Planning permission has been given for a 1.6 million gallon service reservoir at the top of Ballagawne hill in Arbory, to serve the south of the Island.
The Isle of Man Water Authority hopes construction will begin in the autumn, and says the project will take around a year to complete.
Water from the new ?26 million treatment works in Douglas, which supplies the south, will be stored undergound at Ballagawne.
The new reservoir will be built next to the existing service reservoir, which was built in 1943.
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