Laos: Groups demand accountability from companies as well as insurers for collapse of Xe Pian-Xe Namnoy dam

On 23 July 2018, a dam in the Xe Pian-Xe Namnoy hydropower project collapsed and released massive amount of water that resulted to disastrous flooding in districts of southern Laos.

Business & Human Rights Resource Centre invited the companies involved in the construction and finance of the project to respond to allegations of faulty construction. The companies invited to respond were: 1) Export-Import Bank of Korea; 2) Krung Thai Bank; 3) Bank of Ayudhaya; 4) Lao Holding State Enterprise; 5) Korea Western Power Company; 6) Mitsubishi UFJ Bank 7) Ratchaburi Electricity Generating Holding Public Company; 8) SK E&C; and 9) Xe-Pian Xe-Namnoy Power Company. None of these companies responded.

Ratchaburi Electricity Generating Holding Public Company published a statement on their relief efforts in the affected communities. SK E&C also has a similar statement.

A report by Inclusive Development International and International Rivers entitled Reckless Endangerment: Demanding Accountability for the Xe Pian-Xe Namnoy Dam Collapse mentions several insurers of the project – not just in the form of construction insurance coverage but also for other liabilities such as those resulting from the loss and damages incurred by the communities.

The Resource Centre invited American International Group (AIG), Aon, Asia Capital Reinsurance (ACR), Korean Reinsurance, and Samsung Fire & Marine Insurance to respond to the allegation in the report. The companies did not respond.

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Company non-response
31 August 2019

AIG did not respond

Business & Human Rights Resource Centre invited AIG to respond to the latest report by Inclusive Development International and International Rivers entitled Reckless Endangerment: Demanding Accountability for the Xe Pian-Xe Namnoy Dam Collapse” (July 2019). Among other things, the report mentions several insurers of the project – not just in the form of construction insurance coverage but also for other liabilities such as those resulting from the loss and damages incurred by the communities.

AIG did not respond.

Company non-response
31 August 2019

Aon did not respond

Business & Human Rights Resource Centre invited Aon to respond to the latest report by Inclusive Development International and International Rivers entitled Reckless Endangerment: Demanding Accountability for the Xe Pian-Xe Namnoy Dam Collapse” (July 2019). Among other things, the report mentions several insurers of the project – not just in the form of construction insurance coverage but also for other liabilities such as those resulting from the loss and damages incurred by the communities.

Aon did not respond.

Company non-response
31 August 2019

Asia Capital Reinsurance (ACR) did not respond

Business & Human Rights Resource Centre invited ACR to respond to the latest report by Inclusive Development International and International Rivers entitled Reckless Endangerment: Demanding Accountability for the Xe Pian-Xe Namnoy Dam Collapse” (July 2019). Among other things, the report mentions several insurers of the project – not just in the form of construction insurance coverage but also for other liabilities such as those resulting from the loss and damages incurred by the communities.

ACR did not respond.

Company non-response
31 August 2019

Korean Reinsurance did not respond

Business & Human Rights Resource Centre invited Korean Reinsurance to respond to the latest report by Inclusive Development International and International Rivers entitled Reckless Endangerment: Demanding Accountability for the Xe Pian-Xe Namnoy Dam Collapse” (July 2019). Among other things, the report mentions several insurers of the project – not just in the form of construction insurance coverage but also for other liabilities such as those resulting from the loss and damages incurred by the communities.

Korean Reinsurance did not respond.

Company non-response
31 August 2019

Samsung Fire & Marine Insurance did not respond

Business & Human Rights Resource Centre invited Samsung Fire & Marine Insurance to respond to the latest report by Inclusive Development International and International Rivers entitled Reckless Endangerment: Demanding Accountability for the Xe Pian-Xe Namnoy Dam Collapse” (July 2019). Among other things, the report mentions several insurers of the project – not just in the form of construction insurance coverage but also for other liabilities such as those resulting from the loss and damages incurred by the communities.

Samsung Fire & Marine Insurance did not respond.

Article
30 July 2019

Laos: A year after dam collapse, groups call on developers & financiers to ensure remedies for thousands still uncompensated & without homes

Author: Inclusive Development International & International Rivers

"Reckless Endangerment: Assessing responsibility for the Xe Pian-Xe Namnoy dam collaps," July 2019

Laos%20dam%20collapse

...To date, no one has been held accountable for the catastrophe. Yet a growing body of evidence suggests that the dam’s lead developer and builder, the Korean firm SK Engineering & Construction, may have caused the collapse by cutting corners in order to maximize profits. An independent investigation commissioned by the Lao government has ruled out force majeure, or an unforeseeable “act of god” such as a natural disaster, as the cause of the collapse. Korean media have reported that SK Engineering & Construction significantly altered the design of the project, including by lowering the walls of the collapsed auxiliary dam, in order to save money. A Stanford University researcher found that the failed dam was built on a sinkhole. SK Engineering & Construction has denied responsibility...

Entities that... profit from Xe Pian-Xe Namnoy must take...action to ensure that adequate remediation is provided...

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Article
27 July 2019

New Report Pleads for Accountability on First Anniversary of Laos Dam Collapse

Author: Radio Free Asia

23 July 2019

...[A] new report from two NGOs found that nobody has been held accountable for the catastrophe that caused what has been described as Laos’ worst flooding in decades.

...In Reckless Endangerment: Assessing Responsibility for the Xe Pian-Xe Namnoy Dam Collapse, International Rivers and Inclusive Development International detail the disaster, explaining why it occurred, who is to blame, and how survivors are coping with displacement one year later.

...One section of the report explains that living conditions in the camps are so terrible that some have returned prematurely to their old villages. It paints another picture for those who still remain in the camps.

“For many, the extended existence in a state of uncertainty without adequate food, water and other basic necessities has greatly exacerbated feelings of frustration and despair,” the report said.

...[T]he report also touches on finding out who should be taking responsibility for the disaster.

...The report names each entity associated with the project. In particular, it found that that the project’s lead developer and builder may have been at fault.

“The Korean firm SK Engineering & Construction (SK E&C) may have caused the collapse by cutting corners in order to maximize profits,” the report said, also noting that the company has denied responsibility.

...“The company has yet to offer an alternative explanation for the collapse,” the report added.

...The report also urged banks to divulge their roles in the project and use their leverage with the various responsible companies to more effectively address the continuing concerns of the disaster survivors.

Finally, the report recommends that the PNPC project be suspended until all those displaced have access to land and adequate homes of comparable value to what they lost, with an effective grievance mechanism in place.

 

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Article
27 July 2019

Survivors of Dam Collapse in Laos to Receive Half Compensation on Anniversary of Disaster

Author: Eugene Whong, Radio Free Asia

22 July 2019

...On the one year anniversary of the disaster, authorities in Attapeu province plan to facilitate several events for the survivors of the disaster.

"The most important one is the ceremony where we pay 50 percent compensation to the survivors," said Bounhome Phommasane, governor of Attapeu's Sanamxay district.

...But many of the survivors, most of whom have lost everything, will still be living in squalid conditions while the government struggles to keep its promises of adequate temporary shelter and compensation that the victims feel they deserve.

...The government has been providing survivors with rice rations, but survivors say the rice is unfit for consumption.

...Another issue that survivors are struggling with is the quality of land that has been cleared for them by the government. As most of the survivors were farmers before the disaster, the cleared lands were supposed to provide them with enough to get to work and get back on their feet.

...Apart from living conditions and income, the government is also working with the dam developer to pay damages to the survivors, but the compensation process has been wrought with many setbacks.

 

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Article
13 July 2019

PNPC Dam Collapse Survivors Reluctantly Accept Lowball Compensation Offers

Author: Eugene Whong, Radio Free Asia

10 July 2010

...[S]truggling survivors are reluctantly accepting compensation for about 50 percent of their total property losses.

...Some of the victims are still holding out, saying that the compensation proposals they have been presented with are not enough....

...Sanamxay District Governor Bounhome Phommasane said that the responsibility for compensation lies with the developer.

..."The project developer is going to make direct deposits into their accounts. It won't go through the state," said the governor....

The governor also indicated that the 50 percent figure was only the beginning of the compensation package, and that the survivors would be entitled to more.

...Villagers say that the cleared land is infertile; it is gravelly and nothing can be grown on it.

But the Sanamxay District governor said...that the cleared land was for a 'commercial plantation' not for the victims to farm for themselves.

A private company is now in the process of discussing with the authorities and the victims on what should be planted on that 2,000 hectare cleared land, he added.

 

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Article
1 June 2019

Experts Agree With IEP Report: PNPC Dam Collapsed Due to Faulty Construction

30 May 2019

Several outside experts and the Lao government say a South Korean construction firm is shirking liability for poorly building the hydropower dam that collapsed....

...SK Engineering & Construction dismissed the IEP’s findings and questioned the scientific basis of its approach.

“Of course the company would not agree with the report, because it doesn’t want to be responsible,” said Ian Baird, a geography professor at the University of Wisconsin-Madison....

...He added that there is evidence that the developer was trying to cut corners during the dam’s construction.

An official with the Lao Energy and Mines Ministry, speaking to RFA’s Lao Service on the condition of anonymity, said, “The developer has to be responsible according to the concession agreement. [SK Engineering & Construction] should comply with all the terms and conditions of the agreement.”

...Richard Meehan, a former Stanford University civil engineering professor “...the foundation failed because of seepage...I agreed with that.”

...Meanwhile, a member of a South Korean civil society organization said there are still doubts about the accuracy of the report.

“First of all, we want transparency on the investigation by all stake holders,” the activist said.

“We wonder whether the investigation was deep, good and fair enough, and how the local people participated in the process. The report contained no information on this. We still have doubts about the process of the investigation and we want more information on [how it was conducted],” added the South Korean, who spoke on condition of anonymity.

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