APA Group has unveiled a five-year plan to expand its east coast gas transmission network and support the delivery of new gas-power generation.
APA Group said its East Coast Gas Grid (ECGG) Expansion Plan will deliver a 24 per cent increase in north-to-south gas transport capacity1 and new southern markets storage2 to help make sure lower-cost and lower-emissions domestic gas3 is available to meet demand on Australia’s east coast.
According to APA, this plan will support ongoing earnings growth from APA’s core gas transmission business and build on its $700 million investment over the last four years in Stages 1 and 2, which have already added approximately 25 per cent capacity to the grid.
The expansion plan’s initial investment of $75 million over the next two years has been committed, including $40 million to immediately deliver two enhancements to the ECGG that have reached final investment decision (FID).
The remaining $35 million will fund early works on Stages 3, 4 and 5 of the plan, to support the development of new ECGG expansion and storage projects that will be developed over the medium-term.
APA Group CEO and Managing Director, Adam Watson, said this announcement builds on APA’s long track record of delivering for customers, government and Australian consumers.
“Over the last four years, we have invested more than $700 million in our ECGG, including in our Stage 1 and 2 ECGG expansion projects, ensuring 25 per cent more gas has flowed to southern markets when needed. With customer support, this new plan can deliver the next material expansion to meet projected east coast demand out to 2032,” he said.
“As we progress early works on these projects, we will continue to engage customers, communities and government, with the aim to achieve the necessary commercial agreements, approvals and regulatory settings.”
The two immediate enhancements that have reached FID will add new north-to-south gas transport capacity in 2025 and 2026 are:
- The Moomba to Sydney Ethane Pipeline (MSEP) conversion project – set to be completed in 2025. APA will invest $25 million to deliver this project to provide an additional 20TJ/day from Moomba to Victoria or 25TJ/day to Sydney. After conversion to natural gas, the incremental MSEP capacity will increase the total south-bound capacity from Moomba to Sydney from 565TJ/day to 590TJ/day.
- The Moomba Sydney Pipeline (MSP) off-peak capacity expansion project, which will deliver two pressure regulation skids to increase capacity in the summer months when pipeline maintenance is being undertaken. APA will invest $15 million to deliver this project, with new capacity to come online in summer 2025 and 2026. Total new MSP summer capacity on completion will be 80–120TJ/day, delivering additional earnings in off-peak months and supporting storage refill ahead of peak winter months.
The medium-term projects that are progressing with early works will boost north-to-south gas transport capacity and storage:
- Stage 3 (expansion), which focuses on building capacity to move 24 per cent more gas between northern basins and southern markets. This includes the proposed delivery of the Bulloo Interlink, a new 380km, 71cm pipeline connecting the South West Queensland Pipeline (SWQP) to the MSP, and two new compressors on the MSP. The Bulloo Interlink is designed to transport gas from northern basins such as the Surat in Queensland and the Beetaloo in the Northern Territory, amongst others. Engineering design and planning, along with long lead item procurement, is progressing as part of committed early works funding. The project would progressively increase MSP capacity from 590TJ/day to 700TJ/day. SWQP capacity would increase from 512TJ/day to 605TJ/day and capacity between Young and Melbourne would increase from 190TJ/day to 229TJ/day.
- Stage 4 (storage), which focuses on delivering new southern market gas storage to support AEMO’s forecast need for peaking gas-powered generation, as more variable renewable energy is added to the National Electricity Market4. Stage 4 involves the delivery of the proposed new Riverina Storage Pipeline (RSP) in New South Wales (NSW), along with new compression and pipeline infrastructure. Access and approvals and concept design is progressing as part of early works funding. If progressed, Stage 4 would add new storage capacity in winter 2028 and 2029. The storage project can be delivered in stages, with 200TJ of storage online as early as 2028, with the potential to expand to 500TJ as early as 2029.
- Stage 5 (expansion) – this aims to add flexibility and amplify the investments made in Stages 3 and 4, delivering capacity upgrades into the VTS (Victorian Transmission System). The potential project will expand APA’s MSP and VTS systems to 350TJ/day from Young, New South Wales, to Wollert, Victoria, through the addition of new compressors, reconfiguration works and new metering and pressure regulation infrastructure. The 84 per cent increase in transport capacity into Wollert could be delivered as early as winter 2029 as the Victorian market becomes more reliant on northern gas basins.
APA said the plan is designed to ensure there is sufficient capacity for domestic gas to supply southern market demand, to avoid the market shortfalls otherwise forecast by AEMO and the ACCC. Importantly, the plan can be delivered in stages, incrementally satisfying demand to minimise costs to consumers.
The initial investment and the early works funding form part of APA’s $1.8 billion development pipeline and will be funded from APA’s existing balance sheet. Project FID for Stage 3, 4 and 5 will be conditional on early customer support, APA Board approval and any required regulatory approvals. The costs to deliver Stages 3, 4 and 5, along with funding arrangements, will be disclosed once these conditions have been met and FID taken.
Mr Watson said these are critical projects in the national interest to help secure Australia’s energy future and support a more affordable and lower emissions energy system.
“Australia will need gas out to 2050 and beyond as a critical backup to renewables and to support many of Australia’s key manufacturing and industrial sectors5,” he said.
“These investments will help the Australian economy avoid the disastrous option of importing higher cost, higher emissions LNG, which will undermine domestic energy security and expose Australia’s energy market to global supply chains and prices.
“In contrast, APA’s investment will further support the development and commercialisation of Australia’s domestic gas industry, delivering critical security of supply and economic and employment benefits.
“More than 90 per cent of the east coast’s identified gas reserves are located in the north of Australia, including more than 31,000PJ in the Surat and Bowen basins6. The Northern Territory Government estimates that there are more than 200,000PJ of gas in place in the Beetaloo7, which can be unlocked and moved south to meet projected demand.”
Mr Watson said that AEMO’s Future Gas Strategy estimates cost of production and delivery to Melbourne from Surat, Narrabri and Beetaloo to be around $9 to $13 per gigajoule8.
“This compares to an average 2024 Australian winter Asian LNG spot price of $17.81 per gigajoule9 and an average Australian summer price of $21.58 per gigajoule10. These imported LNG prices do not include regasification costs and terminal fees paid to import terminal owners and required transport to local Australian markets, adding further cost to Australian consumers and industry,” he said.
