Sale of AGL’s North Queensland gas assets not to proceed

gas market, gas assets, Santos

AGL Energy Limited (AGL) announced it has terminated its agreement to sell its North Queensland gas assets to Order (Moranbah) Holdings Pty Ltd (“Order Moranbah”), a Chinese gas distributor, originally announced on August 24, 2017.

AGL says the reason for the sale not going through was that “certain conditions precedent to the sale were unable to be satisfied to secure counter-party support for the sale to proceed”.

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The North Queensland gas assets comprise AGL’s 50 per cent interest in the Moranbah Gas Project Joint Venture (MGPJV) and the North Queensland Energy Joint Venture (NQEJV), as well as AGL’s participation rights in the ATP1103 exploration permit located in the Bowen Basin.

Arrow Energy group entities (Arrow) are the joint venture partners in each of these assets.

AGL says it wrote down the carrying value of the North Queensland gas assets to zero in February 2016 and will continue to recognise as operating expenditure all costs associated with its investment in the assets.

The company says there is no change to AGL’s earnings guidance as a result.

Order Moranbah is a consortium of Shandong Order Gas Co. Ltd and Orient Energy Pty Ltd.

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