Nam Theun 2 Trip Report and Project Update - BankTrack

International Rivers NetworkNam Theun 2 is governed by a variety of legal documentsthat outline the obligations of NTPC and theGoL. The NT2 legal framework includes theConcession Agreement between the Government ofLaos (GoL) and NTPC, and loan agreements withproject financiers, such as the World Bank and theADB. The World Bank and ADB loan and guaranteeagreements with the GoL and NTPC in turn requirecompliance with these institutions’ own policies.Essentially, these legal agreements constitute thepromises made to Lao villagers regarding compensationand mitigation measures, and the allocation ofresponsibility amongst NTPC and the GoL.About IRNInternational Rivers Network (IRN) is a non-governmentalorganization that protects rivers and defendsthe rights of communities that depend on them. IRNhas been monitoring the Nam Theun 2 hydropowerproject and other dams in Laos for over a decade,opposing destructive projects and advocating for bettercompensation and mitigation measures for affectedcommunities. IRN staff members visit the Nam Theun2 project site regularly.IRN was opposed to World Bank and ADB supportfor Nam Theun 2 because: a) the dam does not meetWorld Commission on Dams guidelines; b) NT2’srisks to affected communities far outweigh its potentialbenefits; and c) dams have not contributed to povertyreduction in Laos. IRN continues to monitor NT2’sdevelopment to ensure that commitments made byNTPC, the GoL and the international financial institutionsto affected communities and on the environmentare met.IRN’s March 2007 VisitAn IRN staff member visited the NT2 project site inearly March 2007, accompanied by a colleague from aSwedish NGO and an interpreter. The purpose of thetrip was to gather first-hand information regarding theimplementation of the NT2 project. Over a period ofeight days, the team traveled to the Nakai Plateau, thedownstream channel area of Gnommalat District, andthe Xe Bang Fai area to speak with villagers. Followingthe field visit, IRN met with representatives of theGoL, NTPC, the ADB, the World Bank and nongovernmentalorganizations (NGOs) in Vientiane.Although the project area is open to the public, IRNinformed NTPC and the GoL of its intentions to visitthe area before the trip. The team was not accompaniedby GoL or NTPC representatives.The information in this report was primarily collectedthrough field interviews with local people and formalmeeting discussions. To obtain as comprehensive anunderstanding of the situation as possible, IRN tried tovisit many villages and to interview more than onefamily representative in a given village. Informationfrom the field was verified and supplemented by areview of recent project documents. The responsesfrom NTPC, the World Bank and the ADB highlightedin the trip report were obtained during meetings onthe Nakai Plateau and in Vientiane the week of March5, 2007, as well as from subsequent email communicationwith NTPC.The trip report does not provide a comprehensiveoverview of the dam nor of its current or futureimpacts across all project areas. IRN primarily seeks tomonitor and report on NT2’ s environmental andsocial impacts and the implementation of mitigationand compensation programs. The trip report is dividedinto sections that correspond to the three main impactareas of the Nam Theun 2 project: the Xe Bang Faidownstream area, project construction lands, and theNakai Plateau resettlement area. A fourth sectionaddresses biomass clearance and water quality implications,which is a critical cross-cutting issue. The tripitinerary and a selected list of violations of NT2’sConcession Agreement and World Bank and ADBpolicies are included as appendices to the report.9