The start-up of an expanded hydropower dam Friday on the Nam Ngouang River in central Laos is set to impact the lives of thousands, an international environmental group said.
"The Theun-Hinboun Expansion Project has displaced over 7,500 people and will affect the livelihoods of tens of thousands more people living downstream," said Tania Lee, Lao program coordinator for the International Rivers activist group.
The 585-million-dollar expansion has doubled the capacity of the Theun-Hinboun Dam, which has been operational since 1998.
International Rivers has criticized the failure to compensate villagers affected by the first phase of the project, and raised concerns about the compensation allocated for its expansion.
"The plans to restore livelihoods are woefully inadequate," Lee said. "The Theun-Hinboun Power Company - which is part-owned by the Norwegian state-owned company Statkraft - is profiting at the expense of some of South-East Asia's poorest people."
She predicted that thousands of people would be "relocated in the coming five years due to project-induced flooding."
Impoverished Laos has focused on exploiting its abundant potential hydro-electricity, most of which will be exported to neighbouring Thailand, as its main engine of economic growth.