AGL gas projects threatened by bureaucracy

AGL’s Interim CEO Brett Redman says the collapse of the National Energy Guarantee (NEG) has affected the company’s development of new gas fired power stations in NSW, while its Crib Point LNG terminal in Victoria could be delayed by a state government-led environmental assessment of the project and its associated pipeline.

Speaking to the AFR, Mr Redman said AGL’s board had already committed funding to the first generator, part of the replacement for the Liddell coal plant.

He said in addition to the collapse of the NEG, the company had been hampered by its inability to secure long-term contracts with industrial buyers.

In December 2017, AGL outlined a $1.36 billion plan to replace the coal plant’s 1,680 MW output with an energy mix that included new gas plants.

In April, the company approved an investment of $400 million in a gas fired power station to be constructed near Newcastle, while it accessed the possibility of a second.

According to The Australian, AGL’s Victorian LNG import plant at Crib Point could be delayed after the Victorian Government decided to conduct a full environmental assessment of the project.

The import facility and its associated pipeline will undergo an environmental effects statement, which could see AGL struggle to meet its target of starting imports in the first half of 2020.

“It has that risk (of delays) as any study does,” Mr Redman told The Australian.

“But we recognise the importance of making sure the local community is satisfied that environmental concerns are dealt with.”

Mr Redman said the demand for energy on Australia’s east coast showed the need for more gas developments.

“We know that the state needs that gas in the fairly near future so we’re committed to trying to push this project forward,” he said.

Mr Redman took over from previous CEO Andy Vesey who departed AGL in late August.

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