The Waimea Dam project costs have blown out by another $20 million - with the head of the project citing global supply chain issues, inflation and geology risks.
That brings the cost of the project to $185m.
Work on Waimea Dam. (File photo). Photo: RNZ / Tracy Neal
In 2020, its cost jumped from $104.4m to $129.4m, due to what was called "unforeseen geological conditions" after rock near the site was found to be fractured and prone to breaking up and therefore unsuitable for use in a key part of the dam.
Waimea Water chief executive Mike Scott said Covid-19 site shutdowns and restrictions over the past two years had further impacted the project's costs and construction timeline.
Its mid-year report for the 2022 financial year has revised the dam construction costs to $185m, $20m over the $164m estimate in 2021.
There was a chance the cost will be even higher, as the current cost estimate excludes some residual risks that will be evaluated before the end of the financial year in June.
Scott said the dam is almost three-quarters of the way to completion - with significant elements including the rock-filled embankment, lower spillway, flip-bucket and plinths now constructed.
"This is a fine achievement, given the unpredictable challenges of building a dam during a global pandemic, and the bad winter weather we had last year."
He said as construction progressed, the geology risks reduced as the site was exposed.
He said the geology risk to the project has reduced, now that the site's geology is largely exposed and construction is out of the ground.
"We can see what we are working with, and we have engineered solutions to overcome the geological challenges. The highly fractured left-hand side has been very unkind to us, with shear zones in about the worst possible places, bisecting both the top and bottom of the spillway."
He said these geological issues were not known at the beginning of 2021 when they were under 50 metres of hill.
The solutions engineered for this area and the need to import sand and rock for the embankment's safety-critical material had added significantly to the construction costs.
Scott said there had been a tight focus on financial management and the company was doing all it could to minimise costs without compromising safety, reliability and sustainability.
Waimea Water plans to transition from construction to operations later this year with the dam structures due to be completed by September, so the reservoir can be filled.
However, Scott said that could be further delayed due to Covid-19 site restrictions, resource and material constraints in the construction sector and further delays in the delivery of internationally-sourced components.
