The final cost of the Waimea Community Dam in Tasman has been confirmed at $211 million and the district’s mayor is relieved to see the end of the contentious project. 

Dam operator Waimea Water Limited (WWL) made the announcement on Monday after disputes with the joint venture construction contractor were “amicably settled” and dispute proceedings had ceased. 

The dispute had been initiated by the joint venture contractor who challenged decisions of the independent engineer and adjudicator. 

Tasman Mayor Tim King said the dispute’s resolution and receiving the dam’s final cost were a “relief” and brought an end to an “ever-present issue” for the council over the past five years. 

“It’s been a long and tortuous process to get this far.” 

He thanked everyone involved for concluding the project so “we can focus on the other significant issues that the region faces”. 

King said the decision to proceed with the dam had been difficult and he understood residents’ concerns about the significant cost overrun. 

“Over the medium to longer term, [the dam] will demonstrate that despite a significant impact on ratepayers and irrigators … it will deliver value, both economically but also socially and environmentally to the region.” 

The Waimea Community Dam — the largest to be built in New Zealand in more than three decades — had been hit by skyrocketing costs and delays during its construction. 

The dam’s final cost is marginally down on the $211.3 million cost Tasman District Council was advised of in November 2024, but more than double the $104.4m forecast when it was approved in November 2018. 

The dam is funded by the council and irrigators through a combination of equity and debt. 

Much of the cost overrun was the result of unforeseen geotechnical challenges on the site. 

WWL chief executive Mike Scott acknowledged the dam had been a difficult project during a challenging time but it was important for Tasman. 

“This has been a significant project for the region, and I thank the community and shareholders for their ongoing support,” he said. 

“With construction now behind us, we can put our entire focus into efficiently operating the dam to provide shareholders their water security.” 

Scott said the project had several highlights, such as the contractor’s “impressive” safety record with no lost time injuries. 

Waimea Water Ltd chief executive Mike Scott says the dam will provide benefits to the region for generations. Photo / Max Frethey / LDR 

Ben Hayward, representing the Fulton Hogan Taylors joint venture, was pleased to see the project completed and the dispute end. 

“The five-year dam project was demanding at times, but now that it has been completed, we can look back with pride on what we have achieved and the flow-on benefits to the region’s future prosperity.” 

The dam was investigated after a severe drought in the summer of 2000-2001 highlighted water shortage issues on the Waimea Plains. 

Water in the dam reservoir, named Te Kurawai o Pūhanga, is released to recharge the aquifers, fed by the Waimea River, from which the district takes much of its water. 

“The dam is doing its job,” Scott said, pointing to when the dam released water in March and April 2024 to avoid “significant” harm to the local economy and river health. 

“We released 20 per cent of the reservoir to avoid severe water restrictions that would have otherwise severely impacted residential water supply, shut down some industries, impacted our food production and exports.” 

The dam is now fully operational and its reservoir is full and ready to provide service to shareholders and the community this summer season, Scott added. 

The Waimea Community Dam is the first large dam to be constructed in New Zealand since Otago’s Clyde Dam more than 30 years ago. 

Over that time, Scott said the country’s population had nearly doubled and a changing climate has increased the need to store water. 

“Water security for our communities, environment, and economy is important. Productivity and economic benefit require water security,” he said. 

“While I appreciate that the cost of this water security is a lot for our small community, we now have a very well-constructed contemporary dam that will benefit many generations.” 

Local Democracy Reporting is local body journalism co-funded by RNZ and NZ On Air