The dam is a water hazard (rule 26-1a or 26-1b) except for the western side which is a lateral hazard (rule 26-1c). 

26-1. Relief for Ball in Water Hazard

It is a question of fact whether a ball that has not been found after having been struck toward a water hazard is in the hazard. In order to apply this Rule, it must be known or virtually certain that the ball is in the hazard. In the absence of such knowledge or certainty, the player must proceed under Rule 27-1.

If a ball is in a water hazard or if it is known or virtually certain that a ball that has not been found is in a water hazard (whether the ball lies in water or not), the player may under penalty of one stroke:

a. Play a ball as nearly as possible at the spot from which the original ball was last played (see Rule 20-5); or

b. Drop a ball behind the water hazard, keeping the point at which the original ball last crossed the margin of the water hazard directly between the hole and the spot on which the ball is dropped, with no limit to how far behind the water hazard the ball may be dropped; or

c. As additional options available only if the ball last crossed the margin of a lateral water hazard, drop a ball outside the water hazard within two club-lengths of and not nearer the hole than (i) the point where the original ball last crossed the margin of the water hazard or (ii) a point on the opposite margin of the water hazard equidistant from the hole.

When proceeding under this Rule, the player may lift and clean his ball or substitute a ball.

ie; If the ball crosses the margin of the hazard at either point A or B, a ball can be dropped at a point keeping the spot where the ball crossed the margin of the hazard and the flag in line, OR can be replayed from the spot where the shot was hit. Penalty 1 stroke. (Refer to Diagram)