Grant boosts water scheme

01:15, Jun 09 2014

A $7 million government grant guarantees pre-construction work on the Hunter Downs Irrigation (HDI) Scheme can begin.

The latest research indicates that if the scheme proves viable it has the potential to increase income in the Waimate and Timaru districts by $830m annually.

Independent experts have estimated total indirect net economic benefits to include 1800 new fulltime-equivalent positions.

Primary Industries Minister Nathan Guy said the Government's Acceleration Fund will provide over $7m for studies over two years, to co-fund technical investigations and design work to determine if the scheme is viable, both from a technical and economic perspective.

The government funding will be matched by shareholders' equity and the scheme's partner, Meridian Energy.

Hunter Downs Irrigation Ltd (HDIL) director Stacey Scott said the next 12 months will be very important for the scheme.


HDIL will co-fund the pre-construction work to be undertaken by Hunter Downs Development Company Ltd (HDDCL) with Meridian and the Irrigation Acceleration Fund (IAF).

Meridian agreed to provide HDDCL with up to $3.8m for pre-construction work. The IAF will provide up to $641,330 and engage a consultant to undertake the engineering feasibility study.

If viable, the scheme will draw water from the Lower Waitaki River and, depending on the outcome of the investigation, construction could begin in late 2016 and be completed by the end of 2019.

The scheme would provide opportunities for land-use diversification, including horticulture, sheep, beef and dairy.

HDI has consents to irrigate up to 40,000 hectares of South Canterbury farmland north of the Waitaki River.

The scheme has the potential to deliver water and sustained improvements to the productivity and vibrancy of South Canterbury and its communities, Guy said. In addition to on-farm benefits, irrigation schemes have significant flow-on effects to local communities. Earlier this year, HDI raised $4m from prospective investors through its initial share offer.

The Timaru Herald