Tamworth Regional Council to review Demand and Drought Management Plan as it waits for Dungowan Dam approval

But with no time to spare when it comes to Tamworth's water security, a decision has been made to push forward with the assessment.

The new dam, once approved, is expected to take up to eight years to build. Tamworth Regional Council staff will go ahead with a review into the city's Demand and Drought Management Plan as they wait to hear its fate.

In a report issued to council, staff have decided to proceed with drafting the updated plans, which will be presented to councillors for the tick of approval.

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"Council will then consider any submissions received before formally adopting the plans," the report says.

The $1.3 billion dam is still in the planning approval phase, after the long-awaited environmental impact statement was released in October last year.

Stage one of the pipeline rebuild has been completed, with the second stage expected to be finished by mid-year.

Concerned residents have hit back at the plans for the new dam, with just one of 62 public submissions offering support for the project.

Despite the backlash, council's general manager Paul Bennett said it's a "multi-generational" project that "has to happen at one point".

"It provides an additional water source," he said.

"We have to catch the water, we're at the end of the flow and we simply can't have that water flowing past our doorstep.

If the new dam doesn't get built, Mr Bennett said it would be a $330 million blow to council's budget.

He said replacing the pipeline up to the existing dam would cost almost $110 million and safety upgrades to the dam and spillway would be a major expense.

Council maintains it is looking at other water security options, including an industrial water recycling facility.

Mr Bennett said knowing if the dam was approved today it would still be almost a decade away, it was crucial to explore other avenues.

"Based on the current growth trajectory, by the time it's fully built and operational, we would have already used up the additional water security that dam will deliver," he said.

"It's not the silver bullet to fix everything.

"But it's one thing that will provide us with greater water security."

Subject to planning approval, construction of the new dam and the second stage of the pipeline is expected to start in 2024.

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