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APA signs new 3-year deal with AGL Energy

AAP logoAAP 20/12/2016

Gas pipeline operator APA Group has signed a new, three-year agreement with AGL Energy to replace an expiring contract on the Moomba to Sydney pipeline.

APA said the multi-asset, multi-service gas transportation contract is worth $40 million in annual revenue, and includes significant bi-directional capacity on APA's East Coast pipeline grid.

APA, which holds a near 50 per cent interest in the Australian gas pipeline market, said there will be no impact on its FY17 earnings guidance of $1.42 billion to $1.44 billion.

RBC Capital Markets said in a note the new contract was positive for APA Group as it reduces the risks around earnings and perceived risk on the company's Moomba to Sydney pipeline.

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