A strategic mistake in the original 1960s engineering design of Mangla Dam is expected to cost the government Rs38.8 billion in fiscal year 2012, as the government will be forced to evacuate thousands of people and compensate them in order to complete a project to expand the dam’s diminishing storage capacity.
Documents submitted on May 26 to the executive committee of the National Economic Council – the nation’s highest economic decision-making body – reveal that while the dam’s original design incorporated the possibility of raising its current levels, it did not factor in the need for an extended lake area.
While the project to raise Mangla Dam started in 2003, this flaw was first detected in April 2008, when a member of the Planning Commission pointed out the need for the extended area, which would force the government to evacuate thousands of people and compensate them. That compensation amount raised the total project’s costs by approximately Rs39 billion, or 62.1 per cent, to Rs101.4 billion.
The dam raising project was meant to overcome the build-up of silt at the bottom of Mangla, which was reducing its storage capacity. The project will raise the dam’s level by 40 feet, to 1,274 feet above sea level, which will raise the storage capacity from the current 4.28 million acre feet (MAF) to 7.16 MAF – a 67.3 per cent increase.
The increased storage in Mangla is expected to raise hydroelectric power generation capacity at the dam by 772 megawatts-hours (MWh) as well, besides help reducing the intensity of any future floods.
The Water and Power Development Authority (Wapda) has so far spent Rs80 billion on a project that is in its eighth year, despite having originally being scheduled for completion within six years and was originally meant to have cost Rs62.5 billion.
Cost overruns have plagued the project for several years. Many of the increases were associated with a lack of adequate quality and financial controls by the project’s managing agency, Wapda. Others have yet to be explained, including abnormal rises in land prices, contingency and administrative costs.
The cost of resettlement works has increased by 92.3%. Payments to people affected by previous projects and the costs of constructing six grid stations in Azad Jammu and Kashmir (AJK) have risen 128.9 per cent. Wapda was asked to rationalise the cost estimates in consultation with the Planning Commission but it has yet to do so.
Yet the 101-billion-rupee price tag may not be the final bill for the project if the AJK government has its way. Muzaffarabad is demanding Rs10.5 billion for the development of additional settlements to accommodate the extended families of people displaced by the dam raising.
Wapda Chairman Muhammad Shakil Durrani has flatly refused the additional demand by the AJK government, stating that the original project included an agreement between the federal government, the AJK government and Wapda.
“The total cost of dam raising project would be around Rs111.8 billion if government accepts AJK government demand,” sources said, denying that the AJK demand would stir another dispute on Mangla Dam raising project.
Mangla Dam was constructed on River Jhelum in 1967 as a part of Indus Basin Development Plan. The reservoir was first impounded in February 1967 and since then it has undergone more than 30 cycles of operation. According to the original design, live storage capacity was 5.34 MAF.
Published in The Express Tribune, June 20th, 2011.
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