Lesotho Highlands Water Project – Phase II: An update

Phase II of the Lesotho Highlands Water Project (LHWP) comprises the construction of the Polihali Dam and reservoir, water transfer tunnel and the associated access roads, bridges, accommodation, electrical transmission lines and telecommunications infrastructure.

The LHWP Phase II builds on the successful completion of Phase I in 2003. It delivers water to the Gauteng region of South Africa and uses the water delivery system to generate electricity in Lesotho.

Key components of the project

Polihali Dam

• 163.5 m high rockfill dam

• 49.5 m high saddle dam Polihali Transfer Tunnel

• The Polihali Dam will be built downstream of the confluence of the Khubelu and Senqu rivers in the Mokhotlong district in the eastern Highlands of Lesotho.

• A 38.2 km long and 5.2 m diameter water transfer tunnel will link the

Polihali and Katse reservoirs.

Hydropower

• Feasibility studies are completed. It is decided that conventional hydropower is the best option. • Three potential sites have been identified: two on the Senqu River and a third site at Oxbow on the Malibamats’o River.

• The Government of Lesotho has approved the Oxbow site for Phase II hydropower component. The procurement of a service provider for the detail design and supervision of the hydropower scheme has started. Key dates are:

• 2022 – begin the design of the preferred option

• 2025 – begin construction

• 2028 – commission.

Advance infrastructure

• This has mostly been completed and entails:

• roads

• bridges

• housing

• offices

• workshops

• bulk power

• telecommunications networks, which support project implementation and benefit Lesotho in the long term.

Procurement

• 54 contracts have been awarded

• The most recently awarded contract is for the construction of the Polihali Operations Centre to L&M – a joint venture between Lesotho’s LSP Construction and South Africaregistered Mofomo Construction.

• Main works milestones include the procurement of the contractors for the Polihali Dam, Polihali Transfer Tunnel and major bridges. The award of the contracts is expected this year.

• Recent advance infrastructure construction tenders awarded include those for the Katse Lodge and Katse Village upgrades, and the construction of the Polihali Village. Construction work has commenced on these two components.

Polihali diversion tunnels

The two diversion tunnels were constructed in preparation for the Polihali Dam construction and ahead of the appointment of the dam contractor. The Lesotho Highlands Development Authority (LHDA) celebrated the double breakthrough of the tunnels in August 2021, marking the completion of 1 870 m of excavation.

Excavation inside the two Polihali diversion tunnels commenced in June 2020 and mostly advanced from the outlets. Construction was completed in November 2021. The contractor and consultant have demobilised from site.

Bulk power

The electrical infrastructure required for the Phase II development includes the construction of new substations, upgrading of existing Lesotho Electricity Company (LEC) substations, the construction of new power lines, and the diversion of the existing LEC 33 kV distribution network between Letšeng and Mokhotlong, which is below the Polihali Dam full supply level.

A 33 kV power line of 2.2 km from Tlokoeng to Polihali to supply early power for the advance infrastructure contracts and the Polihali village prior to the completion of the main power from Matsoku was completed in June 2021.

The construction of a 38 km 132 kV transmission line between Matsoku substation and the new substation at Polihali have been completed and both were energised in mid-January 2022.

Polihali and Katse infrastructure works

The works at Polihali and Katse – including the potable water supply system and sewer reticulation to permanent and temporary residential areas, water treatment facilities, access roads and street lighting – are complete.

Environmental milestones

Environmental and social impact assessments and environmental management plans for the Polihali Western Access Road (PWAC) and associated infrastructure are completed.

Records of decision (RoDs) authorising the construction of the Polihali Dam, Polihali Transfer Tunnel, PWAC and its associated components have been granted by Lesotho’s Ministry of Tourism, Environment and Culture.

Furthermore, the environmental management plans have been approved, while the RoDs for the Polihali North East Access Road (PNEAR), the construction of the diversion tunnels and for the quarries and borrow pits associated with the major components like the Polihali Dam and Polihali Transfer Tunnel and the major bridges have been granted.

Changes in the overall design/ construction programme

Projected milestones as per the current master programme are as follows:

• Impoundme nt of the dam: June 2025.

• Water delivery (tunnel): December 2027. Several factors have contributed to the programme changes. These include the delays due to complex decision-making processes, the cancellation and repeat of some procurements, and Covid-19 – which brought the LHWP to a halt for a period. Activities then resumed with restrictions to protect LHDA employees, consultants, contractor teams and communities in the construction area. Adverse weather and community unrest also caused delays.

Construction under way

• Access roads: Construction of the PWAR East and West, PNEAR and the Northern Access Road is progressing but is behind schedule.

• Housing: In recent months, construction has begun on the Katse Lodge and Katse Village upgrades, the construction of the Polihali Village and construction of the Polihali Operations Centre. These are three of the four Phase II housing contracts packaged to enhance local participation, especially of small- and medium-sized contractors. Procurement is advanced for the construction of the Polihali Commercial Centre.

• Bulk power: Upgrades to the substations at the Katse intake tower and Ha Lejone – and to the protection and control systems of the Maputsoe,

Pitseng and Matsoku diversion substations – are complete.

Revenue

The Polihali Dam will add another 2 325 million m³ to the LHWP storage capacity. The current annual royalty revenue will increase when Polihali is commissioned, as the volume of water transferred to South Africa will increase incrementally from the current supply rate of 780 million m³ per annum to more than 1 270 million m³ per annum.

Royalty revenues on the transfer of water to South Africa will vary from year to year, depending on the volume of water transferred and inflation. At the end of 2021, the cumulative water transfer royalty revenue was M12.545 billion (at a 1:1 ratio to the South African rand).

The water conveyance system also generates electricity in Lesotho, which has reduced the country’s dependence on imported electricity, saving on import costs and contributing to the country’s GDP by stimulating local industry and economic growth. At the end of December 2021, the cumulative electricity sales revenue from the time the ‘Muela Hydropower Plant that was commissioned in 1998 amounted to M1.276 billion.