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IRN’s Nam Theun 2 Campaign

Nam Theun 2
At the end of March, 2005, the World Bank and Asian Development Bank approved millions of dollars in guarantees and loans for the Nam Theun 2 Hydropower Project in Laos. The project is supposed to generate revenue for the cash-strapped Lao government by exporting power to neighboring Thailand. Yet there are no guarantees that the revenue from Nam Theun 2 will be used for poverty alleviation, nor that the project’s significant impacts on local communities and on the environment can be successfully managed. View a map of the project.

The project will have serious impacts on the lives and livelihoods of tens of thousands of rural Laotians. Roughly 6,200 indigenous people living on the Nakai Plateau would be evicted to make way for the Nam Theun 2 Dam and its reservoir. Another 120,000-150,000 people depend on the Xe Bang Fai and Nam Theun Rivers for their livelihoods. It is likely that they will suffer from destruction of fisheries, flooding of riverbank gardens and other impacts caused by the project. Independent reviews of the mitigation and compensation plans for Nam Theun 2 reveal that these plans are overly ambitious and have a high likelihood of failure.

IRN is concerned that the Lao government lacks the capacity and the political will to manage a project as large and risky as Nam Theun 2. Hydropower projects developed over the past decade in Laos have left a legacy of destroyed livelihoods and damaged ecosystems. As a result of dams, tens of thousands of Laotians lack sufficient food to eat, clean water to drink and income to meet basic needs. The Lao government has taken very few steps to improve the livelihoods of affected communities, and international donors such as the Asian Development Bank have failed in their duty to monitor projects once construction is complete. As there are no independent agencies within Laos to monitor the government’s commitments, affected communities remain isolated, marginalized and intimidated from voicing concerns. Read IRN’s briefing paper on The Legacy of Hydro in Laos.

A host of international financial institutions and private banks have pledged support for the $1.3 billion Nam Theun 2 project. Construction began in early 2005 and is supposed to be completed by May 2009.

IRN is monitoring implementation of the project and will work to ensure that the developers, the World Bank and the Asian Development Bank uphold their commitments to the affected people.

Background reading:


latest additions

IRN Comments on World Bank-ADB Response to NT2 Report (PDF)
IRN corrects inaccuracies in the World Bank-ADB response to its May 2007 Nam Theun 2 Trip Report and Project Update.
Nam Theun 2 Trip Report and Project Update (PDF)
Halfway through Nam Theun 2’s construction, livelihood restoration programs for affected villagers are in jeopardy. IRN visited the area in March 2007 and gathered first-hand information from communities about how the project is affecting their lives. Read the full report (PDF). Read the executive summary (PDF). Read detailed notes from village visits (PDF).
History Repeats Itself in Laos: ADB’s Flagship Hydro Project Goes Awry
An article by IRN’s Aviva Imhof in Bankwatch, published by the NGO Forum on the ADB, examines Nam Theun 2’s failings and draws parallels to other ADB-funded dams in Laos: Theun-Hinboun, Nam Song and Nam Leuk. The article also highlights the ADB’s role in promoting a regional power grid and electricity trading system in the Mekong subregion.
Nam Theun 2 Dam: Risky Business for Laos (PDF)
Summarizes IRN’s concerns with Nam Theun 2 and its implementation, updated in February 2007.
Nam Theun 2 Trip Report and Project Update
Construction is proceeding rapidly on Laos’ Nam Theun 2 Hydropower Project while social and environmental measures are lagging behind. IRN visited the area in June 2006 and gathered first-hand information from communities about how the project is affecting their lives. Read the full report (PDF). Read the executive summary.
Inadequate Compensation for Villagers Living Along Downstream Channel (PDF)
Read an IRN letter to the Nam Theun 2 Power Company highlighting some serious problems regarding interim compensation for villagers living along the downstream channel. The problems were uncovered during a June 2006 trip to the project area. Read the response from the Nam Theun 2 Power Company.
Nam Theun 2’s First Year Marked by Delays in Implementation
One year after World Bank approval for the Nam Theun 2 Hydropower Project in Laos, delays in implementation are causing concern amongst NGOs monitoring the project. While construction is proceeding rapidly, key elements vital to reducing the project’s negative impacts on people and the environment are behind schedule.
IRN and Environmental Defense highlight the latest issues with Nam Theun 2 (PDF)
Read a letter to the World Bank and Asian Development Bank highlighting several issues of concern to NGOs about Nam Theun 2 implementation. Read the response from the World Bank and Asian Development Bank.
Legal Analysis of Nam Theun 2 Concession Agreement
Human rights lawyers at Essex University have reviewed the Nam Theun 2 Concession Agreement. They have found a conflict of interest between the government’s role as project shareholder and as regulator. This means that the commercial objectives of the project are likely to be given priority over social concerns. If the government decides to raise environmental and human rights standards in the future that affect the operation of Nam Theun 2, it will have to pay compensation to the Nam Theun 2 Power Company.
World Bank Responds to Nam Theun 2 Technical Reviews
In March 2005, the World Bank issued a response to the Nam Theun 2 technical reviews commissioned by IRN and Environmental Defense. In its response, the World Bank only referred to the summary of the technical reviews and did not consider the full reports.
World Bank Board Approves Nam Theun 2
The World Bank Board of Directors voted today to approve the Nam Theun 2 dam in Laos. Nam Theun 2 is the first major dam to be supported by the World Bank since it announced its intention to ramp up lending for large dams and other "high-risk" big infrastructure projects in 2003.
Analysis of Nam Theun 2 Compliance with World Commission on Dams Guidelines
This comprehensive analysis shows that Nam Theun 2 Hydropower Project in Laos fails to comply with six of the seven WCD Strategic Priorities. Read the Executive Summary of the analysis (PDF).
153 NGOs Urge World Bank Not to Support Nam Theun 2
Read a letter from NGOs around the world who call on World Bank President Wolfensohn not to finance the Nam Theun 2 project.
Nam Theun 2 Project Documents Flawed
A series of technical reviews by independent experts for the Nam Theun 2 Hydropower Project in Laos has revealed serious flaws in the project’s environmental impact assessment and social development plan - flaws which call into question the project’s viability and scale of impact. The project documents lack critical analysis, data and information, reviewers note, and the project’s plans for compensating affected villagers have a high likelihood of failure. Read the reviews...