NZ Backs $18M Tukituki Water Project to Boost Hawke’s Bay Economy and Climate Resilience

In a major push to strengthen water security and unlock agricultural growth, the New Zealand Government has approved a loan of up to $18.13 million to kickstart pre-construction work on the Tukituki Water Security Project, a transformative infrastructure initiative in one of the country's driest regions.

Announcing the funding in Ongaonga, Associate Regional Development Minister Mark Patterson described the project as a "game-changer" for Hawke's Bay, with the potential to drive economic expansion, support high-value farming, and enhance resilience against increasing climate pressures.

Strategic Investment in Water and Growth

The funding, provided through the Regional Infrastructure Fund, will support critical early-stage work, including:

• Detailed engineering and design

• Cost validation and feasibility assessments

• Confirmation of commercial viability

This phase will determine whether the project proceeds to full-scale construction, which could reshape the region's agricultural landscape.

"Hawke's Bay has significant untapped potential as a key food-producing region," Patterson said, noting that reliable long-term water supply is essential for expansion into high-value sectors such as horticulture, seed production, and advanced pastoral farming.

Transformational Economic Impact

If approved for construction, the Tukituki project is expected to deliver substantial economic gains:

• Irrigation capacity for up to 22,000 hectares of farmland

• Creation of approximately 300 jobs during construction

• Contribution of up to $693 million annually to regional GDP

These projections highlight the project's role as a catalyst for rural economic transformation, particularly in boosting productivity and enabling diversification into premium agricultural exports.

Massive Water Storage Capacity

At the heart of the project is a large-scale water storage and distribution system designed to address long-standing supply challenges.

• Storage capacity: 104 million cubic metres of water

• Equivalent to: 41,600 Olympic-sized swimming pools

This infrastructure will significantly enhance the region's ability to capture, store, and distribute water efficiently, reducing vulnerability to droughts and seasonal variability.

Addressing Climate and Resource Pressures

Hawke's Bay faces increasing strain on freshwater resources, driven by climate change, population growth, and agricultural demand. The region is among the driest in New Zealand, making water security a critical priority.

"New water storage will help address these challenges by improving water reliability and supporting long-term resilience," Patterson emphasized.

The project aligns with broader national goals of climate adaptation and sustainable resource management, positioning water infrastructure as a cornerstone of regional resilience strategies.

Public-Private Collaboration

The project is being developed by the Tukituki Water Limited Partnership, which will receive the loan funding. It builds on earlier government support, including a grant of up to $3 million allocated in December 2024 for initial development work.

This blended financing model reflects a growing trend toward public-private partnerships in infrastructure, enabling large-scale projects while managing financial risk.

Unlocking High-Value Agriculture

Beyond water security, the project is expected to enable a shift toward higher-value food and fibre production, enhancing both domestic supply chains and export potential.

Improved irrigation will allow farmers to:

• Increase crop yields and reliability

• Transition to more profitable crops

• Invest in processing and value-added production

"This project has the potential to transform Hawke's Bay," Patterson said, highlighting its role in driving innovation and competitiveness in the agricultural sector.

Looking Ahead

While the loan marks a critical milestone, the project's future will depend on the outcomes of the pre-construction phase. If viability is confirmed, construction could begin on one of the most ambitious regional water infrastructure projects in New Zealand.

As climate variability intensifies and water scarcity becomes a defining challenge, initiatives like the Tukituki Water Security Project may serve as a blueprint for sustainable regional development, balancing economic growth with environmental stewardship.