CANBERA (dpa-AFX) - APA Group announced the execution of a Joint Development Agreement with CS Energy to advance the proposed Brigalow Peaking Power Plant in Queensland. The new gas-fired facility will be located adjacent to CS Energy's existing Kogan Creek Power Station and, once operational in 2028, will provide firming capacity to support peak electricity demand while complementing renewable energy sources.
The project remains subject to external and government approvals, the resolution of key development matters, and the completion of full form documentation. Following this stage, APA will oversee delivery of the plant under a construction management agreement. Upon satisfaction of conditions precedent, APA will acquire an 80% ownership interest, while CS Energy will retain a 20% stake and assume responsibility for operating and maintaining the facility.
Final capital expenditure will be determined through detailed engineering design, expected to conclude in the first half of 2026. GE Vernova has been appointed to supply the gas turbines for the project.
To manage exposure to wholesale electricity prices, APA intends to enter into a 25-year hedge offtake agreement with CS Energy. This arrangement will provide inflation-linked revenue with a modest variable component, offering potential for enhanced returns.
Under the Joint Development Agreement, APA will provide early-stage funding until it acquires its majority interest. The investment is expected to meet APA's return requirements, will be financed from existing balance sheet capacity, and forms part of the Company's A$2.1 billion organic growth pipeline.
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