Mekong News
Russia, Laos sign electricity MOU

Source - KPL News
March 13, 2006


(KPL) The Russian Regional Oil Company ( Russian Federation ) is set to pump
nearly US $600 million in to the Xekong 4 Hydroelectric Power Project in
Xekong province, according to a Memorandum of Understanding jointly signed
here on 9 March.

The signing ceremony was held at Lane Xang hotel in Vientiane Capital,
between Dr Lienthikeo, Vice President of the Committee for Planing and
Investment, Mr Oleg Kabardin, Director General of Russian Region Oil Co, Mr
Yuri Raykov, Russian Ambassador to Laos and Dr Dao Phonekeo, Representative
of the Lao Electricity Company.

This project has a capacity of 470 mw, and before running its energy
business in this area, the Russian Region Oil Company will conduct a survey
and undertake a feasibility study with the aim of ensuring the investment is
implemented economically.

After the feasibility study over an 18 month period, the company will begin
constructions, and it is expected that Xekong 4 Hydroelectric Power Project
will completed in 2008.

After signing the agreement, Mr Kabardin, Director General of Russian Region
Oil said that he had already planned for a power market.

"We will supply power produced by these stations for domestic consumption
and export to Thailand because Thailand shares long border with Laos ," he
said. "In addition, in Thailand there has been steady economic growth and
the agriculture and industrial sector has been booming dramatically so
demands on electricity are high."

On this occasion, Dr Lienthikeo said that this project would be an important
part of the socio-economic development in accordance with poverty reduction
plan of nation, and would create more jobs for people living in Xekong
province.

"We hope this project will be successful soon and smoothly accelerate the
economic growth of the Lao PDR," he said.

In 2005, the Russian Region Oil Company invested US $680 million for three
hydroelectric projects in two southern provinces of Laos , namely Namkong I,
Namkong III in Attapeu province and Xekong 5 in Xekong province.

The Memorandum of Understanding relating to this project was jointly signed
on 22 December 2005 at the Lao Plaza hotel in Vientiane Capital.

The three projects consisted of the Namkong I with a capacity of 238 mw,
Namkong III with capacity of 35 mw and Xekong 5 with a capacity of 300 mw.

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