The government has taken a decision to allocate Rs. 200 million to pay compensation to the people whose properties were damaged due to the Uma Oya Multi-Purpose Development Project.

The Ministry of Mahaweli Development, Irrigation and Environment, in a statement to the media, said the valuation of properties damaged by the construction is yet to be finalized, but the policy decision of compensation has been taken.

The government temporarily suspended the Uma Oya Multi-purpose Development Project until the issues related to the environmental impact of the project is fully assessed. A special committee which was appointed to provide a comprehensive report over the project is still engaging in its entrusted work. The project was temporarily suspended after continuous protests by the residents in the Uva Province. Meanwhile, allegations were also ranging that those protests were completely motivated by petty political camps.
The massive underground tunnels of the project could lead dry up the fresh water springs in the area, was the allegation brought by the protestors. The multi-purpose project involves the construction of two reservoirs on tributaries of the Uma Oya, which flows down from central hills and joins the Mahaweli River, and one tunnel on the Uma Oya to divert water to a power generator further downstream.

The water will be diverted to Kirindi Oya basin, which will take water to Hambantota through the 25 km-long underground tunnel across mountains in Bandarawela, by creating a dam at Puhulpola in Welimada and a reservoir in Diaraba.

The project was running on a US$ 450 million loan facility from Iran and the government was to shoulder the balance for the project. The project which commenced in 2012 has been planned to complete by a period of five years, and the total estimated cost of the project was US$ 529 million.