NORAD: ‘fox watching geese’ in Lao power dam

Heavy criticism of a Norconsult study of the Nam Theun 1/2 hydropower project in Laos has forced NORAD to concede its mistake in relying on a feasibility study made by a company seeking further contracts in the project. (See DT 17/93)

“This is surely a case of the fox keeping the geese," said Sven A. Holmsen, Assistant Director General of NORAD to Development Today. “Everyone now agrees that it was a mistake at the outset."

Norconsult had strong economic interests in reaching a positive conclusion about the Nam Theun 1/2. Still, NORAD hired the engineering consultant firm to assess the project’s environment and social feasibility of the project.

Norconsult’s highly optimistic conclusions were critcised by several government authorities: the Directorate for Nature Management (DN), the State Pollution Control Authority (SFT) and the Norwegian Water and Energy Administration (NVE). DN argued that the project should be assessed in terms of the combined effects of Nam Theun 1/2 and the planned Nam Theun 2.