General News
3 July, 2024
War waged over water: Mount Isa, Cloncurry councils take aim at state government
The two councils want control over the water assets to allow for growth and a fairer deal for ratepayers.
Combining the region’s water assets and creating a single entity to manage them – owned by the people – would be a game changer for the North West.
That’s the opinion of both the Mount Isa and Cloncurry councils which want to wrest back control of the dams and pipelines from the state government and invest profits directly back into local coffers.
It’s a move that is supported by state MP Robbie Katter.
And while both councils have slightly different motives for the takeover, both are steadfast in their views that the current system is not working in the North West.
Mount Isa ratepayers, for example, will this year pay SunWater – a Queensland government-owned corporation – more than $1 million for the right to pump water from Lake Julius should the city face a drought.
That price tag doesn’t include the cost of water.
It’s a tax incurred on Mount Isa as part of a 30-year deal which has seen the price rise from $762,666 in 2020-21 to $1.079 million last financial year – a rise of 41 per cent in just four years.
Yet it’s been 12 years since the city has required water from Lake Julius, with Lake Moondarra able to carry the load for the most part.
“We’re basically paying for insurance for our own drought mitigation and I’m not sure if any other local government in Queensland has to do that,” said Mount Isa mayor Peta MacRae.
What’s more, the dams at Julius and Moondarra were constructed by Mount Isa Mines for the benefit of the company and the community.
Yet the state government has almost full control over the assets – and the profits – and Mount Isa residents are left with expensive water bills.
The Mount Isa Water Board is another government body that controls the supply of water from Moondarra and generates a profit each year.
That money is sent to Brisbane and around half is returned to the Mount Isa City Council.
Yet the figure changes each year and can’t be projected with any accuracy.
Last week, on the night before the council was due to hand down its 2024-25 budget, the government sent through its remittance for the financial year.
It was almost $1 million less than the previous period, sending shockwaves around the newly-elected council.
“We thought we were going to get about $3.1 million and the figure we got was around $880,000 less than that,” said Cr MacRae.
“There are too many variables in the dividend each year that we can’t budget for because we don’t know what we’ll get until the state tells us – there’s no notice given.”
While the concept of joining up with Cloncurry and taking over the region’s dams and water assets is not a new subject, it failed to gain any momentum in the previous terms of the councils.
Both Cr MacRae and Cloncurry mayor Greg Campbell are keen to change that.
While Cloncurry Shire Council owns Chinaman Creek Dam, the main water source for the town, it still relies on SunWater at times, especially in droughts.
However, the state government largely subsidises that water when required.
Growing the shire’s resources and agriculture is the main factor for Cr Campbell to back such a bold move to join forces with Mount Isa City Council and form a new statutory body, likely to be called North West Water.
“Even if you can pump from Lake Julius the water is too expensive,” the Cloncurry mayor said.
“If it’s too expensive for a mine, then it’s far too expensive for everyone else.”
When an agriculture trial was mooted for Cloncurry, it was found that it was cheaper to truck water in than to pump from Julius.
Cr Campbell said economic growth in the North West was being stifled because of the high cost of electricity and water.
With CopperString set to help bring power costs down for mining companies, the next step is the water issue.
The mayor said he didn’t think it was right for the state government to be profiting from water.
“Our angle has always been to use water as a lever for economic growth,” he said.
“At the moment we are at the mercy of the state government.”
Cr Campbell said, if successful, North West Water would end up in control of Chinaman Creek Dam, Corella Dam at Clem Walton Park, Lake Julius, Lake Moondarra and the associated pump stations and pipelines.
And while profits would be returned to the ratepayers in Mount Isa and Cloncurry, Cr Campbell said the real benefit for his shire could be the removal of red tape.
The mayor is passionate about building a new dam at Cave Hill, about 40km south of Cloncurry.
“We’ve done the business case and it’ll be about $500 million to build the new dam,” he said.
“That’s too big a risk for the council to take on and it’s a hard sell for SunWater to invest in North West Queensland.
“However, if we had our own water board with all those assets, plus big customers like Glencore, Evolution Mining, MMG etc, we could justify the cost.
“There are billions of dollars of mining projects south of Cloncurry that will be unlocked by CopperString, but they’ll need water.”
A detailed business case carried out in 2019 concluded that building a dam on the Cloncurry River was technically feasible and would create significant economic opportunities in the region, facilitating the development of 3150 hectares of irrigated agriculture.
But that was before the state government committed to CopperString, which Cr Campbell says is a game-changer for the region.
GOVERNMENT RESPONSE
The two councils have been in regular contact with Water Minister Glenn Butcher and, on May 1, the Mount Isa City Council had a phone hook-up with him and Mr Katter to discuss the issue.
There wasn’t any follow-up until the minister’s office started fielding media enquiries last week.
At this stage, stakeholders from the North West are likely to gather later this month to discuss the joint council proposal.
However, there appears to be no appetite for change from the state government’s perspective.
In fact, Minister Butcher was pleased that the profits from Mount Isa were helping Queenslanders get short-term electricity bill relief.
“Keeping our energy and water assets in public hands means the Queensland government can pass on $1000 energy bill relief to Mount Isa residents,” he said in a statement.
“It also means we can return 50 per cent of dividends from Mount Isa Water Board back to Mount Isa City Council each year.
“This is an important measure that helps council deliver services and keep rates and other charges as low as possible for Mount Isa residents.
“These dividends paid to council are a percentage of Mount Isa Water Board’s annual profits – so when profits are lower, the dividend is lower.
“For 2022-23 council received $2.8 million in dividends through this arrangement.
“Mount Isa Water Board financial results are publicly available in their annual reports.
“The Water Department is currently preparing to hold information sessions in Mount Isa and Cloncurry in the coming months to continue the consult on water arrangements. I am always open to considering a proposal from either council.”
NORTH WEST’S WATER ASSETS
Lake Moondarra Dam – Built in 1958 by Mount Isa Mines and is still owned by Glencore, although the water and lake are managed by the Mount Isa Water Board.
Lake Julius Dam – Completed in 1978 by Mount Isa Mines to provide backup to Lake Moondarra. Now provides water to mines in Cloncurry Shire and can feed into Chinaman Creek Dam.
Corella Dam – Located about halfway between Mount Isa and Cloncurry at Clem Walton Park, the Cloncurry Shire has been trying to buy the asset off the state government for many years. It was built in 1959 for the town of Mary Kathleen and the uranium mine.
Chinaman Creek Dam – Owned and operated by Cloncurry Shire Council, the dam was constructed in 1993 and can service the township’s needs, apart from instances of extreme drought.