Lesotho signs US$15bn energy deal with SA firm

MASERU — Lesotho has teamed up with a South African industrial group to develop a US$15 billion (about M110 billion) wind and hydro power project in the country.

The Lesotho Highlands Power Project (LHPP) will be the largest renewable power project in Africa and one of the largest in the world, it was announced on Wednesday.

The LHPP, which is a joint initiative with South African firm Harrison and White Investments, is aimed at supplying much needed power to South Africa’s power utility Eskom and Lesotho.

Gavin Zietsman, the chairman of Harrison and White Investments, said the first phase of the project, consisting of a 150 MW, wind farm, will begin early next year in Butha-Buthe and Mokhotlong.

It is expected to be commissioned a year later.

The project is also expected to create thousands of jobs for the Mountain Kingdom during its 10 to 15 year-duration.

The project aims to harness the natural resources of wind and water in Lesotho’s mountains to produce power that will be used by both Lesotho and South Africa.

The parties announced that the project will be funded through a combination of debt and equity. Major debt partners include Chinese financial institutions.

Natural Resources Minister, Monyane Moleleki, said the LHPP could boost Lesotho’s economic wellbeing in the long run.

“The project comes at a time in our history when traditional income streams have dried up due largely to the global economic meltdown,” Moleleki said.

“Through this project, our country has potential to graduate from Least Developed Country to developing country status,” he said.

“The Lesotho economy and its people will enjoy significant benefits from the required infrastructure upgrade that a project of such size brings.

“The construction of new roads and electrical infrastructure will open up isolated communities, giving them access to markets and government services,” Moleleki said.

Zietsman said the inflow of capital will help produce much-needed jobs during the construction phase of the project.

“A further 15 000 jobs will be created through secondary economic activities and new business opportunities,” he said.

Comments are closed.