MP, Jones want dam answers
Nelson MP Nick Smith says he’ll push for a $10 million government contribution towards an estimated $25m cost blowout for the Waimea dam build.
However, the long-time proponent of the project wants to know whether exploratory work should have picked up the unsuitability of some rock at the Lee Valley site, which is the main cause of the budget overrun.
‘‘Whether these risks were adequately identified and included in the contingency, these are legitimate questions,’’ Smith said yesterday.
Regional Economic Development and Infrastructure Minister Shane Jones also wants answers. He said he had called for a report on the project, which he described as a ‘‘tale of woe’’.
‘‘When I talk to my political colleagues, these are questions they’ll want answered,’’ Jones said.
He could not say whether any government funding would be forthcoming.
‘‘I want to be positive, but I cannot be reckless,’’ Jones said. ‘‘I will gladly bring it to the attention of my fellow ministers.’’
The politicians’ comments come after it was revealed last Friday that the forecast build cost of the dam had increased by an estimated $25m to $129.4m.
Tasman District ratepayers are on the hook for $23.5m of that expected hike, because under an agreed funding model for the project, any cost overruns above $3m fall to the council alone. Overruns up to $3m are shared equally between the council and its jointventure partner, Waimea Irrigators Ltd.
A two- to four-month delay for the completion of the dam is also tipped.
Waimea Water Ltd is the company responsible for managing the construction, operation and maintenance of the dam. Its chief executive, Mike Scott, pointed to problems with rock designated for use as drainage material in the embankment as the main cause of the cost increase and delay.
‘‘Some rock was found to be more fractured and breaking up more readily than expected,’’ Scott said.
The rock had been investigated ‘‘at length’’ before the project started, he said. ‘‘What was not possible to investigate before the project started was the behaviour of the rock under mechanical loadings.’’
Smith said it was ‘‘too big an ask’’ for ratepayers to pick up $23.5m of the expected overrun.
As the Government had ‘‘effectively met 40 per cent’’ of the original expected cost of the dam through discounted loans and grants, he would try to secure a similar level of support for the overrun.
It was fair for the council, the Government and ‘‘players like myself to want to have some tough scrutiny over Waimea Water to ensure there aren’t any other nasty surprises’’, Smith said.
Tasman District mayor Tim King said there had not yet been any formal discussions with potential funders to help
ratepayers meet the extra cost, ‘‘and who might be willing to contribute’’.
‘‘This is not money we need tomorrow – this is money we need 12 to 18 months down the track, as the project nears completion,’’ King said.
At this point, the council did not intend to investigate whether the problem with the rock should have been picked up earlier, he said.
‘‘We haven’t discussed running an investigation into the whys and wherefores of this particular issue.
‘‘Everyone acknowledged . . . that the period of digging out/ clearing the site/excavating down was where the risk was going to be. Quantifying that was always going to be really difficult. How much time, energy and money do you spend looking backwards when ultimately, at this point, you have to look forwards.’’
When asked on Friday if the contingency of about $6.4m was too small, given that geology had been flagged as one of the big risks for the project, King said that with hindsight, a greater budget would have been useful.
‘‘Right through this project, we’ve relied on an enormous amount of external advice. For 20 years . . . we’ve been advised by external advisers, we’ve had advice from professional staff, there have been questions asked about just about every conceivable aspect of this project.
The answers that have been provided led to the previous council . . . concluding on balance of all of that questioning, all of that advice, all of that input and feedback to proceed with the project on the basis of the budget and contingency that was provided.’’