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US urges Laos to address mega dam concerns

The United States urged caution on plans by Laos to build a multibillion-dollar dam that has raised environmental concerns from neighboring nations, saying its impact was still "unknown."

The $3.8 billion hydroelectric project at Xayaburi, led by Thai group CH Karnchang, has sharply divided the four Mekong nations—Laos, Vietnam, Cambodia and Thailand—who rely on the river system for fish and irrigation.

"Our own experience has made us acutely aware of the economic, social and environmental impacts that large infrastructure can have over the long-term," the State Department said in a statement that nonetheless recognized the "important role" dams can play in helping advance economic growth.

"The extent and severity of impacts from the Xayaburi dam on an ecosystem that provides food security and livelihoods for millions are still unknown."

Laotian deputy energy minister Viraphonh Viravong earlier told AFP that the government would hold a groundbreaking ceremony on Wednesday and begin work on the dam later this week.

Building work on the main project has been stalled for about 18 months over concerns relating to its environmental impact.

Viraphonh said some aspects of the dam's design had been changed to "reassure neighboring countries", but he insisted that objections would not derail plans to finish the project by the end of 2019.

"We are concerned that construction is proceeding before impact studies have been completed," the State Department said.

It urged stakeholders to voice their concerns through the Mekong River Commission, whose Mekong nation members have not reached consensus on whether the project should proceed.

The mooted 1,260 megawatt dam, the first of 11 on the key waterway, has become a symbol of the potential risks of hydropower projects in the region.

Communist Laos, one of the world's most under-developed nations, believes the dam will help it become "the battery of Southeast Asia" by selling electricity to its richer neighbors.

"We have a strong interest in the sustainable management of the Mekong River, and we view our robust engagement as a sign of our strong commitment toward a lasting and positive relationship with the region," the US statement said.

"We hope that the government of Laos will uphold its pledge to work with its neighbors in addressing remaining questions regarding Xayaburi. We encourage the MRC countries to continue to work together to realize their shared vision of an economically prosperous, socially just and environmentally sound Mekong River basin."