The business case for the Northern Midlands Irrigation Scheme has now been approved.
Construction of the $146.88 million project will be funded by the Commonwealth and Tasmanian governments.
In total, the farmers involved will pay $36.72 million through water purchases.
Tasmanian Irrigation's chief executive officer Andrew Kneebone said that once the scheme had come to fruition, it will be operated on a cost-recovery basis.
"There's no dividend or return on the investment that we get from the government whether that be grants or equity, so then it's really just run for the benefit of the farmers at the lowest possible cost," he said.
The works are set to commence in 2022 and are due for completion in October 2024.
The scheme will see three pump stations and 157.3 kilometres of pipeline built to deliver a high-surety water supply to farms across the region over an 80-day summer irrigation season.
According to the Minister of Primary Industries and Water Guy Barnett, The Northern Midlands Irrigation Scheme was initially designed to provide 13,000 megalitres of water, but is now set to double in size as a result of farmer demand.
"Water is liquid gold and is a part of our plan to ensure we can get to that $10-billion farm gate value by 2050," he said.
"Our recent budget included a $50-million commitment to agriculture and $30 million to water."
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George Gatenby, who is a farmer based out of Egleston, is also a member of the Northern Midlands Irrigation Committee.
He emphasised how much schemes such as this mean to local farmers.
"It allows us to secure crops year in year out which will give us confidence in employment and putting more investment into our own properties to increase our capital," he said.
"We used to be a merino operation and we've tripled our gross revenue in three or four years as a result of irrigation."
This project comes after 16 irrigation schemes have been implemented as a part of the Tasmanian Government's Pipeline to Prosperity statewide irrigation plan.
Ten more schemes are set to to be introduced.
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