Whistle-blowers blast Rookwood Weir cost blowout excuse
EXCUSES for cost blow outs to Rookwood Weir have been blown out of the water by two whistle-blowers who say the Queensland Government needs to come clean and open up its books.
“They think they have sole access to the data and therefore can make up any story they want,” one source said.
“They have to open their books and explain the cost increases and scope changes if they can reasonably expect any investor to contribute more money.
“Their current excuses don’t make sense to people in the industry, but especially to people who know the project.”
The second high profile source was scathing of the Queensland Government’s handling of the project.
“The State Government has interfered with the progress in the same way it did with Adani, saying publicly that it supports it but undermining it from within,” they said.
Alternate explanations dismiss Natural Resources Minister Anthony Lynham’s claims a $200 million cost increase was due to an increase in concrete mass to address structural stability issues, concrete price and complexity of the fish stocks.
Two anonymous industry sources, prominent in the project’s development, provided a list of reasons why they believe the cost has blown out.
The first source, familiar with the budget, said the weir itself was supposed to cost $140 million to build with the remainder of the $352 million set aside for land, environmental and other associated costs.
They said it was highly implausible that concrete costs alone would add $200 million to the cost.
“Frankly, the numbers they’ve come up with are fictitious,” they said.
“SunWater has blown the value of the project out.
“They’ve created a situation where $352 million was never going to be enough because of the way they assess their costings.”
They revised estimates “based on what we know the numbers would be” and what they understood to be an additional 30,000 cubic metres of concrete.
“Let’s say that’s $500 per cubic metre, that’s $15 million,” they said.
Project delays were also highlighted as a factor.
An extra year for Sunwater to start the project ($10 million) and another year to finish ($10-15 million), was estimated to add $20 - 30 million to the final price tag.
While $30 million was budgeted in the original business case for project risk, the source told The Morning Bulletin that had been revised upwards to $90 million.
Internal costs were originally set at $10 million but were now set at $40 million.
The source blamed mismanagement and inefficiencies by SunWater which blew out internal costs by putting more people on the job than budgeted for and charging more for them.
“Someone’s normally charged out at $100 per hour, they were charging out at $200 per hour,” they said.
“There’s inefficiencies in the organisation and that’s being charged 50 per cent to the Federal Government.”
The source was damning in criticism of SunWater saying they had created this crisis by coming out with a “silly price”, they were “not well managed” and “they should be realistic”.
“The Commonwealth subsidy represented an amazing opportunity for generations of Central Queenslanders to have access to a reliable water source to support economic, industrial and urban growth - but the State Government is just playing partisan politics whilst preaching about the impact of climate change causing droughts.”
They dismissed the concrete excuse, saying the State and SunWater “wanted more money from the Federal Government and are using any reason to delay”.
Master Builders Regional Manager for Central Queensland Dennis Bryant said it was a mystery how the cost blow outs could be attributed to the increasing cost of concrete.
“We are not seeing these same increases in the building industry where concrete is also a major part of the build process,” Mr Bryant said.
When asked for comment, Sunwater deferred to the Queensland Government.
The Queensland Government did not respond to questions about Rookwood Weir’s costing details beyond sharing their letter to the Deputy Prime outlining the changes to the project’s scope.