Image: Origin Energy.
BY ELIZABETH FABRI
ORIGIN Energy has inked an agreement to sell its 292km Darling Downs pipeline network (DDPN) in Queensland to Jemena for $392 million as part of the company’s corporate divestment strategy.
The natural gas pipeline transported gas from the South-East Queensland fields to the Wallumbilla gas hub, Origin’s 630MW Darling Downs Power Station, and to APLNG’s export pipeline.
Origin chief executive Frank Calabria said the sale brought the company offloaded asset total to $1 billion; $200 million beyond the $800 million target announced in September 2015.
“The sale of Darling Downs Pipeline Network, which represents a 16.9x FY2018 EBITDA multiple to Origin, is scheduled to be completed by 30 June 2017,” Mr Calabria said.
“The sale culminates our announced asset divestment program, the net proceeds of which will be used to reduce debt.
“We’re on track to achieve our target of adjusted net debt of well below $9 billion by 30 June 2017.”
Jemena managing director Paul Adams said the acquisition was the “crucial next step” in delivering the company’s Northern Growth Strategy, which included the Northern Gas Pipeline currently under construction.
“This is a strategic investment for Jemena which leverages the DDPN’s connection with our Queensland Gas Pipeline to allow us to grow scale in this key market at a crucial time for the Australian energy sector,” Mr Adams said.