Burrendong Dam could run dry before June 2020 unless it receives significant rainfall, according to WaterNSW.
The water level at the popular boating and fishing reservoir currently sits at 6.2 per cent capacity.
WaterNSW has advised that even with water transfers from Windamere Dam, which currently sits at 33.2 per cent capacity, Burrendong is at risk.
WaterNSW executive manager for system operation Adrian Langdon said the Macquarie valley, which extends from the Blue Mountains to the Barwon River Plains, was in the grip of one of the worst droughts on record.
"With ongoing low inflows and storage levels continuing to decrease, the Macquarie Valley is a priority catchment for drought response and WaterNSW is working hard to extend the supply of water to regional towns for as long as possible," he said.
Mr Langdon said WaterNSW was looking at a range of options, including temporary modifications to the Warren weir.
"These temporary works would help us to minimise any system losses and extend limited water supplies for Warren, Nyngan and Cobar."
Water storage levels in Orange have also taken a hit.
Lake Canobolas currently sits at just over half capacity at 54 per cent, as does Gosling Creek Dam at 51 per cent.
Suma Park Dam, located between Ophir, Northern Distributor and Icely Roads, sits at 29 per cent capacity.
Spring Creek Dam, located off Huntley Road, is at 68 per cent capacity.
Mr Langdon said across the state, WaterNSW's management of the storages and river system had delayed the worst effects of the drought.
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