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Korea Western Power to Build Hydroelectric Power Plant in Laos

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South Korea’s public power supplier Korea Western Power Co. announced on Sunday that it signed a memorandum of understanding (MoU) to jointly develop a large-scale hydroelectric power plant in Laos with Thailand’s energy company CEWA.


According to the MoU, the Korean company plans to invest $1.6 million to build a hydroelectric power plant with a capacity of 700 megawatts (MW) in an area about 21 kilometers south of Pakse, Champasak Province. After the completion of the construction, the company will operate the power plant and sell power for 28 years.

The project is larger than another hydroelectric power plant project, the Xe Namnoy Project, in Laos that it won with SK Engineering & Construction Co. in 2013. It has injected $1 billion in the 410-mw hydroelectric power plant that is still under construction.

Korea Western Power hammered out the deal with Thailand’s CEWA after five-year long negotiations, beating out rivals from China, Japan and Europe. The company and CEWA will jointly lead the project including licensing, financing, Engineering, Procurement, and Construction (EPC) and builder selection.

The construction project is expected to be completed in the first half of 2025. Once it is completed, the Korean power company plans to supply a certain amount of power produced from the plant in Laos while exporting the remaining of the power to Thailand.

Laos has been aggressive in developing energy infrastructure as many rural areas in the country still suffer from frequent blackouts due to the lack of power. Considering that annual average precipitation in Laos is about 1,800 millimeters and 70 percent of the country is covered with mountains, the country is at the same time an ideal place to develop multipurpose dams.

Laos is currently running 14 hydroelectric power plants while building 10 additional plants. The country’s government plans to build 61 more in the future, which is expected to cost as much as $40 billion in total.

As Korean companies have already won a number of contracts to build power plants in Laos, more Korean firms are expected to win additional orders in the future. Late last year, Korea Water Resources Corporation (K-water) signed a deal to build a hydroelectric power plant in Salavan Province and is expected to embark on the construction within this year.

Source: Pulse (Maeil Business News Korea)