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Lao, Chinese energy developers ink hydropower deal
Two energy investors last week signed a shareholders agreement on the Nam Ngiep 2 hydropower development project, based in Xieng Khuang province, after more than a year of negotiations.
The agreement was signed between China International Water & Electric Corp (CWE) and Electricite du Laos (EDL).
“We have had many negotiations on the agreement, starting since early last year,” EDL Managing Director Mr Khammany Inthirath said at the signing ceremony.
The project involves investment of about 2.8 trillion kip (US$345 million), of which EDL will initially hold a 10 percent share and the rest will belong to CWE.
EDL Business-Finance Division Director, Mr Bounma Manivong, said “EDL can buy a further 10 percent of the share three years after the start of commercial operation of the plant.” When the plant is operational, it will have installed capacity of 180 megawatts (MW) with two generators that will produce 723GWh per year.
CWE President Mr Wang Yu said the plant is expected to be built and generating energy for supply to the EDL grid by 2015.
“EDL will buy all the power produced for local supply, mainly in central Laos,” Mr Khammany said.
Mr Bounma said a power purchase agreement will be signed within the next few months between CWE and EDL, after which the two parties will sign a project concession agreement with the government.
CWE signed a memorandum of understanding for the project with the Lao government in December 2008 and a project development agreement in August last year.
An electricity transmission line is currently under study and design. “Some construction work has already begun, including an access road to the project site,” Mr Bounma said.
Mr Khammany said Nam Ngiep 2 is the sixth project involving cooperation between the two parties.
They previously teamed up on five energy development projects - Nam Leuk, Nam Mang 3, Nam Lik 1-2, and two transmission line installations and upgrades.
Mr Wang said CWE has been in Laos for 15 years. The company built the Nam Leuk project with an installed capacity of 60MW from 1996 to 2000, and the 40MW Nam Mang 3 plant was built from 2002 to 2005.
CWE built the Nam Lik 1-2 plant in 2010. With installed capacity of 100MW it is now operational and generates electricity for sale to the EDL grid.
The company is currently installing a 230kV voltage transmission line from Hinheup district in Vientiane province to Naxaithong district in Vientiane. “It is now about 95 percent complete,” Mr Wang said.
Laos has other two Nam Ngiep hydropower projects - the Nam Ngiep and Nam Ngiep 1 - based in Borikhamxay province.
Laos will witness the opening of at least two new power plants each year between now and 2020. In 2006 the country had only 10 power plants with a total capacity of 700MW. Now it has 14 plants with a total capacity of 2,540MW.
vientiane times
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