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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                     OVERVIEW

                  Our Commitment                  Contents

                  Waimea Water
                                                  Overview                                      4
                                                  About Waimea Water                            4
                                                  The Waimea Community Dam                      4

                  is committed
                                                  Performance Highlights                        6
                                                  Timeline                                      8
                                                  Report from Board Chair                      11

                  to building and                 Report from Chief Executive Officer
                                                  Executive Management Team
                                                  Areas of Activity

                  operating a safe,                  Design
                                                     Health and Safety

                  reliable and efficient             Project Performance
                                                     Environmental Protection and Compliance

                  dam for the benefit
                                                     Environmental Sustainability              25
                                                     Operating and Financial Overview          27

                  of the region.
                                                     Performance against Statement of Intent   28

                                                  Governance                                   30
                                                  Corporate Governance                         31
                                                  Corporate Structure                          31
                                                  Board of Directors                           32

                                                  Annual Report                                34
                                                  Independent Auditors Report                  35
                                                  Board Attendance                             39
                                                  Director’s Register of Interests             40
                                                  Financial Statements                         41
                                                  Notes to Financial Statements                44
                                                  Corporate Directory                          55

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                 OVERVIEW

OVERVIEW                                                                                                                              Key facts about the dam at a glance:

                                                                                                                                      Concrete-face rock filled dam –                          Lake created by the dam will
                                                                                                                                      approximately                                            contain approximately

                                                                                                                                                                                               13 billion litres
About Waimea Water                                The Waimea Community Dam                                                                                                                     OF WATER
Waimea Water Ltd (WWL) is a                       The three-year construction project     The Waimea Community Dam is
Council-Controlled Organisation                   began in March 2019, with works to      designed to the latest and highest

established in November 2018 to                   create access to the Lee Valley site    international design standards
manage the construction, operation                now almost complete. Construction
                                                                                                                                                                                               UP TO
                                                                                          under the NZ Dam Safety Guidelines
and maintenance of the Waimea
Community Dam. The dam is a
                                                  of the dam is expected to start in
                                                  July 2019.
                                                                                          and will continue to be regularly
                                                                                          peer reviewed by technical experts
                                                                                                                                                                                               2.2 m3/s Flow
significant infrastructure project for
                                                  The dam is being constructed for        throughout the build process.                                                                        into the Lee and Waimea River
the region and is set to secure the
                                                  WWL through a joint venture between
                                                                                                                                                                                               Systems during drought
                                                                                          The benefits of the dam for the
water supply for Nelson Tasman for
                                                  experienced local companies Fulton      region are:
the next 100+ years.
                                                  Hogan Ltd and Taylors Contracting       •   supporting a growing population
Approval to proceed with the dam                  Ltd (FHTJV). Specialist dam                                                                                                                  Filling of reservoir and final
                                                                                              and providing the community with        Constructed from approximately
was reached by the Tasman District                consulting engineers, Damwatch                                                                                                               commissioning by early

                                                                                              water security

Council (TDC) on 30 November 2018                 Engineering Ltd will provide
                                                                                          •   healthy Lee and Waimea rivers
and finance was secured for the                   independent review of the design and
                                                                                              for swimming, fishing and other
project on 21 December 2018. A joint              construction.
venture project between the Tasman
                                                                                              recreational activities
                                                                                                                                      OF ROCK
                                                  The concrete-face rockfill dam will     •   healthier rivers for aquatic life
District Council (TDC) and Waimea
                                                  be about 53 metres high, 220 metres         to thrive
Irrigators Ltd (WIL), the dam realises

                                                  long, and 6 metres wide at the crest.
the vision and many years of work                                                         •   a robust economy strengthened
                                                  About 430,000 cubic metres of                                                       Estimated economic benefit in the first 2 years
for groups and individuals to provide                                                         by the success of horticulture

                                                  indigenous rock will be excavated,
greater water security for the Waimea                                                         and farming industries and the
                                                  processed and used to build the dam.
Plains and wider community (also                                                              subsequent growth of associated
see timeline on pages 8 and 9).                   Once the dam is in place, the               secondary and tertiary industries
                                                  reservoir will fill up naturally over   •   jobs for people in our primary
WWL is focused on ensuring that it
                                                  several months, with the final              industries and the support
has the people, systems and positive
                                                  commissioning expected in early             services working with them
relationships it needs to deliver
                                                  2022. The lake created by the dam
a world-class water project for                                                           •   greater potential to develop,
                                                  will contain approximately 13 billion
Nelson Tasman.                                                                                maintain and grow businesses
                                                  litres of water.
                                                                                              for the next generation
                                                                                          •   families staying in the area and
                                                                                              contributing to a community that
                                                                                                                                      and between

                                                                                                                                      $600 -$900
                                                                                              has more to offer people of all ages.

                                                                                                                                                                                        over 25 years
                                                                                                                                                                                                                                  *NZIER Report 2017

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                       OVERVIEW

    Performance Highlights

    Achievements so far

    The Ground-breaking Ceremony

    Final Investment Decision                     December 2018   Consent Compliance                          100%

    Commenced Construction                           March 2019   Approved Construction Environmental Plans      3

    Project Progress (spend)                               18%    Site Access                Substantially Complete

    Injury Rate                                              0    Expected Completion for filling     October 2021

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                                                      OVERVIEW


Several decades of work has led to this
                                                                                                                                                                                                                  February 2018
significant investment in infrastructure.                                                                                                March 2014
                                                                                                                                                                                                                  Council approves using a CCO6 to oversee and manage the
                                                                                                                                                                                                                  dam project.
                                                                                                                                         Changes to
                                                                                                                                                                                                                  April 2018
                                                                                                                                         water rules in the
                                                                                                                                                                                                                  WIL4 closes water shares offer (opened in March 2018).
                                                                                                                                         Tasman Resource
                                                                                                                                                                                                                  More than 220 applicants sought shares and $16.5 million
                                                                                                                                         Management Plan
                                                                                                                                                                                                                  was raised.
                                                                                                                                         came into effect.
                                                                                                                                                                                                                  June 2018
                                                                                                                                         September 2014
                                                                                                                                         Waimea Community                                                         TDC3 and NCC5 2018/28 Long Term Plans adopted which
                                                                                                                                         Dam Ltd lodges                                                           included funding for the dam.
                                                                                                                                         application for                                                          August 2018
                                                                                                                                         resource consent.                                                        Early Contractor Involvement process concluded with
                                                                                                                                         October 2014                                                             estimate above the original project budget. TDC3 submit a
                                                                                                                                         NZIER report shows                                                       Local Bill to Parliament to allow access to land in Mount
                                                                                                                                         regional GDP would                                                       Richmond Forest Park for the dam.
                                                                                                                                         reduce significantly                                                     September / October 2018
                                                                                                                                         ($17.5 - $34.5 million                                                   A revised project budget was proposed and Select
                                                                                                                                         p/a) without the dam.                      2015 – 2016
                                                                                                                                                                                                                  Committee hearings on the Local Bill were held.
                                                                                                                                                                                    Water permits are
    1979                                                                                                                                 October 2014                                                             November 2018
                                                                                                                                                                                    introduced that
                                                                                                                                         – May 2015
    NC&RWB1                                                                                                                                                                         change water                  TDC3 voted to proceed with construction of the dam.
    commissions a study                      2003                                         2010                                           Community                                  allocation policies
                                                                                          WWAC2 completes                                consultation on how                                                      December 2018
    to consider building                     WWAC2 is established                                                                                                                   and rules in the
    a dam in the Wairoa                                                                   detailed feasibility                           the dam should be                                                        WWL4 is incorporated and takes ownership of
                                             to look at options for                                                                                                                 Waimea water
    Gorge.                                                                                study.                                         funded and managed.                                                      construction and management of the dam.
                                             water supply.                                                                                                                          management zones.

                            Summer 2001 -2002                         2007                                       2013                                         March 2015                             Early 2017
                            Severe drought in                         Many potential                             WWAC recommends                              Resource consents                      Expressions of Interest process
                            Tasman highlights                         sites assessed                             a private co-                                granted, subject to                    to establish the construction
                            the magnitude of the                      for engineering,                           operative company                            conditions.                            cost of the dam.
                            water shortage issue.                     environmental and                          operates the dam.
                                                                                                                                                                                                     June 2017
                                                                      social factors.                            Proposed company
                                                                                                                 has legal constraints                                                               NZIER updates its 2014
                                                                                                                 on funding for TDC3.                                                                economic assessment, showing
                                                                                                                                                                                                     the benefits of the dam are
                                                                                                                                                                                                     greater than earlier estimates.
                                                                                                                                                                                                     November – December 2017
                                                                                                                                                                                                     Public consultation on funding
                                                                                                                                                                                                     Council’s share of the dam.

                                                                                                                                                                                                                                                    Nelson Catchment and
                                                                                                                                                                                                                                                    Regional Water Board
                                                                                                                                                                                                                                                    Waimea Water
                                                                                                                                                                                                                                                    Augmentation Committee
                                                                                                                                                                                                                                                    Tasman District Council
                                                                                                                                                                                                                                                    Waimea Irrigators Ltd
                                                                                                                                                                                                                                                    Nelson City Council
                                                                                                                                                                                                                                                    Council Controlled
The Dawn Blessing                                                                                                                                                                                                                                   Organisation

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                          OVERVIEW

“This year’s drought further highlighted          Report from Board Chair
the need for greater water security in
the Tasman region. Research shows
that New Zealand gets plenty of water
 each year and uses less than two
 percent of it. It’s clear that we need to
 be smarter about storing it for when
we most need it.”                                 Welcome to the inaugural Annual
                                                  Report for Waimea Water Ltd (WWL).
                                                                                              WWL is a Council Controlled
                                                                                              Organisation and represents the
                                                                                                                                          the Waimea Community Dam to a high
                                                                                                                                          standard, and we are very pleased
                                                                                              shared interests of Tasman District         with the progress made to date.
                                                  As we reflect on our first seven
                                                                                              Council (TDC) and Waimea Irrigators
                                                  months as a new organisation, I                                                         The Board, alongside the company
                                                                                              Ltd (WIL). Combining the water
                                                  am mindful that when WWL was                                                            and contractors, look forward to
                                                                                              requirements of both the TDC and WIL
                                                  incorporated in December 2018 it                                                        delivering on our promise to secure
                                                                                              is the most cost-effective option for a
                                                  was not only a key milestone for                                                        water for the region and realise the
                                                                                              regional dam, while minimising costs
                                                  the region but the culmination of                                                       commitments made in the Statement
                                                                                              for ratepayers.
                                                  many years of work to progress the                                                      of Intent.
                                                  dam. The former Nelson Catchment            Financial investment and support for
                                                  and Regional Water Board first              this significant infrastructure project
                                                  commissioned a study to consider            was secured from Crown Irrigation
                                                  building a dam in the Wairoa Gorge          Investments Limited, TDC and WIL.           Karen Jordan
                                                  as early as 1979, and other dam             Our neighbour Nelson City Council
                                                  options in the Moutere area were also       also contributed to the funding of the
                                                  considered over 25 years ago.               dam and a grant was received from
                                                                                              the Ministry for the Environment. This
                                                  This year’s drought further highlighted
                                                                                              all adds up to best value for all parties
                                                  the need for greater water security in
                                                                                              and reflects the spirit of collaboration
                                                  the Tasman region. Research shows
                                                                                              in helping to achieve sustainable
                                                  that New Zealand gets plenty of water
                                                  each year and uses less than two
                                                  percent of it. It’s clear that we need to   The WWL Board has seven
                                                  be smarter about storing it for when        experienced Directors appointed
                                                  we most need it.                            by TDC, WIL and Ngāti Koata. The
                                                                                              Directors have strong ties to the local
                                                  The Waimea Community Dam will
                                                                                              community and expertise across
                                                  provide reliable access to water and
                                                                                              a range of disciplines including
                                                  meet the demand of urban and rural
                                                                                              governance, risk management, water
                                                  communities in the Waimea Plains
                                                                                              and dams. We meet regularly and
                                                  for the next 100+ years and in doing
                                                                                              are committed to a high standard of
                                                  so, plays a vital part in supporting
                                                                                              corporate governance and regulatory
                                                  the region to thrive. A secure water
                                                                                              compliance in guiding and monitoring
                                                  supply underpins the growth and
                                                                                              WWL’s activities.
                                                  economic prosperity of a community.
                                                  It provides future generations with         We have every confidence that the
                                                  opportunities to remain in the region       management team we have put in
                                                  and raise their families.                   place at WWL will build and operate

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                      OVERVIEW

“I strongly believe that                          Report from Chief Executive Officer
the dam will secure our
region’s water supply and
is fundamental to both
building resilience within
our growing community
and providing greater
protection of our local                           I am delighted to be back home in
                                                  the Nelson Tasman region and to
                                                                                            We have a management system in
                                                                                            place to support us to achieve our
                                                                                                                                      2021 to fill the 13 million cubic metres
                                                                                                                                      reservoir in 2022.
economy.”                                         have the opportunity to lead such         objectives, in the areas of safety,
                                                                                                                                      We have put measures in place to
                                                  an important legacy project for our       financial and budget controls, risk
                                                                                                                                      monitor and manage environmental
                                                  region. I appreciate the generally        identification and mitigation, project
                                                                                                                                      considerations around construction,
                                                  strong support from the community,        controls, management of change and
                                                                                                                                      such as monitoring water quality
                                                  and I understand what this key            regulatory controls.
                                                                                                                                      and managing sediment run off.
                                                  investment means for the region.
                                                                                            The design reflects international best    Our environmental sustainability
                                                  Following last summer’s drought,
                                                                                            practice and is appropriate for the       programme is also underway which
                                                  most people I talk to ask whether we
                                                                                            location and geology of the site.         includes relocating rare species from
                                                  can build the Waimea Community
                                                                                            The concrete face rockfill dam            the dam catchment area and the
                                                  Dam any quicker.
                                                                                            meets the high standards under the        upcoming restoration of the Rough
                                                  I strongly believe that the dam will      building regulations and the New          Island Wetlands. Our Environmental
                                                  secure our region’s water supply          Zealand Dam Safety Guidelines. The        Management Plan supports us to
                                                  and is fundamental to both building       design has been peer reviewed by          achieve the requirements under
                                                  resilience within our growing             many experts. We have appointed           the Resource Consent and includes
                                                  community and providing greater           and are supported by independent          planning around biodiversity, vegetation
                                                  protection of our local economy.          specialist dam consulting engineers,      clearance, traffic management, erosion
                                                  Good infrastructure, such as the          Damwatch Engineering Limited, who         and sediment control.
                                                  Waimea Community Dam, will                are recognised as one of the leading
                                                                                                                                      WWL is well positioned to deliver this
                                                  undoubtedly protect and enhance our       dam experts in the Asia-Pacific region.
                                                                                                                                      transformational project, which is
                                                  primary industries, which in turn will    WWL and Damwatch are focused
                                                                                                                                      fundamental to meeting our water
                                                  lead to more secondary and tertiary       on optimising the design to reduce
                                                                                                                                      demands and moving our regional
                                                  industries to provide opportunities       costs, geological risks and improve
                                                                                                                                      economy forward.
                                                  for generations to come and drive         operability.
                                                  economic prosperity within our region.                                              I look forward to the successes and
                                                                                            The dam is being constructed for
                                                                                                                                      challenges that lie ahead as we strive
                                                  Since joining WWL in April 2019, I have   WWL through a joint venture between
                                                                                                                                      to deliver New Zealand’s first large
                                                  worked with the Board to put in place a   experienced local companies Fulton
                                                                                                                                      dam in over 20 years.
                                                  small team of experienced specialists     Hogan Ltd and Taylors Contracting
                                                  to build and operate the Waimea           Co Ltd who have undertaken similar
                                                  Community Dam in a safe, reliable and     projects together in the South Island.
                                                  efficient manner. The team consists       Work commenced in March 2019 and
                                                                                                                                      Mike Scott
                                                  of qualified professionals with           early work has been centred on site
                                                  expertise in the area of dam design,      access. Excavation and mining of rock
                                                  construction, project management,         is due to commence in August 2019,
                                                  operations, environmental and             and river works and structures are due
                                                  sustainability management, business       to commence later in 2019. The dam
                                                  and corporate management.                 is scheduled to be complete in late

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                                                        OVERVIEW

Executive Management Team

                                                                                           Richard Timpany
                                                                                           Commercial Manager                                               Daniel Murtagh                                                        Iain Lonie
                         Mike Scott                                                        and Company Secretary                                            Technical Manager and Engineer                                        Engineering and Project Manager
                         Chief Executive Officer                                           Bachelor of Laws, Bachelor of Commerce                           Representative                                                        Bachelor of Engineering (Civil), Master of
                         Master of Engineering (Civil)                                     (Finance)                                                        Bachelor of Engineering (Hons) (Mechanical)                           Engineering Science (Geotechnical)

Mike has a Master of Engineering with Distinction in Civil          Richard was admitted as a Barrister and Solicitor of the High   Daniel holds a Bachelor of Engineering (Hons) (Mechanical)            Iain is a Chartered Professional Engineer (Aus) and a
Engineering from the University of Canterbury, specialising         Court of New Zealand in 2004 following graduating with a        degree, and is a Chartered Professional Civil Engineer, an            Registered Professional Engineer of Queensland. He holds a
in environmental engineering and has completed executive            Bachelor of Laws and Bachelor of Commerce (Finance) from        International Professional Engineer and member of the NZ              Bachelor of Engineering (Civil) from University of Auckland
international management training at the Thunderbird School         Otago University.                                               Society of Large Dams.                                                and a Master of Engineering Science (Geotechnical) from the
of Global Management in Arizona.                                                                                                                                                                          University of New South Wales.
                                                                    Richard worked in various capital market roles in Sydney        He has extensive knowledge in the development of
Mike has 27 years’ post graduate experience in business and         and then London before returning to New Zealand. He has         challenging large-scale capital projects around New Zealand.          Iain has a background in dams, tailings and geotechnical
commercial development, strategy, planning, operations and          consulted on irrigation projects in Central Otago prior to      Most recently, Daniel successfully managed the ground up              engineering in a variety of locations, including New Zealand,
engineering in predominantly the energy sector in Australia,        becoming the Chief Executive Officer at Hunter Downs            development of the $45M Sheffield Water Scheme in mid-                Australia and South East Asia. His experience includes, the
Scotland, USA and New Zealand. Before joining WWL, Mike             Development Company in Timaru.                                  Canterbury. This project involved the design, consenting,             feasibility, preliminary and detailed design of Greenfield
was the Vice President North West Shelf Venture at Woodside                                                                         capital raising and construction of a cooperative irrigation          dams’ projects and the assessment, design and construction
Energy Limited, a top 15 ASX A$30B market cap company,                                                                              scheme including a High PIC earth ring embankment dam.                of dam upgrades. He gained his expertise working in
where he also held the position of Chief Executive Officer                                                                                                                                                design and construction roles at GHD and most recently as
                                                                                                                                    Daniel has significant experience in infrastructure project
for one of Australia’s largest economic assets, the A$34B                                                                                                                                                 Dams Team Leader for the Snowy Mountains Engineering
                                                                                                                                    management, administration of New Zealand construction
North West Shelf LNG Joint Venture Project. Mike previously                                                                                                                                               Corporation (SMEC) in Queensland.
                                                                                                                                    contracts, water reticulation design, quality control and plant
held the position of Vice President for Strategic Business
Development and Growth at Woodside Energy Limited with
the responsibility of growing Woodside’s business in Australia
and internationally.

                                                                                                                                                             Alasdair Mawdsley
                         Richard Milsom                                                                                                                      Environment and
                         Project Services Manager                                          Dave Ashcroft
                                                                                                                                                             Sustainability Manager
                         Bachelor of Science (Hons) Construction                           Chief Financial Officer                                           Bachelor of Science Geography and
                         Management                                                        Chartered Accountant                                              Environmental Management’

Richard is an Incorporate Member of the Chartered Institute         Dave has significant commercial experience spanning three       Alasdair has nine years’ environmental management
of Building and has over 30 years in the building and civil         decades, specialising in organisations undergoing significant   experience and a Bachelor of Science, majoring in geography
engineering industries in the United Kingdom and New Zealand.       change in a variety of industry sectors in New Zealand,         and environmental science from Auckland University.
He has a diverse portfolio of experience, including over 20 years   Australia, the United States and Europe. In 2017, he launched
                                                                                                                                    Prior to joining WWL, he managed consenting, environmental,
project management. He joined Waimea Water Ltd after eight          his own business advisory company and has recently worked
                                                                                                                                    sustainability and heritage issues for Downers and
years at McConnell Dowell and four years at HEB Construction        with Koata Ltd, NZ Artesian Water and the Aimex Service
                                                                                                                                    McConnell Dowell Constructors Ltd on the Auckland City Rail
working on the two largest infrastructure projects undertaken       Group. Previously Dave had senior executive team roles at
                                                                                                                                    Link (CRL), a project that involved underground tunnelling in
by Christchurch City Council; the safety award-winning Sumner       the Cawthron Institute and at a Sealord aquaculture joint
                                                                                                                                    a high risk, dense urban environment.
Road Rehabilitation and the Lyttleton Wastewater Upgrade.           venture in Tasmania.
                                                                                                                                    Alasdair’s former experience also includes work on the Te
Richard has large earthworks experience, including the Mercer       Dave is passionate about the success of the region
to Long-swamp motorway extension; Sir Barry Curtis Park,                                                                            Mihi Geothermal Power Project, Waterview tunnels and a
                                                                    and supports a small number of local businesses and
the one million3 earthworks project that created Flatbush in                                                                        range of smaller tunnelling projects. He also brings eight
                                                                    organisations in both a commercial and volunteer context. He
Manukau and the Ashburton Business Park.                                                                                            years’ experience from an early career in the freight industry.
                                                                    is a Chartered Accountant and a member of the NZ Institute
Richard’s portfolio at WWL includes project health & safety,        of Directors and of the Australian Institute of Company
schedule performance, cost management and risk strategies.          Directors.

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                     OVERVIEW

                                                  AREAS OF

                                                  The science behind building a         Public safety will always be WWL’s         Another notable feature is that the
                                                  quality dam is complex and this       paramount consideration, and the           design utilises the rock material
                                                  year we engaged the knowledge and     design and materials have been             excavated from the site during the
                                                  expertise of specialists across a     selected to withstand significant          forming of the dam itself, which is an
                                                  range of disciplines.                 natural hazards. This includes an          environmentally responsible practice.
                                                                                        earthquake with a 1:10,000-year            The design also uses nature’s delivery
                                                  As a responsible dam owner, WWL
                                                                                        probability of occurring and a Probable    system - the rivers, to increase water to
                                                  has a primary obligation to avoid
                                                                                                                                   the aquifers that supply our community
                                                  exposing the community to risks or    Maximum Flood (PMF) event that
                                                                                                                                   with water. The dam will release stored
                                                  hazards associated with the build     is greater than 1000 m3/s, or nearly
                                                                                                                                   water slowly down the river during drier
                                                  and management of the Waimea          3 times the 100-year flood, and is
                                                                                                                                   months, increasing their flows and
                                                  Community Dam. To achieve this        equivalent to one and half times the
                                                                                                                                   adding water to the aquifers naturally.
                                                  requirement, the dam has been         size of the reservoir flowing over the
                                                  designed in accordance with the       spillway in a 24 hour period. Designing    Objective
                                                  New Zealand Dam Safety Guidelines,    to these two levels represents the         WWL’s aim is to design the right dam
                                                  New Zealand Standards, New Zealand    highest design standard under the          for the location and to meet the needs
                                                  Building Regulations, international   New Zealand Safety Guidelines.             of the region now and in the future - a
                                                  best practice and to the highest                                                 quality design that is safe, reliable and
                                                                                        A crucial component of the dam is
                                                  possible standards for floods and                                                efficient, and in line with international
                                                                                        the design of the rockfill which firstly
                                                  earthquakes.                                                                     best practice.
                                                                                        provides an impermeable layer and
                                                  Following a rigorous evaluation       secondly allows water to flow through      Progress
                                                  process, the dam selected was a       preferred channels in a controlled         Leading dam engineering experts in
                                                  concrete-face rockfill dam which is   manner in the very unlikely event of       the Asia-Pacific region, Damwatch
                                                  the most appropriate design for the   damage to the upstream dam liner.          Engineering Ltd, has been appointed
                                                  geology, location and seismic risk    This means that no uncontrolled loss       to provide independent review of the
                                                  of the site.                          of the reservoir can occur.                design and build process.

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                                                OVERVIEW

This year, Damwatch has reviewed                  regulator, has commenced.                 about the properties of the rock
the majority of the 257 drawings that             This ensures councillors and              being removed from the ground and
set out the major components of                   relevant staff are kept informed of       those needed for the embankment.         WWL’s focus this year has been to            along with preparation of a number of       As at 30 June 2019, approximately
the dam to optimise the design and                proposed enhancements to maintain                                                  get key contracts and sub-contracts          management plans to meet contract           35 contract personnel were working
identify efficiencies. The drawings               transparency and compliance as part                                                finalised, mobilise plant and                and resource consent conditions.            regularly onsite. A further 130 people
                                                                                               Next steps
include structural detailing for                  of the building consent process.                                                   machinery, as well as attract great          Access to the site was restricted           were inducted and working on site at
                                                                                               In the first quarter of the 2019/20
the concrete membrane, spillway,                                                                                                     people to build the dam in a safe,           during the first quarter of 2019 as         various times, contributing to a total of
                                                  Risk Planning                                year, the drawings will be
concrete joints, pipework, plinth,                                                                                                   reliable and efficient way.                  a result of the drought and Pigeon          20,000 person-hours, using 23 various
                                                                                               finalised, and the construction
conduit, bridges and embankment                   The risk of natural hazards is relevant                                                                                                                                     items of plant and machinery. This
                                                                                               phase of the dam will commence.                                                    Valley fire event with more stringent
                                                  to all areas of the construction and                                               Objectives
zoning. The concrete-face is being                                                                                                                                                                                            number is expected to ramp up during
                                                                                                                                                                                  fire prevention measures put in place
reviewed to improve longevity and to              management of the dam.                       Designers and peer reviewers will     WWL’s aim is to work collaboratively
                                                                                                                                                                                  until early March.                          the course of construction when
                                                                                               continue to be actively involved      with our construction contractor,
reduce costs, and the design of the               Although it is not always practicable                                                                                                                                       parallel work activities and specialist
                                                                                               during the build process to           and to be responsive and open to             Work on upgrading the 6.5 km
spillway, plinth and culvert have also            to have plans in place for every event                                                                                                                                      tasks are undertaken as anticipated in
                                                                                               address issues as they arise.
been enhanced.                                                                                                                       opportunities that enhance the dam           Lee Valley access road to the dam           the build programme.
                                                  that may seriously disrupt work, a
                                                                                               Preparation of dam safety             as the build progresses.                     site will be completed early in the
The contractors have been actively                considerable amount of planning has
                                                                                               management systems and                                                             2019/20 financial year, including           Risk planning
involved in the revision process,                 been undertaken for potential future                                               WWL is striving to build a world-class
                                                                                               developing the design for                                                                                                      As mentioned earlier in this report,
                                                  flooding, drought and fire-related                                                 dam that complies with regulations and       widening for safety and improved
providing input to constructability and                                                        communications and the supply
                                                  emergency events.                                                                                                               traffic flow, and installing rock fall      adverse weather remains a risk to the
offering alternatives to add value to                                                          of power to the site will also        best practice guidelines.
                                                                                                                                                                                  protection measures. Construction           project and resilience plans have been
the process.                                      Compaction and permeability trials           commence in the first quarter of
                                                                                                                                     Progress                                     of the haulage roads to the dam             developed to mitigate this risk.
                                                  commenced in 2018/19, which                  the 2019/20 year.
A cycle of updates to the Tasman
                                                                                                                                     The construction contract for the            site, sediment retention ponds and          Measures to mitigate flood
District Council, in their role as                provide a greater level of confidence
                                                                                                                                     dam was awarded to a joint venture           construction compound were also             damage remain a key focus for
                                                                                                                                     between experienced local company            near completion at the end of the           the construction team especially
                                                                                                                                     Taylors Contracting Ltd and Fulton           financial year. Vegetation clearance        during this early period when
                                                                                                                                     Hogan (FHTJV) on 21 December                 beneath the dam and reservoir               temporary river diversion structures
                                                                                                                                     2018 after a phase of early contractor       commenced in June. Substantial              are in place. Considerable design
                                                                                                                                                                                  progress has also been made on              and planning effort has gone into
                                                                                                                                     Contract work commenced in                   construction of an alternative access       developing a robust method for
                                                                                                                                     January which involved recruiting            road to blocks of land which would          diverting the river to minimise the
                                                                                                                                     personnel and mobilising plant and           otherwise be landlocked once the            likelihood of damage or setbacks
                                                                                                                                     equipment to the construction site           reservoir is filled.                        during predicted flood events.

                                                                                                                                        Next steps                                 excavation work and construction of       Construction of the Starter Dam, the
                                                                                                                                        In the first quarter of the 2019/20        a number of bunds, Coffer Dams, to        foundation, is expected to commence
                                                                                                                                        year, work on Lee Valley access            redirect the river flow in a controlled   in late 2019 and the plinth and
                                                                                                                                        road will continue which will include      manner to ensure concrete work can        grout curtain will be subsequently
                                                                                                                                        installation of two bridges to improve     be completed in dry conditions. In the    constructed during 2020.
                                                                                                                                        long term access and flood resilience      latter part of the financial year, the
                                                                                                                                        during construction and operation of       river will be rediverted through the
                                                                                                                                        the dam.                                   newly constructed culvert to enable
                                                                                                                                                                                   construction of the reinforced rockfill
                                                                                                                                        Planning for the first diversion of the    section of the dam over the culvert.
                                                                                                                                        river is underway which will enable        In parallel with this work, relocation,
                                                                                                                                        the construction of the 160-metre-         salvage and clearance of vegetation
                                                                                                                                        long, 4 metre x 5 metre concrete           within the reservoir footprint behind
                                                                                                                                        diversion culvert on the right-hand        the dam will begin.
                                                                                                                                        side of the river. This will involve

18                                                                                                                                                                                                                                                                      19
WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                                                                                                                                                          OVERVIEW

                                                                                                              CRITICAL PATH                                                                                                                         Health and Safety

                                                       Preliminary Works                                                                                                                                                                                CHARTER

                                                                                                                                                                                                                                                        This year we established our Charter, which is:

                                                                                                                                                                                                                                                        WWL is committed to a culture that creates personal accountability for and a relentless focus on health and
                                                                          River Diversions
                                                                                                                                                                                                                                                        safety as part of the way we do things. WWL lives the value:
                                                                                           Plinth and Grouting

                                                                                                                                                      Concrete Face                                                                                     “No task is too important or so urgent as to preclude health and safety.”
                                                                                                                                                                                       Wave Protection
                                                                                                                                                                                                                                                        We will do this through:
                                                                                                                                                                      Spillway                                                                          •   the Board and management modelling behaviours that they expect from WWL staff and contractors

                                                                                                                                                                                                                                                        •   establishing best practice health and safety behaviours in the field and in the office environment, monitoring
                                                                                                                                                                                                                                                            adherence to these practises and taking immediate corrective actions, if required
                                                                                                                     Mechanical and Electrical
                                                                                                                                                                                                                                                        •   ensuring that WWL and those who are working for WWL meet all health, safety and environment
                                                                                                                                                           Fish Pass                                                                                        regulatory obligations.


                                                                                                                                                                 Miscellaneous Structures

                                                                                                                                                                                                                             Commis                 Objective                                 WWL has worked closely with                    incidents raised by workers.
                                                                                                                                                                                                                                                    Health and safety protects the well-      contractors to establish a safety          •   Health and Safety Representatives
                                                                                                                                                                                                                                                    being of people.                          reporting culture with strong                  (HSR) who provide a voice for
 Jan   Feb   Mar Apr   May   June   July   Aug   Sep    Oct   Nov   Dec    Jan   Feb   Mar Apr   May   June   July    Aug   Sep   Oct   Nov   Dec   Jan   Feb   Mar Apr   May   June   July   Aug    Sep   Oct   Nov   Dec    Jan   Feb   Mar Apr                                             leadership endorsement. This is                workers who would otherwise not
                                                                                                                                                                                                                                                    Personal and process safety is of
                              2019                                                                      2020                                                                    2021                                                2022                                                      important to identify hazards, analyse         speak up about health and safety
                                                                                                                                                                                                                                                    paramount importance to WWL.
                                                                                                                                                                                                                                                                                              trends, explore ‘root cause’ behaviours        matters. They undertake training
                Critical Path                                                                                                                                                                                                                       WWL will be a leader in health and
                                                                                                                                                                                                                                                                                              and learn from ‘near misses’ or                to enable them to upskill their
                                                                                                                                                                                                                                                    safety management, ensuring both the
                                                                                                                                                                                                                                                                                              incidents, however small.                      knowledge and are on the Health
                                                                                                                                                                                                                                                    protection and welfare of our extended
                                                                                                                                                                                                                                                                                              Trust is pivotal to the success of             and Safety Committee.
                                                                                                                                                                                                                                                    workforce, and compliance with the
                                                                                                                                                                                                                                                    Health and Safety at Work Act 2015.       this process and WWL has endorsed          •   Toolbox talks were implemented
                                                                                                                                                                                                                                                                                              the contractors’ proactive Worker              and are a forum for engaging
                                                                                                                                                                                                                                                    WWL is committed to a robust health
                                                                                                                                                                                                                                                                                              Recognition Programme which                    with staff about learnings from
                                                                                                                                                                                                                                                    and safety system that provides an
                                                                                                                                                                                                                                                                                              encourages project leaders to give             recent incidents (internal and
                                                                                                                                                                                                                                                    assurance for our people, contractors
                                                                                                                                                                                                                                                                                              positive reinforcement to their workers        external) and near misses,
                                                                                                                                                                                                                                                    and the public that their personal        particularly for innovation, safety            feedback on action taken and
                                                                                                                                                                                                                                                    safety and well-being matters.            and managing difficult tasks. WWL              current safety and environmental

                                                                                                                                                                                                                                                    Progress                                  regularly reviews contractor method            areas of focus. The talks

                                                                                       Montage to come                                                                                                                                              WWL has developed a Health
                                                                                                                                                                                                                                                                                              statements to assess risk, controls            are distributed weekly to the
                                                                                                                                                                                                                                                                                              and mitigation.                                contractors’ employees via
                                                                                                                                                                                                                                                    and Safety Management System
                                                                                                                                                                                                                                                                                                                                             email and health and safety
                                                                                                                                                                                                                                                    to actively manage this function          Other initiatives introduced include:
                                                                                                                                                                                                                                                                                                                                             noticeboards. The toolbox talk
                                                                                                                                                                                                                                                    throughout the workplace consistent       •   The establishment of a Health and
                                                                                                                                                                                                                                                                                                                                             is delivered on site at a daily
                                                                                                                                                                                                                                                    with industry best practice and the           Safety Committee to review the
                                                                                                                                                                                                                                                                                                                                             prestart by the zone’s site
                                                                                                                                                                                                                                                    contractor’s own systems. WWL                 health and safety performance of
                                                                                                                                                                                                                                                                                                                                             engineer for sub-contractors.
                                                                                                                                                                                                                                                    processes and documents are                   the project, including reviewing new
                                                                                                                                                                                                                                                    reviewed on a regular basis as part of        policy, procedure and the Health
                                                                                                                                                                                                                                                    our commitment to continuous health           and Safety Management System
                                                                                                                                                                                                                                                    and safety improvement.                       each year along with any issues or

20                                                                                                                                                                                                                                                                                                                                                                              21
WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                                                                                                                                               OVERVIEW

Risk planning
                                                                                                                             HEALTH AND SAFETY                                                                                  Project Performance
The development of the Health and Safety Management
                                                                                                                             Safety Performance                                                                                 In December 2018 when WWL was incorporated, an approved               baseline that is regularly refreshed and maintained through
System is based on a ‘zero harm’ culture and documents
the key requirements to achieve a safe working environment.                                  30                                                                                                                                 design and baselines for cost and project schedule were               an active risk management process.
WWL considered NZ Health and Safety legislation and                                                                                                                                                                             agreed with shareholders and financers. Managing these
                                                                                                                                                                                                                                                                                                      WWL operates an inclusive risk model and has an open forum
international dam safety guidelines as minimum standards                                     25                                                                                                                                 parameters is set in the company constitution, shareholders’          to engage widely with staff. This helps maintain a broader
when developing risk controls.                                                                                                                                                                                                  agreements and the Project Funding Agreement.                         perspective and provides an opportunity to further explore the
WWL recognises that an effective health and safety system                                    20                                                                                                                                 WWL provides regular reporting against these schedules                risk or identify appropriate contingencies or mitigation.

                                                                    Observations (Leading)
is paramount to constructing and operating a safe, reliable                                                                                                                                                                     to deliver the project and keep both shareholders and
                                                                                                                                                                                                                                                                                                      Risk planning

                                                                                                                                                                                                              TRIFR (Lagging)
and efficient dam. WWL reduces safety clutter by focussing                                   15                                                                                                                                 financers informed of progress.
                                                                                                                                                                                                                                                                                                      WWL senior managers continue to be an integral part of the
on key risks, process safety and engaging workers in these
                                                                                                                                                                                                                                WWL has developed and uses a risk management system                   risk committee, and the risk register is regularly reviewed
processes which is key to the success of the programme.
                                                                                             10                                                                                                                                 that proactively understands and mitigates risks.                     and updated to reflect developments as the project evolves.

                                                                                                                                                                                                                                Objective                                                             WWL administers a contingency to cover reasonable
                                                                                             5                                                                                                                                                                                                        risks. The contingency was determined probabilistically
     Next steps                                                                                                                                                                                                                 WWL is committed to delivering the Waimea Community
                                                                                                                                                                                                                                                                                                      using reasonable distributions for items at risk, which
     Ongoing monitoring and auditing of incidents with                                                                                                                                                                          Dam on schedule and within budget.
                                                                                             0                                                                                                                                                                                                        is predominantly sub-surface geology, and equates to
     a view to updating risk controls to ensure the Health
                                                                                                                                                                                                                                Progress                                                              approximately 25% of the project components that are not
     and Safety Management System reflects learnings
                                                                                                                                                                                                                                                                                                      fixed and are at risk.
                                                                                                  Jan 19

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                                                                                                                    Mar 19

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                                                                                                                                      May 19

                                                                                                                                               Jun 19

                                                                                                                                                        Jul 19

                                                                                                                                                                 Aug 19

                                                                                                                                                                          Sep 19

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                                                                                                                                                                                            Nov 19

                                                                                                                                                                                                     Dec 19
     and remains relevant in an evolving construction                                                                                                                                                                           WWL has adopted the New Zealand Transport Agency Z/44
     environment.                                                                                                                                                                                                               standard for risk management and has a comprehensive                  WWL holds insurances for Contract Works, General Liability
                                                                                                           Safe                  Observation                         At Risk                     TRIFR                          strategic and operational risk register in place, which sets a        and Statutory Liability.

                                                                                                                                                                                                                                                       RISK MANAGEMENT
                                                                                                                                                                                                                                                                                                           Next steps
                                                                                                                                                                                                                                                 78% of Project Budget is Fixed
                                                                                                                                                                                                                                                                                                           In the 2019/2020 financial year, WWL will continue to
                                                                                                                                                                                                                                                                                                           look for opportunities to reduce costs and risks on the
                                                                                                                                                                                                                                                                                                           project through implementing risk mitigation plans.
                                                                                                                                                                                                                                                                        Measure and Value
                                                                                                                                                                                                                                 Engineering                            (Geology) $3m, 3%
                                                                                                                                                                                                                                & Verification         Contingency
                                                                                                                                                                                                                                     $5m, 5%             $6m, 6%                  Provisional Sum
                                                                                                                                                                                                                                                                                  (M&E) $6m, 6%

                                                                                                                                                                                                                                                                                            Rock $9m, 9%

                                                                                                                                                                                                                                                    Contract Lump Sum

WWL’s Daniel Murtagh discusses plans with Contractor Matt Taylor.                             WWL and the Contractor work together closely on safety. Here
                                                                                              Contractor Peter Wissel briefs visitors on safety.

22                                                                                                                                                                                                                                                                                                                                                                   23
WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                                               OVERVIEW

Environmental Protection                                                                                                                  Environmental
and Compliance                                                                                                                            Sustainability
WWL is committed to minimising its                The following Supplementary                Risk planning                                Social and environmental                 the Waimea Community Dam to
operating impact on the environment               Construction Environmental                 Monitoring compliance with resource          sustainability is at the heart of what   the highest affordable sustainability     Next steps
by using practices that protect the               Management Plans (SCEMP) have              consents and environmental                   WWL does and underpins the project       standards.                                During the construction and
environment during the build and                  also been developed and certified:         legislation is key to mitigating WWL’s       from conception, planning and                                                      operation of the dam, WWL
                                                                                                                                                                                   Progress                                  will continue to implement the
operation of the dam.                                                                        environmental risk. The development of       design through to construction
                                                  •   SCEMP 1: Access road to dam site
                                                                                                                                          and operation.                           WWL has developed an Environment          programmes committed to in the
WWL is complying with 130 resource                    – roading improvements                 Environmental Management Plans and
                                                                                                                                                                                   and Sustainability Plan to embed good     Biodiversity Management Plan.
consent conditions.These conditions                                                          an adaptive management approach              The dam will have environmental
                                                  •   SCEMP 2: Site compounds,                                                                                                     practice for delivering sustainable
include salvaging rare plants from the                                                       that ensures learnings throughout the        benefits for the region, including
                                                      disposal area and concrete                                                                                                   infrastructure in the project.
reservoir footprint and propagating                                                          construction process are included in         healthier Lee and Waimea Rivers.
                                                      batching plant
them, offsetting vegetation loss via a                                                       the plans, means that WWL is well            The dam will improve water quality       Consistent with the Partnering Deed
                                                  •   SCEMP 3: Access to eastern and
range of biodiversity enhancements,                                                          placed to achieve compliance.                to provide a better environment for      between WWL and Ngāti Koata, the
                                                      western dam abutments.
preparing to prevent and respond to                                                                                                       plants, fish and animals, and in doing   project is working closely with the iwi
                                                                                             A range of water quality and river
                                                  SCEMPS 4 -7 will be developed prior                                                                                              to protect and nurture taonga in the
spills, constructing sediment ponds                                                          health metrics have been put in              so, create more opportunities for
                                                  to the works commencing that they                                                                                                area and to integrate Māori cultural
to protect water quality, vegetation                                                         place to regularly assess the impact         people to enjoy fishing, swimming
                                                  relate to.                                                                                                                       values in caring for the environment
clearance, measuring and tracking                                                            of construction work downstream.             and other recreational activities all
river water quality and remediating the           Vegetation clearance of the reservoir                                                   year round.                              in WWL’s work. Always being mindful
                                                                                             These measures ensure that an
land within the project footprint upon            and dam footprint has commenced                                                                                                  of the natural environment is vital for
                                                                                             accurate picture of river health is
                                                                                                                                          Objective                                the success of WWL’s Environmental
completion of the dam.                            under the Vegetation Clearance Plan.       available so emerging issues can be
                                                  Most vegetation, being larger trees,                                                    WWL’s vision is to build and operate     Sustainability Strategy.
                                                                                             resolved quickly.
                                                  will be removed from the site and
WWL is delivering a project that has                                                         The concrete batching plant will be
                                                  WWL is working with Ngāti Koata to
environmental and economic benefits                                                          built on an elevated platform to keep
                                                  salvage larger native trees. Residual
for the region and is ensuring these                                                         it clear of the river so in the event of a
                                                  smaller vegetation is being mulched
benefits are not eroded through                                                              flood, the health of the waterway is not
                                                  to provide protection against growth
unexpected adverse effects on the                                                            affected by the plant.
                                                  and sediment run off. The mulch
environment.                                      is expected to decompose during
                                                  construction of the dam before the
Progress                                                                                        Next steps
                                                  reservoir is filled.
WWL and construction partner,                                                                   WWL has the people and systems
FHTJV have jointly developed                      To support WWL’s obligations under            for environmental auditing,
Environmental Management Plans                    the Emissions Trading Scheme (ETS),           monitoring and training. Through
in preparation for the start of                   WWL is working with a qualified               a continuous Plan, Do, Check and
                                                  forestry contractor to carry out ETS          Improve cycle, WWL monitors
construction works. These plans
                                                  accounting and reporting for the              compliance, deals with change and
have been certified as compliant with
                                                  clearance of pre-1990 trees in the            ensures our construction partners
resource consent conditions by the
                                                                                                continue to work in a manner that
Tasman District Council and include:              dam footprint.
                                                                                                protects our natural environment.
•    Vegetation Clearance Plan                    Pre-construction river water quality
                                                  monitoring has been completed; this will
•    Construction Environmental
                                                  form the baseline for future monitoring.
     Management Plan
                                                  Turbidity loggers have also been
•    Construction Traffic Management
                                                  installed to monitor the ‘murkiness’
                                                  of the river by assessing the level of
•    Erosion and Sediment Control Plan            material suspended in the water.
•    Hazardous Substances –
     Emergency Spill Contingency Plan.
                                                                                                                                          Sediment retention ponds.

24                                                                                                                                                                                                                                                                  25
WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                                                             OVERVIEW

A Biodiversity Management Plan has also been developed and includes the following key initiatives:

     Maintain Eel Passage – a fish pass is incorporated into the       Rough Island Wetland Restoration – to mitigate the removal
     dam design to allow upstream eel migration. Once operational      of forest from the dam footprint, WWL is organising the
     WWL will monitor the fish pass to assess how well it caters for   planting of a 10-hectare wetland buffer on Rough Island.
     downstream migrating eels. Further activities may be required     The land around the wetland will be retired from forestry and
     to ensure the eels continue to thrive.                            planted out in native vegetation. It will improve biodiversity
     Starts 2019 with fish passage design – long term project          on the land and provide protection to the unique wetland on       Operating and Financial Overview
                                                                       the site.
     Rare Plants – the dam and reservoir footprint have a number       Starts 2019 with weed management and plant procurement
                                                                                                                                         Waimea Water Ltd is fully funded by its shareholders,              Controlled Organisation loan to the project. Interest is
     of rare plants, including NZ shovel mint, scented boom, rock
     coprosma and river cloak daisy. Biodiversity experts have         Protecting Alluvial and Riparian Forest – WWL has acquired
                                                                                                                                         Tasman District Council (TDC) and Waimea Irrigators Ltd            expected to be earned from term deposits.
     collected samples to transplant and propagate these plants        a covenant to protect two existing alluvial and riparian forest   (WIL) to the project budget of $104.4 million. WIL funding
                                                                                                                                                                                                            Spend to 30 June 2019 is $19.2 million, of which $6.3
     into suitable habitats in the region. By establishing a greater   areas within the Wairoa River catchment from development.         is sourced from WIL equity contributions and a Crown
     number of populations and increasing the number of plants         WWL will also carry out pest and weed management                                                                                     million was expended prior to the investment decision on
                                                                                                                                         Irrigation Investments Ltd (CIIL) loan that converts to WIL
     through nursery propagation, WWL expects these species to         activities to restore these areas to a more natural state.                                                                           early commitments made that include land acquisition,
     flourish in the future.                                                                                                             equity as the loan is repaid with water usage by WIL.The
                                                                       Commence planting in 2019                                                                                                            design, procurement, early contractor involvement,
     Started 2018 – ongoing transplant and propagation                                                                                   TDC equity contributions are sourced from TDC, TDC loans
                                                                                                                                                                                                            consenting, project office and governance. Expenditure is in
                                                                       Gorge Turf – WWL will monitor downstream Gorge Turf               from CIIL and grants from the Ministry for the Environment
                                                                                                                                                                                                            line with the project budget.
     Restoring the Lee River – a programme of controlling invasive     communities to assess potential effects of the dam on these       and Nelson City Council. TDC will also advance a Council
     weeds and pests as well as carrying out planting within the       plants at two locations in both the Lee and Wairoa Rivers.
     riparian margin on the banks of the Lee River downstream of       Starts 2019
     the dam is planned. The aim is to enhance the ecological value
     of the river margin to support the natural systems that feed                                                                                                FUNDING AND SPEND                                          FORECAST COST & SCHEDULE TO COMPLETE
     into the Lee River.
     Physical works to start 2020                                                                                                                   WWL Sources and Uses of Funding ($M)                                                            ($M)

                                                                                                                                          $120                                                              $120

                                                                                                                                                    CCO Loans and Interest            Contingency
                                                                                                                                          $100                                                              $100
                                                                                                                                                      TDC Equity (NCC)

                                                                                                                                                       TDC Equity (MfE)

                                                                                                                                           $80                                                               $80
                                                                                                                                                         TDC Equity

                                                                                                                                                                                      JV Contract            $60
                                                                                                                                           $60            TDC Equity

                                                                                                                                           $40                                                               $40
                                                                                                                                                        WIL Loan (CIIL)

                                                                                                                                           $20                                                               $20
                                                                                                                                                                                     Project Office

                                                                                                                                                          WIL Equity                  Engineering

                                                                                                                                                                                  Environment & Land

                                                                                                                                                                               ECI Costs (Spend pre-2019)
                                                                                                                                            $0                                                               $0
                                                                                                                                                          Sources                         Uses
                                                                                                                                                                                                                   Dec 18      Sep 19     Apr 20       Dec 20    Aug 21      Apr 22

Relocation of rare plant species.                                      Measuring river water quality.                                                                                                                        Project Costs Budget           Project Costs Actual

26                                                                                                                                                                                                                                                                                    27
WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                          OVERVIEW

Performance against
Statement of Intent
Health and Safety                                 •   Achievement of the Tree
No task is too important or so urgent                 Management and Carbon                    Funding envelope
as to preclude health and safety.                     Offsetting Plan milestones.
                                                                                               Achieve value for money through fiscal
•    Development and implementation                      Plan and milestones in               and budgetary prudence and efficiency.
     of an annual Health and Safety                       development, will then meet
                                                                                               •   Track percentage of variance
     Management Plan.                                     milestones as they fall due.
                                                                                                   between actual and budget.
        WWL has developed a Health               •   Effective engagement with the
         and Safety Plan System in line               BTAG.                                           11% of budget not yet spent.

         with industry best practice and                                                       •   Transparent reporting to
                                                         Biannual meetings held, with
         the contractors’ own systems.                    advice informing WWL actions.            stakeholders.

•    Quarterly audit compliance score             •   Achievement of our Sustainability               Regular updates to
     from FHTJV.                                      Communications and Engagement                    shareholders and financers.
        95% compliance score in                      Plan milestones.                         •   Unconditional sign off of the
         audits undertaken by WWL.                       Plan and milestones in                   Company accounts from external
•    Percentage of incidents                              development, will then meet              auditors.
     investigated, reported, actions                      milestones as they fall due.                Achieved.
     assigned and closed out within               Project delivery                             Communication and engagement
     two weeks.
                                                  WWL will deliver the Waimea                  Stakeholders and the community are
        Not applicable (no incidents).           Community Dam to quality, time and           engaged to become more informed
•    Total Recordable Injury Frequency            cost in accordance with shareholders’        about the dam and its benefits. WWL
     Rate.                                        expectations.                                has a range of formal and informal
      Zero.                                      •   The dam is built as designed, to         communication channels, and there is
Sustainability and social outcomes                    the quality and safety guidelines        readily available information about the
We will comply with resource consent                  applicable.                              project, its benefits and impacts that
conditions, including the requirement                    On track to achieve this when it     is current and plain English. Enquiries
to relocate rare native species, enhance                  falls due.                           have been responded to promptly and
lowland areas (e.g. the lower reaches of                                                       any issues resolved.
                                                  •   Built as Designed Certificate
the Waimea River and native areas of                  issued by Design and Assurance           •   Track quarterly and annually
Rabbit Island), considering advice from               Consultants, verified by the                 information provision and events.
the Biodiversity Technical Advisory                   Independent Technical Engineer.                 Quarterly presentations to
Group (BTAG).
                                                         On track to achieve this when it             shareholders, AGM pending.
•    100% compliance with resource                        falls due.                           •   Proportionate social media
                                                  •   The dam is constructed to                    presence and communication.
        All consent conditions due to                schedule in accordance with the
         be met have been met, on track
                                                                                                       Social media accounts setup
                                                      baseline plan.
                                                                                                       – 259 Facebook and 94 Twitter
         to meet all those not yet due.
                                                         Expect to meet schedule.                     followers.
•    Achievement of the Environment
                                                  •   Practical completion is achieved                Stories in national and local
     and Sustainability Plan milestones.
                                                      on or before September 2021 and                  publications, newspapers and
        5 Environmental Management                   commissioning is achieved on or                  newsletters.
         Plans developed and certified.               before February 2022.                    •   Mana Whenua engagement
        3 of 7 Supplementary                            Expect to meet completion dates.         through agreed channels.
         Construction Environmental                       Current activities following plan.
         Management Plans (SCEMP)                                                                     Engaging with iwi, Kaumatua,
         have also been developed and                                                              Trustees, Directors and staff as
         certified.                                                                                appropriate.

28                                                                                                                                             29
WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                GOVER N ANCE

                                                  Corporate Governance
                                                  The WWL Board is committed to a high standard of                       Government Act 2002 and other relevant legislation.
                                                  corporate governance and regulatory compliance in guiding
                                                                                                                         Board performance is evaluated on an annual basis.
                                                  and monitoring WWL’s activities.
                                                                                                                         Directors are appointed for a period of four years.
                                                  The Board carries out its accounting, reporting, risk
                                                                                                                         The Board has seven highly experienced directors
                                                  management and decision-making responsibilities in
                                                                                                                         appointed by shareholders and iwi, as follows:
                                                  accordance with legislation and the directors comply with
                                                  their obligations under the Companies Act 1993, the Local              Tasman District Council - 4, Waimea Irrigators Ltd - 2 and
                                                                                                                         Ngāti Koata - 1.

                                                  Corporate Structure
                                                  The WWL Board is supported by four committees                          Board that provides systems for management of change;
                                                  that consist of subgroups of directors and staff. The                  risk management; authorities and financial controls;
                                                  committees provide governance and assurance across                     budget controls; organisation preservation and regulatory
                                                  audit and risk; human resources; design and construction;              compliance. An external audit is completed annually for the
                                                  and sustainability and communities. The management of                  Board by Audit NZ.
                                                  WWL works to a management system approved by the



                                                                                                     Delegation                Accountability

                                                                            Human Resources &                                                     Design &              Sustainability &
                                                        Audit & Risk
                                                                              Compensation                  Chief Executive Officer             Construction             Communities
                                                                               Committee                                                         Assurance                Committee

                                                                                                                     Management Governance and Assurance
                                                                                     Management of Change                                                          Budget Controls

                                                        External Audit
                                                                                        Risk Management                                  Water                 Organisation Preservation

                                                                                                                                 Waimea Water
                                                                                  Authorites & Financial Controls              Management System                Regulatory Compliance

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                                                     GOVER N ANCE

Board of Directors

                                                                                             Julian Raine                                                                                                                           David Wright
                         Karen Jordan                                                                                                                             Ken Smales
                                                                                             Director                                                                                                                               Director
                         Chair                                                               Director (Waimea Irrigators Ltd) and Chair                           Director                                                          (Tasman District Council) and Chair Human
                         (Tasman District Council)                                           Sustainability and Communities Committee                             (Tasman District Council)
                                                                                                                                                                                                                                    Resources and Compensation Committee

Karen is a qualified Accountant (FCMA) and project manager            Julian’s career background is in agriculture and horticulture        Ken has nearly 50 years of engineering experience in               David is a Company Director, Management Consultant and
with over 20 years’ corporate general management experience           and he is actively involved in a wide range of export focussed       all aspects of dam building, including design, consents,           former Chief Executive. His current directorships include
in FTSE Top 20 infrastructure companies. She has extensive            businesses. He is a former Director on the Cawthron Institute        construction, operation, safety, hydro power generation and        Chair of Wellington Water Limited and a Director of the
commercial operations and asset management expertise;                 Board, Director and Deputy Chair on Manaaki Whenua                   irrigation. He was involved in the Central Plains Irrigation       Waikato District Council Waters Governance Board, both
latterly with National Grid plc across a £1BNpa construction          Landcare Research and Chairman of Sirtrack. Julian is                Project in Canterbury worth $450 million for five years and        council owned organisations providing drinking water, storm
programme. Prior to moving permanently to NZ, she was                 also the chair of Wai-West Horticulture and a Director and           has also been the Deputy Chairman of DamWatch for 10               water and waste-water services. David was previously
Director of Contract Management for UK Defence, with                  shareholder of Waimea Irrigators Ltd.                                years and a Director of Southern Generation Australia and          employed as Acting Chief Executive of Palmerston North
responsibilities across a multi-billion-pounds project delivery                                                                            their subsidiary company Meridian.                                 City Council.
portfolio. She is an Independent Member of the NZDF Risk
and Assurance Committee and is currently a Director of City
Rail Link Ltd, providing governance in the construction of New
Zealand’s largest ever infrastructure project.

                         (Tasman District Council) and Chair Design
                         and Construction Committee

                         Doug Hattersley                                                     Bruno Simpson
                         Director                                                            Director                                                             Andrew Spittal
                         (Tasman District Council) and Chair Design                          (Waimea Irrigators Ltd) and Chair Audit and                          Director
                         and Construction Committee                                          Risk Committee                                                       (Ngāti Koata)

Doug has over 45 years engineering and project management             Bruno is the Director - Sales, Finance and Administration            Andrew is a Director and Shareholder in a national company
experience on large international infrastructure. He is a             at Waimea Group and Chairman of the International New                and several local companies. He has a vast range of
Graduate Member of the Australian Institute of Company                Varieties Network. He has been actively involved in Waimea           commercial experience in the civil construction industry with
Directors, a Chartered Professional Engineer and has a                Irrigators Ltd (WIL) and is also a director of Century Water         over 25 years in the field, including transforming a residential
Bachelor of Engineering (Honours) (Civil) degree from the             Ltd, the other major funder of WIL.                                  drainage business into one of Nelson’s largest drainage
University of Canterbury. Doug is currently a consultant for                                                                               and water reticulation specialists. Andrew represents the
renewable energy and infrastructure companies.                                                                                             interests of Ngāti Koata as their nominated Board Director.

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                ANNUAL R EP O RT

Annual Report
                                                  Independent Auditor’s Report
                                                  To the readers of Waimea Water Limited’s financial statements and performance information for the
                                                  seven months ended 30 June 2019
                                                  The Auditor General is the auditor of Waimea Water Limited (the company). The Auditor General has appointed me,
                                                  John Mackey, using the staff and resources of Audit New Zealand, to carry out the audit of the financial statements
                                                  and performance information of the company on his behalf.

                                                  We have audited:

                                                  •   the financial statements of the company on pages 41 to 54, that comprise the statement of financial position as
                                                      at 30 June 2019, the statement of comprehensive revenue and expense, statement of changes in net assets and
                                                      statement of cash flows for the seven months ended on that date and the notes to the financial statements that
                                                      include accounting policies and other explanatory information; and

                                                  •   the performance information of the company on page 28.

                                                  In our opinion:

                                                  •   the financial statements of the company on pages 41 to 54:

                                                      •     present fairly, in all material respects:

                                                            •       its financial position as at 30 June 2019; and

                                                            •       its financial performance and cash flows for the seven months then ended; and

                                                      •   comply with generally accepted accounting practice in New Zealand in accordance with New Zealand
                                                          equivalents to International Financial Reporting Standards Reduced Disclosure Regime; and

                                                  •   the performance information of the company on page 28 presents fairly, in all material respects, the company’s
                                                      actual performance compared against the performance targets and other measures by which performance was
                                                      judged in relation to the company’s objectives for the seven months ended 30 June 2019.

                                                  Our audit was completed on 12 September 2019. This is the date at which our opinion is expressed.

                                                  The basis for our opinion is explained below. In addition, we outline the responsibilities of the Board of Directors and
                                                  our responsibilities relating to the financial statements and the performance information, we comment on other
                                                  information, and we explain our independence.

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WAI ME A WATE R LIMIT ED | AN N UAL REPORT 2019                                                                                                                                                                                             ANNUAL R EP O RT

Basis for our opinion                                                                                                     As part of an audit in accordance with the Auditor General’s Auditing Standards, we exercise professional judgement
                                                                                                                          and maintain professional scepticism throughout the audit. Also:
We carried out our audit in accordance with the Auditor General’s Auditing Standards, which incorporate the
Professional and Ethical Standards and the International Standards on Auditing (New Zealand) issued by the New            •   We identify and assess the risks of material misstatement of the financial statements and the performance
Zealand Auditing and Assurance Standards Board. Our responsibilities under those standards are further described in           information, whether due to fraud or error, design and perform audit procedures responsive to those risks, and
the Responsibilities of the auditor section of our report.                                                                    obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
                                                                                                                              a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
We have fulfilled our responsibilities in accordance with the Auditor General’s Auditing Standards.
                                                                                                                              collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
                                                                                                                          •   We obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
                                                                                                                              appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Responsibilities of the Board of Directors for the financial statements and the performance information
                                                                                                                              company’s internal control.
The Board of Directors is responsible on behalf of the company for preparing financial statements that are fairly
                                                                                                                          •   We evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
presented and that comply with generally accepted accounting practice in New Zealand. The Board of Directors is also
                                                                                                                              related disclosures made by the Board of Directors.
responsible for preparing the performance information for the company.
                                                                                                                          •   We evaluate the appropriateness of the reported performance information within the company’s framework for
The Board of Directors is responsible for such internal control as it determines is necessary to enable it to prepare
                                                                                                                              reporting its performance.
financial statements and performance information that are free from material misstatement, whether due to fraud
or error.                                                                                                                 •   We conclude on the appropriateness of the use of the going concern basis of accounting by the Board of Directors
                                                                                                                              and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions
In preparing the financial statements and the performance information, the Board of Directors is responsible on
                                                                                                                              that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a
behalf of the company for assessing the company’s ability to continue as a going concern. The Board of Directors is
                                                                                                                              material uncertainty exists we are required to draw attention in our auditor’s report to the related disclosures in the
also responsible for disclosing, as applicable, matters related to going concern and using the going concern basis of
                                                                                                                              financial statements and the performance information or, if such disclosures are inadequate, to modify our opinion.
accounting, unless the Board of Directors intends to liquidate the company or to cease operations, or has no realistic
                                                                                                                              Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future
alternative but to do so.
                                                                                                                              events or conditions may cause the company to cease to continue as a going concern.
The Board of Directors’ responsibilities arise from the Local Government Act 2002.
                                                                                                                          •   We evaluate the overall presentation, structure and content of the financial statements and the performance
Responsibilities of the auditor for the audit of the financial statements and the performance information                     information, including the disclosures, and whether the financial statements and the performance information
                                                                                                                              represent the underlying transactions and events in a manner that achieves fair presentation.
Our objectives are to obtain reasonable assurance about whether the financial statements and the performance
information, as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s     We communicate with the Board of Directors regarding, among other matters, the planned scope and timing of the audit
report that includes our opinion.                                                                                         and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit carried out in accordance with    Our responsibilities arise from the Public Audit Act 2001.
the Auditor General’s Auditing Standards will always detect a material misstatement when it exists. Misstatements are
differences or omissions of amounts or disclosures, and can arise from fraud or error. Misstatements are considered
material if, individually or in the aggregate, they could reasonably be expected to influence the decisions of readers,
taken on the basis of these financial statements and the performance information.

We did not evaluate the security and controls over the electronic publication of the financial statements and the
performance information.

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