Origin Energy to sell Darling Downs pipeline network to Jemena for $392 million
ORIGIN Energy will sell its Darling Downs pipeline network in Queensland to Chinese-controlled Jemena Gas for $392 million.
The pipeline network is used for the transportation of gas to Origin’s Darling Downs Power Station, the APLNG terminal as well as the domestic market. As part of the sale, the energy producer and retailer has secured gas transportation services on the Darling Downs pipeline network for between 10 and 30 years as part of the agreement.
Jemena, which operates a $9 billion major utility infrastructure on Australia’s east coast, is backed by the State Grid Corporation of China and Singapore Power.
The deal takes sale proceeds from Origin’s asset sale program, announced in 2015, to $1 billion.
Origin had targeted raising $800 million through divestment of non-core assets by June 2017 as part of efforts to repair its balance sheet.
“The sale culminates our announced asset divestment program, the net proceeds of which will be used to reduce debt,” Origin chief executive Frank Calabria said.
The pipeline sale follows the sale of the Mortlake terminal and gas pipeline in Victoria, two wind farm projects and the 50 per cent stake in a geothermal energy business.
Origin is separately looking to offload its conventional oil and gas exploration assets.
Origin Energy chief Frank Calabria has said that proceeds of the pipeline network sale will be used to reduce debt