AGL progresses Crib Point LNG with two deals
Australian utility AGL Energy executed two deals in relation to its proposed liquefied natural gas (LNG) import project at Crib Point in Victoria.
The company signed a deal with APA Group for the development and construction of the Crib Point Pakenham pipeline and the ongoing transportation of gas from the proposed LNG import project to the domestic market.
APA will continue early work including sourcing certain long lead-time items for the development of the proposed pipeline. AGL also signed works, lease, and berthing and jetty agreements with the Port of Hastings Development Authority for the long-term use of Crib Point jetty berth 2.
The Port of Hastings Development Authority will begin jetty remediation works to prepare for AGL’s exclusive occupation of Crib Point jetty berth 2 for the continuous mooring of a floating storage and regasification unit (FSRU).
Execution of both agreements is subject to regulatory approvals and a final investment decision by AGL.
AGL said it continues to work through key commercial and stakeholder engagement processes to enable a final investment decision on the Crib Point LNG import project during the 2019 financial year for delivery of first gas into the domestic market during the 2021 financial year.
If AGL does not proceed with the project, its total financial exposure as a result of entering the above agreements would be up to $65 million. This is in addition to AGL’s currently committed capital expenditure to the development of approximately $37 million.
AGL is progressing its environmental approvals and licensing requirements for the project and continues to negotiate further key commercial arrangements for LNG supply and for the long-term charter of the FSRU.
AGL is also working closely with the Western Port community in the development of the project.