More than two years after the commissioning of the Erongo Desalination plant, Areva says negotiations on the offtake agreement with water utility, NamWater, are still ongoing.
Hilifa Mbako, the Country Manager for AREVA Resources Namibia, a 50:50 joint venture partner with the United Africa Group in the plant, told The Economist on Tuesday that they were confident of reaching an agreement soon despite the protracted negotiations.
Mbako could, however, not shed more light on the reasons for the delay in reaching an agreement citing confidentiality. He said: "The negotiations with NamWater are ongoing, and we are confident of reaching an agreement soon. "We have a confidentiality agreement in place not to divulge any of the components of the negotiations."
It is, however, widely understood that pricing of the water by the owners of the plant has been the major stumbling block to an agreement with NamWater, local authorities and some of the mines in the region.
Problems with an off take agreement of the first desalination plant in the country, built at a cost of N$1.8 billion, has not dettered the construction of a second desalination plant. Abraham Nehemia, the Under Secretary in the Department of Water Affairs and Forestry recently told this newspaper that construction of the second plant would start soon after the tender for the N$2 billion project closed at the end of June. Nehemia said government was working towards water flowing from the plant, to be built through a Public Private Partnership, in 2014.
Mbako said a second desalination plant will have no material effect on the existence and operation of the Erongo Desalination plant, primarily because it was built to supply water to the Trekkopje Mine. He added: "We imagine there will always be more demand than supply of water in the dry Erongo Region. There are more companies willing to take water from the Erongo Desalination plant than we can actually supply."
The Erongo Desalination plant was built after studies showed that water reservoirs in the Erongo Region, home to some of the country's major mines, were dwindling.
The plant has a current capacity of 20 million m3 water per annum ,and Areva's Trekkopje Mine, is expected to use 13 million m3 water per annum once it goes into full production.
At the moment, says Mbako, the product water offtake is very low, less than 1 million cubic metres, as Areva is currently in the construction phase of the project. "As such we do not currently need the high volumes that the plant has been designed to produce when the mine is in operation. We have only fitted 4 of the 9 trains with reverse osmosis membranes simply because we only need one train to supply the total water requirements."
The recent growth in uranium activities in Namibia has increased water demand in the Erongo region and stretched the nation's limited resources. Rainfall in the region doesn't meet the daily freshwater requirement of 35,000 cubic meters, according to the Ministry of Agriculture.
Water to augment supplies in the region is being pumped from the Omdel aquifer, which the ministry says has reached its maxium sustainable yield. A study on future uranium mining in the Erongo region confirmed that there is not enough groundwater in the central Namib to supply uranium mines, so all these mines must in future use desalinated water for their operations.
The study, conducted by local and international experts under the guidance of the Geological Survey of Namibia and German's Bundesanstalt fur Geowissenschaften und Rohstoffe (BGR) recommended that NamWater should enter into negotiations with AREVA to use their excess water from the desalination plant.