The Department of the Environment is studying a proposal by Dublin City Council to supply water from the river Shannon to households in the Dublin region via a 100km pipeline.
The council recently lodged a feasibility report with the Department as part of a project aimed at addressing water shortages in the Dublin region after the year 2016.
At current prices the project could cost between €500 and €600 million.
Tom Leahy, Deputy Chief Engineer, said two options were examined as part of the study. The first was the supply of water from Lough Ree, while the second was to use treated salt water from the Irish Sea.
The study found Lough Ree to be the most suitable source for Dublin's water in the future.
After 2016, the pipeline could carry 350 million litres of water per day and it is estimated that water resources will have hit maximum capacity by then.
