The plant is expected to have an installed capacity in the range 240MW-360MW, and will be a run-of-river project with a dam and head pond on the Sahong river. The location of the scheme is a 150km road trip south of Pakse, the capital of Champasak province.

MFCB is to undertake the project via a Lao PDR-registered special purpose company, which would sell the output from the plant mainly to the country as well as neighbours, such as Thailand, Vietnam and Cambodia. The plant is to come into commercial operation between 2013-15.

The project company would have a 30-year concession to build, own and operate (BOO) the project, which would then transfer the scheme to the state.

MFCB said the project development agreement gives it 18 months to undertake feasibility and socio-environmental studies in support of the examination of technical and financial viability of the scheme.

During the year and a half the company also has the exclusive right to negotiate the terms and conditions of the project documents, including: the concession agreement; a shareholders’ agreement; power purchase agreements (PPAs); and engineering, procurement and construction (EPC) contract; an operation and maintenance agreement; and financial documents.