On 28 January the WB began its assessment of the broad preliminary work for the US$1.2B project, the statement says. Its appraisal will confirm whether the Nam Theun II project complies with the ‘decision framework’ for project processing – an agenda that requires the project to adhere to the WB’s concerns in areas such as technological, financial and economic stability, and to follow the WB’s environmental and social safeguard policies.

The proposed project site is located in the Khammouane and Bolikhamxay provinces in central Laos, about 250km east of Vientiane. The main features of the project include a 48m high gravity dam on the Nam Theun river, with a 450km2 reservoir, that would use water from the Nam Theun river, a tributary of the Mekong river. The project’s completion would allow Lao PDR to export 995MW of electricity to the Electricity Generating Authority of Thailand, along with 75MW to Electricité du Laos for domestic use. It is estimated that Nam Theun II could increase annual government revenue by about 5% annually, which would boost the economy of the poverty stricken region.

Upon a successful appraisal, the WB would then negotiate financial terms with the Lao government and prepare information for the WB’s board of Executive Directors to make the final decision as to whether or not to give the project its support.

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