CK shrugs off dam report

Bangkok Post 18 July 2012

By Nareerat Wiriyapong

Ch. Karnchang Plc (CK), Thailand's third-largest contractor by market capitalisation, remains optimistic the Xayaburi hydroelectric dam will be completed on schedule despite last week's announcement by the Lao government postponing the project.

Chairman Aswin Kongsiri played down media reports about the announcement made by Lao Foreign Minister Thongloun Sisoulith that the project would be suspended pending further environmental studies.

"We've worked closely with the Lao government, and I think we must wait for official word that the project will be postponed," he said.

"We've scheduled time for possible delays. If the project does become postponed for no more than a few months, then I think it will remain on course to finish on schedule in 2020."

Mr Aswin reiterated that Ch. Karnchang has yet to begin construction of the US$3.8-billion run-off river dam but rather has only built an access road to the site.

"Road development will continue, as this will benefit Laos, which remains in need of public transport routes," Mr Aswin said.

Banks remain committed to helping fund the 1,260-megawatt power project, while the Electricity Generating Authority of Thailand has confirmed its intention to purchase electricity from Xayaburi, the cheapest of the utility projects it has signed agreements for, said Mr Aswin.

The environmental group International Rivers welcomed the Lao announcement.

However, it pointed out that Ch. Karnchang will still be allowed to continue its scheduled activities at the dam site including the resettlement of affected villages.

Mekong River Commission member countries have still not decided whether to proceed with the project.

"Laos's promise to suspend the Xayaburi dam is welcome," said Kirk Herbertson, International Rivers' coordinator for Southeast Asian policy.

"However, Laos has been saying for months that it has agreed to suspend the dam while at the same time allowing Ch. Karnchang to continue to move forward with construction activities on everything but the dam itself."

The group called on the Lao government to order the immediate halt by Ch. Karnchang of all construction-related activities at the Xayaburi site and cancel plans to resettle more villagers until a regional agreement has been reached.

CK shares closed yesterday on the SET at 7.30 baht, unchanged, in trade worth 20.6 million baht.