Forestry, at the Vaal River Eastern Sub-system Project (VRESAP) at the Vaal
Marina, Vaal Dam
2 March 2006
Ladies and gentlemen
I am proud today to be officiating at this sod turning ceremony of the Vaal
River Eastern Sub-system Augmentation Project (VRESAP) marking the commencement
of physical construction of this pipeline project due to its importance to all
people of the country. At first glance this may seem to be elevating this
pipeline project to a far higher importance than it normally would be
considered. We could not have wished for a more appropriate way to start off
our annual water awareness campaign for 2006.
As you know March is the month in which we traditionally celebrate national
Water Week which is a significant awareness week for the Department of Water
Affairs and Forestry and serves as a powerful campaign mechanism to popularise
the importance of water to the general public, as well as to the general water
stakeholder group. National Water Week also gives us an opportunity to showcase
successes and inroads made by government in delivering on access to water to
the public, a basic human right, which is enshrined in our constitution.
The 2006 national Water Week theme is âWater for Growth and Developmentâ,
which emphasises the fact that water is an essential factor in all sectors of
economic and social development, as it is a necessary input for all types of
economic activity and livelihood practices. Adequate, reliable water
availability is a prerequisite for investment, growth and poverty alleviation.
The allocation of water across different uses, and the policies and practices
that are used to manage, deliver and finance water, creates incentives for
specific economic activities in particular geographical areas.
These incentives influence the structure of the economy, reinforce and
induce specific spatial patterns of growth, which, in turn, have an overall
impact on national development paths, local economic growth, distributive
equity and environmental transformation. It is in this light that I ask you to
see this ceremony in its true perspective, one which is providing the security
of water supply to the all important power generation and petro-chemical
industries.
The eastern high veld area of Mpumalanga is underlain by extensive coal
deposits. Most of South Africaâs thermal electricity generating capacity is
situated on these coalfields and operated by Eskom. This area is effectively
the powerhouse of South Africa. Conventional thermal power stations require
large quantities of cooling water for their operation. In addition, the SASOL
petrochemical industry based on coal is also located on the same coalfield.
The uninterrupted provision of electricity and fuel by these two industries
is critical for the economy of South Africa and also for our neighbours.
Without this security of water supply during the periodic droughts, which
characterise our subcontinent, Eskom could be faced with the prospect of
blackouts and power rationing which would play havoc on all sectors of the
economy. We all recall the inconvenience caused by power cuts, not even to
mention the economic losses that could result from frequent power
interruptions. The shortages of fuel which were experienced during December
2005 reminded all of us of what could happen if refineries are unable to
function.
Over the years, a complex system of interconnected water supply schemes
linking river catchments adjacent to the eastern high veld coal deposits was
developed thereby providing sufficient water for these industries at a high
level of security. The water schemes also provide smaller quantities of water
for domestic and other industrial users.
Growth projections in electricity demand have indicated that all power
stations will soon be required to operate at full capacity while previously
mothballed power stations in the area will also have to be re-commissioned. The
water demand from SASOL will also increase due to changes in process and
increased production. Expected deterioration of water quality will also lead to
an increase in water requirements for both major customers. The combined effect
of these changes together with projected increased demand by domestic and
industrial users requires that additional bulk water resources be provided to
augment those of the existing eastern Vaal River sub-system to maintain this
high level of assurance of supply.
The initiation of construction of the project today marks the culmination of
a planning process which started some years ago when analyses showed that the
levels of assurance could be violated (and hence water supplies fail to deliver
the quantity required) as early as 2007, during serious drought conditions.
Thus the planning and implementation process was fast tracked to reduce the
risk of water shortage occurring should the worst-case drought scenario arise.
Although these catastrophic drought occurrences should seldom occur, they
present a very real threat for which provision must be planned. Bitter
experience has also taught us that infrastructure needs to be provided before
the onset of a drought and that infrastructure provided only during the drought
period is usually not able to mitigate the effects adequately so that the full
benefits are only derived in subsequent droughts.
I must commend my departmental engineers who initially lead the
multi-disciplinary team from project inception. The Trans-Caledon Tunnel
Authority (TCTA) has been drawn into implementation using a combination of
expertise of the private sector and my Department. Credit must also be given to
the close co-operation of the major users, ESKOM and SASOL. Without full
meaningful participation of all parties, we would have not been able to roll
out this major infrastructure Project in the relatively short time available.
This shows that we are still capable of delivering major water resource
infrastructure. It is my Departmentâs function to manage the water resources of
the country for the benefit of all and this is a concrete example of this in
action.
Looking around us at the completely full Vaal Dam, it is difficult to
imagine the scenario that drives the need for this project and the concerns
expressed that the water supply would fail before the project could be
completed. Now we face a different sort of problem of constructing an inlet
tower in much deeper water than the 34 percent of capacity which we experienced
early this year. At that time the levels of water in the storage dams continued
to fall and the prospect of below average inflows looked very real. Such are
the vagaries of our arid country.
As the power stations and many industries that require electricity to
function are crucial for the continued economic growth and sustenance of the
country as a whole, it is of critical importance that the water resources be
augmented to ensure that an acceptable level of assurance is built into the
water supply network in order to maintain its functioning under the drought
scenarios projected. This augmentation project is designed to cater for these
needs until 2030.
A reliable power supply underpins a thriving economy while the thriving
economy brings greater employment, higher standards of living and a much-needed
better life for all. The benefits of this project should thus filter through to
all users of electricity in all corners of the country while the spin-off of a
thriving economy can even extend to those not currently connected to Eskom
power. In a similar vein this water supply will provide water security for
SASOL while allowing for expansion of their business enterprise also to the
benefit of the wider economy with positive spin-offs in many different
directions.
In a developing country such as ours facing tremendous backlogs in services
and development, the demands on the National Treasury to supply funding for
development is greater than our limited resources allow. This usually means
that projects must be prioritised to determine funding requirements. This
project is one of the first water projects (other than the Berg Water Project)
being funded off budget with funds borrowed on the open market under very
favourable terms by TCTA. The customers will be repaying the full development
and operational costs of the project costs. This allows for freeing up limited
treasury funds for more socially oriented uses.
The implementation of this project will present many challenges. Our
contractors are joint ventures, which have been formed to comply with our
legislation for preferential procurement to allow black owned companies to
participate in large projects. This offers opportunity for growth whilst
working with partners to achieve the set goals. The contract conditions include
specifications for procuring of goods and services from various categories of
local, black empowerment enterprises and small, medium and micro enterprises.
The contracts also stipulate minimum levels for the employment of local labour.
The sheer size of this project will tax the provision of construction materials
whilst there are currently large investments in the building of new
infrastructure in the country. According to earlier reports the manufacturing
of pipes required for this project will occupy as much as 25 percent of the
country's steel production capacity.
The implementation agreement between my Department and TCTA also requires
the pooling of resources of the two institutions. This was done in compliance
with a decision of Cabinet to establish a national water resource
infrastructure agency by amalgamating the TCTA and my Department's
infrastructure branch.
It is in this context that I understand that the achievement of the
completion date of October 2007 will be very challenging. I hereby extend my
best wishes for a successful completion of this important project to all those
that will be spending time and effort during the next 20 months.
We indeed have much to celebrate today after the recent good rains in many
parts of the country and the start of this auspicious project. I would also
like to appeal to all of you to recognise World Water Day on 22 March 2006 and
celebrate safe drinking water with us.
I thank you.
Issued by: Ministry for Water Affairs and Forestry
2 March 2006
