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About Ellisras

Due to its resources – Waterberg’s coal reserves constitutes around 45% of ’s coal reserves - and the obvious benefits of the location of power generation plants, is being called “the future of power generation in South Africa”. In fact, the town is situated in the middle of one of the biggest development projects in South Africa, including the new , a projected plant and the Mabula coal project in Botswana, just across the River, to name but a few.

The extent of the planned economic development and the subsequent demand for housing in the area makes it a great investment area for savvy property investors.

According to a report compiled by the Lephalale Economic Development Company for the local municipality, five power stations are expected to be operational in the area by 2025. As a result, coal production will increase from 16 million tons to 100 million tons and a petro- with a capacity of 160 000 barrels per day will be established in the area. Mega petro-chemical plants in -rich countries such as Iran produce around 120 000 barrels per day. By 2025, the population of the total area, roughly in the shape of a triangle between Lephalale, Steenbokpan and Stockpoort, is expected to double to 240 000.

The local economic development planning has been divided into phases with the current construction of the new Medupi power station falling into Phase 2. To provide an insight into the extent of the impact of this power station on the area, it should be noted that Medupi will be the 4th largest coal plant in the world. At peak, 8 000 people will be employed to construct the power station, while another 1 500 jobs will be created indirectly. Around 750 permanent new jobs will be created once in Medupi is in operation. The agreement between Exxaro and with regard to the supply of 7,3Mt of power station coal will result in the mining and beneficiation complex at Lephalale becoming the biggest in the world. The indirect spin-offs for the local economy are immense. Every sector of the economy, from road maintenance, sanitation and social facilities to freight forwarding, local transport and catering industries will receive significant boosts from just this one project.

Phase 3 of the planned development includes the construction of petro-chemical plants and another coal mine between Steenbokpan and Stockpoort. Sasol has already applied for a manufacturing licence for a new coal-to-liquids plant, Project Mafutha, to come online in 2016. Phase 4 planning covers the period from 2015 to 2020 and includes another coal mine and another 4 200 Mw power station, as well as a power station and a coal mine on the Botswana side of the Limpopo river. For this phase, Anglo Coal is also planning a plant.

As the development progresses and more people move into the area to work in these new industries, the demand for housing is expected to increase significantly, with obvious opportunities for property investors.

Source: Treoc, Market News, February 2010