Genex Power expects to reach financial close on its Kidston Pumped Storage Hydro Project by the end of 2020 after a series of setbacks.
The company missed its September 2020 target date for delivering financial close on the project, which is expecetd to deliver 500 jobs in construction.
But chairman Ralph Craven, speaking at the company AGM, said Genex was now in the final stages of negotiations with an investor to take up a 50 per cent interest in the project.
“Genex made significant progress on advancing the flagship 250MW Kidston Pumped Storage Hydro Project (K2-Hydro) and, while the process for financial close has been both exhausting and challenging, we are still aiming to reach financial close on the project this calendar year and are continuing our extensive engagement with all project stakeholders,” Dr Craven said.
The project, being built at the old Kidston gold mine site, has a total construction pricing of about $600 million. This excludes transmission costs, financing costs and Genex’s development costs to date.
It will use two former mining pits (Wises and Eldridge) as the upper and lower reservoirs for the project to minimise construction time and cost.
During peak power demand periods water will be released from the upper to the lower reservoir, passing through reversible pump/generators acting in generation mode. During off peak periods, water will be pumped back to the upper reservoir.
The project achieved a breakthrough in March when Genex secured a long-term energy offtake agreement with EnergyAustralia, allowing it to move forward.
At that point the company expected to begin construction in the second half of this year.
In August, Genex signed a new $25 million Share Subscription Agreement
with Japanese public utility company J-Power, and the Queensland Government recently reaffirmed its commitment of $132 million towards transmission infrastructure.
The company has been able to secure extensions on key agreements to fit the new timeline, including the Northern Australia Infrastructure Facility (NAIF) offer of up to $610 million.
“The validity of Powerlink’s offer to connect, which includes the construction of the transmission line, has also been extended and we also recently concluded an early works agreement with Powerlink which will secure the timeline for the construction program,” Dr Craven said.
“The scope of early works includes the establishment of the project management processes, contractor engagement and the start of transmission line design.”
Dr Craven also provided an update on the company’s Bouldercombe Battery Project near Rockhampton.
“Genex has already secured an Investigation Licence and Tenure Arrangements Agreement with Powerlink Queensland to access land adjacent to Powerlink’s Bouldercombe substation,” he said.
“We have also selected our preferred battery system supplier and integrator for the project and have submitted an application for connection to the NEM.
“With several workstreams well advanced, we are looking to fast-track the development and aim for the project to be operational in the first half of calendar year 2022.”