APA Group Buys Queensland Gas Pipeline for $5b 1

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Thursday, December 11th, 2014
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Energy infrastructure business APA Group is buying a major Queensland LNG pipeline for $US5 billion ($A5.41 billion).

APA has entered into an agreement to buy the connection between gas fields in the Surat Basin and the QCLNG project on Curtis Island, near Gladstone.

The company will carry out a $A1.84 billion capital raising to help fund the project, with the rest of the funds coming from a $US4.1 billion debt facility.

APA shares have been halted from trade while it completes an entitlement offer to shareholders.

Meanwhile, the company said it was on track to achieve its 2014/15 earnings guidance of between $A1.17 billion and $A1.19 billion, excluding the impact of the pipeline acquisition.

Managing director Mick McCormack said the acquisition would allow the company to benefit from Queensland’s growing LNG sector, which is set to become a major exporter in 2015.

“The acquisition of the QCLNG pipeline allows APA to obtain exposure to the globally significant east coast LNG sector and expands APA’s contracted revenue base with revenue from highly creditworthy counter-parties under 20 year take-or-pay contracts.”

Australia’s LNG exports are expected to rise 70 per cent in 2015, thanks in part to the QCLNG project.

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  1. Graeme Henderson

    QGC makes much on their website about the significance of this pipeline being built to the appropriate standard. However I has filmed multiple breaches of the AS 2885.1. I passed these concerns on to Tony Heidrich at QGC and it seems that QGC has decided to dump the problem onto someone else.
    Let me be clear, the pipeline has not been built to the appropriate safety standard over a considerable part of its length. All those responsible for approving this pipeline for use, at a bureaucratic level, need to be closely investigated for possible corruption. Why would the authorities approve a dangerous pipeline if they were not receiving either payment now or the promise, a la Andrew Briar, where a company, in his case Santos offered him "a stupid amount of money," to work for them.
    QGC in its early statements claimed this pipeline was to be a world first in its design. That what is basically an experimental pipeline was built and approved when it had not been constructed according to its design standards.
    The anti-corrosion system has been completely compromised, and the incompetent filling of the trench has resulted in erosion that has exposed the corrosion system to ongoing damage.