Mallesons Stephen Jaques and Freehills have advised on the establishment of a joint venture between AGL Energy and APA Group to develop a 242MW gas-fired power station at Mount Isa, Queensland.
The power station, to be known as the Diamantina Power Station (DPS), will be underpinned by a long-term energy supply agreement with Xstrata and a power purchase agreement with Ergon Energy.
AGL will supply gas to DPS from its wholesale portfolio, using existing transportation arrangements and new capacity on the Carpentaria Gas Pipeline provided by APA. DPS will be constructed under a lump-sum turn-key EPC contract.
Mallesons acted for the APA Group and AGL consortium on aspects of the power station development, including a long term electricity and gas supply arrangements with Mount Isa Mines (Xstrata), and a power purchase agreement with Ergon Energy, the regional electricity supplier. The firm is also advising the consortium on its project financing arrangements.
The Mallesons team was led by energy, resources and projects partner, Craig Rogers who was supported by partners Dominic Bortoluzzi, David Bell, Matthew Austin,Scott Budd, senior associates Shannon Etwell and Roderick Smythe.
Freehills also advised AGL on aspects of the project, including energy supply, power purchase, gas sale, gas transportation and EPC arrangements.
Total capital expenditure for the DPS will be approximately $500 million (before project financing costs), which is expected to be funded by implementing a limited-recourse project financing and equity contributions by AGL and APA.
The Freehills team included partners Rob Merrick, Sharon Wilson, Toby Anderson, John Angus, Nick Heggart; senior associates Prue Taylor, Gary Borgan, Vittorio Cassamento and Michael Voros; as well as solicitors Matthew Goerke, Clancy Rudeforth, Mark Hatfull and Tristian Boyd.
Greenswoods & Freehills directors Richard Hendricks and Andrew Hirst advised AGL on tax issues.
The Freehills and Greenwoods & Freehills teams worked with AGL Legal, lead by senior in-house lawyers Chris Reynolds and Kirstin Mann as well as the AGL Tax and AGL Treasury teams.
APA Group was also advised by Clifford Chance.