ASSET DESCRIPTION
- A 391km onshore natural gas pipeline system, transporting gas from the Moranbah Gas Project in the Bowen Basin to power and industrial uses in Townsville, Queensland
- Constructed and commissioned by Enertrade in 2004 with an expected useful life of 50 years
- Managed by EIM, an independent operator owned by AGL and Arrow
- Wholly owned by Palisade investors
INVESTMENT FUNDAMENTALS
- Monopoly asset – North Queensland’s only source of natural gas and supplies critical power station
- ‘Uncovered’ – not subject to economic regulation in the form of price and revenue controls. Tariffs negotiated on a commercial basis
- Revenue underpinned by long-term take-or-pay contracts, escalation linked to CPI
- Revenue sources supported by electricity generation and industrial users
KEY RISKS AND MITIGATION
- Availability of gas supply – the MGP and ATP1103 gas fields have c.8,000 PJs of proven, probable and possible reserves
- Renewal of offtake contracts – offtakers are large industrial users and electricity generators whose assets have long remaining life
- Contract pricing is currently below where it would likely be should the NQGP become regulated
Visit the North Queensland Gas Pipeline website
