The Dungowan Dam feasibility study is not expected to be completed until 2018, which means the state government funding for the project could be off the table for up to two budget cycles.
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The federal government has already committed $75m, but the project is estimated to cost $150m, so the NSW government will be required to provide some, if not all, of the remaining funding.
Tamworth councillor Russell Webb was disappointed to hear the study would take so long, and had concerns the federal money would “evaporate” if the state government didn’t play its part.
“We’re not talking about small amounts of money, so I understand the due diligence has to be done, but when things get dragged out through preliminary studies, projects fall of the table,” Cr Webb said.
“It’s extremely important this happens sooner rather than later. If we don’t take advantage of the funds offered federally, they will quickly go somewhere else.”
A spokesperson for Regional Water Minister Niall Blair said the study was investigating environmental issues and best-cost options, while investment decisions will be assessed against strict criteria.