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Tunnel Closes and Nam Theun 2 Reservoir Begins to Fill

April 10, 2008

On April 10, 2008, the tunnel which has been diverting the water around the Nam Theun 2 (NT2) dam will close. Following this, in mid-June 2008, the dam gates are scheduled to close which will enable the full inundation of the reservoir.

In February of this year, the World Bank reported in its Interim Progress Report that in order for reservoir inundation to go ahead three benchmarks have to be met according to the Concession Agreement between the Lao Government (GOL) and the Nam Theun 2 Power Company (NTPC).

The three benchmarks and their current status as of April 4, 2008, are as follows:

  • Resettlement of all impacted households in the Nakai Plateau to be completed, along with related infrastructure (houses, water wells…) and services – 98% of houses have been completed. The remaining 35 households, which will not be impacted until June, will be fully resettled by end of April. Water wells and other infrastructure, including community buildings (schools, health centers) are almost finished and will be completed by June 15. Minor finishing touches will take place throughout the year;
  • The Reservoir Fisheries Plan, and related sub-plans, must be completed – Draft plans have been completed and will be reviewed by GOL and the international financing institutions (IFIs) in April so that the resettled villagers can start taking advantage this year of fishery opportunities;
  • An Emergency Contingency Plan must be finalized in consultation with the Dam Safety Review Panel – This has been completed and communities have been made aware of potential risks.

In addition, the World Bank also highlighted in February that three other related actions also needed to be met and their current status as of April 4, 2008, is as follows:

  • Comprehensive plan for mitigation and compensation for the villagers who will be impacted in the Downstream Areas – IFIs and NTPC are discussing final refinements, and GOL will approve a plan – that will cover activities for approximately the next two years;
  • Selective vegetation clearance in the areas of the reservoir that will be permanently inundated will be completed to help improve water quality and navigation access – Most of the 1500 hectares (ha) identified have been cleared and are being burned. Additional vegetation clearance will take place until mid June.
  • A water quality monitoring program, with baseline information, must be operational –This is in place and will continue in the coming years.

The International Panel of Experts (POE), who advise the Lao Government on social and environmental issues related to NT2, also assessed the status of the actions outlined above when they undertook their 14th visit to the project site March 26-April 4.

The Panel reviewed the progress since their visit in January, assessed the status of all the actions mentioned above and also the status of work on recommendations they had made during their January visit (see POE 13th and 14th reports). The Panel has expressed its full support for tunnel closure in April. Their 14th report highlights actions to be completed before the dam gate is closed in June 2008.

The World Bank and other financing institutions will continue its close supervision of social and environmental programs. In the coming months, we will pay particular attention to the full completion of infrastructure in the new villages, the provision of boats for villagers to fish in the reservoir, the permanent relocation of the Vietic villagers from SopHia, the progress on livelihood activities throughout all project areas, the protein status of the 37 villages downstream of the dam and the continued progress of the Watershed Management Protection Authority (WMPA).