Key Highlights

  • APA has reached final investment decision on the Bulloo Interlink Pipeline, committing $700 million to construction and commissioning.
  • The decision follows a February 2026 commitment of $220 million for early works and is backed by a five-year, take-or-pay, inflation-linked agreement with Origin Energy.
  • The pipeline has an 800 TJ/day maximum capacity and is targeted for commercial operation in winter 2029.
  • Stage 3 of the East Coast Gas Grid expansion will deliver about 30% more north-to-south gas transport capacity when completed.

APA Group (ASX:APA) has reached a final investment decision on the Bulloo Interlink Pipeline (BIL) and has signed a five-year east coast gas transport and storage agreement with Origin Energy. The BIL is Stage 3B of the company's East Coast Gas Grid (ECGG) Expansion Plan and is designed to address projected north-to-south gas transport constraints for Australia's east coast gas market.

The investment decision commits $700 million to the construction and commissioning of the pipeline. That amount comes in addition to the $220 million APA decided in February 2026 to invest in early works, where line pipe procurement, engineering, approvals and related development activities are well progressed.

Terms of the Origin Energy Agreement

The decision is supported by a five-year, take-or-pay, inflation-linked gas transportation and storage agreement with Origin Energy for services on the ECGG. APA describes the contract as a firm revenue commitment. The new services will start at the end of Origin's existing arrangements on 1 January 2028.

The agreement includes contracted summer and winter capacity on key east coast assets, namely the South West Queensland Pipeline, the Moomba to Sydney Pipeline, the Roma to Brisbane Pipeline and, once commissioned, the BIL itself.

APA says the Origin contract, together with engagement from other customers, underpins its view that demand for the BIL is firm. The investment forms part of an organic growth pipeline of about $3.5 billion, will be funded from existing balance sheet capacity and is expected to deliver returns above APA's hurdle rates.

Chief Executive Officer and Managing Director Adam Watson said the company is proud to continue its long-standing partnership with Origin, and that the agreement reflects demand for contracted capacity across its east coast assets more broadly.

Pipeline Design and Delivery Timetable

The BIL is an underground, high-pressure natural gas transmission pipeline with a maximum capacity of 800 TJ/day. It links APA's South West Queensland Pipeline in Queensland with the Moomba to Sydney Pipeline in New South Wales.

Construction is due to begin in early 2027, subject to relevant approvals. In the meantime APA will continue to advance environmental approvals, detailed design, corridor assessment, procurement and stakeholder engagement. Targeted commercial operation is winter 2029, with revenues expected to ramp up over a period of about five years after commissioning.

APA does not expect the expansion to change its standing inflation-linked tariffs for key pipeline transport routes. It also expects the BIL to reduce long-term stay in business capital expenditure required on the Moomba to Sydney Pipeline.

Mr Watson said the BIL is designed so that pipeline capacity is not a constraint on meeting projected gas demand in the southern states later this decade and into the early 2030s, and that beyond the BIL APA can deliver further capacity increases incrementally. He described delivery of the BIL as critical to east coast energy security, unlocking gas volumes available in Queensland and the Northern Territory and complementing earlier ECGG investments. He added that APA expects increasing demand for gas transport and storage capacity over the longer term.

Place Within the Stage 3 Expansion

The BIL forms part of the broader Stage 3 expansion works announced in February 2026. When completed, Stage 3 will deliver about 30% more north-to-south gas transport capacity. Once it is delivered, APA will have increased north-to-south capacity in the ECGG by more than 50% since 2023.

Stage 3A of the ECGG expansion remains on track for delivery in winter 2028, with procurement of key items and contractor agreements well progressed and site works under way.

Where the Numbers Leave the Company

APA's combined commitment to the BIL now amounts to $920 million, made up of the $220 million early works decision in February 2026 and today's $700 million. The project is funded from existing balance sheet capacity and sits inside the roughly $3.5 billion organic growth pipeline.

The company describes itself as an ASX listed energy infrastructure business owning and operating a portfolio of more than $20 billion of assets, including gas transmission, processing, compression and storage, along with gas-powered and renewable generation, battery storage and electricity transmission. It delivers around half of the nation's domestic gas through more than 15,000 kilometres of pipelines that it owns, operates and maintains.