AGUNCI PON IN1IUNAIONAI. OUVILOPUIN4NT 1. TANSACTION CODE DOCL"'?LNT PROJECT DATA AAwAdd Amendment Number CODE J{I D a o ee le e3 COU.NTRY/E.N TTY SRILAW 3.PROJECT ~3T71SRILANKA NIIBER . 3-0073 "w ,L BURtEAUI/OI FTC 5.PROJECT Trri (maximm40 carotn) ASIA 04- [ = AHAWELI BASIN DEVELOPMENT. PHASF 6. PROJECT ASSISTANCE COMPLETION DATE (PACD) 7. -ST-lMATED DATE OF OBL GATION (Under "3:'btiow.enter 1. Z .. or4) WA'C(DO0 C -- 1019131 d81 61 !tiilF [!1 .Qw-C.FnlF L 9. COSTS '3000 OR ZQQIVA:...NT S1 - A. FtUNDLNG SOURCE -:'UKST FY BL 3.FX' [_LIFE OF PROJECT C.LIC D. To, I E FX I F. LIC G. A DA ppr p a dTo tal 2nd7 ,gni 4 -2 0 Tou 25 000 9 1,3 U _ 1 .,1 l0 0_0 ___,, )M, )T 2.490 510 1 3 00. (E 507.f 4-2n I( 2s'nn AR -oR 1Q ) .lin7 n.L HaltCo y -- I b 5D.542 -_ 111I_999 111.999 Othr Donors) i - I - - Z91x0U TOTAL S - 29 000 4 1 ZU,/bU 10 792 I 3 15b4 699 , PRCHE.Y 9.SCEDULE OFAIDFUNDING ($000) -- A.A.PPRO. PRIMARY TET COD D.OBLIGATIONS TO DAE. AMOINT ,-PROVED F. WIE OF PROJEcT PROATONFURPOSE (I 480 I rs ACTION___ ,1 TEC COU u CODmEnt Z 1.o D ATE'sCD area SG2.'Lan .Grat A Loaed Y (u) FN I 2n00 - . ant 2.Loan I ______I_____22,=__'U 17000 TOTALS5ATOS 6 = I "U -L O OO A 10 10. ST $ARYTECHNICAL co ( i&sng of 3 onrulponech) T I an a milo o I I IM I IT.N 12. SPECIAL DA _. JOCU. CONCERNS CODES (maxmum.7 coes. of 4 posknoru techl) CoeBR BL BS ENV EQTY 13. PROJECT PUR.POSE (maximum 480 cAa'wcterr) Development of the area of System "B.P of the AcceleratedMahaweli Program lying along the Left Bank of the Maduru- Oya (River) '4. SCHEDUILED EVALUATIONS 115. so JriC!/Olo i- oFGoos AND SERVICES - -- - rI 'at I 11 ~I~ 8t ~a 10' 1 18161 iZ 000w 16.AMLNDMENTSINATtJRE _5p_1_oa_____rS-O ......... OF CHANCE PROPOSED (Vhisisupqe Iof a_ part?? Ammedmff&&) Project Funds (.AID. Financed) increased $25 million from $85 million To $110 million consisting of $3 million grant and a $22 million loan. S-LDATE DOCUML R.ECEIVED 1IN AZ/W, ORFOR.AJW DocU. XENTSw ZATE OF DISTR.IBUION it~~~D YI I PROJECT AUTHORIZATION AMENDMENT SRI LANKA Mahaweli Basin Development Phase II AID Project No.383-0073 AID Loan No.383-T-028/A/B/C Pursuant to Section 103 of the Foreign Assistance Act of 1961, as amended, the Project Authorization is hereby amended: (a) to increase planned obligations over the life of the Project from not exceed $85,000,000 to not to exceed to $107,000,000 in loan funds and to add not to exceed $3,000,000 in grant funds, both subject to the availability of funds in arcordance with the A. I.D. OYB/Allotijent process, (b) to provide that, except as AID may otherwise agree in writing: (1) commnodities financed under the grant shall have their source and origin in Sri Lanka or in the United States, (2) except for ocean shipping, the suppliers of comnxmdities or services financed under the grant shall have Sri Lanka or the United States as their place of nationality, and (3) Ocean shipping financed under the grant shall be only on flag vessels of the United States. The authorization cited above remains in force except as hereby amended. TABLE OF CONTENTS Project Data Sheet Draft Project Authorization Amendment Glossary 1.0 RECOMMENDATIONS AND SUM4ARY 1.1 Recomendations 1.2 Sumnary 2.0 PROJECT RATIONALE AND DESCRIPTION 2.1 Rationale for Amending the Project 2.2 Project Description 3.0 COST ESTIMATE AND FINANCIAL PLAN 3.1 General 3.2 Shortfall of Funding 3.3 Effects if Additional Funds are not Available 4.0 IMPLE ENTATION PLAN 4.1 Project Status 4.2 Inplementation Schedule 5.0 MDNI'rRING AND EVALUATION 6.0 PROJBZT ANALYSES 6.1 Technical Analysis 6.2 Economic Analysis 6.3 Social Soundness Analysis 6.4 Administrative Analysis 6.5 Environmental Analysis 7.0 NEGOTIATING STATUS AND CONDITIONS ANNEXES A. PID approval B. Log Frame C. Statutory Checklist D. B/G Assistance Request E. Review of Progress - MBD Phase II F. Procurement List G. Detailed TA Package Budget (Grant) H. Location Map I. Project Map J. Tables noted in Text iii GLOSSARY ACRES Acres International Limited ADTAB Australian Development Assistance Bureau. ADB Asian Development Bank. AID/W Agency for International Development/Washington. AMP Accelerated Mahaweli Development Program Berger/IECO (B/I) Louis Berger International Inc./International Engineering Co. Inc. CH2M Hill CH2M Hill Inc. CPM Critical Path Method. D-Channel Distributary Channel. EEC European Economic Cmrimunity Ganga A river which does not go dry. GSL Government of Sri Lanka. ID Irrigation Department. Maha Season Cultivation season generally lasting fram November through February. In the project area this is the time of monsoonal rains. MASL Mahaweli Authority of Sri Lanka. MBD Phase I Mahaweli Basin Development, Phase I. MBD Phase II Mahaweli .n Development, Phase II. MEA Mahaweli Economic Agency, a (department of MASL). OPBC Organization of Petroleum Exporting Countries Oya A river with very low or no flow for part of the year iv O&M Operations and Maintenance. PACD Project Authority Completion Date. PC Project Cacnittee. PP Project Paper. Purana An existing or traditional village is referred to as a Purana Village. TA Technical Assistance. USAID/AID United States Agency for International Development Colombo. Yala Season Cultivation season lasting from May to September a very dry period in the project area. Z/D U.S. Joint Venture firm of Zachry/Dillingham. v PRQJW T PAPER SUPPLE4ENT MAHAWELI BASIN DEVELOPMENT PHASE II AID PROJT NO. 383-0073 1.0 RECOMMENDATIONS AND SUMMARY 1.1 Recomndations The Mahaweli Basin Development Phase II project (MBD Phase II), as amended by this PP Supplement, remains financially, economically, technically, administratively, socially and environmentally feasible. It is recommended that: (a) the total costs of the project be i icreased from $203.6 million to $251.0 million; (b) AID authorize an additional $25.0 million for the project thereby increasing AID's contribution from $85.0 million to $110.0 million, including: (i) an additional loan amount of $22.0 million to finance increased construction costs of main and branch irrigation canals and to provide required equipment for operation and maintenance; (ii) a grant of $3.0 million to finance a new technical assistance package to support the system. The $3.0 million grant should be obligated in FY 1984 and the. $22.0 million loan should be obligated: $8 million in FY 1984 and $17.0 million in FY 1985. The recommended terms of the loan are repayment of the principal and payment of interest in U.S. dollars within 40 years including a ten year grace period of repayment of the principal with interest at two percent (2%) per annum during the grace period and three percent (3%) thereafter. 1.2 SUMMARY MBD Phase II currently provides loar finance for main and branch irrigation canal construction of a [ijor portion of System B in the GSL's Accelerated Mahaweli Program. System B encompasses the Left and Right Banks of the Maduru Oya river in the east-central dry zone of Sri Lanka, and the project area of MBD Phase II constitutes appKoximately 75,000 hectares of the Left Bank. Total costs of the project were estimated in the original Project Paper to be $203.6, subsequently revised to $218.2 million in the Project Loan Agreement. Both the PP and the Loan Agreement provide for $85 million in AID loan funds for main and branch canal construction. The renainder of $133.2 million, as reflected in the Loan Agreement, is being met by the GSL from its own resources, by other donor contributions, and by reimbursements under USAID's Mahaweli Sector Support project (383-0078), with the caveat that non-reimbursed C13L contributions remain at a minimum of at least 25% of total project costs. Other direct USAID support for System B development is provided under the Mahaweli Basin Development Phase I project (383-0073). This predecessor project finances a host country contract with the joint venture association of 1 Louis Berger International Inc. and International Engineering Co. Inc. (Berger/IECO). Under its contract, Berger/IECO (a) has designed the irrigation system for both the Left Bank and Right Bank of System B, and (b) is providing the engineering supervision for the Left Bank construction financed by MD Phase II. An important milestone as reached in July, 1983 when the Maduru Oya headworks dam was inaugurated. This structure and its reservoir will control the flow of irrigation water into System B and was built with Canadian assistance. The Left Bank system financed by AID under MBD Phase II remains scheduled for completion by the original PACD of September 30, 1986. The Right Bank system will be developed at a later date. The project as authorized by the Administrator on April 11, 1981 and obligated in the initial amount of $25 million on May 29, 1981. Three subsequent amendments to the Project Loan Agreement have increased the amount obligated to $68 million. Bids for the construction contract were received in April 1982 and a host country contract was awarded by the GSL in May 1982 to the joint venture of H.B. Zachry Co. and Dillingham Construction International Inc. (Z/D). The contractor commenced work on site in June, 1982.