DELIVERING WESTERN AUSTRALIA’S GAS SUPPLY AT LOWER COST

January 24, 2020

Maintaining strong safety, reliability and service performance with lower revenue and costs are the focus of Australian Gas Infrastructure Group’s Final Plan for Western Australia’s Dampier to Bunbury Natural Gas Pipeline (DBP) for the 2021 to 2025 period.

The Plan also puts in place measures to support the DBP continuing to deliver gas to an evolving Western Australian energy market well into the future.

The Plan was presented this month to WA’s Economic Regulation Authority (ERA) and follows an extensive 18 month consultation period with customers of the pipeline.

The pipeline – part of the Australian Gas Infrastructure Group (AGIG) – is the backbone of the WA energy supply industry, linking the gas fields in the State’s northwest directly to electricity generators, gas retailers, mining, and industrial customers.
AGIG’s Chief Executive Officer, Mr Ben Wilson, said the Plan outlines DBP activities and expenditure proposed to be undertaken from 2021 through to 2025.

“Our customers told us that the cost and the reliability of our service are fundamental. AGIG’s success in operating the pipeline has not required any curtailments of capacity for more than 10 years. This Plan supports the continuation of this strong reliability performance in a rapidly changing energy sector,” he said.

Mr Wilson said the Plan proposes a $53 million (8%) cut in total expenditure, and a $241 million (13%) cut in revenue compared to the previous planning period. These cuts will be delivered while maintaining our current high safety, reliability and service performance.

“Over the five-year period, we will deliver a standalone communications infrastructure for the northern section of the pipeline, and replace 25 control systems on compressor units and gas engines. These initiatives will further ensure the reliability of the pipeline and confirm AGIG’s ability to meet our customers’ needs.

“With interest rates at historic lows, our financing costs have also reduced. This is a key driver of the reduction in revenue of $241 million and the benefits of this have been passed on to customers.”

The ERA will now commence its review of the Plan which will provide the community with further opportunity for comment. AGIG looks forward to working with the ERA as it examines the proposals.
The review is expected to be concluded by the end of the year in time for 1 January 2021.

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