A massive hydroelectric project to be inaugurated this week would have adverse effects on the ecology of Laos and more than 100,000 Laotians, environmental and civil society groups charged Tuesday.

French President Nicholas Sarkozy, Thai Prime Minister Abhisit Vejjajiva and senior World Bank and Asian Development Bank officials were expected to attend a ceremony Thursday inaugurating the Nam Theun 2 Hydropower Project in central Laos.

The environmental and human rights group International Rivers said the project has displaced 6,200 indigenous people on the Nakai Plateau and affected more than 100,000 people living downstream along the Xe Bang Fai River.

Funded by the World Bank, Asian Development Bank and a host of other public and private funders, Nam Theun 2 has been a focus of criticism by environmental and human rights groups since it was first proposed in the early 1990s.

The hydroelectric dam in Khammouane province has the capacity to produce 920 megawatts of electricity, much of it to power Thailand’s fast—growing economy.

Two Thai private companies — Italian-Thai Development Pcl and the Electricity Generating Pcl – co - invested in the construction of the project with the Lao government and France’s EDF International.

A group of 34 civil society groups and individuals from 18 countries wrote to the World Bank and Asian Development Bank this week calling on the banks to take immediate action to ensure sustainable livelihoods for the affected communities.

International Rivers, which opposes large internationally funded dam projects, said the food security of farmers displaced by the dam project is threatened because of the poor quality of the land at resettlement sites.

In addition, it said tens of thousands of people living downstream along the Xe Bang Fai River have already suffered impaired water quality and reduced fisheries and funding is inadequate to restore their livelihoods.

Environmentalists have also lamented the loss of habitats of indigenous species.

“The Nam Theun 2’s promoters are all too keen to call the project a success, but many problems remain,” said Ikuko Matsumoto, Lao programme director for International Rivers. “The sustainable livelihoods of more than 120,000 people directly affected by the project are far from guaranteed.”