Stage 1 of the Olifants Management Model Programme has reached mezzanine debt financial close with Climate Fund Managers, marking a financing milestone for one of South Africa’s largest water infrastructure programmes.
The Badirammogo Water User Association said the agreement was reached through Climate Fund Managers’ European Union-supported Climate Investor Two facility.
The milestone follows commercial close for Stage 1 in December 2025 and the start of detailed design, limited procurement and construction activities in February 2026.
Blended finance supports water infrastructure delivery
The OMM Programme is a R25bn multi-stage, source-to-tap water infrastructure programme designed to expand bulk raw and potable water infrastructure across Limpopo Province.
The programme is structured as a 50:50 public-private collaboration between government and the private sector and is registered as Strategic Integrated Project 19.
Stage 1, valued at approximately R8.5bn, includes bulk raw water pipelines, pump stations, associated water treatment infrastructure and supporting energy solutions.
“Achieving Mezzanine Debt Financial Close is a significant milestone for the Olifants Management Model Programme and demonstrates how blended finance can continue to support the delivery of strategic infrastructure at scale,” said Darron Johnson, Regional Head of Africa at Climate Fund Managers.
The mezzanine debt milestone confirms Climate Fund Managers’ committed debt participation in Stage 1 and allows mezzanine lending and grant funding streams to progress in parallel.
Senior lender close is next financing milestone
The programme is now progressing towards senior lender financial close with Absa, Nedbank and Standard Bank.
The mezzanine debt close builds on earlier support from the Infrastructure Finance and Implementation Support Agency and South Africa’s Department of Water and Sanitation.
Climate Fund Managers had previously approved a USD 86.2m, approximately R1.4bn, financing facility through its Climate Investor Two fund to support the first stage of the programme.
“The achievement of Mezzanine Debt Financial Close represents another significant step forward for the Olifants Management Model Programme and demonstrates the confidence that our funding partners have in the project’s vision, governance model and long-term impact,” said Dr Kobus van Duvenhage, Chief Executive Officer of BWUA.
Water security for Limpopo communities and industry
Once fully implemented, the OMM Programme is expected to include more than 875km of bulk raw and potable water infrastructure.
The programme is expected to provide potable water to around 140 communities, benefit approximately 390,000 people, strengthen water security for municipalities, communities, mining operations and industrial users, and create an estimated 42,000 direct, indirect and induced employment opportunities.
“I am delighted that European Union support has assisted in leveraging significant private sector commitment towards the next financing milestone, the so-called Senior Lender Financial Close with South African banks,” said Sandra Kramer, European Union Ambassador.
With construction activities already underway, BWUA and its financing partners said their focus is now on maintaining implementation momentum and progressing senior lender financial close.
Read more water infrastructure and finance coverage in H2O Global News’ Water Management and Finance sections.
FAQs
What is the Olifants Management Model Programme?
The OMM Programme is a R25bn source-to-tap water infrastructure programme designed to expand bulk raw and potable water infrastructure across Limpopo Province in South Africa.
What milestone has Stage 1 reached?
Stage 1 has reached mezzanine debt financial close with Climate Fund Managers through its Climate Investor Two facility.
Who is implementing the programme?
The programme is being implemented by the Badirammogo Water User Association, formerly known as the Lebalelo Water User Association.
What is the next financing step?
The next major financing milestone is senior lender financial close with Absa, Nedbank and Standard Bank.
