Genex to strike deal in weeks for half stake in pumped hydro scheme
Genex expects it will announce the financial close on the $700 million hydro project in north Queensland within weeks when it stitiches up a deal with a major equity partner.
One of the disused mine pits to be used as part of the hydro scheme
The company said the Kidston pumped storage project has struggled through the pandemic shutdowns to finalise the project and it missed its September deadlines, but chairman Ralph Craven said a deal was close.
“Over the year, Genex made significant progress on advancing the flagship 250 megawatt Kidston pumped storage hydro project and while the process for financial close has been exhausting and challenging we are still aiming to reach financial close on the project this calendar year and continuing our extensive engagement with all the project stakeholders,” Craven told the company’s annual general meeting.
The pumped hydro scheme, which uses two disused mining pits to transfer water, has already achieved most of its funding and has finalised an offtake agreement with Energy Australia. It has a $610 million commitment from the Northern Australia Infrastruture Facility and equity funding from Japan’s J-Power. The State Goverment has also committed to $132 million in infrastructure.
“While the target date for delivering financial close by the end of September 2020 has not been met, we believe we are close to finalising negotiations with key partners with the majority of agreements already in place,” Craven said.
“Genex has been actively engaged in the selection of a potential equity investor to take up to 50 per cent interest in K2-Hydro through an investment of new cash equity.
“We have completed the competitive equity process assessment and are currently in the final stages of concluding negotiations with a successful party.”
Genex already has a solar project operational on the site and is the feasibility stages of a wind farm at what it calls the Kidston Clean Energy Hub.