Dubbo Regional Council will send courtesy notices to property owners "who will have their access disrupted by the installation" and instigate traffic control measures when necessary.

Western Sydney company Jonishan Pty Ltd was awarded the tender for the 19-kilometre and non-potable water pipeline being installed underground.

It will take non-potable groundwater from the city's established recreational bores to the John Gilbert Water Treatment Plant "in times of severe drought".

The dual pipeline will also allow treated recycled water from the Dubbo Sewage Treatment Plant to replace non-potable groundwater.

Four new bores constructed in North Dubbo will be connected to the pipeline.

The council reports that most of the pipeline will be laid within existing road corridors but sometimes across state-owned Transport for NSW roadways and railway lines.

The project has been funded through the $30 million given to the council by the state government in mid-2019.

"Last year I announced an emergency $30 million grant to Dubbo Regional Council for the purposes of trying to secure Dubbo's water resources, both in the short-term and the long-term," Member for the Dubbo electorate Dugald Saunders said in a statement released by the council.

"We want to make the community more resilient during drought, so investing in new technologies like this pipeline and investigating recycled water and its potential uses is crucial to easing the demand on existing town water supplies."

Dubbo regional mayor Ben Shields has welcomed a start to the project.

"This region was one of the hardest hit by the worst drought on record in Australia," he said.

"The whole community suffered, so it's imperative that we prepare and drought-proof ourselves for future generations," he said.

" A lot of planning has gone in to this multimillion-dollar project and I am pleased that we are now starting to see the pipeline in the ground."

Work was underway in Yarrandale Road on Tuesday.

Jonishan Pty Ltd has more than 25 years' experience as a pipe-laying civil contractor.

It was among 19 companies nationwide which tendered for the project.

A protracted tendering process was the result of interested companies seeking more time to submit tenders and the easing of the drought.

In early August the council announced that the successful tenderer was at work in Dubbo.

"The contractor is responsible for the detailed design and construction of the pipeline," a council spokeswoman told the Daily Liberal this week.

"The contractor undertakes the non-destructive digging and survey initially to identify all services within the pipeline route and to provide to the design team.

"The final design drawings will then identify the services and determine the route to accommodate for existing services."

The pipeline is expected to be completed in early 2021.