Scheme Update: Operations, Environment & Finance

This is an update from the team on the works completed over autumn and winter, along with key business matters and progress on our environmental and consenting programme

River & Intakes

Significant riverbed protection works were completed over the autumn to safeguard our intakes and secure reliable supply into the scheme. We experienced high flows most of summer and continue to experience significant flow variations depending on the electricity market conditions.

In the river adjacent to Bells Pond, we undertook significant works in February and May to encourage the dominant braid towards the centre of the river, as shown in the image. The river is pushing back on the groynes after a winter of significant flow fluctuation and high flows. The image below shows the flow fluctuations in the Meridian-controlled Waitataki River flow compared with the unmodified Rangitata River.

We continue to bolster the groynes protecting the intake with additional rock. The Bells Pond intake remains vulnerable to a future flood event. We monitor this area regularly and schedule weekly drone flights to assess what work is required.

At the Stonewall intake we have also placed rock protection to respond to continued erosion and planted more willows. The Stonewall is our more stable site and needs less intervention in the riverbed.

Silt Ponds and Control Gates

The Bells Pond control gate seals have been replaced, and a crack in a gate and scouring of concrete have been repaired. The repair work involved placing an earth bund at the downstream end of Bells Pond, which lowered the pond level and provided a dry work environment.

Silt has been removed from the Top Pond with a long-reach excavator operating around the edge of the pond. This approach allowed a reasonable amount of silt to be removed without dewatering the pond, which avoided the need for significant river works to close the intake and fish recovery. We have also removed willows. Silt and willows have also been removed at the Stonewall intake.

A Kākahi (freshwater mussel) survey was completed as part of our environmental monitoring. The survey found over 3,000 in Top Pond, 1,500 in Bells Pond, and 3,000 in Waikakahi Stream. Kakahi are a threatened species and it is great see them thriving in our scheme.

Waihao Downs

The Operations team have changed the oil on the submersible pumps this year, which has resulted in a good cost saving. We have purchased a vibration monitoring tool to better monitor the performance of our pumps and are installing a monitoring system so we can collect data on pump performance over time. A submersible pump and two of the large surface pumps have been sent away for servicing. There is damage to a surface pump impellor, which is being repaired.

We had a leak in the pipeline in the Cochrane property, which has been repaired. This was a significant job because it was in a wet area, which made access and work conditions very challenging and we are grateful for the support of the landowner.

We have performed a camera inspection of the high pressure 500 mm pipeline near McCullochs Bridge and it was in reasonable condition.

MGI Pump Stations

Over the last season, we upgraded our monitoring of pump sheds to gather better data, which showed that pumps were drawing too much current at times, causing excess heat. We have adjusted current settings, and we are investigating options for sealing the electrical components and improving cooling to reduce the risk of electrical component failure. A meeting will be scheduled with shareholders to discuss pumpshed performance and cooling.

Waimate District Council

We have entered into a Water Supply Agreement (WSA) with WDC to help secure their alternative water source from Bells Pond Drain for their Lower Waihao scheme. No shares have been issued under this arrangement.

2026/27 Season

At this stage we expect to be supplying water from around mid-September. We will continue to review this over the coming weeks. Please take the opportunity to undertake intake screen maintenance over the next few weeks while the races are dry.

Farming Land Use Consents

Most farms south of Mairos Road and Pikes Point (The Plough) require Farming Land Use (FLU) consents. The farmers to the north are mainly permitted activities. It is important that all shareholders have completed overseer assessments and understand whether your farm requires consent.

Farmers who require consent are currently unauthorised which is a risk to their farming business and to MGI. It is important for MGI’s reputation heading into our consent renewal process that our shareholders are all authorised. It has been over 18 months since MGI first advised shareholders that they would need a FLU consent unless they could meet the permitted activity rule and while some progress has been made, we are concerned that the process is dragging on.

The MGI Board has decided that all shareholders who require a FLU consent must lodge their applications with ECan by no later than 1 October 2026. Please note that the water supply agreement requires farmers to have all the necessary consents to farm their land and those farmers who require a FLU consent and do not yet have it are not meeting the terms of the water supply agreement.

Farmers who require consent should all engage with their consultants and confirm that applications will be lodged by 1 October. If they cannot commit to that timeframe then another provider should be used. Please contact Judith if you have any questions. We appreciate the effort that has been made to date and encourage you to give this matter your urgent attention.

Consent Replacement

We expect a five-month extension to our existing consents once the replacement RMA legislation becomes law. We are working towards applying for replacement consents in December 2027. We also continue to develop a fish screen concept for the Bells Pond intake and we are in discussions with the landowner regarding access arrangements. we aim to lodge construction consent applications in the next month and construction could occur in the middle of next year.

Fish Surveys

Recent fish surveys at Stonewall and Bells Pond show encouraging results. Monitoring confirms the Stonewall rock barrier reduces the number of fish entering the scheme. The race network continues to support a range of native fish, with some species able to live and breed within the system. At Bells Pond, surveys identified a more diverse fish community, including species of conservation interest.

Groundwater Insights

Historically, irrigation practices resulted in higher groundwater levels due to recharge from border dyke irrigation and race losses. Over time, as the scheme has shifted to spray irrigation and reduced race losses by piping and lining races, we have improved efficiency, meaning less water is lost to the ground, reducing recharge to the aquifer. This has led to a gradual lowering of groundwater levels across the scheme, particularly during summer.

We are working with LWIC to complete a Lower Waitaki groundwater model. This model is improving our understanding of how the scheme interacts with the aquifer. The model will allow us to assess development scenarios, e.g. further lining and piping of races and further stream augmentation.

We have recently conducted a piezometric survey across the scheme during both the irrigation season and winter, which will allow us to predict the direction of groundwater flow.

El Niño Outlook

After a couple of relatively wet irrigation seasons, NIWA forecasts now point to a strengthening El Niño, with peak conditions expected over summer 2026/27. For our area this typically means stronger westerly winds and drier-than-normal conditions on the east of the South Island, so we are preparing for a warm, dry summer and planning our water management accordingly. Shareholders can follow the latest forecast in NIWA's Seasonal Climate Outlook.  

Waihao Downs Nutrient Budgets for Year End 2026

A reminder that Year End Nutrient Budgets for the period of 1 July 2025 to 30 June 2026 will be due soon for Waihao Downs Irrigation Shareholders. A Nutrient Budget is required each year to meet the Annual Reporting requirements under the Waihao Downs Irrigation Scheme Resource Consents. All Nutrient Budgets for Year End 2026 must be completed and available to MGI Irrigation no later than 1st September 2026.

Please ensure that your Overseer FM account subscription has been paid and is up to date. To renew your Account Subscription, you can login to the Overseer website: https://www.overseer.org.nz/ 

Please ensure that you have provided MGI Irrigation with Admin Access to your Overseer FM account. MGI Irrigation requires Admin Access to all MGI and WDI Shareholders’ OverseerFM Accounts.

If you have recently sold or purchased a property within the Waihao Downs Irrigation Scheme, you will need to ensure that the Account Ownership for the farm Overseer FM Account is transferred to the correct person or organisation. To change or transfer the Overseer FM Account Ownership, you can contact the Overseer FM Help Desk here: helpdesk@overseer.org.nz Please ensure to provide the FEP Number and Farm Name of the Overseer Account that is being transferred.

For compliance purposes, all nutrient budgets must be completed by a Certified Nutrient Management Adviser (or be reviewed and signed off by a person with this qualification). Please contact your Consultant as soon as possible, as most Consultancies have long turnaround times with preparing nutrient budgets at this time of the year. If you do not have a Consultant who can complete this work, you can find a Certified Nutrient Adviser in your area here:  CNMA Certified Adviser

Feature

MGI Irrigation is working with Instream Consultants to implement a riparian planting trial on the Waikakahi and Whitneys Streams. The purpose of this trial is to demonstrate the benefits of riparian planting for stream shading. While the focus will be on the specific study areas (and their controls) i.e. the unplanted upstream and downstream study sections; the information will be used to quantify the environmental/ecological benefits of this enhancement/mitigation. The learnings obtained from implementing the trials and the results will be used to inform decisions on future riparian planting projects.

The benefits of shading include a reduction in water temperature resulting in less stress for aquatic life. Without shade, the water temperature can fluctuate, and New Zealand native fish generally can't tolerate temperatures above 25°C. Lower water temperatures also support higher dissolved oxygen levels, which invertebrates and native fish need to survive.

Shading also results in reduced macrophyte growth (and a resultant reduction in fine sediments). Reducing pest macrophyte growth means that the stream can move water more efficiently during rain events, reducing the risk of flooding and damage. Less sediment on the stream bed supports macroinvertebrate habitats. Riparian planting also stabilises the stream bank and acts as a filter for over land runoff and sediment transport during rain events.

Riparian areas offer diverse habitats for different native species. The roots provide hiding and spawning spots for essential native species. Plants also provide overhanging habitat and a source of food for aquatic animals. All species contribute to the overall health of the ecosystem, and greater biodiversity helps make the system more stable and resilient to stresses such as temperature changes and pests.

Surveying to identify potential sites for the trials has been completed and landowners will be contacted if they have a potential site on their property.

Interested in being involved in a planting trial, or would like more information? Please contact Judith Ireland in the Environment Team.

Direct Debit Payments

Please note that the August 2026 invoice is the first invoice for the FY27 season and reflects the new annual charges advised to shareholders. If you have set up your payments by direct debit as a fixed amount, we would like to draw your attention to the updated charges and ask that you review and adjust your payment amount accordingly to avoid any payment variances.

Shareholders can choose to pay their charges by monthly Direct Debit, complete the BNZ Direct Debit form and email to adminsupport@mgiirrigation.co.nz

Bank Facility and Insurance

We have renewed our facility agreement with BNZ for a two year period with a fixed margin. We have hedged our loans within this facility by splitting the loan balances evenly into three tranches, which between floating, one and two year fixed terms respectively.

We have renewed our insurance policies with QBE. The value of the assets at risk was increased by 3%.

Energy Contracts

Our Meridian energy contract for WDI expires in February 2027, and the MGI contracts expire in 2028. We are assessing options for renewing these contracts.

For WDI, we are currently in the final year of a five-year contract that was established when there was uncertainty about the future of the Tiwai smelter, which resulted in sharp pricing. The contract was also front loaded, which meant that the last year of the contract was cheapest. We are working through market pricing before replacing the contract, but we want to signal early that WDI farmers should expect an increase in electricity pricing on the current years contract price, but when the average price in the five-year current contract is used the pricing still looks attractive in the key irrigation season months.

MGI Irrigation

Morven Glenavy Ikawai Irrigation Company Ltd
26 Glenavy Tawai Road, RD 10, Waimate 7980
Phone (03) 689 3854

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