details about the project,” the official said.

The agreement for the project was signed between Norpower AS Company and the Ministry of Planning and Investment last October.

The company began researching the project in 2003, carrying out an initial feasibility study and engineering survey and analysing potential environmental impacts before submitting the findings to the government in 2006 for approval.

“The investors are also preparing some documents and seeking a bank loan to help finance the project,” the official said.

The hydropower plant, to be built in Viengxay district, will cost about 138 billion kip (US$14.4 million). The government will hold a 25 percent investment share.

The investors estimate it will take two years to build the plant, which will have an installed capacity of 7.8MW and will generate electricity for local supply.

The company will operate the plant for 25 years after construction, and sell the electricity generated to Electricite du Laos (EDL) for use in the province.

“The company has not yet signed a purchase agreement with EDL,” the official said.

The hydropower plant will reduce the need for the purchase of electricity from Vietnam , and will help to develop the province's infrastructure and economy.

According to the Ministry of Energy and Mines' 2007 annual report, Laos imported 475.9 million kWh from Thailand , China and Vietnam last year.

The government is currently promoting the rapid development of small and medium power plants for local supply to reduce the need for imported electricity.

These plants will have installed capacities ranging from 2 to 100MW.

Other small hydropower plants planned are on the Nam Nhone in Tonpheung district, Bokeo province, the Nam Ham in Botaen district, Xayaboury province, Tadslen in Xepon district, Savannakhet province, and Xelanong 2 in Ta-oy district, Saravan province.

Laos currently has a combined installed capacity of about 670MW from 11 major and 36 smaller and medium hydropower plants, which generate energy for both domestic and export markets.

These plants generate approximately 3.5 billion kWh per year, of which about 2.2 billion kWh is exported to Thailand.

By Phonsavanh Vongsay
(Latest Update June 19, 2008)

Laos, Vietnam ink supplements to major hydro-power project

(KPL) Supplements to a Memorandum of Understanding on a group of Vietnamese-invested hydro-power projects in Laos were signed in Laos ' capital Vientiane on June 16.
Signatories were Lao Deputy Minister of Planning and Investment Thongmy Phomvisay and President of the Managerial Board of the Viet-Laos Power Joint-stock Company, Mai Huy Tuan.
The freshly-signed accord on the group of Sekaman hydro-power projects No. 4 has developed from the former Sekaman 4 project signed with the Lao government in December 2006.
The projects will be based in Dakcheung district, Sekong province with a capacity of 200MW and an annual output of 900 million kWh.
They are scheduled to start construction in 2009 and begin operating in 2013.
The Viet-Laos Power Joint-stock Company has signed contracts to conduct a feasibility study and invest in a number of hydro-power projects in Laos , including Sekaman 1, Sekaman 3 and Sekaman 4, with a gross capacity of 1,000MW and an annual output of over 4 billion kWh.
Once these projects are put into operation, the Viet-Laos company will export electricity to Vietnam

Deforestation impacts hydropower potential

Deforestation could negatively impact hydropower projects, according to the National Land Management Authority president.

Speaking at a press conference in Vientiane yesterday, Mr Kham-ouan Boupha said levels of deforestation in Laos were already back to those of 1989, when 47 percent of Laos was covered in forest.

The current situation was even more worrisome, because this figure had further reduced, he said.

“In 1989 we should have held up a red light to logging, but now the problem has got even worse,” he said.

“If we faced a red light then, I don't know what colour light we're facing now.”

Mr Kham-ouan maintains he has seen satellite images which back up his claim.

He said if Laos 's forests continued to disappear, it would damage the potential of local hydropower projects.

If deforestation occurs in a reservoir's catchment area this contributes to soil erosion. Soil then fills the reservoir and reduces the life of the hydropower project.

Mr Kham-ouan said he knew of several hydropower dams that had failed to meet production targets for this reason, including Houayho in southern Laos and Nam Mang in Borikhamxay province.

“Another dam in Luang Namtha province has insufficient water for electricity production because people cleared forests for rubber tree plantations,” he said.

Mr Kham-ouan said illegal logging and slash and burn cultivation were contributing to forest decline.

He said deforestation also contributed to changing weather patterns and the increasing frequency of floods and droughts in Laos during the past two years.

In order to encourage reforestation and protect Laos 's capacity for hydropower, Mr Kham-ouan has called on officials from relevant sectors to strictly enforce current laws to ensure illegal logging is eradicated.

Another challenge in preserving forests is instances of villagers taking ownership of state land without permission, including forest areas, and clearing the land for farming.

This problem could be addressed if villagers were given land titles and legal rights to land, and these land titles were enforced to prevent forested land from being damaged.

Foreign investment must also preserve the environment while ensuring local people benefit.

In addition to deforestation, this was also important for poverty reduction, he said.

Mr Kham-ouan found many investment projects had implemented a “1+4” policy by employing villagers to work as labourers.

He said this was not a good way to reduce poverty.

“One man I met in Xayaboury province earns about 50 million kip per year from farming his land on his own. In contrast, labourers earn only 20,000 to 25,000 kip a day.” By these calculations, if a labourer worked every day of the year he would only earn about 9 million kip.

The government's policy is encouraging investors to implement the “2 + 3” policy to ensure investment is beneficial to investors and local people, as well as to the country in general.

Under this policy, investors must provide funding, technical training and a ready market, while villagers provide their land and labour.

By Somsack Pongkhao
(Latest Update June 6, 2008)
http://www.vientianetimes.org.la/

Bokeo hydropower plant on track

Construction of the Nam Nhone hydropower project, a small-scale power plant to be located in Bokeo province, will start later this year.
“The main components are the powerhouse and dam and we will begin work after the wet season,” said an official from the Contract Negotiation and Management Division of the Energy Promotion and Development Department, in an interview on Friday.
The hydropower plant, located in Tonpheugn district, will cost about 39 billion kip (US$4.5 million) to build. It is an investment between two businesses from Hong Kong with a shareholding of 70 percent, and a Lao investor.
Land is being cleared at the site to build the powerhouse and an access road.
A 22kV transmission line will be installed to bring electricity to the site. This will be 6km long and cost about 960 million kip (US$100,000).
“The plant is expected to be finished by the end of next year and energy generation should start in early 2010,” the official said.
The hydropower plant will have an installation capacity of 2.4 megawatts and a forecasted annual production of about 10.4GWh. The electricity will be sold to Electricite du Laos (EDL) for supply to Bokeo consumers.
The investors and EDL signed two agreements for energy purchase in February and a concession agreement in March 2006 following a feasibility study in 2005.
“This project won't affect the environment or local people because there won't be a large reservoir; there will be no population resettlement,” the official said.
Instead of a dam, the project will operate using a weir to raise the water level at the intake. As the water reservoir is small and will flood a very limited area, no homes or farmland land will be flooded, and the plant will not significantly change the water flow in the river.
It is expected the plant will contribute to the development of industrial activities in the province, creating jobs and stimulating the local economy with a fishing basin.
New infrastructure such as a road and a bridge will improve access to farmland, and the project will directly contribute to the electrification of local villages.
“The government is promoting the development of small-scale power plants and Nam Nhone is a model example of a private small-scale investment,” the official said.
The government considers this project important because it will be the only local energy source for Bokeo province, and may replace Thai electricity imports.
The government is urging the building of small and medium power plants for local supply to reduce the need for power imports. These plants will have installation capacities ranging from 2 to 100 megawatts.
Other small hydro plants planned for construction are on the Nam Ham in Botaen district, Xayaboury province, Tadslen in Xepon district, Savannakhet province, and the Nam Sim in Viengxay district, Huaphan province.
Laos currently has 11 major hydropower plants and at least 36 smaller projects. These generate energy for both domestic and export markets and have a combined installation capacity of more than 670 megawatts. The 36 smaller hydropower plants are government investments.

By VIENTIANE TIMES (Latest Update June 2, 2008)

EDL considers prepaid accounts

Electricite du Laos (EDL), the largest electricity supplier in Laos , plans to introduce a new system requiring customers to pay for their electricity in advance.

EDL Acting Managing Director, Khammany Inthirath yesterday confirmed the state-owned enterprise was developing the new system in response to customers failing to pay their bills.

He said a large number of customers were late making payments, but he could not say how much money was owed to the company in unpaid accounts.

According to an electricity official, many customers pay bills once every few months, instead of immediately after the bills are issued. This negatively affects the company's cash flow.

Mr Khammany said the new system would enable EDL to collect money from consumers in advance, which would prevent customers accumulating large debts.

“We will do a test and then we will decide whether we will introduce the new system or not,” he said.

“The prepaid electricity system is widely used in our neighbouring countries of Thailand and Vietnam .”

EDL Deputy Managing Director Mr Savath Phoumalavanh the new system would also address customer dis putes about how much electricity was used each month.

Many people have filed complaints, saying staff collected incorrect data from their electricity meters and charged them for using more electricity than they really used.

He said the new electricity payment system would operate in a similar way to the prepaid mobile phone system, which requires customers to buy prepaid cards.

He said EDL was considering introducing the prepaid system in the four major provinces of Vientiane , Luang Prabang, Savannakhet and Champassak in September.

EDL would like to establish the new system with state organisations and major industrial units first. Initially the new system would be optional, but once it is fully operational consumers will not be able to access the electricity supply without a prepaid card. The prepaid cards will be sold in many places, like prepaid cards for mobile phones.

New electricity meters will also need to be installed if the new payment system is introduced.

By Ekaphone Phouthonesy. www.vientianetimes.org.la (Latest Update May 30 , 2008)

Xieng Khuang villages to power up Khonesavanh Latsaphao

Residents of Kham district, Xieng Khuang province, will be connected to the national electricity grid next month, a provincial official said on Monday.

Kham's central market has already been connected to the network and the remainder of the town will receive electricity supply by the end of next month, said an official from the Xieng Khuang provincial branch of Electricite du Laos, Mr Visien Sisamak.

“Connection to the electricity grid ensures residents will be able to use electricity at all times of the day and night. So, we are very pleased to deliver electricity to the people here,” he said.

At present, locals source power from a small hydropower station but the electricity generated is not sufficient to meet families' needs.

Because the dam used by the power station is so small, it cannot create sufficient energy for everyday use. In fact, it takes a whole day to build up and release the energy required for households' nightly use,” Mr Visien said.

“People only have electricity from 7 to 11 pm,” he said.

Some people have installed generators in their homes to ensure they can have electricity throughout the day, but they cannot use this power for cooking purposes. Generators are easy to obtain in local markets, but the increasing price of fuel means they are becoming expensive to run.

Kham district consists of 120 villages, but not all of them will be connected to the electricity grid. Only people living in the largest urban centres will have access to the network, Mr Visien said.

According to Electricite du Laos, the government is in the process of expanding the national electricity grid into the rural areas, where about 80 percent of the population lives. At present 43 percent of people living in rural areas have access to electricity.

By Vientiane Times
(Latest Update May 27, 2008)

Thailand, Laos agree to build dams in Mekong river

(KPL) Thailand and Laos have signed agreements to construct three dams where the Mekong river passes through Ubon Ratchathani, Nong Khai and Loei provinces, said Thailand's Prime Minister Samak Sundaravej on May 25.
According to VNA, once completed, the three dams will help retain water in the Mekong river, enabling Thai and Lao villagers who live on both sides of the river to have sufficient water for the whole year, PM Samak added.
He said he believed in the feasibility of the idea of diverting water from the Nam Ngum river in Laos through underground pipelines to feed Thailand 's northeastern people, for the reason that the Lao river is located on a higher ground than Thailand 's northeastern region.
The Thai PM also revealed a government project to divert water from the Mekong river to feed the water-starved northeastern region.
Water from the Mekong river in Chiang Khan district of Loei province would first be diverted for storing at Ubolratana Dam in Khon Kaen for agricultural production. The two provinces are 80 kilometres apart.

Sino interests in substitute energy investment in Laos

(KPL) China expressed interests in investment of substitute energy sector and the establishment of slaughterhouse in Laos.
The intention was made during a Chinese delegation from Song Jing City of China.
Mr Vang Chi Qaung who led the Economic-Commercial Relation delegation of Song Jing City, said during called on Mr Anouphap Tounalom, new Deputy Vientiane Mayor, on 15 May, Vientiane Capital.
Mr Qaung, Deputy of Foreign Economic-Commercial Relation Department of Song Jing City and his delegation paid a working visit to Laos between 11 and 16 May.
In 2004, Song Jing businesspeople have invested in animal raising and agriculture and rice seeds production.
The Chinese delegation has informed the result of investment in Laos yielded a great accomplishment in agriculture and forestry cooperation between Song Jing and Vientiane Capital.
The sides have pledged to further existing bilateral cooperation.
The visit of delegation was warmly welcomed by Mr Anouphap who has also expressed congratulation for the past implementation of bilateral cooperation.
He highly valuated Chinese investment in Laos and cooperation between two nations in order to boost cooperation between the agriculture and forestry sector of Vientiane and Song Jing as well as Laos and China.

Lao company to market Chinese LED lights

New energy-efficient lights, powered by renewable energy sources, are now available in Laos after a business partnership was formed between a local company and a Chinese company.

On Friday, Phongsavanh Telecommunication Spare Parts Supply and Feng Huo Ji Tuan Co (from the Chinese Shaanxi province) signed a 10-year agreement to exclusively market and distribute the Chinese-made goods in the local market.

Phongsavanh Telecommunication Spare Parts Supply General Manager Lee Tian said the LED lights were designed to use solar and wind based power and were environmentally friendly.

These products would be popular with Lao customers because they can save up to 80 percent more energy than lights currently available, he said.

Lights fuelled by solar energy can be used to light roads, homes, gardens, schools and public places where there is strong sunshine. When the sun shines, it charges the battery and at night the light will turn on automatically.

Lights fuelled by wind can be installed in areas where there are strong winds, such as areas in northern Laos .

Mr Tian said LED lights would replace conventional lights in the near future because they saved energy and were cheaper to run.

He said the lights were produced in China with modern technology and met international standards.

The company plans to invest in the establishment of an LED light manufacturing factory in Laos to sell the good domestically and abroad, but Mr Tian could not confirm when this might happen.

Feng Huo Ji Tuan Co General Manager Li Yuan Jun said Laos was an attractive market for the products because the country had strong sunshine, and also strong winds in areas of northern Laos such as Xieng Khuang province.

The company will target customers in rural areas where electricity from the national power grid is not accessible.

President of Phongsavanh Group, Mr Oth Phongsavanh, attended the signing ceremony.

By Vientiane Times

(Latest Update May 19, 2008)

Three power plants delay export

(KPL) Developers of three hydropower plants have made a proposal to the government to put off the export of electricity generated by them one year after the original plan.
According to the Ministry of Energy and Mining, the three power plants included Nam Ngum III, Nam Theun I and Nam Ngieb I.
Nam Ngum III and Nam Theun I have proposed the delay from 1 January 2013 to 1 January 2014 and Nam Ngieb I from January 2014 to January of 2015.
The director of the Energy Commerce and Promotion Department, Mr. Saypaseuth Phomsoupha, said that the developers of the investment projects have faced difficulties and cannot generate electricity by the schedule.
"The obstacles include the concession agreements which have not yet been reached and the study on the installation of a 150-kv transmission line from Nabong to Thinthene to be done by parties concerned."
The three projects of Nam Ngum III, Nam Theun I and Nam Ngieb I are investment proposals by GMS Lao, GAMUDA Berhad and KANSAI Electric Power.

Japanese firm to conduct hydropower study in Xekong

The Department of Electricity agreed last week to employ a Japanese consulting company, New Jec Inc, to carry out a feasibility study of the Houay Lamphan Gnai Hydropower project in Xekong province in the south of Laos .

Mr Viraphonh Viravong ( left ) shakes hands with Dr Masayoshi Yamashita after signing the agreement. --Photo Sisay

The World Bank has provided the department with US$990,000 to hire the co mpany.

The agreement between the department and company was signed last Thursday at the Lao Plaza Hotel in Vientiane . It was signed by Director General of the Electricity Department Viraphonh Viravong and Managing Director of New Jec Inc Dr Masayoshi Yamashita.

The signing ceremony was witnessed by the Deputy Minister of Energy and Mines, Mr Somboun Rasasombath, and officials from both sides.

The study will begin on May 25 and the company has agreed to complete the work in eighteen months.

The hydropower project is located in Thateng district, and has a proposed installed capacity of about 60MW. The dam will generate electricity for both domestic use and export to Cambodia .

The dam site is situated in the Houay Lamphan stream, which flows into the Xekong River .

Initial surveys for a hydropower plant at this site have been conducted several times since 1970, but the information used to make the calculations was obtained from maps of the area.

Surveyors did not collect information in the field relating to specific geological data and the precise geographic location of the dam and watercourses, a press release from the department said.

From the end of 2005 until the start of 2006, the World Bank provided assistance for a power import and export study. This examined the feasibility of exporting hydropower from the south of Laos to Strung Treng province in Cambodia and the supply of hydropower to the southern Lao provinces.

The study also included a pre-feasibility study of the Houay Lamphan Gnai Hydropower Project.

To implement the project as a public-private partnership, in 2007 the Ministry of Energy and Mines asked for assistance fro m the World Bank to undertake a full technical feasibility study.

The selection of a consulting company to undertake the study began in May last year.

By Manichanh Pansivongsay
(Latest Update May 12, 2008)

Nam Ngieb 1 hydropower project helps resettlement

(KPL) More than 170 families out of a total of 490 families living of the villages of Thavieng and Thathom, who are affected by the construction of Nam Ngieb 1 hydropower dam, are expected to resettlement this year.
These families are classified as poor and their living conditions are impacted by the construction of the Nam Ngieb hydropower dam in Xiengkhouang province.
The programme will provide settlement to 174 poor families this year.
In order to deal with the environment impact, Xiengkhouang province organised a meeting last week, to discuss environment impact from the Nam Ngieb 1 hydropower construction in Thavieng and Thathom areas.
Chaired by Mr Viengthanoum Phommachanh, Governor of Xiengkhouang province, the meeting was participated by 60 representatives from the construction companies of Kansai Electric Power Co. of Japan, Electricite du Laos and Thai Electricity Companies, and local residents who are affected by the construction project.
The meeting has agreed to relocate the 174 families in Thavieng and Thathom areas to the riverside area of the Nam Ngieb river.
The constructing companies will take responsibility for all costs and problems involved in the resettlement in the future.

Raising awareness on saving electricity

(KPL) A ceremony to launch The Promotion and Creation of Awareness on Saving Electricity was held on 29 April at Lane-Xang hotel, Vientiane.
The event was chaired by Deputy Minister of Energy and Mining Mr. Somboune Rasasombath, and attended by director of Electricite du Lao (EDL), Head of energy and mining ministry’s office, representatives of World Bank and concern sectors.
This project was established on 2 February 2007 and managed by EDL with a financial support from the World Bank (WB) to reduce high expense on power.
This project constitutes very significant to contribute to the promotion of power efficiency, to reduce state budget loss on electricity, which is increasing annually and encourage the society to participate in power efficiency.
Participants of the meeting also reviewed the implementation of first phase of the management of electricity use project.

Nam Ngum 5 Hydropower starts construction

(KPL) The construction of a 120 KW- Nam Ngum 5 Hydropower plant started at the end of last month.
Present at the opening ceremony of Nam Ngum 5 construction on 28 April were Deputy Minister of Energy and Mining Mr. Somboune Latsasombath, Minister of Foreign Affairs Dr Thongloun Sisoulith, President of Sino Hydro Co., (China) and relevant officials.
Nam Ngum 5 is located at Phoukhoune district, Luang Prabang province. The project costs US$200 million, a joint venture investment between Chinese investor and Electricite du Lao. The project is on a basis of Build-Operate-Transfer (BOT). After completing the plant will operate privately for 25 years before transferring to the government of Laos.
Chinese investor holds 85% of the total shares of the investment project and the Lao government takes the rest.
Nam Ngum 5 Hydropower plant construction is scheduled for completing in 2011. The plant is projected to generate 507 GWH annually.
Although the construction was officially launched last month, roads accessing the dam and diversion tunnel of the dam have been constructed and dug months ago.

Chinese studies Sepon III Hydropower Project

(KPL) A memorandum of understanding on Sepon III Hydropower Project was signed here on Monday by the Lao government and the Chinese National Machinery and Equipment Import and Export Co-operation (CMEC).
It is expected that the project will have its hydropower plant built in Samouy district, Saravan province, which is part of Government's development plan to produce electricity for export to neighbouring countries.
Signatories to the MOU were Deputy Minister of Investment and Planing Mr. Thongmy Phomvisay, Head of Energy Development and Promotion Department of Energy and Mining Mr. Saypaseuth Patsoupha, Deputy President of CMEC Mr. Jin Chun Sheng and Director of CMEC Mr. Guo Ying Xin in the presence of Governor of Saravan province and relevant officials of both sides.
The MOU says Lao government has allowed CMEC to conduct a feasibility study on the possibility of the project within 18 months after signing.
If the study shows the project is economically beneficial and environment friendly, the Sepon III Hydropower Project will be developed in 30 year-concession through Build-Own-Transfer (BOT) procedure.

Transmission lines link northern part

(KPL) The Electricite du Laos (EDL) and the China International Water and Electricity (CWE) have inked an agreement on the installation of 230 kV transmission lines linking the northern part of the country.
The two sides signed an agreement, on 4 April for the installation of the 230-kV-transmission line from Hinheub district, Vientiane province, to Nasaithong district, Vientiane Capital, with the construction of substations in Vientiane province.
The signatories to the document were EDL Director General and the CWE President. The signing was witnessed by Minister of Energy and Mining Bosaikham Vongdala, Chinese Ambassador to Laos and other senior officials of both sides.
This project is aimed at strengthening the capacity building for future power grids in Laos which will serve as a main transmission line between the hydropower dams in the northern region such as Nam Lik I, II, Nam Ngum V and the Hongsa Lignite Power Plant in Sayaboury province.
The substations will be built at Ban Done, Hinheub, Nasaithong and Phontong, with the installation of a 17-km long 115-kV transmission line between Ban Done and Hinheub substations, a 71.5-km long 230-kV transmission line from the substations at Hinheub to Nasaithong, and a 12-km long 115-kV from Nasaithong to Phontong substatations.

Govt grives the green light to Nam Lik I hydropower plant

(KPL) The government has allowed Hydro Engineering (Thailand) to develop Nam Lik I Hydropower Plant in Vientiane province, according to its newly signed agreement with the foreign investor.
The agreement was signed on 8 April in Vientiane among the witness by Deputy Minister to Prime Minister�s Office Dr. Boviengkham Vongdara, Deputy Minister of Energy and Mining Mr. Somboune Lasasombath and concerned officials.
In July 2006 the contact company signed an MOU on feasibility study on the project with the government of Laos.
After its construction complete, with an investment of 109 million US dollars, the plant in Hine Heup district of Vientiane province could generate 249 Gwh a year.

Bidding contract signed for power project in Laos

(KPL) A 42.36 million USD bidding contract for the supply of electrical equipment and technical services for the Vietnamese-invested Sekaman hydropower project in Laos was signed in Hanoi on April 17.
The contract was signed between Sekaman 3 Co. Ltd. of the Vietnam-Laos Electrical Joint Stock Company and Vatech-Hydro GmbH of Austria.
Vatech-Hydro GmbH won over four other bidders to supply 250 MW capacity electrical turbines for the plant.
The project will be built in Dakchung district of Sekong province at the cost of 273.1 million USD. It is expected to produce over 1 billion Kwh of power, of which 90 percent will be sold to Vietnam. The project is scheduled for completion in September 2010.

Nam Theun 2 reservoir begins to fill

The Nam Theun 2 (NT2) hydropower project has began the impoundment process, meaning the storing of water, with the sealing of the diversion tunnel that will cause dam water levels to rise and ultimately fill the reservoir.

“From now on, water will begin to fill the Nakai reservoir, but a small flow will be released downstream for fisheries and environmental purposes,” said the Chief Executive Officer of Nam Theun 2 Power Company Limited, Mr Jean Pierre Katz, at a ceremony last Thursday to mark the closure of the diversion tunnel.

The ceremony was held at the Nakai dam site in Khamkeuth district, Borikhamxay province, in the presence of Standing Deputy Prime Minister Somsavat Lengsavad.

The closure of the tunnel will result in 80 sq km of land being flooded.

“The tunnel closure is the first step in the reservoir impoundment process, before the dam gates are closed in June,” said Minister of Energy and Mines Bosaikham Vongdara.

The tunnel was built to divert the Theun River around the dam site during construction. Water will now be released through the dam gates.

Mr Bosaikham said the independent Panel of Experts on Environment (POE) had been monitoring and assessing project implementation so far and had approved the closure of the diversion channel.

The POE has been monitoring the project since 1997. They have constantly referred to the concession agreement that underpins the project, highlighting the importance of this accord in achieving the desired social and environmental outcomes of the venture.

“This step of closing the tunnel occurs towards the final phase of the project, and shows the venture is well on track,” said the Deputy Director General of the Energy Promotion and Development Department, Mr Sychath Boutsakitirath.

Project construction began in mid 2005, and is now 85 percent complete.

Mr Bosaikham said trial electricity production would begin in March next year and official commercial operations would begin by the end of 2009.

Investment in the project is worth more than 11.8 trillion kip (US$1.2 billion). The plant will have an installed capacity of 1,070MW with six generators for electricity supply to both local and export markets. Thailand will buy 995MW of electricity, and 75MW will be used for domestic consumption.

The hydropower plant is a joint venture between the Lao government, which holds a 25 percent shareholding, and foreign investors from Thailand and France who hold the remaining 75 percent. Financing involved 26 international banks including the World Bank, Asian Development Bank, European Investment Bank and Agence Francaise de Developpement.

“After completion, the plant will contribute about US$80 million per year to the national budget over the 25 year concession period,” Mr Bosaikham said.

NT2 will bring about indirect benefits to local communities through socio-economic development projects such as infrastructure installation including roads, schools, hospitals and other public facilities. The project will also provide local communities with electricity and clean drinking water.

By Vientiane Times
(Latest Update April 18, 2008)

Work to start on Lao-Cambodian power line

Electricity generated by the Xeset 2 powerhouse, seen here under construction in Lau-ngam district in Saravan province last December, will be sold to Cambodia starting in 2010.

The installation of 115kV transmission lines between Laos and Cambodia will begin by the end of this year, giving Laos a new electricity export market, said a project official.

The power lines will run for 26km, from Hat village in Khong district, Champassak province, to the border, where they will connect with a 54km line from Cambodia .

“The total cost of the Ban Hat Lao-Cambodian 115kV Transmission Lines and Ban Hat Substation Extension Project will be about 23 billion kip (US$2.6 million),” said Project Manager Khamsing Phosalath on Thursday.

Funding was loaned to Electricite du Laos by the government for the installation, as part of grant aid received from the World Bank.

“The installation is expected to be completed by the end of next year,” said Deputy Minister of Energy and Mines Somboun Rasasombath at the annual meeting of the energy and mining sectors recently in Vientiane .

The project is now seeking tenders for the work and has been advertising for bidders for the last two months.

“A few companies are interested and we will make an announcement of the winning bidder in June,” Mr Khamsing said.

The project will allow the sale of hydropower from Champassak province to Siem Pang district in Stung Treng province, Cambodia .

“Transmission is expected to begin by 2010. The initial supply will be about 5MW but it may be increased as needed,” Mr Somboun said.

Laos and Cambodia signed a memorandum of understanding (MoU) on energy purchase in December last year. This was the initial move for the sale of Lao electricity to Cambodia , and an important step in the cooperation of the two energy sectors.

But the two governments have yet to agree on how many megawatts Laos will sell to Cambodia and over what period of time.

Currently Laos has MoUs to provide 5,000MW to Thailand until 2015, and a further 2,000MW after this date until 2020. Vietnam has also agreed to purchase 5,000MW of electricity from now until 2020.

Laos has a combined energy production capacity of about 670MW from 11 major and 40 medium-sized hydropower plants, which generate power for both domestic consumption and export.

By 2020, the Lao energy sector hopes to have an installation capacity of 30,000MW from dams currently under construction or planned along the Mekong River and its tributaries. This goal may be achieved now that more investors are conducting studies at several places in the country.

This is fundamental to the Lao government's intention, announced at the 10 th Asean Summit in 2004 in Vientiane , to become the ‘battery of the region'.

By Phonsavanh Vongsay
(Latest Update April 21, 2008)

Tunnel closure takes Nam Theun 2 project nearer completion

(KPL) The Nam Theun 2 hydropower project on 10 April moved one step nearer completion with the sealing of the diversion tunnel which will see the water level start to rise and ultimately fill the Nam Theun 2 reservoir, a process referred to as impoundment.
The tunnel was officially closed in a ceremony that took place at the Nakai dam site in Khamkeuth district, Borikhamxay province, Lao PDR in the presence of Mr. Somsavat Lengsavad, Standing Deputy Prime Minister of the Lao People's Democratic Republic.
This closure will result in the flooding of 80sq km of land and is the first step in the process of impoundment: The dam gates are scheduled to close in June 2008.
Deputy Director General of the Department of Energy Promotion and Development Mr Sychath Boutsakitirath said the tunnel closure represented an important milestone in the development of hydropower in Lao PDR.
"This step toward the final completion of the NT2 project is one we have been anticipating with some enthusiasm, as it means the project is well on track and impoundment can begin this wet season," he said.
"We are delighted with the progress of the project as it represents a vital contribution to the Lao economy and the Lao people and will playa substantial role in helping the Government meet its poverty alleviation goals."
The tunnel was built to divert the Nam Theun river around the dam construction site so water flow could be better managed during the construction phase. Water will now be released through the dam gates.
The Nam Theun 2 project is 85% complete and on schedule for its planned start of operation in 2009. Commissioning of the Nam Theun 2 hydropower plant is set for the beginning of March 2009 and commercial operations will commence in December 2009.
The tunnel closure follows the agreement by an independent international Panel of Experts (PoE) late last week that the project operators and the Lao Government had met their obligations in the Social and Environmental Management Framework and Operational Plan. In January the PoE outlined several key areas it suggested needed addressing before the tunnel closure and its latest report says it is now satisfied that these requirements have been met or are sufficiently far advanced. The report made special comment that completion of the necessary tasks had been achieved much faster than the panel had anticipated; in fact the PoE noted that the rapid and effective responses by the Lao Government and Nam Theun 2 Power Company (NTPC) had indeed been impressive.
Recommendations included successful resettlement of all affected people, establishment of a reservoir management committee, completion of essential infrastructure and housing, removing of the reservoir biomass, establishment of fishing and agriculture rights, livestock replacement and a protein provision program for 37 villages below the dam.
The PoE, which has been involved in monitoring the Nam Theun 2 hydropower project since 1997, has filed 14 reports to date and they have constantly referred to the Concession Agreement that underpins the project, highlighting the importance of this agreement in achieving the social and environmental outcomes being pursued. The three-member panel routinely submits its findings to the Ministry of Energy & MInes, at the same time referring recommendations to the NTPC where appropriate.
It has stated that it believes NT2 has the potential to be a world class model of a large scale project that could benefit the nation, the people and the environment.
With its installed capacity of 1070 MW, NT2 is the largest hydropower project to be constructed in Lao PDR to date. It is a joint investment between the Government of Laos and foreign investors in the form of a build, operate and transfer (BOT) project. Nam Theun 2 Power Company Limited (NTPC) was established under Lao PDR law, being the owner of the Project. Shareholders are the Lao Holding State Enterprise (25%), Electricity Generating Public Company Limited (25%), Electricite de France International (35%) and Italian-Thai Development Public Company Limited (15%). Financing involved 26 international banks including international financial institutions such as the World Bank, the Asian Development Bank, the European Investment Bank, and Agence Francaise de Developpement.
The bulk of the power generated by the project will be exported to Thailand but 75MW will be earmarked for Lao domestic use.
In the past, more than 6.000 poor peoples used to practice slash-and-burn activities in Nakai plateau. With the support of the Government and NTPC, they have learned new occupations on the basis of the sustainable utilization and management of natural resources. With regard to the Nakai-Nam Theun watershed management, the Project will provide 1 millions US annually to relevant government's agencies for 25 years. Those agencies will have the duty to protect the habitats of wildlife animals and the abundance of the biodiversity of the 4000 km2 Nam Theun 2 Watershed area. The released water from the plant will supply the irrigated areas covering thousand of hectares in Xe Bang Fay, Gnommalath and Mahaxai districts. During the construction phase, a large number of employments were created; technology was transferred thus generating an income of 5000-7000 people every year. Therefore, we can proudly say that apart from being an industrial and business project, the Nam
“Theun 2 project is also a development project that aims to reduce the poverty in Laos.
This project started its overall construction in mid 2005 after received the official support from the international financial institutions. Up to now, the construction has been conducted for 33 months out of the 55 scheduled months and the construction works are 85 % completed,” Mr Bosaikham Vongdara, Minister of Energy and Mines, said.
The Nam Theun 2 Project and the Lao Government have accomplished the implementation of the socio-environment programs (infrastructure construction, sustainable livelihood program for resettled people, downstream livelihood development program, the water sources protection and biodiversity program, the salvage logging programs) to be implemented fully in accordance with the conditions stipulated in the Concession Agreement. Last week, after accomplishing their mission conducted between 25 March -5 April 2008, the independent Panel of Expert on Environment or POE, who have been monitoring and assessing the project implementation so far, have agreed and supported the closure of the tunnel to be held on 10 April 2008 as planned.
The tunnel closure is the first step for reservoir impoundment before moving towards the closure of the dam gates in mid June 2008. The trial beginning of production in early March 2009 and the official beginning of production in December 2009 will constitute important milestones of the success of the Nam Theun Project construction.

Investor studies Champassak hydropower project

A Thai company has taken steps towards a hydropower project on the Mekong River in Champassak province that could be worth upwards of US$1 billion if it is built.

Deputy Minister of Planning and Investment Thongmy Phomvixay ( right ) exchanges agreements with Charoen Energy and Water Asia Co. Chairman Chatchaval Jiaravanon.

On Wednesday, the Lao government signed a Memorandum of Understanding with Charoen Energy and Water Asia Co., allowing the company to conduct a study aimed at determining whether the project would be viable.

Company Chairman Chatchaval Jiaravanon said the project was focused on establishing a hydropower station which would have an installation capacity of 800MW, meaning it would use this amount of power in the generating process.

The study will provide the investor with detailed project information so the company can decide whether the project should proceed to the development stage.

The project, called Lat Seua Hydroelectric Power, is located between Latseua village in Sanasomboun district and Khanyang village, Phonthong district, Champassak province, and according to project coordinator Bountao Phichit, could cost about 10.5 trillion kip (US$1.2 billion).

If the results of the study show the project to be economically viable, it is planned the hydropower station would have an operating period of 30 years, including the construction period.

“The energy generated from this project will be exported to Thailand ,” said Mr Chatchaval.

Laos currently has a combined installation capacity of about 670MW from 11 major and 40 medium-sized hydropower plants generating energy for domestic and export markets. They generate approximately 3.5 billion kWh per year, of which about 2.2 billion kWh is exported to Thailand .

By 2020 Laos hopes to have energy generation with an installation capacity of 30,000MW from hydropower projects currently being built or planned along the Mekong River and its tributaries.

Laos may achieve its goal of 30,000MW now that energy investors are studying hydropower projects in several sites on the Mekong River .

Lao Deputy Prime Minister of Foreign Affairs Dr Thongloun Sisoulith and Thai Minister of Foreign Affairs Noppadon Pattama recently sig ned in Vientiane a Memorandum of Understanding on cooperation in an electricity development project.

The two nations agreed to allow a private firm to conduct a feasibility study of a proposed project in Koum village, Champassak province, Laos , located on the Mekong River opposite Khong Chiam district in Ubon Ratchathani province, Thailand .

By Phonsavanh Vongsay
(Latest Update April 4, 2008)

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