Billion Dollar Investment For Lesotho Water Project

Funds Secured For Phase 2 Of Long-running Bi-national Water Access Programme

3 Jul 2021 by The Water Diplomat
Johannesburg, South Africa

South Africa’s Trans-Caledon Tunnel Authority (TCTA) has raised just over $1 Billion USD on capital markets for the Lesotho Highlands water project, the country's Department of Water and Sanitation (DWS) minister has confirmed.

The TCTA required guarantees from the National Treasury to secure the private funding for the project - designed to improve water access across South Africa by diverting water from Lesotho's mountains.

“We have the resources, we have the guarantees, and we can assure you we will be hard at work to provide water security,” DWS minister Lindiwe Sisulu told lawmakers.

The bi-national water project, which was established through a treaty between the Republic of South Africa and the Kingdom of Lesotho signed in 1986, currently satisfies 60 Percent of Gauteng’s water demands, whilst generating hydroelectricity solely for Lesotho citizens. It is based on a 30-year plan staggered across 5 phases. Phase 1 began water delivery in 1996.

The new funding will enable completion of phase 2, involving the construction of a cluster of new dams, and a 38km water transfer tunnel connecting the Polihali reservoir to the Katse reservoir, to support water delivery across South Africa’s major cities.

Following a week-long oversight visit to the LHWP, the Portfolio Committee on Human Settlements, Water and Sanitation has emphasised the significance of the project for the socio-economic prospects of both South Africa and Lesotho.

Committee chairperson, Machwene Semenya said: “The committee felt it was necessary for its oversight work to visit Lesotho and assess progress, especially considering the economic importance of the project to the sustainability of Gauteng, which is our country's economic hub and seat of the executive”.

Photo credit: SkyPixels - Own work, CC BY-SA 4.0,