Federal budget reaction: Labor cuts $483m from Urannah dam

A pillar of support for a massive Mackay/Whitsundays project has been knocked away, but it doesn’t mean the project is dead. Read why.

There is still hope for the mammoth $2.9bn Urannah project west of Mackay despite a dramatic funding cut in Labor’s first federal budget.

The three-component project, made up of a 940-gigalitre dam on the Broken River, an irrigation precinct around Collinsville and a pumped-hydro scheme, nabbed $483m in the Coalition’s March budget, but Treasurer Jim Chalmers has now redistributed the money elsewhere.

The LNP’s federal representation across Central and North Queensland has reacted with fury.

Capricornia MP Michelle Landry said she was “lost for words”.

“Labor have well and truly walked away from regional Queensland,” she said.

“Urannah is ready to go and will provide untold economic and social benefits for the region.”

Dawson MP Andrew Willcox said he was “devastated” by the cut.

Treasurer Jim Chalmers delivers the 2022-23 federal budget in the House of Representatives at Parliament House on October 26, 2022, in Canberra, Australia.

“Urannah Dam was the only dam that has been through Infrastructure Australia and has private equity partners ready to go.”

But Bowen River Utilities CEO James Benjamin cautioned on budget night the project was not dead and his company was committed to seeing it through.

“The funding that we had was earlier in the project cycle than needed,” he said.

“It was certainly nice to have but construction for Urannah Dam is not scheduled to commence until 2025.

“So if the funding is not there, it does not mean the project is not proceeding, it means it is back to business as usual.”

Mr Benjamin said though the budget papers seemed to show the money had been cut, there were other buckets of money that could flow into the project, namely the $1.2bn earmarked for the national water grid fund to increase and safeguard farming output with another $1bn for future projects.

Bowen River Utilities CEO James Benjamin is confident the project can proceed despite a $483m funding cut. Picture: Contributed

Bowen Gumlu Growers Association general manager Ry Collins has said the irrigation scheme could result in new high-value crops such as citrus and macadamias emerging to complement the region’s existing horticultural industry.

He also said new broadacre crops such as soy beans, cotton and legumes could also emerge with the scheme.

Economic analysis prepared by BDO and Victoria University puts the cumulative region-wide impact of the project at $4.1bn.

The Urannah Project map. Picture: Contributed

Some have welcomed the setback for the project.

Mackay Conservation Group dams campaigner Imogen Lindenberg said the project posed a threat to the region’s waterways, Great Barrier Reef and wildlife, while returning just 26 cents in economic benefit for every dollar in cost.

“This project does not stack up economically or environmentally,” she said.

“Far from being a project that benefits the community, it will only benefit the private proponents themselves and the coal industry.”