APA signs agreement to develop the Brigalow Power Plant
| Stock | APA Group (APA.ASX) |
|---|---|
| Release Time | 1 Dec 2025, 8:28 a.m. |
| Price Sensitive | Yes |
APA signs agreement to develop the Brigalow Power Plant
- APA signs joint development agreement with CS Energy to build 400MW gas power station in Queensland
- Project will provide firming capacity for peak electricity demand, complementing renewable energy
- APA to acquire 80% ownership, CS Energy to operate and maintain with 20% ownership
APA Group has announced the execution of a Joint Development Agreement with CS Energy for the delivery of the proposed Brigalow Peaking Power Plant. The 400MW gas power station will be located next to CS Energy's existing Kogan Creek Power Station in Queensland. Once operational in 2028, the project will provide firming capacity for peak electricity demand periods, complementing variable renewable energy. Under the agreement, APA will lead the delivery of the project and acquire an 80% ownership interest, while CS Energy will operate and maintain the plant and retain a 20% ownership. The final capital expenditure will be subject to detailed engineering design, expected to be completed in the first half of 2026. GE Vernova has been appointed to deliver the gas turbines for the project. APA will limit its exposure to wholesale electricity prices through a proposed 25-year hedge offtake agreement with CS Energy, providing an inflation-linked revenue arrangement with a small portion of variable revenue. The project expands APA's footprint in gas-powered generation and will connect to APA's Roma Brisbane Pipeline via a new lateral transport and storage pipeline, which is being developed separately by APA.
The Brigalow Peaking Power Plant project is expected to deliver returns consistent with APA's required return hurdles and will be funded from existing balance sheet capacity, forming part of APA's $2.1 billion organic growth pipeline.
APA continues to see strong momentum across a range of growth opportunities in gas transmission and storage, gas-powered generation, and remote power generation, and will maintain its focus on efficient and prudent capital allocation to prioritize the most attractive opportunities for its securityholders.