By Agencies

South Africa and Zimbabwe are in talks over a $500 million dam project to supply water to an industrial hub near their border, Bloomberg reported on Monday, citing documents it had seen.

The proposed Thuli Moswa dam, to be built in Thuli in Zimbabwe, would have a storage capacity of about 430 million cubic meters and could supply up to 90 million cubic meters of water to the Musina-Makhado Special Economic Zone in South Africa’s Limpopo province, the report said.

South Africa’s Water Department said the two countries are still discussing a joint study to assess the feasibility of building dams in Zimbabwe and transferring water to Limpopo as a long-term plan, the report said, citing spokesperson Wisane Mavasa.

The Musina-Makhado zone, which is set to host energy-intensive industries such as metals processing and manufacturing, declined to comment “at this stage,” the report said.

Zimbabwe’s Agriculture Ministry secretary, Obert Jiri, told Bloomberg there is no timeline for the project to begin.

If agreed, the project would go through an 18-month preparation phase followed by about three years of construction, the report added.

South Africa would pay for the water under an agreement lasting between five and 35 years, according to the documents.

The report added that chronic water shortages, rising industrial demand and climate risks are making water infrastructure an urgent investment priority for South Africa, though large cross-border projects can take years to reach construction as governments work through financing, pricing and cost-sharing.

It would be one of the largest cross-border water projects involving South Africa since the Lesotho Highlands Water Project, the report said. Under that scheme, Lesotho delivers about 780 million cubic meters of water annually and earns roughly 4.2 billion maloti a year in royalties.