The Australian Competition and Consumer Commission today issued its Final Approval on the access arrangement proposed by East Australian Pipeline Ltd for the Moomba to Sydney pipeline.
"In response to the ACCC's Final Decision, EAPL submitted a revised access arrangement on 23 October", ACCC Chairman, Mr Graeme Samuel, said today. "This revised access arrangement did not fully comply with the amendments required in the decision. As a consequence the ACCC has drafted and approved its own access arrangement as required under the Gas Code. The access arrangement will come into effect on 1 January 2004".
The ACCC has considered the decision by the Federal Minister for Industry, Tourism and Resources to revoke coverage between Moomba and Marsden with effect from 11 December 2003. The Minister also determined that coverage of the MSP mainline between Marsden and Wilton and the regional laterals is to stand. The ACCC considers that the access arrangement (including reference tariffs) it has drafted and approved accommodates this partial revocation of coverage.
"For instance reference tariffs in the Final Approval have been established on a cents/GJ/km basis. This would have translated into a starting tariff of $0.50/GJ on the Moomba to Sydney segment of the pipeline (GST exclusive) which compares with the $0.66/GJ currently being charged by EAPL. Separate tariffs have been set for gas being transported along the regional laterals.
"Even though the ACCC has approved a lower tariff, EAPL's cash flows will not be substantially affected in the short term", Mr Samuel said. "This is because EAPL has a contractual arrangement with its main customer, AGL, under which AGL is required to make minimum monthly payments to EAPL regardless of the level of regulated tariff.
"The ACCC considers that proceeding to the Final Approval ensures that regional NSW centres which do not have alternative gas transmission services can benefit from the access arrangement.
"EAPL may at any time submit revisions to the access arrangement or may seek review of the ACCC's decision under the terms of the Gas Pipelines Access Law".
The Final Approval and revised access arrangement will be available from the ACCC's website.