Bank adds loan, risk guarantee to funds for 1,070-MW Nam Theun 2

The Asian Development Bank (ADB) has approved a US$50 million private sector loan and a US$50 million political risk guarantee for the 1,070-MW Nam Theun 2 hydroelectric project, which is under construction on the Nam Theun River in Laos.

The funding, which includes bank safeguard policies aimed at indigenous peoples, resettlement, and environmental issues of the project development, follows US$1.45 billion in funding endorsed by the ADB and World Bank in 2005. Nine international and seven Thai banks signed a pact that year to lend a combined US$1 billion to the project.

ADB and the World Bank issued a report on Nam Theun 2 in late 2006, declaring work to be on schedule and environmental protection and social mitigation programs well under way. (HNN 11/6/06)

Project developer Nam Theun 2 Power Co. is a venture of EDF International, Italian-Thai Development, Electricity Generating Plc. of Thailand, and Laos government-owned Electricite du Laos. The project includes a 39-meter-tall dam, a 450-square-kilometer reservoir, and a diversion of water from the Nam Theun to another Mekong River tributary, the Xe Bang Fai River.

Most of the power from Nam Theun 2 has been pre-sold to Thailand, which recently announced it plans another significant increase in hydropower purchases from neighboring Laos. (HNN 9/10/07)

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