Laos, China ink Nam Ngum 4 dam loan agreement
Laos, China ink Nam Ngum 4 dam loan agreement
The Lao government and China have signed a US$600 million loan agreement for the Nam Ngum 4 hydropower project in XiengKhuang province.
The agreement was signed between Laos' Ministry of Finance and the Export-Import Bank of China during the Asean Summit in Vientiane last week, witnessed by Lao Prime Minister MrThonglounSisoulith and Chinese Prime Minister Mr Li Keqiang.
The project will maximise the efficiency of the Nam Ngum river hydropower cascade development and boost national foreign exchange reserves, greatly contributing to the economy and Lao people's livelihoods.
The signing of the loan agreement is the result of joint efforts by the government and relevant agencies, such as the Ministry of Finance, Ministry of Energy and Mines, Electricite Du Laos (EDL), and China's Ministry of Commerce and Export-Import Bank.
The government previously granted permission for a local company to build the Nam Ngum 4 dam, with construction expected to take five years before electricity could be generated.
But the company did not make progress with the project so the government handed it over to EDL to carry out under the EPC (Engineering, Procurement and Construction) model, EDL Deputy Managing Director MrKomonchanhPhet-asa told Vientiane Times yesterday.
With an installed capacity of 220MW the dam would cost about US$700 million to build, he said.
The dam will be built 30km from Paek district. It is government policy to generate more electricity to supply local demand and accommodate the growing industrial sector.
Officials say the project will play an important role in socio-economic development and improving the lives of people in the northern provinces.
Laos has considerable potential for hydropower development and has many rivers that are suitable for this type of project. The government believes strongly that hydropower development will help to alleviate poverty and enable Laos to graduate from Least Developed Country status by 2020.
