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International Rivers Network Press Release                                 27th March 2000

US COMPANY SIGNS DEAL FOR NOTORIOUS INDIAN DAM
Opponents Demand That Ogden Withdraw

International Rivers Network today wrote to New York-based Ogden Corporation calling on the company to withdraw from a highly controversial dam project on India's Narmada River. The letter is endorsed by 124 organizations from 27 countries. Ogden signed a Memorandum of Intent, Thursday, March 23, to develop the Maheshwar Dam, as part of U.S. President Bill Clinton's state visit to India.

The 400 megawatt Maheshwar hydropower project is fiercely opposed by the Narmada Bachao Andolan (Save the Narmada Movement), which represents tens of thousands of local people, as well as by other Indian and international human rights and environment groups because of its social, environmental and economic impacts.

The Maheshwar Dam would displace more than 35,000 farmers, wage laborers, fishers and crafts people in 61 villages and submerge about 1,100 hectares of rich agricultural land. Independent investigations have found that resettlement planning for the project is totally inadequate and that no land is available for resettlement as required by law.

People affected by the dam are determined that they will never let it be built. Over the last two years, thousands of farming families have occupied the dam site nine times, barricaded all roads leading to the dam for three months, and held mass demonstrations and hunger strikes opposing the dam.

The dam's serious financial risks and the intense opposition to it caused U.S. power utility PacifiCorp to back out of the project in 1998, and German utilities Bayernwerk and VEW Energie to pull out in April 1999.

Electricity generated by the dam will cost four to five times more than other electricity generated in Madhya Pradesh state and will be prohibitively expensive for local consumers. The Madhya Pradesh Electricity Board (MPEB), which signed last week's agreement with Ogden Energy Group Inc. and Indian firm S. Kumars, has guaranteed the project developers a return on equity of 16% for the next 35 years, whether or not the expected amount of power is produced. As the MPEB is on the verge of bankruptcy and cannot afford this annual payment it has proposed to cut subsidized connections for the poor and substantially increase tariffs.

The Madhya Pradesh government responded to popular opposition in 1988 by forming a Task Force Committee to review the dam. At the end of 8 months of deliberations, the Task Force submitted a report which detailed cheaper and better power alternatives to the Maheshwar Project

Ogden Energy is a wholly-owned unit of Ogden Corporation which has interests in the airline services, entertainment, environmental and energy sectors. The company has no experience with large dam projects. Its current portfolio contains only six small hydroelectric dams (four in the US and two in Costa Rica) with an average generating capacity of about 20 megawatts each. S. Kumars is a textile firm with no previous experience of dam building.

The IRN letter to Ogden Corporation CEO and President Scott Mackin urges the company "to withdraw from Maheshwar and decline involvement in a project which is based on the destruction of local peoples' livelihoods." The letter continues "The undersigned organizations are determined to support and publicize the struggle of the villagers in the Narmada Valley. NGOs will not hesitate to inform the shareholders and other stakeholders of Ogden Corporation about the social, environmental, legal and financial risks of the Maheshwar project."

When news of Ogden's interest in the Maheshwar Dam was first reported in the Indian press in late 1999, local people who face displacement wrote to the company insisting that Ogden representatives should visit the affected villages before deciding on their investment. In February, 2000, nearly 300 elected representatives of the affected area sent Ogden a resolution opposing the Project. Ogden has failed to reply to these demands. No Ogden official has yet visited any of the affected villages or spoken to their representatives.

Chittaroopa Palit of the Narmada Bachao Andolan says:
"In the coming months we will intensify our struggle at the state, national and international levels. We will succeed in stopping the destruction of this rich area."

For more information, go to www.narmada.org or www.irn.org or contact

  • Patrick McCully, Campaigns Director, International Rivers Network, California +1 510-848-1155 (w) +1 510-528-2930 (h) or patrick@irn.org
  • Venu Govindu, Friends of the Narmada, New Jersey +1 609-799-5907 (h) +1 609-951-2823 (w) or venu@narmada.org
  • Heffa Schuecking, Urgewald, Germany, +49 2583 1031 or urgewald@koeln.netsurf.de
  • Chittaroopa Palit, Narmada Bachao Andolan, Badwani, Madhya Pradesh, +91-272 9022464 or nobigdam@bom4.vsnl.net.in
  • Shripad Dharmadhikary, Narmada Bachao Andolan, Baroda, Gujarat +91-265-382232 (w) or nba@bnpl.com
  • Himanshu Thakkar, South Asia Network on Dams, Rivers and People, New Delhi, +91 11 748 4654 or cwaterp@del3.vsnl.net.in

International Rivers Network (IRN) is a US-based nongovernmental organization which supports local communities working to protect their rivers and watersheds. IRN works to halt destructive river development projects, and to encourage equitable and sustainable methods of meeting needs for water, energy and flood management.