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Greenfield Irrigation DevelopmentPublic Private Partnerships
Irrigation Australia 2014Chris Thompson
Managing Director , Macquarie Franklin
Background
• In Tasmania – we have approx 12% Australia surface water runoff – generally not where the usage is !! – predominance of stream diversion as method of irrigation supply
• Sustainable greenfield development in Tasmania is $2000 per ML upwards
• Irrigated agriculture is expanding rapidly
• Existing supplies under stress
• Political Intervention to augment supplies and support water infrastructure
• Public – Private partnership as the way forward
• Why PPP
When done properly
• Best (I believe !) process to implement
• Best method of valuing, managing and apportioning risk – apply the risk to those who can appreciate/manage/afford it !!
• Risk issues
– Approval Risks (EPBCA 1999 and the contingent outcomes in state acts)
– Stakeholder Risks – ie “buy in” from irrigators and communities, government instrumentalities and “third parties”
– Financing risks – “impatient capital”, returns to investors, Project lifespans
– Engineering risks – technical and budgeting risks – aggressive or conservative ?
– Environmental Risks – real or perceived – often mismanaged and poorly understood
– Agricultural risks – understanding future markets and needs
– Climate risk !!!!! – impact on both water availability and growing conditions
• The outcome• 5 projected completed 3 others underway• Around $350 M spent approx 60/40 Govt
private• All on time and under budget
