Speech at the Ceremony for the Construction of the 338-MWs Rossei Chrum Krom Hydropower Plant, Bak Klorng Commune, Mondul Seima District

Koh Kong Province, December 28th, 2010

- Your Excellency PAN GUANGXUE, the Ambassador of the People’s Republic of China to Cambodia,

- Excellencies, ladies and gentlemen, distinguished national and international guests, armed forces,

- Dear the compatriots!

Today, I am pleased to be here to participate in the Ceremony for the Construction of the 338-MWs Rossei Chrum Krom Hydropower Plant in Bak Klorng Commune, Mondul Seima District, Koh Kong Province.

On behalf of the Royal Government, I extend my congratulation to China Huadian Corporation that has been awarded the construction of this hydropower plant. I thank all the related institutions and local authorities for their cooperation that results in a timely implementation of the project.

Today, we are materializing the first-ever large scale Rossei Chrum Krom Hydropower Plant project which is a BOT (Build-Operate-Transfer) investment project of China Huadian Corporation, estimated to cost around USD 495.76 million. Apart from flood prevention, tourism attraction, employment creation and income improvement, the hydropower plant will indeed boost the sustainable source of electricity supply, strengthen energy independency and security, and make energy price more affordable which is crucial to socio-economic development and poverty reduction.

On behalf of the Royal Government and myself, I appreciate China Huadian Cooperation for speeding up the construction process until having blocked the Reussey Chrum River for the construction of the dam and the hydropower plant. I would also like to take this opportunity to thank the Government of the People’s Republic of China that has been a strategic partner of the Royal Government and encouraged Chinese investors to invest in Cambodia. In particular, the construction of this hydropower plant does not only represent a large-scale energy investment, but it also reflects investors’ confidence on political stability and the Royal Government’s Rectangular Strategy for growth, employment generation, equity, and efficiency which has been implemented since the Third Legislature of the National Assembly to the Fourth mandate.

Currently, the government has transformed Cambodia from what is used to be known as the killing field, war zone infested with mines into a new country which is full of peace, land unity, political stability, safety, and development in all sectors. Obviously, for the last several years, the electricity sector has made gradual progress from one phase to another to answer the ever-increasing demand for electricity consumption. With respect to the development of this energy sector, the government has paid high priority to encouraging the private sector to make investment in electricity sector’s infrastructure development. The ceremony for the construction of the 338-MWs Reussey Chrum Krom Hydropower Plant at this moment has definitely illustrated the policy of the government to develop the energy sector and engage private sector participation in the development process by sharing the government’s common view which considers the private sector as a partner and locomotive of national economic growth while the government is the strategist and manager of development who plays important roles to ensure a transparent, stable and favorable business climate and predictability for private sector. Moreover, this ceremony clearly reflects the implementation and promotion of Public-Private Partnership mechanism through private participation in infrastructure development under the existing law on concession.

At the same time, I would like to highlight that the development of energy sector and electricity network remains an important agenda for economic policy of the government during the Fourth Legislatures of the National Assembly and onwards. Over the past, the government has successfully rehabilitated the energy sector to ensure electricity supply in Phnom Penh, and other urban and rural areas in the Royal Kingdom of Cambodia even though it was being viewed as a temporary solution with high electricity price, still. Nowadays, the development of electricity sector in Cambodia has reached a new stage; the government has started the development of major line networks linking various areas in Cambodia along with the development of big power sources that are reliable and affordable. The government has also established sub-stations for providing electricity at provinces and cities in order to be able to provide generated electricity to the provinces, cities and other remote areas nationwide in the Kingdom of Cambodia. This development is the development of the key foundation of power supply system in Cambodia. The main objective of this key foundation is to ensure sufficient power sources to use in cities as well as other remote areas in Cambodia, and to enable the country to provide a more stable, affordable, and good quality electricity.

Furthermore, in the development of key foundation of power supply system in Cambodia the government has focused on energy security for Cambodia in the future through promoting the development of electricity sources in the country, and the effective use of those sources with the development of many kinds of power source to make Cambodia not to depend only on one particular source that could make the country face with electricity related risks in the future. Indeed, the Royal Government has placed high priority in attracting the private sector to take part in the development of power infrastructure in terms of power sources and power line networks by appropriately balancing the public interests with private interests. Parallel to this, the Royal Government has also focused on and encouraged the exchange of electricity businesses in the region through bilateral and multilateral cooperation; in this regard the Royal Government is not only thinking about importing electricity from neighboring countries to temporarily solve the power shortage problem but is also thinking about the development of a number of projects that can export electricity to neighboring countries in the future as well.

In addition, while the price of petroleum in the world is fluctuating from day to day, countries in the Greater Mekong Sub-Region and ASEAN collectively encourage the development of other power sources in order to substitute electricity sources with petroleum-generated electricity source. Cambodia is a country with high potential hydropower source, with the capacity of about10,000 MWs, so the hydropower is a priority source among other power sources that the Royal Government has focused on developing to replace the development of factories producing electricity with the use of petroleum as an input. In development of each hydropower project, the Royal Government has always carefully weighed the environmental impacts that can occur.

With respect to this point, I would like to clarify that we cannot just develop without considering the environmental impacts that can occur; however, parallel to this we also cannot just think about environment without developments that our country needs. In this sense, indeed the Royal Government has clear and proper mechanisms for the environment and development by considering and keeping an appropriate balance between development and environmental protection. Such mechanisms existed since the beginning of master plan development until the stage of the feasibility study and study of each project in which it’s findings will be used for negotiating, deciding and carrying out investment projects. Moreover, the strategy of the Royal Government, while implementing each project, is to try the utmost of each project in order to reduce the adverse impact on the environment and society.

Taking this opportunity, I would like the management and staff of the China Huadian Corporation to pay attention with high responsibility for constructing the Hydropower Plant according to the technical standard with high quality and safety measures in order to ensure the benefit of the project for the interest of Cambodia’s Socio-Economic Development without casting any adverse impact on the environment. In this spirit, I would like the company to continue to constantly cooperate with related Ministries/Institutions and local authorities in order to make sure that this project will proceed smoothly. At the same time, I would like all relevant Ministries/Institutions to pay attention to implement their respective duties and obligations based on the spirit of the project implementation agreement.

In the meantime, I would like all Ministries/Institution, related local authorities and all people to continue good cooperation with the Ministry of Industry, Mines and Energy in order to promote the implementation of other projects such as other Hydropower Plant projects, Power Transmission Projects and the Coal-power Plant Projects, in order to ensure that we have sufficient electrical power for consumption with affordable price, stable supply, independence, and toward commercializing electrical power with the neighboring countries in the region. I would also like all Ministries, related to the use of water serving to support the agricultural crops, to study the possibility of receiving water from all Hydropower Plant Projects to be used with efficiency as necessary.

I would like to take this opportunity to express my appreciation to the Inter-ministerial Committee, which includes the Ministry of Industry, Mines and Energy, the Ministry of Economy and Finance, the Electricity Du Cambodge (EDC) who have tried their utmost efforts in reviewing related technical and financial documents, being part of the negotiation process and finally for celebrating the ceremony for the construction of this project today.

At the end, together with the Construction Ceremony of the 338-MWs Steung Reussey Chrum Krom Hydropower Plant in Bak Klorng Commune, Mondul Seima District, Koh Kong Province now, I would like to wish Excellencies, Ladies and Gentlemen, Distinguished National and International Guests and all Compatriots during this Universal New Year the four gems of Buddhist blessing: Longevity, Nobility, Health and Strength.

May I wish the construction of this 338-MWs Steung Reussey Chrum Krom Hydropower Plant a great success!