Xe-Pian Xe-Namnoy power project commercial operation date unchanged

VIENTIANE (Vientiane Times/ANN) - The Xe-Pian Xe-Namnoy hydroelectric power project is expressing confidence in its planned commercial operation start date despite the partial collapse of its saddle dam D leading to the loss of lives and livelihoods, according to one of its shareholders.

Ratchaburi Electricity Generating Holding Plc (Ratch), which holds 25 percent stake in the US$1 billion investment project announced this week the failure of the saddle dam D would not require the project to readjust its commercial operation date, which is scheduled to take place in 2019.

“Xe-Pian Xe-Namnoy Hydroelectric Power Project is currently under construction. The progress of the project is approximately 90 percent, and it is scheduled to commence commercial operation in 2019,” the company said in a media release dated July 24.

Other remaining companies which hold stakes in the project include SK Engineering & Construction Company Limited (holding 26 percent in the project), Korea Western Power Company Limited (25 percent), Lao Holding State Enterprise (24percent) and RATCH (25 percent).

These firms did not make their spokespeople available to make the comments on the matter.

An analysis shows that there was still a high possibility for the project to keep its commercial operation date in 2019 unchanged due to the fact it would not need the addition of more time to restructure the saddle dam D as it is a relatively small part of the project.

The major elements of the project have been readied, and the primary reservoir of the dam is still functioning correctly.

An official from the Lao Ministry of Energy and Mines agreed that if the project were able to reconstruct the saddle dam within a year, the commercial operation of the project would still be able to take place in 2019.

He said that there are many factors including financial disincentives that will likely require the company to keep the commercial operation date unchanged in 2019 as per its contractual obligations.

 “If the company fails to supply the power to electricity to Thailand on time as stated in the power purchasing agreement, it will be fined,” the official said.

The Xe-Pian Xe-Namnoy project is set to generate about 1,860 GWh annually once it begins generating energy in 2019. The majority of the electric power will be exported to Thailand.

The remainder will be used for domestic consumption.

The project has purchased insurance which means that the project would not face financial pressures directly from compensating the people affected by the saddle dam’s collapse, Ministry of Energy and Mines’ Energy Department Director General, Mr Xayphaseuth Phomsoupham said.

“The project has purchased insurance. Otherwise, it would not be able to obtain bank loans,” he said.

Based on this scenario, the project developers will continue to push forward construction of the dam and maintain the commercial operation date unchanged.    

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