Xekaman 1 Power Ltd Company, a joint venture between Viet Nam and Laos, signed a power trading deal with Electricite du Laos (EDL) in Vientiane on Thursday.
The Xekaman Power Plant 1 is a key project within the co-operation programme on power between the two countries that will run from 2006 to 2020.
Construction of the project will begin at the end of this year and it is estimated to cost US$441.6 million. The project is expected to be put into operation in 2015.
The power purchasing agreement will create favourable conditions for the project's development.
The project includes the Xekaman 1 Hydropower Plant and the Xekaman Xanxay Hydropower Plant in Laos' Attapeu Province and will produce a total output of 1.2 million KWh per year.
The power co-operation agreement started in 2006; and Minister of Industry and Trade Vu Huy Hoang earlier this year sat down with his Lao counterpart to review its progress and make plans for the future.
The two countries plan to build a 500-kV power grid between Viet Nam and Laos to help facilitate power trading activities.
They will also call for financial and technical support from the Asian Development Bank (ADB) to build and maintain the grid./.