The Federal Government is investing $65 million in SA's Northern Water Supply Project.

The federal government has committed funds to the planning of a major desalination and water transport initiative in the Upper Spencer Gulf. 

This announcement was made by Federal Treasurer Jim Chalmers at Sundrop Farm near Port Augusta, who said it would form an important regional contribution to the Future Made in Australia initiative.

The Northern Water Supply Project, with a total pre-construction fund of $230 million, is also backed by the South Australian government and BHP. 

The project includes a seawater desalination plant at Cape Hardy, capable of processing 260 megalitres per day, and a 600-kilometre pipeline to deliver treated water to Whyalla and outback mining sites such as Carapateena and Roxby Downs. 

Currently, mining operations in the far north rely on water from the Great Artesian Basin. 

The new desalination project aims to provide a reliable and climate-independent water source, reducing the strain on natural water resources like the Murray River and the Great Artesian Basin. 

Federal Environment and Water Minister Tanya Plibersek said the project would be significant for water-intensive industries such as green hydrogen production and copper mining. 

“The alternatives here in South Australia are a continued reliance on water from the River Murray or from the Great Artesian Basin. Both of these sources are not as reliable as they need to be for industry, but they’re also incredibly valuable environmentally,” she said. 

Proponents say the Northern Water Supply Project will create 4,200 jobs annually in resources, renewables, and net-zero transition sectors over its lifetime. 

Analysis suggests it could unlock $5 billion in investment and boost South Australia's GDP by $150 billion by 2053. 

The funding will support critical pre-construction activities, including industrial offtake agreements, water allocations, geotechnical investigations, design work, and community engagement.

South Australian Treasurer Stephen Mullighan expressed optimism about the project's timeline, aiming to complete planning and pre-construction works within 18 months.