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Nam Theun 2 Hydroelectric Project

Lao PDR

Project SpecificsTechnical - Environmental - Social

By Jean-Pierre Serusclat, Chairman, NTPCSeptember 2004

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A. Project Overview

Cross border Project is part of 3,000 MW

electricity export program between Lao PDR and Thailand

1,080MW capacity - 95% of electricity sold to Thailand

Trans basin Project will dam the Nam

Theun and divert water to the Xe Bang Fai

Xe B

ang

Fai

Nam Theun

Mekong Power

Station

Nakai Dam

Nam Theun

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Water Transfer Scheme

48m high dam on Nam Theun creating a 450km2 Reservoir (at full supply level) on the Nakai Plateau

Water from reservoir drops ~350m through tunnel to power station at base of Nakai escarpment

6 turbines will generate ~6,000GWh per year of electricity A regulating pond regulates downstream releases; water passes

through a 27km long channel before reaching Xe Bang Fai

Source: NTPC, 2004

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Project Organisation

Franco-Lao-Thai partnership with multilateral support

25 year concession period (CA signed in Oct 2002, PPA signed in Nov 2003)

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B. Environmental and Social Plans

3 Safeguard documents designed to meet GoL and IFIs requirements + 1 summary :

Environmental and Social studies carried out since 1991 : more than 600 supporting documents

Participatory approach : Consultations with Project Affected People on-going since 1996, results regularly incorporated in SDP

EAMP : Environmental Assesment and Management Plan

SDP : Detailed plan to manage social impacts

SEMFOP : management plan for the Nakai-Nam Theun National Protected Area (watershed)

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Environmental and Social Principles

Livelihood restoration/improvement rather than cash compensation

Mitigation of environmental impacts whenever technically feasible, or offset (protection of the watershed)

All commitments described in the Concession Agreement : Long term Binding E&S : ~ 10% of total project costs Dedicated contingencies

3 major areas: (1) Nakai Plateau, (2) Watershed, (3) Downstream of power station and Xe Bang Fai, (+ Downstream of dam)

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Nakai Plateau

Xe B

ang

Fai

Nam Theun

Mekong Power

Station

Nakai Dam

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Nakai Plateau

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Nakai Plateau

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Nakai Plateau

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Nakai Plateau : Impacts

Reservoir Flooding E&S Impacts

Inundation of mixed vegetation (Max 450km2 in rainy season – Min 80km2 in dry season)

Change of animal habitats and biodiversity

Biomass degradation likely to impact water quality during first years

Resettlement of ~6,000 people

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Nakai Plateau : Resettlement

208km2 along southern rim of Nakai Reservoir

Livelihood restoration/improvement, based on Forestry Agriculture (irrigated and non-irrig.) Fishing Livestock

Each relocated family to be provided with land, equipment, and training

Infrastructure includes irrigation, domestic water, electricity, schools, community facilities

Long term health program

Features tested in the pilot village (30 voluntary families)

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Nakai Plateau : Resettlement

The Pilot Village - A unique opportunity to test proposed livelihoods and to monitor how resettlers adjust to new sites

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Nakai Plateau : Environmental Management

Specific studies for fauna and management plans

Wildlife monitoring and rescue plan during reservoir filling

Public education on environmental issues

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Watershed

Source: NTPC, 2004

NNT NBCA

+ corridorsXe

Ban

g Fa

iNam Theun

Mekong Power

Station

Nakai Dam

Protected area of ~ 4,000km2

Conservation of a unique

ecosystem over the long

term

Managed by GoL agency :

WMPA

funded by NTPC during the

entire concession period

…

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Xe Bang Fai

Xe B

ang

Fai

Nam Theun

Mekong Power

Station

Nakai Dam

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Xe Bang Fai

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Xe Bang Fai : E&S Impacts

Physical and bio-chemical impacts• River bank erosion• Changes in water quality• Effects on fisheries• Restrictions on crossing the river but : • More irrigation potential • Improved navigation

Approximately 40,000 people living along the river + 11,000 in hinterlands

No resettlement

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Xe Bang Fai : Environmental Measures

Aeration weir to improve water quality

Riverbank protection

Regulating pond to limit fluctuation of flow releases and erosion

Operation restrictions during flood events

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Xe Bang Fai : Social Measures

Livelihood restoration (rather than cash compensation)

Mitigation / compensation plans include : Domestic water wells Provision of boats Alternative fisheries Relocation of riverbank gardens Adjustment of existing pumps

Some measures to be implemented prior to commercial operations

Regional Health plan

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Downstream of Nakai Dam

Xe B

ang

Fai

Nam Theun

Mekong Power

Station

Nakai Dam

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Downstream of Nakai Dam

Guaranteed minimum flow + complementary release

Reduced flow for first 12km below dam site, then

substantially increased from Nam Phao confluence

From dam to existing Theun Hinboun Reservoir (32 km): no

established villages or permanent settlements

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NTPC Commitment

NTPC is contractually responsible for implementing and covering cost of all mitigation and compensation measures

during construction and operation.