A permanent water supply is expected to be restored to Wingham by early December, with contractors working seven days a week to install a new pipeline under the Manning River.
The previous pipeline, which had supplied water to Wingham from Bootawa Dam since the 1960s, was damaged where it crossed the river during the May flood, unexpectedly cutting off supply to the town's reservoirs.
An emergency solution has been in place since then, with water being pumped backwards through the network from Taree's Kolodong Reservoir to Wingham.
However, with drilling well underway and the project progressing daily, it is hoped this solution can soon be discontinued.
MidCoast Council's Director of Infrastructure and Engineering Services, Rob Scott, said the project had been fast-tracked to reduce risks to the community.
"There are a number of significant risks associated with the emergency solution and that's why we sought an exemption from councillors not to go to open tender," Mr Scott said.
"That has allowed us to appoint contractors that have previously delivered large infrastructure projects for us and speed up the construction timeframe by about 12 months.
"If the emergency solution failed, it could significantly impact customers in the northern part of our network, which is obviously a concern. There's also a possibility that the solution we have in place won't be able to meet the increased demand for water we experience in summer, so it's really important we push ahead with this project as quickly as we can."
Initially, a budget of $4.1 million was allocated to the project. This has now been increased to $6.5 million following further investigation.
Mr Scott said the increased estimates were based on a geotechnical investigation undertaken in July. The investigation found that additional work would be required to get through the layers of rock beneath the river, making the pipeline longer.
Taking into account the clean-up of the site and the creation of easements, Mr Scott expected the project to be wrapped up completely by March 2026.
"But with no major disruptions or delays, we're on track for a permanent water supply to be restored to Wingham in about three months, which will be a great outcome."