major victorian projects in development

Major Victorian Projects in Development

APGA Dinner Melbourne5 March

Kevin LesterGroup ExecutiveInfrastructure DevelopmentAPA Group

• Snapshot of APA• Crib Point Pakenham Pipeline• Western Outer Ring Main pipeline• Dandenong Power Station• Orbost Gas Plant

major victorian projects in development

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snapshot of APA

Notes: (1) Includes 100% of assets operated by APA Group, which form part of Energy Investments segment, including SEA Gas and EII.(2) Includes 100% of assets operated by APA Group in Queensland, New South Wales, Victoria and South Australia.(3) Includes Badgingarra Solar Farm commissioned in early August 2019

…a leading Australian energy infrastructure businessMarket capitalisationA$13.5 billion (as at 29 January 2020)

Credit ratingsMoody’s: Baa2 (outlook Stable) S&P: BBB (outlook Stable)

Employees~1,800

Assets owned/operated>A$21 billion

Gas transmission(1)

15,425 km transmission pipelines

Gas distribution(2)

~29,000 km gas mains & pipelines~1.4 million gas consumers

Gas fired power generation(1)

418 MW

Renewable energy generation(1,3)

149.3 MW Solar342 MW Wind

Gas storage12,000 tonnes LNG18 PJ gas

Gas processing45 TJ/day processing plants

Electricity transmission244 km HV

ListedS&P/ASX50

Register compositionSecurities on issue: 1,179.9 millionSecurity holders: ~74,000Institutional/retail: 70:30Domestic/international: 75:25

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our footprint

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• Supply shortfall of gas in south eastern Australia is predicted to occur from around 2024 with potential shortfalls on high demand days in the early 2020s.

• AGL and APA are proposing to develop a Gas Import Jetty and Pipeline Project (the Project) to provide an alternative source of natural gas to the south eastern Australia market.

Crib Point to Pakenham Pipelinebackground…

6Source: AGL

• APA has entered into a Development Agreement with AGL to undertake development of the pipeline.

• APA is the proponent for the pipeline and will own and operate the pipeline.• The AGL Gas Import Jetty Project and the APA Pipeline Project are subject to project

approvals and Final Investment Decisions.

APA’s relationship with AGL…

7Source: AGL

• Pipeline Project is between existing jetty facilities at Crib Point (south of Hastings) and Pakenham.

• Project supports AGL’s proposal to import natural gas.

• AGL responsible for gas importation activities while APA provides necessary connection to the Victorian Transmission System.

• Targeting construction commencement in 2021 with completion in Q2 2022.

Pipeline overview:

Length Approximately 57 kilometers.

Material Epoxy coated high strength steel line pipe.

Diameter 600 millimetres.

Firm Service Approx. 500 MMSCFD (bi-directional).

Burial Depth

Generally 1,200 millimetres (deeper at crossing of third party infrastructure and waterways).

Permanent Easement

Nominally 15 metres (reduced at areas of ecological sensitivity or other constraint).

Facilities

End of line above-ground facilities (Crib Point and east of Pakenham) as well as two mainline valves.

Design Principles

Strictly in accordance with the latest version of AS2885 –Pipelines Gas and Liquid Petroleum

project overview…

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• LNG Import.

• Supply re-gasified LNG to the market.

• FSRU (Floating Storage and Regasification Unit) will be used. Basically, a LNG carrier with regasification equipment.

AGL’s project scope…

9Source: AGL

Hoegh Esperanza

floating storage regasification unit (FSRU)

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Source: AGL

• The project consists of approximately 57km of DN600 Pipeline from the Crib Point Receiving Facility to the Pakenham Delivery Facility.

• 2 x MLV Stations.

• Receiving Facility (Crib Point).

• Delivery Facility (Pakenham).

APA’s project scope…

BEGINNING OF LINE FACILITY (CRIB

POINT)B31.3

END OF LINE FACILITY

(PAKENHAM)B31.3

AS2885.1

MIJ

VTS

AS2885.1 or B31.3

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crib point pakenham pipeline proposed alignment

12Source: AGL

• APA and AGL have been consulting with key stakeholders and the local community since June 2017.

• There has been significant public interest in the project.

• 10 revision changes to the pipeline alignment since project conception.

• Many of these changes are a result of consultation and negotiation with a number of Landholders and other Stakeholders.

• Feedback from stakeholders and the community forms an integral part of the final EES submission.

stakeholders and the community

13Source: AGL

key dates and milestones…

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Late 2020: EES Minister for Planning’s determination.Early 2021: Granting of Pipeline Licence.Early 2021: Commence pipeline and facility construction.Mid 2022: Commissioning.Mid 2022: Available for commercial operation.

14Source: AGL



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western outer ring mainproject scope

• Greenfields and brownfields infrastructure to be constructed

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• Increased gas capacity between east and west Victoria resulting in higher refilling rates for Underground Gas Storage at Iona.

• Increased security of energy supply for Victoria.•• New high pressure gas pipeline between APA’s Plumpton City Gate and Wollert Compressor Station.

western outer ring mainproject benefit

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western outer ring main

Proposed Alignment

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• The WORM project is an approved project under the VTS Access Arrangement.

• The WORM Project was determined to require an Environment Effects Statement (EES) by the Victorian Minister for Planning, on 22 Dec 2019.

• The EES Scoping Requirements needs to be agreed with the state and federal governments which is expected to occur mid 2020. Current forecast date for completion is likely to be delayed a minimum of 12 month to mid 2022.

• Land Access and Approvals works are well underway and will focus on the EES for the majority of 2020.

western outer ring mainproject status

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western outer ring mainkey project challenges

Urban Development Geology

Approvals

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western outer ring main

project indicative dates

• Late 2021 Planning Minister’s EES Decision

• Late 2021 to early 2022 Commence Construction

• Mid 2022 Commissioning and gas flowing

• Impact to overall Program will be clearer at the completion of Scoping Requirements and agreement with Government by mid-2020.

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dandenong power station project design intent

• Support the stable operation of the Victorian power system as it transitions to increased renewable generation.

• Efficient, flexible, fast-start power plant capable of ramping up or down in response to the fluctuating output of renewables.

• Facilitate the long term reduction of Victoria’s emissions intensity; emissions from an integrated renewables/gas generation fleet significantly less than the existing brown coal fired generation.

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federal governmentunderwriting new generation investments program (UNGI)

• APA’s proposed Dandenong power plant is one of two shortlisted projects under the Federal Government’s UNGI program from an initial 12 shortlisted projects

• The UNGI program provides underwriting of firm generation capacity with the aim of :- reducing wholesale electricity prices by increased competition- improving reliability- targeted at supporting small retailers & industrial customers

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dandenong power station project – overall concept

• Proposed gas fired power station located at APA’s existing site at Greens Road Dandenong.

• Initial proposed capacity of 220MW (expansion capacity to 330MW possible).

• 7Km 220kV underground cable from Dandenong to existing AusNet 220kV overhead line in Hallam.

• Hallam switchyard connection located immediately adjacent to the AusNetoverhead line.

• Hallam switchyard on private property in an industrial area.

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LNG storage

Power Station

Expansion units

dandenong – existing APA site – city of dandenong

LNG storage Power Station

Expansion units

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dandenong power station

• 12 fast start, efficient, low emission and flexible gas reciprocating engines.

• Fast start: five minutes from start to full load.

• Emission Intensity: 0.47 tonnes of CO2e/MWh vs Yallourn 1.4, Loy Yang A 1.15, a reduction of 65% and 58% respectively.

• Would provide firm generation supporting high levels of renewable energy.

• 24 month project delivery from FID.

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dandenong power station – site

• Located on vacant land adjacent to APA’s LNG storage plant, enabling green field construction.

• Site surrounded by light industrial businesses and closest residential noise receptor is ~1.9 km.

• Victorian Transmission System (VTS) runs through the Dandenong site providing a highly reliable gas supply.

• Access to LNG storage and dedicated regasification infrastructure protects against short term fuel supply risk.

• Located close to large load centre (Melbourne): very favourable and stable Marginal Loss Factor.

• Challenge to installing large scale power generation at Dandenong is establishing a strong high capacity network connection. Existing 66kV network substation is inadequate.

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Orbost gas plant project background

• Orbost plant acquired from Cooper Energy in 2017.

• APA have undertaken an extensive upgrade of the plant.

• Multi Year Gas Processing Agreement + Options• OGP - Former Patricia Baleen Gas Plant

• Commissioned 2003 • Process Patricia Baleen Gas, export to

EGP• Upgraded for Longtom Gas in 2008/9• MRU Upgrades in 2009/10• Longtom field shut-in January 2015 • Plant in care & maintenance

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Orbost Gas Planttransaction & project timeline and status

• 2016 Santos-Cooper JV Sole FEED Project• Late 2016 Santos agree to sale of 50% JV to Cooper Energy• January 2017 Cooper commenced Sole Project detailed design• Q1 2017 APA Due diligence of gas plant & development project• Q2 2017 APA acquired Orbost gas plant from Cooper Energy• Conditional agreements with Cooper for plant, project & processing• 1 July 2017 – APA takes control of onshore development project• October 2017 – Transaction completion• Detailed design & procurement activities January 2017 – January 2019• Construction August 2017 – January 2020• Pre-commissioning September 2019 – February 2020• Commissioning November 2019-March 2020• First gas March 2020

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sole project overview

• Two Well Development • 2x Horizontal Completions

• Subsea Tie-back & Controls• New 65km Pipeline & Umbilical• 1.2km Shore Crossing HDD• Plant Processing Upgrades• Plant Restart Integrity Works• Export Pipeline Licence Amendments &

Life Extension

Source: Cooper Energy 32

APA upgrade project scope

• Plant upgrades to process sour gas to meet sale gas specification. • Sour gas containing 1000ppm H2S

• Upgrade and modification to the existing Orbost Gas Plant: • Subsea control interfaces • Inlet metering & quality monitoring• Inlet separation • Mercury removal upgrades • Sulphur removal and handling • Dew point control unit modifications• Relocated flare facilities • Integration of OGP into APA communications and controls systems

• Integrity works to reinstate the plant to fit-for-service operation and compliance• New plant licencing.• Inspection and assessment of design life for sale gas pipeline reinstatement.

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Original to current plant comparison

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some highlights and challenges

• Sole and Orbost Gas Plant will supply approximately 10% of Victoria’s gas demand.

• HSE performance – 1.4 million manhours and 20 months of construction and commissioning with zero LTIs (TRIFR = 2), no reportable environmental incidents and zero community complaints.

• APA is a significant employer and supporter of the local community.

• Ecologically sensitive area with stringent EPA requirements on noise, emissions, water discharge and sulphur waste disposal.

• Worksafe assessment as Major Hazardous Facility (MHF).• Construction and commissioning challenges with hot and

inclement weather, bush fires and subsequent smoke.• Regional Industrial Relations.• Engineering delays impacting procurement processes and

construction contracting strategy.

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Source: Snowy River Rovers Football and Netball Club

plant last month

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Questions?

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