Mekong Utility Watch

Russians win deal for mega power plant

Vietnam Investment Review
September 15, 1997

Vietnam has hand-picked a Russian hydropower project design company to carry out the feasibility study for the country’s largest ever hydropower project in Son La province.

The Moscow-based Designing Survey Research and Production Shareholding Company, who previously completed a similar job for the Hoa Binh hydropower plant, has been handed the contract.

The Russians got the prestigious contract because “they are familiar with the area, have a lot of experience in hydropower projects worldwide and in Vietnam and, most important of all, their price is affordable” said engineer Nguyen Thai An, spokesman for the Son La Hydropower Management Board.

The total cost for the study is $675,000, and it will be a joint cooperation between Russian and Vietnamese power experts. A further $100,000 has been added to the contract price which will be used for travel and station facilities.

The feasibility study is expected to be finished by the end of next year. Energy experts revealed that the whole project will take at east a decade to come into fruition, if all goes according to plan. Construction on the Son La Hydropower Plant is scheduled to start in late 1999 and should be able to begin supplying electricity by 2010.

The Government has not said where it will find the estimated $3.6 billion (VND40,000 billion) needed for the construction of Son La Hydropower Plant. A number of financial institutions, including the World Bank, have been approached for possible funding, but so far no commitment has been made.

The more difficult task, according to Vu Duc Thin, Chairman of the project’s management board, is to move and resettle residents of Son La and Lai Chau provinces.

Disastrous consequences of unfair compensation and resident resettlement which followed the construction of Hoa Binh hydropower plant a decade ago have left officials wary of making the same mistakes.

Earlier this year, the Son La Hydropower project management board organised a trip for delegates from Son La to the Yaly hydropower project’s resettlement area in the central highlands to show them how to better conduct the process.

If construction does go ahead, some 80,000 people, mostly ethnic minorities, will have to move out to make way for the state-of-the-art power plant.

Deputy Prime Minister Tran Duc Luong, in his approval of the development plant early this month, singled out Son La hydropower project as a must for development. “We have to prepare everything in advance for the Son La hydropower project. The precise date and time as well as amount of work to be done will be decided by the Prime Minister once he sees the feasibility study,” he said.

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