AGL pours cold water on Colin Barnett’s east-west pipeline push
AGL Energy has poured cold water on former WA Premier Colin Barnett’s push to pipe WA gas to the east coast.
AGL Energy, which is studying a Victorian LNG import terminal, has cast more doubt on former West Australian Premier Colin Barnett’s push to pipe West Australian gas to the east coast, saying the economics do not appear to stack up.
AGL’s head of energy supply and origination, Phaedra Deckart, said AGL’s plans for a regasification terminal at Crib Point was expected to cost $250 million to $300m and that a 2018-19 final investment decision was still being targeted.
“I’m yet to see the economics stack up for a west to east pipeline of 3,000 kilometres compared to LNG imports,” Ms Deckart said on the sidelines of the Australian Domestic Gas Outlook conference in Sydney today.
She said AGL had looked at such a pipeline using back-of-the envelope calculations that showed costs would be $2m to $3m a kilometre.
“That’s (at least) a $6bn investment to deliver a new source of supply compared to a $250m to $300m investment to deliver our LNG imports,” Ms Deckart said.
As reported in today’s Australian, Mr Barnett believes the pipeline project can get up without government help, makes more sense than an import terminal, and that it could get WA gas to the east coast at a price of about $3 per gigajoule.
Ms Deckart welcomed the move by the Australian Industrial Energy, a group headed by former Santos east coast gas head James Baulderstone and backed by billionaire Andrew Forrest and Japanese trading houses, to import LNG into NSW.
She said it may impact AGL’s plans it went ahead.
“It would be something we would need to look at, it’s early days,” she said.
“We see anything that brings gas on gas competition to the consumer as a positive
