Origin Energy acquires state owned generator

• 11 years ago (2013-07-02)
• Junior Isles

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Australian firm Origin Energy Ltd is to pay A$659 million for New South Wales’s state-owned generator Eraring Energy, as part of a A$3 billion power privatisation sell-off.

NSW authorities are to pay Origin A$300 million in severance to cancel a 17-year coal supply agreement and a coal mine development project at Cobbora, a deal which NSW Treasurer Mike Baird said would save taxpayers more than A$1.5 billion.

Origin will also enter into a coal supply agreement for Eraring Power Station with Centennial Coal, worth 24.5 million tonnes of coal between June 2015 and June 2023.

Origin’s payment of A$659 million for Eraring Energy will be topped up by the A$609 million it paid to the NSW government for the generator’s power under its previous “gentrader” deal.

Origin’s executive director of finance and strategy Karen Moses said the acquisition of Eraring Energy was “a natural extension of the existing relationship between Origin and Eraring Energy via the GenTrader Arrangements”.

“Eraring Power Station is one of the most efficient and lowest carbon intensity coalfired power stations in NSW while the Shoalhaven Scheme uses pump hydro technology to generate electricity during periods of peak demand,” she said.