The repairs are essential if the Pacific Ocean island nation is to survive the impact of climate change, Australian Foreign Minister Bob Carr announced Monday.
Many scientists believe the entire land area of Kiribati, whose highest point is now just 10 feet above sea level, will disappear with ongoing sea level rise caused by global warming.
"Kiribati is at the front line of climate change," Carr said. "Unless action is taken, Kiribati will be uninhabitable by 2030 as a result of coastal erosion, sea level rise and saltwater intrusion into drinking water."
In June 2008, Kiribati asked Australia and New Zealand to allow its citizens to move to those countries as permanent refugees.
Australia's funding would be delivered over three years in partnership with the World Bank and Asian Development Bank, China's Xinhua news agency reported.