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Impact of Townsville Power Station

  1. Yak

    13,672 Posts.

    Here's what McQ has to say:

    Impact on upstream stocks

    This decision may well sound the death knell for the PNG gas
    project as a whole, and this impacts upstream stocks as
    follows:

    Santos: positive - removes perceived pressure on future
    eastern states gas prices and to a lesser extent, future
    Santos sales volumes.

    Oilsearch: negative - without the gas project, Oilsearch lacks
    a long-term growth project and we value the stock at 59c.
    Exploration provides excitement and leverage but the
    company dormant on this front until later this year. There is
    better value or more growth elsewhere in the sector.

    Impact on downstream stocks

    AGL: negative - missed opportunities from PNG pipeline
    construction plus a need to renegotiate the supply of 50PJ of
    gas.

    Origin Energy: negative - returns on the $49.5m investment
    in coal seam methane reserves are less clear at this stage.
    Australian Pipeline Trust: negative - the delay in PNG has
    the risk of reducing volumes through the Moomba to Sydney
    Pipeline.

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