APA Group has agreed a new gas transportation and storage services deal with Origin Energy to increase gas transport from Victoria into New South Wales.
The new agreement has a term of six years and commences at the expiry of the current contract in December 2013. Under this agreement APA will supply a revised suite of services on the Moomba Sydney Pipeline including increased gas transportation from Victorian gas sources and some reduction in services from Moomba.
To enable the increased gas flow into New South Wales from Victoria, APA will increase the capacity of the northern zone of the Victorian Transmission System by 59 per cent by looping sections of the Wollert to Barnawartha pipeline, at a cost of approximately $65 million. Capital works are scheduled to commence this year and are expected to be completed by winter of 2015. The expansion is underwritten by this new agreement and additional regulated revenues on the Victorian Transmission System.
Commenting on the new agreement with Origin, APA Managing Director Mick McCormack said “We continue to adapt APA’s gas pipeline infrastructure to serve the changing needs of our customers, particularly during this time when New South Wales requires increased flexibility in its sources of gas supply. APA has a longstanding commitment to work with our customers to identify, and invest in the development of, gas infrastructure required to support their business.
“The planned capacity increase in the northern zone of the Victorian Transmission System is an incremental development of APA’s east coast gas grid and will further enhance our ability to offer a flexible range of services. The Moomba Sydney Pipeline is an integral component of the east coast gas grid.”