The Nam Theun 2 Hydropower Project began commercial export of electricity in March 2010 and was awarded its final certificate of readiness by the main client, EGAT, on April 30 2010.

The Nam Theun 2 Power Company Limited (NTPC) is established under Lao law as the owner of the facility. Shareholders in NTPC are the Lao Holding State Enterprise (25%), the Electricity Generating Public Company of Thailand Limited (25%), Electricité de France International (35%) and Italian-Thai Development Public Company (15%). 27 international banks, including international financial institutions such as the World Bank, the Asian Development Bank, the European Investment Bank and Agence Française de Développement, are involved in the financing of the project. Financial Close occurred on 15 June 2005. The initial total project cost of US$1,250 million was divided into equity and debt financing, representing 30% and 70% respectively.

The Project has resettled 6,300 people who were living in the assigned reservoir area on the Nakai Plateau. In order to gain the support of the local public, and to share information with a wider community, a series of domestic consultations and international communications were held during the project preparation phase.

The potential for hydroelectric power on the Nam Theun on Nakai Plateau was first identified in the 1920s but it was not until the early 1990s that the Nam Theun 2 Hydroelectric Project was prioritised by the Lao Government for the economic and social development of the Lao nation. Construction work started in 2005 and was completed in early 2010.

Revenues from Nam Theun 2 will serve the long-term development of the country. The Project is forecast to generate an average of US$80 million annually in direct revenues for the state in the form of taxes, royalty charges and dividends over the 25-year concession held by NTPC. After this, the Project will be transferred to the Government and all revenues will thereafter accrue to the Lao state.

The Lao Government has set up a Poverty Reduction Fund that is being initially backed from International Development Agency funds but will then benefit from Nam Theun 2 revenues. With World Bank support, special administrative units are being established to deal with both the implementation of the Project and the effective management and allocation of the financial resources gained from NT2.

Around the Project area, NT2 will bring considerable improvement in living standards for people through direct development  programmes plus the economic stimulus supplied by the Project, and has also made substantial funding available for protection of the National Protected Area that borders the Nakai reservoir.

The Nam Theun 2 project is an outstanding example of how the Government of the Lao PDR is working with the private sector and multilateral organisations to develop a model of sustainable development with strong economic, social, and environment fundamentals. The Project has long been recognised by independent experts as having great potential to achieve the country's development objectives. In a statement issued by the World Bank, following a visit to the Project in May 2003, Shengman Zhang, the World Bank's Managing Director, said, "We see Nam Theun 2 not as a project per se, but as a vehicle through which to make a considerable progress in the effort of poverty reduction."

The Project’s pre-construction phase featured an intensive consultation process. Public consultations were held in Vientiane from 1997 to discuss the Resettlement Action Plan while a series of detailed local consultations were held in villages on the Nakai Plateau, along the Xe Bang Fai River, in the watershed area, and in the project lands and peripheral impact zones. The findings of these consultations were discussed with a broader regional and international audience through a series of workshops held in Vientiane, Bangkok, Paris, Washington and Tokyo in 2004. [click here to see the workshop schedule]

An economic analysis workshop was held in Bangkok in November 2004. In December, a further workshop was held in Laos to discuss the Xe Bang Fai downstream compensation framework.

In addition, the summary of the Environmental and Social Impact Assesment (Lao and English versions) and other key safeguard documents (e.g. SEMFOP, EAMP, SDP and PIP) have been posted online on this web site and/or on the Nam Theun 2 Power Company web site at www.namtheun2.com. These extensive documents were refined over considerable time to reflect feedback from the consultative process and other relevant inputs, and each represents many thousands of hours of expert study and review.

These documents formed the basis for the wide-ranging social and environmental programmes that have accompanied the Nam Theun 2 Project and given it immense added value for the country. Many of its accomplishments, such as the setting of a stringent resettlement policy, provision of a comprehensive social and environmental assessment, incorporation of emergency contingency planning, and creation of specialised agencies for local implementation, have been the first such actions in Laos, and have helped improved the government’s capacity to plan and execute projects in all sectors. Nevertheless, these documents have been used as templates rather than manuals, with the authorities and NTPC instituting adaptive management committees to ensure that implementation of programmes remains flexible and responsive to the evolving needs of local people.

An international and independent panel of experts has monitored the Project since its inception, one of various bodies making regular oversight to ensure that all obligations are met and that goals remain true to the design of NT2 as a mechanism to reduce poverty and improve environmental sustainability. The reports of this Panel of Experts (PoE) are available on this website or on the NTPC website.

Project Timeline

For more news on Nam Theun 2 see:

http://www.namtheun2.com/

www.worldbank.org/lao/nt2

http://www.adb.org/Projects/Namtheun2/default.asp

http://www.power-technology.com/projects/namtheun2/

http://en.wikipedia.org/wiki/Nam_Theun_II_Hydroelectric_Dam