ADB supports hydropower project

By Helen Wright03 November 2011

Asian Development Bank

Asian Development Bank

The Asian Development Bank (ADB) has lent US$ 465 million to support the construction of a 440 MW hydropower plant on the Nam Ngum River in the northern part of the Lao People's Democratic Republic (Lao PDR).

The plant would supply power to the Lao PDR's energy-hungry neighbour, Thailand, as well as generating upwards of US$ 770 million to fund poverty reduction programmes in the Lao PDR.

The public-private project, estimated to cost around US$ 1 billion in total, will be built and operated for 27 years by the Nam Ngum 3 Power Company (NN3PC).

NN3PC is owned by three private sector companies - Thailand's GMS Lao Company Ltd and Ratchaburi Electricity Generating Holding, together with Axia Power Holdings, a subsidiary of Japan's Marubeni Corporation. The Government of Lao PDR will also hold a stake through the Lao Holding State Enterprises (LHSE).

Construction work for Nam Ngum 3 will include a 220 m high dam that will create a 27.5 km2 reservoir. Seasonal flooding from the new reservoir will mean that 144 households located near the area will be moved.

The Nam Ngum 3 plant is expected to be operational in 2017 and will be located upstream of the existing Nam Ngum 1 and Nam Ngum 2 hydropower plants, and downstream from another plant that is currently under construction. The Nam Ngum 4 A and B plants are also planned upstream of Nam Ngum 3.

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