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World Bank begins appraisal of giant dam
project planned for Laos
WASHINGTON (AFP) - After nearly a decade
of discussions and project preparation work, the World Bank (news
- web
sites) said it had started an appraisal process for a 1.2 billion
dollar proposed hydroelectric dam project in Laos.
The bank has held international consultations in Bangkok, Paris, Tokyo
and Washington on the controversial 1,070-megawatt project, which some
green groups have protested against due to its social and environmental
effects.
"As part of the ongoing due diligence process for the project, the
appraisal phase will constitute a further review of the extensive
preparatory work undertaken by the Government of Lao PDR and the Nam Theun
2 Power Company," the Washington-based bank said in a statement.
The company comprises EDFI, the global arm of French state-owned
Electricite de France, which holds a 35 percent key stake.
The Lao government and Thailand's Electricity Generating Public Co.
Ltd. have a 25 percent stake each while another 15 percent equity is from
joint venture Italian-Thai Development Public Co. Ltd.
"If the appraisal is successful, the next step would be to
negotiate the terms of the financial instruments with the Lao government
and the sponsors and prepare information for the World Bank's Board of
Executive Directors," the statement said.
The Board, it added, would then use that documentation to make
"the final decision on whether or not the World Bank would support
the project."
A key concern of the project is the social impact it will have on 5,700
people who will be forced to leave their homes to make way for the dam,
intended to start generating electricity from 2009.
The cash-starved Lao government is bent on seeing the venture
implemented as it has the potential of generating revenue of nearly two
billion dollars -- the current Gross Domestic Product value of Laos --
over a 25-year period.
The bank has been nudging the communist Lao government to implement a
series of economic reforms after it became involved in the project.
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