LAST week the Federal Government made good on a pre-election promise and released money to be used in another Urannah Dam feasibility study.

On Friday the Palaszczuk Government received paperwork signed by Deputy Prime Minister Barnaby Joyce and the Bowen Collinsville Enterprise which will unlock $3 million for the dam's study.

The dam on the Urannah Creek 60 kms south-east of Collinsville has been on the drawing board since the 1950s but has never got off the ground.

Minister for Water Supply Mark Bailey, said the funding was for feasibility assessment and made no promises the dam would be built.

"If the project is shown to have merit and net benefit to the community there may be further detailed consideration and assessments including further detailed environmental assessments,” he said.

"Before the Queensland Government could consider the advancement of a significant water infrastructure proposal such as the proposed Urannah Dam, there would need to have been rigorous assessments undertaken in the areas of economic and technical viability as well as environmental sustainability.”

Member for Whitsunday Jason Costigan has been pushing the dam project for many years and was critical of the State Government for the funding delay.

"It has taken the Palaszczuk Labor Government nine month to pull their finger out. Where have they been, " he said.

However in January this year Rural Economic Development Minister Bill Byrne framed the delay on Mr Joyce's shoulders.

The dam, if built is expected to open up 20,000 ha irrigated agriculture land capable of producing sugar cane, cotton, horticulture crops and and mixed broad acre crops.

It will store 1.5 million ML of water and in 1998 stage one of the project was expected to cost $113 million according to the Bowen Collinsville Enterprise.

Mr Costigan said he would not be "frightened away” by indigenous claims to the land.

"I want to work with the indigenous community to bring this project to fruition,” he said.