HBRIC confident of funding

Hawke's Bay Regional Investment Company chairman Andy Pearce says deals to use about 35 million cubic metres of water per year were "in the contracting pipeline". Photo / File

Hawke's Bay Regional Investment Company says it is confident it will secure the required corporate investment funding and sign sufficient irrigation contracts to make the Ruataniwha dam project viable.

HBRIC, the investment arm of Hawke's Bay Regional Council, used its annual meeting yesterday to release some details of the progress it has made to date signing up irrigators for the Ruataniwha water storage scheme in Central Hawke's Bay.

The company's chairman, Andy Pearce, told the meeting that deals to use about 35 million cubic metres of water per year were "in the contracting pipeline as of today".

The scheme is designed to have a capacity to deliver about 100 million cubic metres of water per year.

The regional council has agreed to invest up to $80 million in the Ruataniwha project, but only once HBRIC has signed deals with potential irrigators to take at least 40 million cubic metres of water a year.

Dr Pearce said of the 35 million cubic metres in the sales "pipeline", 12 million cubic metres was "either signed up or at the point where it's only a matter of signing it".

He said some potential water users would not sign until an appeals process relating to an environmental management plan change for the surrounding Tukituki catchment was completed.

A High Court appeal against the plan change is set down to be heard next month.

"Having 35 million cubic metres in the pipeline, and a third of that pretty much locked away at this point, we're feeling quite comfortable [about meeting 40 million cubic metre requirement," Dr Pearce told the meeting.

HBRIC chief executive Andrew Newman told the meeting there was a significant pool of other potential irrigators that would be targeted by the company's sale staff as the deals currently being negotiated were signed off.

Dr Pearce said HBRIC also had "strong institutional investor interest" in the scheme, subject to getting its resource consents for the project "clear of appeal".

"We have two parties and either of them could provide all of the institutional capital that's required for this project and it would be our view that it is going to be a contest between those two," he said.

He said having two interested parties meant that HBRIC had "some useful competitive tension" when it came to negotiating terms for the investment. "We don't feel that there's going to be any issue about getting investment capital for this project," he said.

HBRIC is working towards a deadline of the end of March next year to have investment in the project finalised and the minimum level of water contracts signed.