APA Group shares lift after regulator price ruling on Queensland pipeline
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The news: APA Group has welcomed a preliminary ruling by the Australian Energy Regulator that the company’s south west Queensland Pipeline (SWQP) should not be subject to full price regulation.
The numbers: APA Group shares were up nearly 5% at $7.75 in early trading helping lift the overall utilities sector. The sector was the best performing, up 1.57%.
The context: The regulator also said the existing light regulation regime applicable to the pipeline should remain in place.
The AER’s preliminary ruling comes months after APA announced in May it would delay expansion on the SWQP due to regulatory uncertainty tied to the government’s investigation into the pipeline sector.
The pipeline expansion, which links Wallumbilla in southeast Queensland to Moomba in South Australia, is seen as critical to avoid impending gas shortfalls in Australia’s southern states in the next two years. It was due to start construction in the second half of 2024.
The AER is conducting further consultation with stakeholders before a final decision.
What they said: “This decision, if confirmed, creates confidence to make the necessary investment in our east coast gas grid to support energy security for our customers and consumers,” APA chief executive Adam Watson said.
The source: ASX announcement
