MEECHAM PHILPOTT:

I was contacted earlier this morning by Matt Canavan, of course the Minister for Resources and Northern Australia, and they were keen to get on air to announce -they have a big announcement coming out of Canberra, but also it was a great opportunity because with Mark Bailey, the Minister for Water and Roads and those sorts of things in the Queensland State Government, there was a bit of a brouhaha over funding for the feasibility study for the Urannah Dam. So I thought well, this is a fair opportunity. So I just asked the Minister, what's the announcement this morning coming out of Canberra?

MINISTER CANAVAN:

So look today we take our next step in building dams across the country. It's a big agenda for the Federal Government to build water infrastructure, to grow our agricultural sector. We'd already announced before the election, funding to do the planning works on Urannah Dam and Burdekin Falls Dam. This next step is about announcing the capital funding that we've got available, that the State Government and other groups can apply to now, to help build those dams. So today we've got more than $400 million on the table for state governments to bid for. It's a beauty contest. There'll be other state governments lining up for this money. And Tasmania's already done very well on this front. We just need our state government, the Queensland State Government, to come forward with their plan to back this. We need to work in partnership with them. And there are lots of opportunities in North Queensland of course. There's some really good dam sites. Lots of agricultural opportunities. This really is the next opportunity for North Queensland, to grow our food sector, to take advantage of all that demand that's there in our region.

MEECHAM PHILPOTT:

Urannah Dam of course is right in the middle of our footprint, so with Urannah Dam - a couple of things that have happened over the last couple of days, I'm sure you're aware, Queensland State Government was basically saying that for the feasibility studies, the money's not upfront, it's paid in arrears and for companies that have to do these feasibility studies, they need to be paid forward. What's your response to that?

MINISTER CANAVAN:

Well these are the arrangements that have always been in place for infrastructure funding, everything seems to be a drama with this state government, unfortunately, I wish we'd just get on with the job and not have to squabble all the time. Every other state government in the country has signed up to this. The Queensland Government has signed up to it, they just didn't live up to their commitments. But every other state government without any public complaints or drama has agreed to this process. So the Victorian Labor Government, the South Australian Labor Government is all signed up, there was only Minister Bailey in the Queensland Government that wanted to make this into Days of Our Lives. Ultimately Mark Bailey and the Queensland Labor Government have agreed to stand by what they agreed to late last year which was to cash flow these projects, of course giving the Federal Government, as always, the case to provide the funding on a milestone basis. And all I can say is I'm glad that this has been finally resolved.

MEECHAM PHILPOTT:

So a Urannah Dam feasibility study, now that that's sorted, that's going ahead?

MINISTER CANAVAN:

Because of this back down from the Queensland Labor Government, it can go ahead now. That's great news for the people of Mackay region, particularly for Bowen and Collinsville, where this is a huge opportunity.

MEECHAM PHILPOTT:

Alright now the S400 million that you mentioned there, is that a loan, is it a government grant, how does that work?

MINISTER CANAVAN:

This is funding from a Federal Government grant. We are very committed to grow and build dams in Australia. We recognise that in the agricultural sector, it is difficult sometimes to fund the capital costs of dams, that they won't necessarily stack up in every instance. So this funding helps to get those projects across the line because we think they are nation building projects, we think they're good for the country and that's why we're investing in them. We do have as well on top of this money previously announced, a $2 billion loan, concessional loan facility. So for state governments or for a private proponent that may want to fund the Urannah Dam, they could come to the Australian Government and get low cost finance, concessional finance to help cover the other costs. Typically we'll provide up to 50 per cent of the capital costs, and we've done that with some projects in Tasmania already, that works well but there will need to be commitments from other state governments and other sources as well.

MEECHAM PHILPOTT:

Urannah Dam, now you mentioned that if that goes ahead, if that dam actually got built, that the water would be very handy for the likes of Bowen and Collinsville. I'm just wondering is that something that the likes of Adani or a GVK would be looking at if the Galilee Basin opens up?

MINISTER CANAVAN:

Look my understanding is that the Adani project are comfortable with the water that they'll have available in the Galilee at this stage. If there is further expansion out the Galilee, there most likely would be the need for outside sources and that could come from a range of areas. That's something that this study will look at in terms of say for Urannah, the Burdekin Falls is an option and the previously proposed Connors River Dam as well which is actually in the Fitzroy Catchment possibly could be an option. But that's really for the longer time for the Galilee, let's hope Adani goes ahead and it could be the first mover on that rail line, open up the first coal basin for years and then there'll be other opportunities for other proponents and more demand for lots of things, not just water.

MEECHAM PHILPOTT:

You mentioned Connors River Dam, my understanding is that's actually a shovel-ready project, in fact some of the groundwork's actually been done. That'd be more an agricultural dam would it for the Highlands and Coalfields I'm assuming?

MINISTER CANAVAN:

Yeah well it's a great point, Meech, you're absolutely right. I remember flying over Connors River Dam around four or five years ago and there were people on the ground doing early works on the project. It's a great dam site and a very good catchment. Unfortunately the business case for that dam at the time was to provide the water for the Galilee Basin, and a number of proponents pulled out of the deal, if you like, with SunWater, and so the project fell over. Now there are opportunities for agriculture. We'd have to refocus the project. There's really fertile agricultural land on the junction of the Mackenzie and the Connors, and that's certainly something I'd been interested to look at in the future.

We don't have a group of proponents pushing that project at this stage like we have with the Urannah, so we really got to - it's got to be grassroots here, it can't be top down. The people of Bowen and Collinsville have been very proactive in putting a good business case together for Urannah and a good pre-feasibility case. So that's why we're funding this study. But there are lots of opportunities in North Queensland, and the projects we have on the table at the moment is just the start, not the end.

MEECHAM PHILPOTT:

Matt Canavan, can you just explain for people that are not exactly sure how a dam stacks up, what you have to look at to make it come together?

MINISTER CANAVAN:

Well the big thing that marks our dams, as well as some other major infrastructure, but dams are very costly upfront, all big capital costs in pouring of concrete. They typically don't have a lot of operational costs, particularly where they're gravity fed. So it's a matter of how do you finance those big upfront costs when you're only going to get limited cash flows over a long period. Dams last, of course, for at least 50 years and more, and so paying off that big, big upfront cost over that time is a challenge, and financing that over that length of time is a challenge. Most banks and private investors of course don't have that kind of patience, and that's why the Government certainly has a role. We have that kind of patience, we have access to low cost finance and capital that can help reduce those upfront risks and make sure these projects get ahead.

MEECHAM PHILPOTT:

On the East Coast of Australia, are there any particular dam projects where they've got council, they've got state government, they've got the locals, everyone screaming for it that looks like it's a tap on the head?

MINISTER CANAVAN:

Well, you know, there are a couple. I mean, the Rookwood Weir down on the Fitzroy River near Rockhampton is certainly what you'd call a shovel-ready project. It is still requiring a finalisation of its environmental approvals, but that is very close. So we've got $130 million on the table to build the Rookwood Weir, the Federal Government. We'd happily start it right now, we think it's ready to go. There has been enough studies over ten years; they should get on and build something in this country, and that's what we want to do. The Prime Minister and the Deputy Prime Minister Malcolm Turnbull and Barnaby Joyce are in Rockhampton today talking about the Rookwood Weir and these announcements. But the State Government want to do another business case on this project. They want to take another year to do that work. They're delaying this project, delaying those jobs that could be created. I can't force them to do anything else, so we're just going to probably have to wait, but I just can't understand why we just can't get on in this country and do things. This project's ready to go, it's been on the books and planned for ten years now.

MEECHAM PHILPOTT:

Matthew Canavan, Minister for Resources and Northern Australia. So we're having a bit of a think about Urannah Dam.

[ENDS]