APA Group approves investment in Hunter gas pipeline

The news: Energy infrastructure owner APA Group has made a final investment decision to build the Kurri Kurri Lateral Pipeline, which will connect the Hunter Power Project to its existing Sydney to Newcastle Pipeline.

The numbers: APA has outlined a total capex cost of $450 million for the 20 kilometre-long gas transmission pipeline and a 70 terajoules gas storage facility to service the power project.

The context: The pipeline investment is part of a 30-year Gas Transportation and Storage Agreement that APA signed with Snowy Hydro in June 2022, which can be extended for another decade. The NSW government granted the pipeline licence in September this year.

Major construction will now start with all third-party approvals and development matters now finalised and agreed with Snowy Hydro, APA said. The Hunter Power Project will be essential to ensure grid stability and support the growth of renewables as coal fired generation is withdrawn across the National Electricity Market, APA chief executive Adam Watson said.