Funding to the tune of $150,000 has been allocated to council to investigate the development potential of land in the western area of Stawell, giving the city's economic future a significant boost.

Member for Western Victoria, David O'Brien, was in Stawell last week to make the funding announcement.

Under the Victorian Government's Regional Growth Fund, council will receive $150,000 to produce a master plan for a section of industrial and business land which includes the former Pleasant Creek and Motorway sites, and Frewstal abattoir.

Northern Grampians Shire Mayor, Cr Kevin Erwin said the document would play a vital role in council's strategic planning over the next 15 years.

"With underground operations at Stawell Gold Mines coming to an end, this announcement is particularly timely," he said.

"Last year we conducted an industrial land audit which flagged the Western Stawell Business Precinct as a prime location for business development.

"The master plan will provide us with a chance to capitalise on these opportunities, boost job creation and grow the economic and social sustainability of the shire."

Cr Erwin said Western Stawell Business Precinct Plan would investigate factors including amenity, employment, environment, freight and transport networks, infrastructure and assets.

The $200,000 master plan project is being funded by the State Government and a $50,000 council contribution.

Mr O'Brien said the project would create a master plan for the potential development.

"The area includes private and public land of approximately 60 hectares incorporating the existing industrial precinct and surrounding vacant land," Mr O'Brien said. 

"The plan will provide strategic direction over the next 15 years for sustainable business development, creating employment opportunities, a diverse economic base and improved infrastructure and transport logistics.

"The plan will also provide for improved servicing and expansion opportunities for existing key industries such as Frewstal abattoirs." 

Mr O'Brien said that Northern Grampians Shire Council had identified the project as one that could significantly assist with job creation and to plan for the longer term economic and social sustainability of Stawell and the broader districts. 

"A 2012 industrial land audit by the council identified key features required for a site to provide a competitive advantage across a range of industry areas, improving economic outcomes and creating jobs," Mr O'Brien said. 

"The Western Stawell Business Precinct is prime land that can capitalise on those key features outlined in the audit. 

"There is also a range of sector plans that identify this site as having high potential to be developed for industrial and business growth. 

"This funding will equip Northern Grampians Shire Council with the resources it needs to properly plan for future investment opportunities." 

Mr O'Brien said the Victorian Government funding towards the $200,000 project would be provided through the Regional Growth Fund to Northern Grampians Shire Council, which will contribute $50,000. 

"Coalition Government support for this project demonstrates our commitment to driving growth and prosperity throughout regional Victoria," Mr O'Brien said. 

"Since it was established in early 2011, the Regional Growth Fund has provided more than $350 million to support over 1200 projects across regional and rural Victoria, leveraging around $1.5 billion in total investment. 

"In Northern Grampians Shire the Regional Growth Fund has provided $3.3 million to 30 projects worth $5.29 million."