South Africa's Oceana invests in desalination plant amid drought

CAPE TOWN, Feb 5 (Reuters) - South African fishing company Oceana will invest 20 million rand ($1.7 million) in a desalination plant at its west coast factory as businesses look to save water amid a major drought in the Western Cape, officials said on Monday.

Residents of Cape Town have been restricted to a maximum of 50 litres of water a day from the beginning of February, as the popular tourist destination scrambles to avert queuing for water when taps are expected to run dry in mid-May.

The investment by Oceana means the factory will not draw water from the municipal supply and will also not close down, saving around 2,000 jobs. The second phase of the plan will consist of a desalination unit at Oceana's Laaiplek facility which will produce around 600,000 litres of water per day.

"Phase one of the plan will see a 20 million rand desalination plant, capable of producing 800,000 litres of water per day, come online at their largest facility in St Helena Bay, by the end of March," the Western Cape provincial government said in a statement.

The company is considering drilling boreholes on a nearby farm to augment its water supply to the St Helena Bay factory, about 170 kms north-west of Cape Town.

At the end of January dam levels in the Western Cape province fell to 24.5 percent from 25.3 percent the previous week, and from nearly 38 percent a year ago. ($1 = 12.0407 rand) (Reporting by Wendell Roelf; Editing by James Macharia and Mark Potter)