Work to resume at Laos' 1,260-MW Xayaburi hydropower project

Work has resumed on the controversial 1,260-MW Xayaburi hydroelectric project, HydroWorld.com has learned.

The Laotian government suspended construction of the US$3.5 billion project in December 2011 after facing heavy criticism from environmental protection groups, but the plant's developer -- CH. Karnchang Public Co. Ltd. -- has said it expects to begin construction of a reservoir at the site by the end of the year.

"We are still working on the project," says Plew Trivisavet, Chief Executive Officer at CH Karnchang. "We haven't received a formal letter from the Lao government that we should suspend or put the project on hold."

Opponents of the project say that the Xayaburi will open the door for future dams along the Mekong River, prompting the formation of the Mekong River Commission, which includes members from Cambodia, Laos, Thailand and Vietnam.

The commission says member governments had agreed to approach the Japanese government and other international groups to further study the dam's impact before giving Laos the go-ahead for construction.

The Mekong River Commission says the Xayaburi and the 10 other dams planned for the lower Mekong River could turn as much as 55% of the river into reservoirs, resulting in more than $500 million in lost agricultural profits.

Half of the Xayaburi hydropower project is owned by CH Karnchang subsidiary Xayaburi Power Co., which has a 29-year concession contract with the Laotian government to operate the facility's powerhouse.

CH Karnchang is joined by Natee Synergy Co., which ownes 25%, and Thailand's Electricity Generating Co. and Bangkok Expressway Pcl, which own 12.5% and 7.5%, respectively.

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