re: Ann: ORG: Origin acquires 180MW longterm ...
ASX/Media Release
15 May 2009
Origin acquires 180 MW long term power purchase
agreement in South Australia- Origin Energy Limited (“Origin”) has reached a conditional agreement with Babcock & Brown Power Limited (“BBP”) to assume the long term power purchase and gas purchase and sales agreements associated with the 180 MW Osborne cogeneration power station in South Australia.
- Origin’s Executive General Manager Energy Markets, Mr Frank Calabria said, “Assumption of the Osborne agreements will provide Origin with flexible baseload and peaking cover for our current retail electricity portfolio until 2018 and complement Origin’s existing South Australian power stations at Quarantine and Ladbroke Grove.”
Upon completion, the transaction provides competitive electricity for Origin in South Australia. It is expected to be earnings accretive from Financial Year 2009/10.
The structure of the Osborne agreements and the plant configuration mean that Origin will have around 150 MW of baseload capacity and access to around 30 MW of peaking capacity as required. This flexibility provides the opportunity for Origin to optimise its power purchases to meet its retail portfolio requirements. Origin is also
able to supply gas to Osborne from its extensive portfolio when the existing gas purchase agreement expires.
Flinders Osborne Trading Pty Ltd (“FOT”), a wholly owned subsidiary of BBP, is the holder of the long term agreements for the purchase of up to 180 MW of electricity from Osborne power station and the sale of 13.5 PJ of gas per annum to Osborne power station until 2018. FOT also holds a gas purchase agreement with AGL for gas that it sells to Osborne power station until the end of 2010.
Origin will assume all of these contracts for a nominal consideration of $1.
“The transaction is a great example of the value of Origin’s fuel integrated generator and retailer strategy and the opportunities that it provides,” Mr Calabria said.
Completion of the transaction, which is expected in June 2009, is subject to a number of conditions precedent, including consents from FOT’s commercial partners.
The Osborne power station, which is located near Adelaide, is jointly owned by Origin and ATCO Limited. The cogeneration facility, which is one of Australia’s
largest, has one gas turbine and one steam turbine that together can generate 180 MW of electricity. Osborne power station also provides steam to adjacent Penrice
Soda Holdings Limited.//
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