Lesotho Highlands Water Project. Refiloe Tlali Chief Executive LHDA 22 May 2015

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1 Lesotho Highlands Water Project Refiloe Tlali Chief Executive LHDA 22 May 2015

2 Today s roadmap Why the LHWP? What is the mandate? How is LHDA governed? What has been achieved? Where to from here?

3 Why the LHWP? Needs Concept of the LHWP goes back to the 1930s Lesotho Revenue generation Reduce energy imports South Africa To meet increasing household and industrial water needs

4 Why the LHWP? Search for solutions Joint Detailed feasibility studies by GOL & RSA August 1983 to December 1985 Several options were considered LHWP was chosen as the most viable option Cheapest It could be implemented in four phases to reach its target of 70m 3 /s by 2020 Treaty signed on 24 October 1986 Next phases would require subsequent agreements

5 Why the LHWP? Purpose of the project To transfer water from Lesotho to South Africa and to generate hydro-electric power in Lesotho Both countries are allowed the opportunity to undertake ancillary developments in its territory, including: the provision of water for irrigation, potable water supply and other uses; the development of other projects to generate hydro-electric power; and the development of tourism, fisheries and other projects for economic and social development SA is 100% responsible for the water transfer costs Lesotho is 100% responsible for the hydro-power generation costs

6 Location 6

7 Senqu; Caledon & Vaal Rivers

8 Cost savings = Royalties OVTS = M billion LHWP= M billion COST savings = M billion Lesotho 56% = M billion RSA 44% = M billion Source : Royalty manual, Volume 3; Table 98

9 Project governance Treaty of 1986 LHDA Order No. 23 of 1986 as amended Protocol VI (1999) Functions, powers and obligations of LHDA, TCTA and the LHWC

10 Project governance LESOTHO HIGHLANDS WATER COMMISSION

11 LHDA top structure Chief Executive Chief Operations Officer Divisional Manager Development and Operations Divisional Manager Phase II Divisional Manager Social Development and Environment Chief Finance Officer PMU-Project Management Unit Dedicated to Phase II Implementation Covers Engineering; Social; Environmental; Financial; Public Relations and Contracts/Legal Issues

12 Briefing on LHWP

13 13

14 Key features Phase I A Katse Dam - 185m high; 1,950 million M3 storage Transfer Tunnel 45 km Delivery Tunnel - 16 km Hydropower plant -72 MW installed capacity Muela Dam- 55m high concrete arch type

15 Electricity for domestic needs Briefing on LHWP

16 Key features Phase I B To deliver 11.7 M 3 /sec Mohale Dam- 145 m high ; 958 million M 3 storage Transfer tunnel- 32 km Diversion weir and tunnel on Matsoku River Interconnecting tunnel 6 km long

17

18 Social & environmental issues Compensation & resettlement Project compensates households and communities Resettlement villages provided with roads, water, sanitation etc. Schools provided with improved facilities Households provided with VIP toilets

19 Social & environmental issues Focus on sustainability & livelihoods Development programme Food security Improved subsistence farming High value crops e.g. asparagus, garlic, seed potatoes, orchards High value livestock Ecotourism Reservoir fisheries Public health Hospital and several clinics HIV/AIDS management programme

20 Katse Botanical Garden Briefing on LHWP 20

21 Social & environmental issues Focus on sustainability & livelihoods Development programme Natural environment & heritage Three nature reserves Tsehlanyane Bokong Liphofung Conservation of the Maloti minnow Integrated Catchment Management (ICM) In-stream Flow Requirements (IFRs)

22

23 LHWP Phase II

24 LHWP PHASE II Kobong Pump storage 101m high Kobong Dam 6.3 km tunnels 11.5m dia Transfer Tunnel 38.2 km long 5.2m diameter Polihali Dam 163.5m high rockfill dam 49.5m Saddle dam

25

26 KATSE POLIHALI to KATSE TUNNEL POLIHALI

27 ACCESS ROADS

28 FEEDER ROADS AND FOOT BRIDGES

29 Phase II scope Environmental studies and mitigation plans Socio-economic studies and resettlement action plans Public health impacts and action plans Polihali Dam 165m high CFRD Saddle dam 165m high Transfer tunnel _ 38 km long, 5m NB diameter Hydropower studies still in progress Advance infrastructure

30 Contract Types Professional Services Environmental & heritage Perseveration Socio-Economic, Public Health & Livelihoods Restoration Resettlement & Compensation Engineering Design & Construction Supervision Urban Planning & Architecture Dams Tunnels and Geotechnical Roads and Bridges Power and Telecommunications Construction Contracts Briefing on LHWP

31 Contract Packages- Engineering AI AI AI AI AI AI AI AI ENG ENG ENG DAM TUN Design and Supervision of Construction-Bulk Power & telecommunications Design and Supervision of Construction-Major Bridges Design and Supervision of Construction-Feeder Roads and Foot bridges Design and Supervision of Construction-Main Access Road (PWAR) Design and Supervision of Construction-North East Access Road Planning, Design & Supervision of Construction- Urban Planning & Architecture Architecture Katse Lodge Geotechnical Engineering Services Demarcation of the Reservoir Polihali Dam Diversion Tunnels Design and Supervision of Construction-Polihali Dam Design and Supervision of Construction-Polihali to Katse Transfer Tunnel

32 Contract Packages- Works AI AI AI AI AI AI AI DAM TUN TUN SOC Construction-Bulk Power & telecommunications Construction-Major Bridges Construction-Feeder Roads and Foot bridges Construction-Main Access Road (PWAR) Construction-North East Access Road Construction- Permanent and temporary Housing Katse Lodge Upgrade Construction-Polihali Dam Geotechnical Investigations Construction-Polihali to Katse Transfer Tunnel Local Development Programmes- Rural Electrification, WATSAN etc

33 Contract Packages- Env Services ENV ENV ENV ENV ENV ENV ENV ENV ENV ENV ENV HLTH HLTH SOC SOC SOC SOC SOC SOC SOC Biophysical & Archaeological Baseline Study IFR Baseline Study EIA-Polihali Area ( Project Housing & Dam Site Establishment) EIA-Polihali Western Access Corridor (PWAC) EIA-Major Bridges EIA-Feeder Roads and Foot bridges EIA- Western/Katse (Tunnel West Establishment) EIA-Heritage/Archaeological Management Plan Implementation of IFR/Water Quality Monitoring Plan Biodiversity Monitoring Integrated Catchment Management Plan Public Health Baseline Study Public Health Action Plan Socio-Economic Baseline Study RAP-Polihali Western Access Corridor (PWAR) RAP- Polihali North East Access Road & & Dam Site Establishment RAP- Polihali Dam- Inundation Areas ( Including Feeder Roads) RAP- Western/Katse Basin Construction Facilities Compensation Preparation Monitoring Contracts

34 Hydropower update World Bank financing Feasibility studies show need for further studies World Bank financing in place All Agreements signed Conditions of effectiveness of grant were fully met in January 2015 Implementation programme Studies September 2015 to August 2017 Design 2018 to 2020 Construction 2020 to 2024

35 Phase II : Progress to date May 2013 August 2013 March 2014 April 2014 June 2014 March 2015 GoL ratified Phase II Agreement PMU Mobilised Project Launch- HM & RSA President Roadshows in Lesotho Road Show in South Africa Road Show in Mokhotlong

36 Timeline - key milestones Sept Procurement of services commences April Tenders awarded August Resettlement Action Plans August Environmental Impact Assessments March 2016 Polihali dam and transfer tunnel design March 2016 Construction of advance infrastructure March Construction of Polihali dam and tunnel May 2022 ROD to impound reservoir Wet season Commence impoundment Dry season 2024 Water delivery 2025 Project completion

37 Benefits to Basotho More than jobs created M1 billion paid in wages Value of contracts (local contractors) > M250 m Value of contracts (local consultants) > M300 m Supply of goods & services > M1.2 billion High quality roads mean Improved access into the highlands areas Greatly reduced travelling time Tourism attraction and beneficiation of local cottage industries Development of fisheries development

38 Benefits to Lesotho M5.85 billion in royalties revenue to date (Jan 98 Feb 2015) Infrastructure > 300 km of paved/tarred roads > 400 km of Grade 1 gravel roads 1,133 km of roads rehabilitated to Grade 1 standard 11 bridges 3 bridges bordering Lesotho & South Africa (Maseru, Maputsoe and Calendonspoort > 300 km of power lines (including substations) Work camps, staff housing (Katse, Mohale, Likileng)

39 Benefits to South Africa High quality water transferred > million m 3 to date, improved security of water supply, significantly reduced water treatment costs Secure low cost water supply for mining, power and other industries, households and agriculture RSA contractors and consultants in major contracts Job opportunities during construction of delivery tunnel Improved infrastructure in Clarens, Fouriesburg, Ficksburg and Ladybrand

40 In conclusion A win-win situation for Lesotho and South Africa Project of the Century Award 27 November 2003 NOSA SHE 5 Star Rating Muela Hydropower Successfully fought corruption. Quoted as best practice A showcase of bilateral co-operation and trans border water resource management

41 ? We Invite questions

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