The undercover police officers allegedly purchased methamphetamine and GHB from the woman and her associates on a number of occasions, at times totalling more than $3000.

Warrnambool police divisional tasking unit officers arrested and charged three people on Wednesday following a seven-month investigation into drug trafficking in the city.

About $20,000 cash, three cars and significant quantities of drugs were seized in the raids.

Demi Nash, 30, appeared briefly in Warrnambool Magistrates Court on Thursday charged with the high-end offence of conspiracy to traffic methamphetamine, as well as three counts of traffic methamphetamine and other offences.

She did not apply for bail and was remanded in custody until January 16.

Michael Sparrow, 38, appeared in the same court where he made a bail application.

Warrnambool police Senior Constable Nick Amos told the court investigators established Operation Groats in April 2022 to investigate the alleged trafficking of methamphetamine by Ms Nash and her partner Leigh James, 33.

He alleged Ms Nash paid Mr Sparrow and his partner Kayla Smith-Brockway, 30, to travel to Braybrook, west of Melbourne, to pick up quantities of methamphetamine and facilitate sales in the Warrnambool area.

Senior Constable Amos alleged bank accounts showed $319,000 of suspicious bank transactions between Ms Nash, Mr Sparrow and Ms Smith-Brockway between August 26 and November 28.

The court heard surveillance showed the man attended the Braybrook area a number of times throughout the investigation.

The police informant said a number of people were also frequently observed attending Mr Sparrow's Warrnambool home for a short period, including Ms Nash.

He alleged bank transfers showed thousands of dollars were deposited into Mr Sparrow's bank account on the days he attended the Braybrook area.

Senior Constable Amos told the court undercover police officers attended an area in Lava Street on October 23 and met with Ms Nash, who sold them 1.2 grams of the drug ice.

Ms Nash allegedly told the officers she supplied the town and "they can't catch me".

The court heard she later organised further sales to the officers through a co-accused.

The co-accused allegedly sold the ice to the officers on four occasions between November 2 and December 1.

The quantity of drugs ranged from one to 13 grams and totalled $6550.

On one occasion the officers were also allegedly sold GHB for $175.

Ms Smith-Brockway initiated conversation with the officers on two occasions asking if they wanted to purchase anything but a transaction did not occur, the court was told.

Senior Constable Amos said testing of the methamphetamine showed it was above 80 per cent purity.

Then on Wednesday police raided three properties in Raglan Parade, Lachlan Street and Morriss Road, he said.

At the Morris Road address police allegedly seized $700 cash, knuckle dusters, a number of digital scales, nine mobile phones, 7.37 grams of ice, a black taser and a 2011 Holden Commdore station wagon.

He said Mr Sparrow and Ms Smith-Brockway were arrested at the property.

The raid at the Raglan Parade property allegedly netted 4.1 grams of methamphetamine, 29 rounds of .22 calibre ammunition, an extendable bat, more than $24,000 cash and a bank check in Mr James' name for $37,750.

Police also said they seized four mobile phones, a Holden Calais and BMWX5.

There was nothing located at the Lachlan Street premises.

Senior Constable Amos said the alleged offenders had numerous bank accounts and investigations showed a number of bank transfers from known drug users in the Warrnambool area.

He alleged $155,000 was transferred into Mr Sparrow's accounts alone.

The informant alleged Mr Sparrow used money made from the sale of methamphetamine to purchased two vehicles for $30,000 and $10,000.

The court heard Mr Sparrow claimed he worked three days a week but Senior Constable Amos said there was no evidence of income.

Magistrate Ann McGarvie said the police case was strong and she didn't believe any sentence would be less than any likely period on remand.

She refused bail and remanded Mr Sparrow in custody until January 16.

Ms Smith-Brockway was bailed on Wednesday to appear at the same court at a later date.

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