A file photo taken last July shows trucks and heavy machinery taking part in road work at the Xayaburi dam construction site in Xayaburi Province, Laos.
Construction of the US$3.8-billion Xayaburi dam will be suspended pending further impact studies to be done by Japan, the four countries that share the lower reaches of the Mekong River agreed Thursday.
Environment ministers from Vietnam, Cambodia, Laos, and Thailand agreed to defer a decision on the 1,285-megawatt, 810-meter (2,600-ft) dam after a meeting held under the auspices of the Mekong River Commission (MRC), the organization established to coordinate dam projects on the river, in the Cambodian town of Siem Reap.
The riparian countries "agreed in principle to approach the Government of Japan and other international development partners to support the conduct of further study," the MRC said in a press release.
"Further study will provide a more complete picture for the four countries to be able to further discuss the development and management of their shared resources," Lim Kean Hor, chairperson of the MRC Council and Cambodia's minister of water resources and meteorology, said.
MRC chief Hans Guttman said the scope and details of the future studies were not discussed at the meeting.
"We haven't identified all the details yet," he said. "Who and how varied agencies will be involved is not decided but it will be within the MRC cooperation framework."
In April the four Mekong nations agreed at a meeting that the decision on the Thai-financed dam would be elevated for consideration at the ministerial level. Vietnam had even called for a 10-year moratorium on all 11 dam projects proposed on the 4,900-km Mekong, which also runs through Myanmar from its source in the Tibetan plateau.
The project opponents fear the 1,285-MW dam would unleash massive ecological changes on a river that sustains around 60 million people. Scientists also warned it would devastate the flow of vital fish population and nutrient-rich silt to the Mekong Delta in Vietnam.
Environmentalists warned further that the dam would set the stage for a building spree involving the 10 other dams proposed on the river's lower mainstream, which, if approved, will only provide 6-8 percent of Southeast Asia's power needs by 2025.
The Electricity Generating Authority of Thailand is planning to sign a deal with the dam's developer, Ch. Karnchang Pcl, Thailand's third-biggest construction company by market value, to buy 95 percent of the electricity to be produced by the dam. Four Thai banks are also financing the project.
A study released this week revealed that power from Xayaburi and other mainstream dams is not needed to meet Thailand's energy demand, and that cheaper and cleaner options exist that would lower electricity bills and reduce greenhouse gas emissions.
With a population of around six million and a gross domestic product of $5.6 billion, land-locked Laos has promoted the Xayaburi project as a potential source of income and investment that will help spur its economy.
A report issued by the Asian Development Bank last April said that hydropower and mining activities would underpin the country's economic growth in the next two years.
Relief and caution
The suspension of the giant dam has provided relief to some but caused doubt to others.
"Today the Mekong governments responded to the will of the people of the region," Ame Trandem of International Rivers, a California, US-based environmental NGO, said.
"We welcome the recognition that not nearly enough is known about the impacts of mainstream dams to be able to make a decision about the Xayaburi dam."
Nguy Thi Khanh, coordinator of Vietnam Rivers Network, a Vietnamese environmental group, said: "The Mekong governments made the right decision today, but it is only the beginning.
"We hope the Lao government will act in good faith and immediately halt all construction activities at the dam site and withdraw all construction equipment.
The countries are bound by the 1995 Mekong Agreement to hold inter-governmental consultations before building dams, but none have veto powers and Laos will have the final say, although considerable diplomatic pressure can be exerted on it.
"While the governments have agreed to a delay, they will eventually need to make a final decision on whether to proceed with the dam," Chhith Sam Ath, executive director of the NGO Forum on Cambodia, said.
"The Mekong governments have succeeded at this first test of regional cooperation, but we cannot stop and rest yet."