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Limpopo gets R7.4bn water project

28 May 2008

The government has signed a memorandum of agreement with 23 mining companies to jointly invest R7.4-billion in the Olifants River water project, which aims to unlock mining opportunities and increase water provision in the Limpopo province.

Addressing delegates at the signing of the agreement in Johannesburg this week, Water Affairs and Forestry Minister Lindiwe Hendricks said the projects were to ensure an increased capacity in the country's water resources and alleviate concerns that water was running out.

She warned, however, that much greater priority needed to be given to water conservation and water demand management that as South Africa was a water scarce country and only a limited number of dams could be built.

"We have a joint responsibility to manage our natural resources in a sustainable manner for our future generations and protect them," she said in a department statement.

"Water, offers us life, it brings with it possibilities of social development and economic opportunities."

Human development

The major component of the Olifants River water project is the De Hoop Dam, which will firstly store floodwater for bulk supply to residential and commercial users as well as poorly serviced rural communities in the Limpopo province, and secondly to supply the platinum group metals mines in the area.

Hendricks said the memorandum paved the way for the development of these mines, due to conclusion of water supply agreements, and the addressing of key risks through ensuring suitable project design and appropriate financing instruments.

"The mutual benefits of bringing private sector finance into these projects allows us to concentrate the public sector resources on investment in human development and in overcoming enormous inequalities in the provision of basic services such as water, sanitation and waste management," Hendricks said.

Work on the De Hoop Dam started in July this year and the dam is scheduled to start delivering water to industrial, commercial and residential users by April 2011.

"The project will bring a number of business and job opportunities, with related skills training opportunities during the construction period," she said.

Broad benefits

Apart from the direct permanent employment opportunities that will be created by the project, it has been estimated that mining and its support industries will stimulate investment of several billion rand and create hundreds of jobs.

The mining companies operating locally have also invested millions on the Lebalelo water pipeline, which runs from the Olifants River to the Steelpoort area and further southwards to the Mototolo mine, to ensure increased water provision for mining activities.

In addition, the mining companies have also invested over R200-million into raising the Flag Boshielo Dam in exchange for an increased assured supply of water, further highlighting the growing cooperation between the government and the private sector.

The water affairs department is also working with state-owned power utility Eskom to investigate the possibility of constructing a new pumped storage scheme to provide an additional 1 500 megawatts to the national grid and provide potable water to about 800 000 people in the Nebo Plateau in Sekhukhune.

SAinfo reporter