A critical decision delaying commencement of OakajeeASX AND...

A critical decision delaying commencement of Oakajee
ASX AND MEDIA ANNOUNCEMENT
15th May 2009 ELS 38 2009
WA DEFERS CRITICAL MIDWEST ENERGY
INFRASTRUCTURE
Integrated energy developer Aviva Corporation Limited (ASX:AVA, BSE:AVIVA)
advises that the WA government has deferred construction of the 330kV transmission
line from Perth to Geraldton and has not included expenditure on the line in the
2009/10 budget.
The Economic Regulation Authority of Western Australia determined that the 330kV
transmission line satisfied the Regulatory Test in December 2007. The Regulatory
Test is an assessment of whether the proposed work maximises the net benefit to
those who generate, transport and consume electricity in the South West
Interconnected Network after all options are considered.
The 330kV transmission line was proposed by the state network operator Western
Power. The ERA received public submissions in favour of the proposal from Aviva
and other entities including
• Mid West Development Commission
• Griffin Energy
• Geraldton Iron Ore Alliance
• Extension Hill Pty Ltd
Aviva CEO Lindsay Reed said “The power line is of critical importance for the
development of the Mid West region because energy is a key requirement for all the
proposed iron ore projects and the deep water port at Oakajee”.
Aviva’s Coolimba Power project at Eneabba can accommodate up to a two year
deferral of the transmission line and requires the construction of only the first stage
from Perth to Eneabba to facilitate connection to the network.
“It is critical for Coolimba that the government expeditiously clarifies the extent of
the deferment and indicates how it intends to fund the transmission line”, Mr Reed
said.
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“Without such commitment Coolimba will be unable to contract with Western Power
for connection to the network and as a consequence would be unable to contract to
supply electricity to Synergy or other customers”.
The capacity to execute these contracts is fundamental to the procurement of project
finance for Coolimba.
Mr Reed said that Aviva maintains that a competitive power generation sector in WA
involving private sector projects requires adequate and timely provision of
transmission infrastructure in order for new generation to be developed.
As a matter of priority Aviva will be engaging with government at all levels to
provide certainty for the funding and development of this transmission line.
CONTACTS:
Lindsay Reed Robert Kirtlan
Aviva Aviva
Chief Executive Officer Director
Tel: +61 (0) 8 9367 2344 Tel: +61 (0) 8 9367 2344