KZN to spend R30bn on two new dams over the next 10 years

The dams will secure the province’s water supply for the next 50 years, with Umgeni Water stumping up R1bn of the cost — without needing a bailout

Two new dams‚ providing a combined 800-million litres of water a day‚ are set to be built in KwaZulu-Natal over the next decade — at a cost of more than R30bn.

Speaking at the release of the Umgeni Water annual report in Durban on Thursday‚ the water authority’s CEO Thami Hlongwa said the huge builds — along with the completion of the Hazelmere Dam wall expansion project — will secure the province’s water resources for the next 50 years.

The biggest project is the Smithfield Dam in the Upper uMkomazi area. In total‚ about R26bn will be spent on the dam‚ which will add 700-million litres of water a day to KwaZulu-Natal’s water supply when full. Between R7bn and R9bn of the cost will be paid by Umgeni Water.

Hlongwa said it is “full steam ahead” on the project‚ with construction expected to be completed by 2030.

Construction on the second dam‚ Ngwadini‚ which will feed into existing dams supplying the KwaZulu-Natal south coast‚ is expected to start in the 2020/2021 financial year. It will cost Umgeni Water R4.2bn and will add 100-million litres of water per day to the system when complete.

Funding for these and other capital projects‚ Umgeni Water chair Ziphozethu Mathenjwa said‚ would not come from national government. She announced that the state-owned entity (SOE) had made a profit of R1.3bn‚ which means it is “going to give out a billion [rand’s] worth of service delivery”.

In reference to embattled SOEs, including Eskom‚ SAA and the SABC‚ she said Umgeni Water would not seek “bailouts”.

“We want to be‚ and to remain‚ a role model … where we don’t want to write to our shareholders seeking a bailout. That’s who we are‚ and that’s who we want to be. We will remain resilient‚ focused and an example to other SOEs‚” said Mathenjwa.

Some irregular spending

However‚ the water utility also owned up to incurring R220m in irregular spending during the 2018/2019 financial year. This was money spent without following the correct procedures‚ and included spending on a lift for its offices‚ canteen services and fixing a cracked dam wall. Mathenjwa said the utility is reviewing processes and systems to ensure the issue was dealt with.

Speaking specifically on the Imvutshane Dam wall‚ Hlongwa said R1.3m was spent to assess whether Umgeni Water had to urgently repair the crack in the wall‚ could fill the dam up to its maximum capacity‚ or had to allow water to be released from the dam to ensure its structural integrity.

Ultimately‚ he said‚ it was decided that the dam was not badly damaged enough to require emergency work and that a tender would be issued for the crack to be repaired. The dam is 100% full.

He and Mathenjwa said the decision to do the work urgently was done in the interest of “dam safety”. While the dam is small‚ with a maximum capacity of about 3-million litres‚ there are a number of communities immediately around it which could have been severely affected if precautions weren’t put in place.

Said Mathenjwa, “If we had not done it‚ we could have been in the news for the wrong reasons. We could have destroyed families.” https://www.businesslive.co.za/bd/national/2019-11-28-kzn-to-spend-r30bn-on-two-new-dams-over-the-next-10-years/