APA Group (ASX: APA) has finalised the Project Development Agreement and the Gas Transportation and Storage Agreement with CS Energy, marking a major step toward delivering a new natural gas pipeline to connect APA’s Roma Brisbane Pipeline with CS Energy’s proposed Brigalow Peaking Power Plant in Queensland.
The planned natural gas power station will be constructed adjacent to CS Energy’s existing Kogan Creek Power Station near Chinchilla in the Western Downs.
Designed to provide firming capacity during peak electricity demand periods, the facility will complement variable wind and solar energy.
Notably, the new power station will have the capability to start and stop multiple times daily and reach full output within five minutes.
To enable this, APA will build a new approximately 23-kilometre pipeline, specifically designed to deliver both natural gas transmission and storage services.
Under the agreement, APA will develop, own, and operate the pipeline, generating revenue under a 35-year Gas Transportation and Storage Agreement with CS Energy.
The project’s completion is targeted for mid-2027, with total construction costs currently estimated at a minimum of $150 million.
Final capital expenditure will be determined following detailed engineering design, expected to conclude in the third quarter of FY2026.
The development of both the Brigalow Peaking Power Plant and the connecting pipeline remains subject to necessary approvals.
APA CEO and Managing Director Adam Watson said: “The completion of this agreement builds on our strategy to leverage our existing gas transmission network and capabilities to progress growth projects that deliver for investors and support energy security and transition along Australia’s east coast.”
Watson added: “Along with the recent announcement of our agreement to acquire the Atlas to Reedy Creek Pipeline and our ongoing East Coast Gas Grid Expansion work, this announcement demonstrates both our disciplined approach to capital allocation and the significant growth opportunities ahead in gas transmission and storage and gas-powered generation.”
The project forms part of APA’s broader efforts to support Australia’s energy transition by providing flexible, fast-start gas-fired generation that enables greater integration of renewables while maintaining grid reliability.
