Adelaide Brighton secures more power for SA operations from Beach Energy, Infigen

ADELAIDE Brighton has signed two energy supply deals to provide its local operations with “continued certainty” of power at competitive prices.

Adelaide Brighton chief executive Martin Brydon.

ADELAIDE Brighton has signed two energy supply deals to provide its local operations with “continued certainty” of power at competitive prices.

The gas purchase agreement with Beach Energy starts in the new year while an electricity supply deal with Lake Bonney wind farm operator Infigen is already in place since October.

The direct agreements are part of strenuous efforts by the cement and building products maker, which uses up to six petajoules of gas a year in its kilns, to cut its energy bill.

The group has estimated its energy bill will rise by $8 million for the full year.

Besides the high cost, the publicly listed group suffered a $9 million hit following a 36-hour shutdown due to the statewide blackout in September 2016 and the temporary closure of the Heywood interconnector in July 2016.

Infigen is expected to power the Birkenhead and Angaston cement making plants and its Klein Point Quarry on the Yorke Peninsula.

The company is also rationalising operations and managing consumption and has a target to obtain 30 per cent of its energy supply from alternative fuels in the medium term.

“The new agreements ... provide our South Australian operations continued certainty of energy supply at competitive prices and underpin our leading position in this important market,” chief executive Martin Brydon said in a note to shareholders on Tuesday.

Adelaide Brighton posted a half-year net profit of $68.7 million, on revenues of $718.4 million to the end of June.

At the time of releasing the results in August, Mr Brydon said the group is anticipating “materially” lower power prices next year while the chance of another blackout had been “materially reduced’’.

The company is a supplier to the $985 million Northern Connector project, linking the Northern Expressway and Port Wakefield Rd to the Port River Expressway and South Rd Superway, which is expected to deliver a $20 million revenue boost.

It is understood forensic investigation by KPMG accountants into $14 million worth of allegedly fraudulent underpayments at the company is continuing.