Origin sells $2.1bn APLNG stake

ORIGIN Energy has sold a 10 per cent stake in its Australia Pacific liquefied natural gas project for $2.12bn to private equity investor EIG, with the deal landing amid Asian prices trading near all-time records.

The move cuts Origin’s stake in the giant LNG export project based in Gladstone, Queensland, to 27.5 per cent.

Origin expects net proceeds of $2bn after costs with cashflow for the 2022 financial year unchanged at greater than $1bn to be used to pay off debt, consider returns to investors and for growth opportunities. EIG was previously rebuffed by Santos in 2018 with a $13.5bn takeover bid and the private equity player has invested in nine separate LNG projects located in six countries.

The energy operator has been under pressure amid a collapse in wholesale electricity prices that has eroded earnings.

“Divesting a 10 per cent interest allows Origin to crystallise some of the significant value we have created in Australia Pacific LNG, while retaining upside to further value creation through a continuing substantial shareholding,” Origin chief executive Frank Calabria said.