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Project Sea Dragon, the ambitious AUD 1.5 billion (USD 986 million) prawn farming endeavor conceived by Seafarms, has met a disheartening fate in Australia. Following a Federal Court ruling affirming the company’s insolvency dating back to June 2020, liquidators have been appointed to wind up the business. The appeal, launched by Project Sea Dragon with hopes of overturning the judgement, was dismissed, leaving local contractors and investors to ponder the remains of what once promised to be the world’s largest prawn farm.
The Legal Quagmire
The chain of events unraveled notably after construction company Canstruct opted to pursue legal recourse against Project Sea Dragon, stemming from the termination of an AUD 13.9 million (USD 9.15 million) contract in April 2022. The subsequent ruling confirmed not just financial instability but also mandated that Project Sea Dragon covered Canstruct’s legal costs. Local Kimberley businesses, contracted as subcontractors in this ambitious undertaking, now face an uncertain future as they await potential compensation—if indeed any will materialize.
For over a decade, Seafarms had envisioned Project Sea Dragon as a transformative venture, proposed to occupy a sprawling 10,000 hectares of the remote Legune Station. The farm was expected to yield 100,000 tonnes of tiger prawns annually, bolstering local job creation by an estimated 1,600 positions. However, a leadership change in late 2021 exposed critical flaws within the project’s operational framework. A subsequent review deemed the plans “not viable” and fraught with “unacceptable” risks, namely issues related to remote location, biosecurity, and environmental sustainability.
Former CEO Mick McMahon, who expressed shock upon uncovering these challenges, played a pivotal role in the company’s eventual descent into voluntary administration in February 2023.
Financial Strain and Government Support
These setbacks compounded in severity as Seafarms recorded a staggering net loss of AUD 19.6 million (USD 12.89 million) for the 2023/24 financial year, exacerbated by the sale of two farms in Queensland for a mere AUD 13.5 million (USD 8.86 million). Meanwhile, substantial government investments—amounting to over AUD 134 million (USD 88.2 million) across federal and state contributions for supporting infrastructure—left taxpayers questioning the viability of their investment amid such a collapse.
In the wake of this disheartening verdict, Shire of Wyndham East Kimberley president David Menzel maintains a cautious optimism about future investments in the region. While the failure of Project Sea Dragon is a blow, Menzel believes the infrastructure developed, particularly roadways, may still catalyze growth in alternative agricultural projects. He points to vast tracts of land ripe for development, both for dryland and irrigated farming operations, suggesting that the legacy of this ambitious shrimp farming initiative could yet facilitate economic opportunities in the long run.