Newly formed basin-oriented hydro power development corporations have announced that work will begin this year on the 5.4GW Longtan project and the 4.2GW Xiaowan scheme. The two projects, on the Hongshui and Lancang (Mekong) rivers respectively, are China’s second and third largest projects after Three Gorges.

The development corporations are using domestic syndicated loans to finance the projects. Longtan, Construction, whose civil works is formally scheduled to begin on 1 July 2001, is pioneering the concept. Xiaowan is expected to follow suit.

Project developer Guangxi Longtan Hydropower Development Corporation said that Gezhouba Hydropower Engineering Company and a consortium between Jiangnan and Guangxi Hydropower Engineering Bureaux had won public bids among ten domestic and foreign ventures to build Longtan’s civil works. The project’s US$3B investment is being financed by a US$2.4B, 25-year loan whose syndication agreement has been signed between four domestic banks: • State Development Bank: US$847M.

• China Construction Bank: US$726M.

• Bank of China: US$423M.

• Agriculture Bank of China: US$394M.

The funds will finance an installation of 4.2GW capacity by 2007. The remaining 1.2GW, to be commissioned by 2009, will be financed from project revenues.

Resettlement began in May 2001 involving 75,125 people, far fewer than at Three Gorges. Longtan is expected to cost US$56M to construct and is scheduled for completion by 2008.

Work on the Xiaowan scheme is also scheduled to begin this year according to Yunnan Province governor Li Jiatung. Lancang River Hydropower Development Corporation (LRHD), a joint venture between China’s State Power Corporation (SPC) and three Yunnan companies, will need to raise US$2.6B to finance the project.

Designed as a 292m high RCC arch dam, the 6 x 700MW Xiaowan scheme will be the second largest of an eight-dam cascade on the Lancang river that will have a combined installed capacity of 15.5GW. Manwan (1.5GW) and Dachaoshan (1.35GW) are already either built or under construction. The largest project, Nuozhadu (5GW) is still in the planning stage.

Xiaowan is expected to be commissioned between 2010 and 2013, at least two years ahead of original plans. It will be located upstream of all other projects except the 750MW Gongguqiao plant, and will export most of its electricity to China’s eastern seaboard via the Three Gorges and Longtan tie-lines.

Finally, the Japan Bank for International Cooperation (JBIC) has announced loan approvals for four other hydro power projects in China as part of a much larger anti-pollution and inland development aid programme. The projects are: • Zipingpu multi-purpose: US$263.35M.

• Shandong Tai’an pumped storage: US$147.21M.

• Hubei province small hydro: US$74.85M.

• Gansu province small hydro: US$53.51M.

Between them, the projects account for approximately one third of the total loan.