Palisade Investment Partners (Palisade) has reached financial close on the acquisition of 100 percent of the North Queensland Gas Pipeline (NQGP) from clients managed by Victorian Funds Management Corporation (VFMC).
Palisade acquired, and will manage, the asset on behalf of a number of direct investment mandate clients and its Diversified Infrastructure Fund (PDIF), while the terms of the transaction remain confidential.
The NQGP is a 391-kilometre onshore natural gas pipeline system, transporting gas from Maranbah Gas Project in the Bowen Basin to power and industrial uses in Townsville, Queensland. It was constructed and commissioned by Enertrade in 2004 with an expected useful life of 50 years.
It is also a monopoly asset as it is North Queensland’s only source of natural gas and supplies a critical power station. Its revenue is underpinned by long-term take-or-pay contracts, with escalation linked to the Consumer Price Index (CPI).
Daniel Roberts, an investment director at Palisade, commented: “The long term stable contracted cash flows, combined with operating synergies from Palisade’s expanding pipeline business, created a compelling investment proposition.”
Since Palisade now owns and manages the Tasmanian Gas Pipeline and the North Queensland Gas Pipeline, Palisade expects to extract synergies across both pipelines which will drive value for investors in each asset as well as establish a platform for future incremental growth opportunities.
The acquisition was advised by Citi, Allen & Overy and KPMG.
Palisade now has over A$2 billion (€1.27 billion; $1.4 billion) in funds under management and commitments. Its infrastructure asset portfolio also includes airports, ports, renewable power generation, transmission, social infrastructure, agri-infrastructure, and alternative waste treatment.
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