Water is Lesotho's most important natural assest as well as being the country's largest single source of foreign exchange earnings and otherwise known as 'White Gold'. Lesotho is one of the most important catchment areas in southern Africa. Rainfall together with winter snowfalls provides an estimated 5.5 billion cubic metres of water annually, and renewable groundwater resources some 340 million cubic metres a year.

Since 1984, efforts have been focused on developing these resources for export through the Lesotho Highlands Water Project, which today, provides the country with a steady stream of royalties.

Supplying the Republic of South Africa with millions of cubic metres of water per year, the Lesotho Highlands Water Project (LHWP) is the largest and most ambitious long term water scheme of its kind in the continent, and has done much to develop the region's water supply. The Lesotho Highlands, with its high rainfall and surface area of high basalt mountains - the Maloti - is an outstanding catchment area.

The project aims to address the needs of South Africa's rapidly expanding Gauteng province, which generates almost 60% of the country's industrial output and 80% of its mining output, and where over 40% of South Africa's population lives. The province needs more water than its main source, the Vaal River, can provide.

The Lesotho Highlands Water Project captures most of the excess water from rainstorms in the Orange/Senqu River catchment and transfers it to the Vaal River system, at the same time ensuring the sustainability of life forms dependent on flows downstream of its storage dams.

Construction on phase 1A of the project began in 1984, and the first dam, Katse, began delivering water in 1998. Construction on phase 1B of the project began in 1998, and comprises the 145 metre high Mohale Dam on the Senqunyane River, the 32 kilometre Mohale Tunnel linking Mohale Dam to Katse Dam, and the 6 kilometre Matsoku weir and tunnel, which diverts flood water from the Matsoku River into the Katse reservoir.

In 2005, Lesotho and South Africa signed an agreement for a R53 million feasibility study for Phase II of the LWHP, which will include a major dam on the Senqu River.

Water Bottling Investment Opportunities

As referred to above, Lesotho's major natural resource is water and it is considered one of the most pure in the world with very little microbiological and chemical contamination which does not require intensive treatment. With increasing fears of water borne diseases, people are voting with their wallets when they buy bottled water.

Bottled water is also considered a food product internationally, thus investment in water bottling is necessary since this would result in a positive impact on public health in the region, by providing safe drinking water and soft drinks in areas with poor water supply quality.