Murray Irrigation (MIL) held a series of shareholder discussion groups during September to ensure it understands shareholder sentiment around the Federal Government’s intent to undertake further water buybacks in the region.
The discussions aimed to gather constructive shareholder input on how the company and shareholders can collaborate to minimise the impact of buybacks on MIL, its customers, and the community.
MIL Chairman, Phil Snowden, said he was pleased with the level of engagement. Participation from 135 shareholders represented almost 30 per cent of 2023/24 water usage.
He said general feedback was “very positive overall” and has given the Board confidence in pursuing company initiatives such as:
- Government feasibility study, if funding is granted
- Commercial discussions with the Commonwealth Environmental Water Office (CEWO) and Murray-Darling Basin Authority (MDBA) continued
- Exploration and further research into new water market initiatives or products to assist in retaining irrigation water within the Murray Irrigation footprint
Mr Snowden said it was clear that shareholders understand the forecast impact of buybacks on MIL and the effect on the regional community.
“From my perspective, it is essential for shareholders to be aware the company has strategies to ensure ongoing business viability despite water buybacks.
“From a personal perspective, I would like irrigators to think about the community impact of selling water, but I want to emphasise we cannot, and do not want to, stop people from selling their water. That is an individual’s decision,” Mr Snowden said.
The shareholder discussions showed strong support for the MIL’s Water Fund, which, if implemented, would aim to retain as much water as possible within the company’s footprint.
“MIL cannot control the buyback process, and we do not intend to compete against the government on water purchases. However, the MIL Water Fund could provide shareholders who wish to sell their water during the buybacks an alternative option,” Mr Snowden said.
While the company does not support and will not assist with the government’s water purchase program from its footprint, it will work with agencies, including CEWO and MDBA, to deliver water via MIL assets for a fee on parity with irrigators while maintaining irrigator priority for water deliveries.
MIL will also continue to lobby for reductions to the proposed increase in government charges on water delivery.
Mr Snowden said the shareholder discussions were “a positive exercise” that has provided the company with clear direction.
There was also an overwhelming view that shareholders support the process developed for reporting back after the engagement sessions and for further engagement before decisions are finalised.
“Our Board of Directors wants to work closely with shareholders to ensure decisions are made in everyone’s best interests,” Mr Snowden said. “I would like to thank everyone involved in this engagement process, including shareholders, management, and directors. We look forward to continuing to work with our shareholders in this manner.”
The report can be downloaded here.
Image: lkonya/stock.adobe.com
