Borumba: interim civils to FKG Group and exploratory tunnelling out to tender

Queensland Hydro awarded FKG Group an interim civil works contract for the Borumba Pumped Hydro Project in May 2026. A month earlier it issued a Request for Tenders for exploratory tunnelling and drilling — a two-kilometre exploratory tunnel plus geotechnical investigations, explicitly intended to reduce design uncertainty ahead of the main works contract. Tenders closed 20 May.

Both proceeded while the revised business case that will determine the project's scope, cost and schedule remains unfinished. It was expected mid-2026.

That is the tension worth understanding about Borumba: work is being contracted on a project whose fundamental parameters have not been settled.

The essentials

What the reporting says about cost and schedule

Reported figures put the project at around $18.4 billion — an increase of roughly $4 billion — with delivery not before 2033, and a "risk-adjusted" completion date of July 2035.

Set that against the $6 billion in equity committed by the Queensland Government in the 2023-24 Budget, and the scale of the reassessment becomes clear. This is not a project being fine-tuned. It is a project whose reported cost is approaching three times its committed equity.

The Queensland Government elected in 2024 indicated it was open to a smaller version of Borumba and would review the business case. Queensland has separately shelved the Mt Rawdon pumped hydro project.

These cost and schedule figures come from reporting rather than from the ANZIP record or a Queensland Hydro publication, and are flagged accordingly below. The direction is not in dispute; the precise numbers need confirming from primary sources.

Who already holds work

Despite the unresolved business case, a substantial consultant and contractor roster is in place:

The weighting is worth noting: five of the six are design, technical or enabling roles. No main works contractor has been appointed, and the original four-package structure — Pumped Hydro Energy Storage, Upper Dam, Lower Dam, and Original Equipment Manufacturing — is described as the old scope, superseded pending the revised business case.

Why exploratory tunnelling is the right call

The April 2026 RFT is the most technically sensible thing on this project, and the reasoning generalises.

A two-kilometre exploratory tunnel and geotechnical program exists to retire ground risk before the main works contract is priced. Underground pumped hydro is where Australian cost estimates have failed worst — Snowy 2.0 ran a dedicated exploratory works package and still saw its main contract reset — and the largest single driver is conditions that could not be known at estimate.

Doing that investigation before pricing main works is the correct sequence. It is also expensive and slow, which is why it is often skipped. That Queensland Hydro is doing it, and that the business case waits on the result, suggests a deliberate decision to trade time for estimating confidence.

Whether it works is a question every underground megaproject in the country has an interest in.

Governance has moved

Borumba was previously led by Powerlink Queensland. It is now led by Queensland Hydro, with the Queensland Investment Corporation having taken on management responsibilities for Queensland Hydro and oversight of the revised business case.

Bringing the state investment corporation into oversight of a delivery body is not a routine administrative change. It signals the business case is being tested on investment grounds, not only engineering ones.

What to watch

1. Publication of the revised business case. It was due mid-2026 and is the decision point for the entire project. Its absence is currently the story.
2. Whether the project is rescoped smaller, as the government has indicated it is open to.
3. The exploratory tunnelling award and what the geotechnical program finds.
4. Delivery Partner appointment, following the December 2025 ROI.
5. Whether committed equity moves from $6 billion in a future budget — the leading indicator, as with Snowy 2.0.

Published 18 September 2026 · Updated 23 September 2026