Australian gas supplier Origin Energy has entered an agreement with Chinese-controlled Jemena Gas Pipelines Holdings to sell its 292km Darling Downs Pipeline Network in Queensland for A$392m ($291.76m).
The sale forms part of Origin’s asset divestment programme that was announced in September 2015.
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Comprising three interconnected pipelines in south-east Queensland, Darling Downs Pipeline Network transports gas to Origin’s Darling Downs Power Station, Australia Pacific LNG and also in the domestic market.
Under the sale agreement, Origin will continue to utilise gas transportation services on the pipeline network for ten to 30 years.
Origin CEO Frank Calabria said: “The sale of Darling Downs Pipeline Network, which represents a 16.9x FY2018 EBITDA multiple to Origin, is scheduled to be completed by 30 June.
“The sale culminates our announced asset divestment programme, the net proceeds of which will be used to reduce debt.
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By GlobalData“We’re on track to achieve our target of adjusted net debt of well below $9bn by 30 June.
“In addition, we continue to make good progress on the divestment of Origin’s conventional upstream business, Lattice Energy, during 2017.”
Under its asset divestment programme, Origin has sold Mortlake Terminal Station, Mortlake Gas Pipeline, Cullerin Range Wind Farm, Stockyard Hill Wind Farm project and Origin’s 50% stake in OTP Geothermal.
The company reported having secured A$1bn ($740m) through this divestment programme, A$200m ($148m) higher than the original target of A$800m ($595m).
