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Jul 12, 2012

Two contracts awarded for Phase 2 of Lesotho Highlands project

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Water and Environment Minister Edna Molewa said on Thursday two contracts had been awarded for the building of the second phase of the R15-billion Lesotho Highlands Water Project (LHWP Phase 2).

In a response to a Parliamentary question posed by the Democratic Alliance’s Gareth Morgan, the Minister said the first contract, which was awarded to Lesotho-based Mops Civil, was for the construction of a 3.8 km access road to the measuring weir downstream of the Polihali dam. The road was completed by the end of November.

The second contract was awarded to South African company BKS for the construction of the measuring weir, located on the Senqu river. The measuring weir was still under construction and wasexpected to reach completion by September.

Molewa reported that the Lesotho Highlands Development Authority had completed negotiations with the preferred bidder for the project management contract. The contract is expected to start by the end of July.

She added that requests of proposals for baseline studies had been advertised and that the closing date was June 29. The contract was likely to be awarded in August, with some studies anticipated to take 24 months to be completed.

The environment and social development baseline studies and planning would be undertaken between August 2012 and July 2020. The environmental-impact assessments would also be conducted during this time.

Commenting on the rest of timeline for Phase 2, Molewa said that consultants, as well as design and issue construction tenders would start in November and continue to January 2015, the construction of advance infrastructure would run from July 2014 to December 2015 and the construction of the Polihali dam and the tunnel were expected to start in January 2016 and end in March 2020.

Impounding to 2 000 m above sea level would be realised in August 2018 and the first water should be delivered to South Africa by August 2020.

The agreement on the implementation of LHWP Phase 2 was signed in August between the governments of Lesotho and South Africa.

The Phase 2 agreement would open the way for additional water and power to flow to South Africa from the mountain kingdom. The water aspects of the project were likely to cost around R7.8-billion, including R2.4-billion for development of the Polihali dam. The government of Lesotho was also preparing to pursue a R7.6-billion hydropower project directly linked to the Phase 2 developments.

Molewa said that the pump storage scheme’s feasibility study was expected to reach completion in August, while provisional construction of the pump storage facility was planned to run from January 2013 to December 2017.

Meanwhile, the Minister said that the loan capital for the building of the dam had not been secured yet.

“This will be informed by the outcome of the guarantee request, which is currently under consideration by the National Treasury,” she noted.

The outcome of the decision was expected by the end of July, once the Fiscus Liability Committee of the National Treasury made its recommendation to Finance Minister Pravin Gordhan.

Molewa indicated that the necessary offtake and implementation agreements would be entered into once the loan capital was in place.
 

Edited by: Mariaan Webb
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