After months of investigation, Victorian water officials have settled on a plan to alter water flows through the Gunbower Forest in a bid to save thousands of hectares of dying trees.

Gunbower, on the Murray River near Cohuna, is protected by international and Australian environmental treaties, yet is facing severe decline after years of poor water supply.

About 70 per cent of Gunbower's trees are estimated to be dead or dying.

The Age revealed in May that authorities were developing a major engineering solution for Gunbower, and yesterday the North Central Catchment Management Authority confirmed it had settled on a plan to expand channels to carry water deep into otherwise dry sections of forest.

The work, which is expected to cost between $25 million and $30 million, will take place at the south-eastern end of the forest, midway between the towns of Cohuna and Gunbower.

The topography of the forest will allow the water to drain through the rest of the forest towards Koondrook.

Damian Wells, the catchment authority's chief executive, said the benefit of more water would outweigh any damage caused to the forest during construction.

"We are providing a huge benefit to 5000 hectares of forest and in terms of the impost of the construction work, we would be looking at very modest disturbance to some trees," he said.

The project will require final approval from the Murray-Darling Basin Authority later this year.