Vientiane Times September 6, 2012

Deputy Minister of Energy and Mines Mr Viraphonh Viravong gave an exclusive interview in Vientiane to the Aljazeera Network, one of the world’s most influential news agencies, on the Xayaboury hydropower project. The following are the questions and answers that arose during  the interview, given on August 20.

What are the reasons for the dam’s construction and what are the  potential effects on the local and national economy?

Mr Viraphonh Viravong.

(i). Laos is blessed with large hydro potential. Hydropower is clean,  has zero carbon emissions, and is renewable. No other method of  generating electricity can create opportunities for providing water for  human consumption and flood control. Hydropower is also a  non-consumptive use of water, i.e. after electricity generation, water  can still be used for irrigation. The sustainable and responsible  development of hydropower can be a catalyst for economic development and  can help bring about poverty reduction in Laos.

(ii) The direct benefits to the local population are better  infrastructure such as roads, clean water, irrigation, electricity, and  improvement of living conditions such as employment, education, health,  trade, etc.

(iii) National direct benefits include royalties, taxes and dividends;  reliable supply of clean and renewable energy; training of skilled  labour; raise creditworthy and cheaper project financing; opportunity to  develop large hydro potentials.

(iv) Hydropower contributes 33 percent to the natural capital of Laos’  wealth (Wealth and Sustainability – Background Paper on the Lao PDR  Development Report 2009 by World Bank Group). Without hydropower  development, it will be difficult for Laos to leave Lower Income Country  status by 2015-2018.

What are the environmental risks involved in building this dam, and  what is the government doing to try to minimise them?

In developing hydropower projects, generally there are 5 domains of  concern that may have transboundary impacts. The Mekong River Commission  Secretariat issued “Preliminary Design Guidance for Proposed Mainstream  Dams in the Lower Mekong Basin” in 2009 which addressed the 5 issues as  follows:

(i) Navigation.

(ii) Fish migration.

(iii) Sediment transport and river morphology.

(iv) Water quality and aquatic ecology.

(v) Safety of dams.

Xayaboury is a run-of-river type dam without large storage capacity, and  also has a low dam height (average dam height of only 40 metres,  compared to the 198 metre height of the Nam Ngum II dam built by the  same developer), thus:

(I) Navigation locks are fairly common and there are hundreds of  references in the world of successful operation.

(II) There are a fish ladder, fish lift and fish passage through the navigation locks; in addition, fish-friendly turbines are specified to be used, and a fish hatching station will complement any endangered fish species.

(III) Sediment transport through the dams will be designed in accordance with recommendations from Compagnie Nationale du Rhone (CNR), which has been operating their 19 run-of-river hydropower stations on the Rhone River successfully for the last 50 years.

(IV) Quality of water will be the same as before since there is no reservoir and the ratio of retention capacity is negligible compared with the inflow at Xayaboury.

(V) Fluctuation of the downstream water level will be kept to less than 0.5 metre in one day. Safety of dams is designed with all applicable international standards.

Confusion over the status of the project: is it currently suspended or not – and the apparently different messages coming from different members of the government on that issue?

Brief history of the development of the Xayaboury hydropower project:

. 1960-1990: A multi-purpose project with a large reservoir was considered as it has much higher benefit potential, such as the example of the Phamong project. However, the environmental impacts were serious and the resettlement of hundreds of thousands of people made the project unacceptable.

. 1992-1994: CNR proposed a run-of river type dam in the mainstream Mekong. A preliminary feasibility study recommended 4 first grade projects comprising Don Sa Hong, Ban Koum, Xayaboury and Pakbeng.

. The Lao government signed an MOU with Thailand’s Ch. Karnchang for a feasibility study of the Xayaboury project on May 4, 2007. The Mekong River Commission Secretariat held a workshop on Procedures for Notification, Prior Consultation and Agreement under the 1995 Mekong Agreement on Dec. 8, 2008. The four member countries adopted the “Preliminary Design Guidance for proposed mainstream dams in the lower Mekong Basin”.

. Xayaboury Prior Consultation carried out from Sept. 20, 2010 to April 22, 2011.

. Compliance Review report by Poyry was issued to the public in August 2011.

. Peer review report by CNR was issued to the public in April 2012; the report detailed designing a transparent dam with respect to sediment transport.

. Lao Joint Committee issued a letter in April 2011 to all MRC member countries confirming that Prior Consultation of the Xayaboury had been carried out in full compliance with the 1995 Mekong Agreement and completed on 22.04.11.

. MRC Council Meeting in December 2011, in Siem Reap, Cambodia: Lao representatives reported on the progress of the Xayaboury project but not within the framework of the Prior Consultation process.

. Laos’ statements always confirmed that no Permanent Works had been allowed to be undertaken in the Mekong, pending additional review by experts such as Poyry and CNR, in order to be able to address all legitimate concerns from MRC member countries, even though the Prior Consultation had been completed.

The Lao government acquired the services of Poyry, CNR and many independent experts to review the final design of the Xayaboury project to confirm that it met all international practices, complied with Mekong River Commission Secretariat preliminary design guidance, and that it can be considered a transparent dam with respect to sediment transport, and a good example of sustainable hydropower development.

It can be said today that all valuable and legitimate concerns have been incorporated into the final design of the Xayaboury hydropower project by the Lao government’s engineers, Poyry and CNR, who have reputable experts and joint experience in the construction of hundreds of dams. Laos therefore would like to confirm that it will develop the Xayaboury project in full compliance with the experts’ recommendations, according to the schedule presented in our last presentation at site on July 16-17, 2012, and will develop the project responsibly.