APA Group (ASX: APA), a leading Australian Securities Exchange (ASX) listed energy infrastructure business that owns and operates a diverse portfolio of energy assets across Australia, has announced the finalisation of full form agreements with CS Energy to develop and majority own the Brigalow Peaking Power Plant. Under the agreement, APA will acquire an 80% ownership stake in the 400MW gas power station, situated adjacent to CS Energy’s Kogan Creek Power Station near Chinchilla, Queensland. CS Energy will retain a 20% interest, operating and maintaining the plant upon completion.
The total cost of the Brigalow project is expected to reach $1,269 million. APA’s 80% contribution will amount to approximately $1,015 million, which the company intends to fund from its existing balance sheet capacity. The project’s returns are supported by an inflation-linked, 25-year hedge offtake agreement with CS Energy, largely limiting APA’s exposure to wholesale electricity price fluctuations. This investment forms part of APA’s $3.5 billion organic growth pipeline and is anticipated to deliver returns consistent with its hurdle rates. The new facility is designed to provide fast-start dispatchable energy, complementing variable renewable energy sources and capable of powering the equivalent of more than 150,000 homes.
In addition to the power plant, APA is also delivering a new gas lateral and storage pipeline. This separate project, also under agreement with CS Energy, will connect the Brigalow Peaking Power Plant to APA’s existing Roma to Brisbane Pipeline. APA CEO and Managing Director Adam Watson stated that the partnership supports Queensland’s energy security and transition, aligning with the Queensland Government’s Energy Roadmap and demonstrating the private sector’s role in critical infrastructure. The project is targeted for completion in early 2029, with early works already concluded. GE Vernova is delivering the gas turbines, and Monadelphous is now progressing with the main construction works.
