US$3.7 billion Hongsa Mine Mouth Power Project in Xayaboury Province

Singkham

(KPL) Hongsa Power, the developer of the US$3.7 billion Hongsa Mine Mouth Power Project in Xayaboury Province, has begun commercial electricity generation of its first power generator with a 626-megawatt capacity.

The power generated by the first generator will be solely exported to the Electricity Generating Authority of Thailand (EGAT) through a 500-kilovolt power grid system stretching over 67-km, according to a source from the Hongsa Power Company.

The official ceremony for the launch of commercial power generation was held at the plant on Tuesday in the presence of members of the Board of Directors of Hongsa Power Company and other relevant officials.

As much as 680 tonnes of lignite are used every hour for the first generator of the power plant to generate electric current.

The Hongsa Mine Mouth Power Plant comprises three 626-megawatt generators.

The second generator of the plant is expected to begin commercial generation in November of this year and the third one is scheduled to begin generating power in March of 2016.

The power from the first generator is being exported to Thailand in accordance with the Power Purchase Agreement between the Hongsa Power Company and EGAT.

In 2007, the two governments of Laos and Thailand signed a Memorandum of Understanding (MoU) to sell 7,000 megawatts of electric power to Thailand by 2015.

The Hongsa Mine Mount Power Project is the biggest thermal power plant in the country.

The development project is to bring to fruition the Party and Government’s guidelines, especially those for modernization and industrialization.

The project is located in the Hongsa and Ngeun districts of Xayaboury province. The project comprises a lignite-fired power plant, a lignite mine, a limestone mine, and supporting infrastructure.

On 30 November 2009, the Hongsa Power Company signed a concession agreement with the government of the Lao PDR to develop and operate the power plant and mines.

Under the agreement, 1,473 megawatts of electricity (total capacity = 1,878 megawatts) will be sold to EGAT at the Thai-Lao border for a period of 25 years.

The power plant will use approximately 14.3 million tonnes of lignite per year.

The project is expected to improve the living standards of local communities through constant generation of revenue, to promote the bilateral economic relationship between Thailand and the Lao PDR, and to fulfill the bilateral power purchase agreement between the two countries.

KPL