Irrigation has changed the face of North Otago farmland.
Photo by David Bruce.
"Irrigation really is the future" - that is the message
from North Otago Irrigation Company chief executive Robyn Wells
as the company plans for the second stage of its scheme.
Preliminary estimates for stage two have been put at about
With an estimated two-year construction phase, it was a
large-scale and complex infrastructure project, Mrs Wells
The company was approaching it "in a very disciplined and
staged way" and was going to do everything it could to put
forward a viable proposal by the end of the year.
Stage one of the scheme - which cost $67 million to build -
was opened in 2006.
Irrigating 10,000ha, it delivers water from the Waitaki River
to farms on the North Otago downlands and in the Waiareka
In a report by the AgriBusiness Group last year, it was
estimated stage one increased farm output by almost $44
million a year and had created an extra 76 jobs.
Farmers had spent about $62 million in land conversion costs,
over and above the cost of the scheme.
The first stage has enough capacity from its intake and
pump-house at Black Point to handle a second stage.
At the moment, the North Otago Irrigation Company was close
to completing options analysis for upgrading the Black Point
part of the scheme.
A study was also being completed by an agri-business
consultant to determine how much farmers could afford to pay
The irrigation company was communicating with interested
parties - some community meetings have been held - and the
feedback was "tentatively positive", Mrs Wells said.
Once the final proposal was completed, the company would ask
farmers to invest in "the right project at the right price".
Workshops discussing the affordability of the proposal would
probably be held in late June.
It was a big project and the company needed to put together a
strong business case that showed it had looked at the
options, done the analysis, understood the market, got an
indication on uptake, and the returns it was going to
generate for investors and the community.
Irrigation provided the ability for "people to sleep at
"It's really about security and it's about options," she
Forty percent of current shareholders were not dairy farmers
and it appeared to be beneficial for those who were not
Any affordability models needed to look at various scenarios,
including a drop in commodity prices so risk could be
This season had been "pretty light" irrigation-wise for those
involved with the first stage of the scheme, because of high
Overall, that was positive for shareholders, as they did not
have to pay for water and money could be used to pay debt,
The irrigation company welcomed the pre-Budget announcement
on the Irrigation Acceleration Fund to support development of
irrigation proposals to the investment-ready stage.
The announcement indicated the Government would also consider
options to encourage greater investment in water
External investment was something already being considered
for financing the stage two development.