Evidence mounts of 4-year sewage cover up to protect Queenstown property development

Analysis/Opinion

Investigations into the detail of ongoing failures of the Queenstown Lakes District Council’s troubled Shotover sewage plant indicate that the council has since 2020 deliberately hidden the failures from the community in order to allow record breaking property development to continue.

Here’s what we know so far - to be added to shortly as new phases of our investigative work are completed.

The key question is - will the newly elected mayor and councillors hold anybody accountable for what has happened, via an independent investigation, or simply allow the status quo to continue? Within weeks the existing council CEO will depart.

As a timely reminder of all of the research published by Crux to date, we include a selection of key stories at the end of this article. The summary below is based on the facts, documents and links included in those stories.

The story so far:

· Contractors and experts determined as early as 2020 that the failure of the Shotover dispersal field was due to serious problems at the plant itself – not just the faulty design of the field. The field could not be repaired – it was beyond any possible fix.

· Contractors discovered this in 2020/2021 when asked to fix the field by QLDC they found vital dispersal components blocked by solid waste – a situation that would be impossible if the plant was functioning correctly, as claimed by QLDC. When functioning correctly the plant should only deliver highly treated liquid waste to the dispersal field.

· The fundamental problem was compounded by poor design and a lack of comprehensive geotechnical work by engineering consultants who designed the dispersal field. To the best of our knowledge those engineers have never been held to account or asked to contribute to millions of dollars of costs.

· In spite of this information, supplied on multiple occasions to senior QLDC managers by experienced contractor and operators (plus ORC investigators), the council decided to hide the situation from the public and continued to issue thousands of building permits to local property developers.

· As the regulator, the Otago Regional Council and their inspectors knew of the extent of the problems for almost as long as they existed and were fobbed off with unspecified excuses from QLDC – but it is assumed that “economic consequences” (property development) would have been high on the list of reasons given to the ORC. On one occasion the ORC was told by a senior QLDC manager that “the council has better things to do with ratepayers money than short term sewage fixes.”

· The ORC issued two abatement notices and eleven infringement notices to the QLDC in relation to the failure of the Shotover plant over the past five years – but only took enforcement action when Crux published video in November 2024 of semi-treated sewage being deliberately piped, 24 hours a day, into a public recreation reserve and then into the protected Kawarau River.

· QLDC Deputy Mayor Quentin Smith called in early 2025 for a halt to all property development until the sewage plant was fixed, based on the precedent of the South Wairarapa District Council taking that action when their sewage plant ran out of growth capacity (but did not fail or pollute.) His call was met with no action from QLDC.

· For five months after the publication of multiple pieces of Crux video and technical evidence of the Shotover Plant’s failure, and the pollution of the Kawarau River and Shotover Delta public parks, the QLDC continued to deny the situation backed up by local MP Joseph Mooney and the community newspaper Mountain Scene. QLDC CEO Mike Theelen and the council comms team accused Crux of dishonest reporting.

· The ORC then took the QLDC to the Environment Court and won a comprehensive Enforcement Order in early 2025 that demanded the proper operation of the Shotover plant, staff training, multiple technical fixes/repairs and the destruction and re-design of an $800,000 earth wall that the QLDC had built around the dispersal field through contractor Veolia in a last ditch attempt to hide the problem from the community. QLDC then appeared to “trump” the Enforcement Order with an Emergency Declaration that allowed it to discharge treated or semi-treated sewage direct into the Shotover River.

· The illegal, non-consented earth wall had collapsed within weeks of being built in early 2024 and released further sewage pollution into the Kawarau River with toxicity levels 9,000 times the public health safety limit.

· QLDC paid for the wall in secret and appointed one of their staff to run Veolia – that person then hired a contact linked to Skyline Enterprises to build the wall – without telling ORC, obtaining resource consent or designing the wall to prevent the almost immediate collapses that occurred.

· During this entire 5 year period the QLDC has spent, and continues to spend, many millions of dollars on external consultants many of whom appear to be doing the same or similar work as each other.

· None of the consultants has fixed the problem – but were paid anyway.

· Now the same or similar problems are starting to occur in Wānaka and Hāwea as the dispersal field at Project Pure, near Wānaka airport, has started to fail due to explosive growth and a lack of technical ability to run the plant properly.

Crux has published this interim report in the hope that our new mayor and councillors can start to take definitive action before the departure of current QLDC CEO Mike Theelen next month. The elected members control the council’s activities only via the CEO. It is then up to the CEO to deliver against the expectations of the elected members.

There are other issues that in many ways are equally urgent – the $100 million loss on the Lakeview project being just one of a number of situations that warrant deep investigation so that these problems – estimated to have cost ratepayers up to $400 million in total – can be prevented from happening again and those responsible need to at least explain to the community what actually happened – and why.

Here are some of the key stories published by Crux that have documented the wide spread sewage failures - their causes, the cover up, the environmental damage and the costs. All of this work is funded by our paid subscribers.