06/09/05 – WEST FIELD AGREEMENT

International Power Australia (IPRA) today welcomed the Victorian Government’s decision to approve the continuation of its $400m West Field coal field development in the Latrobe Valley.

West Field supplies brown coal to the Hazelwood power station which generates up to 25 per cent of Victoria’s electricity needs. Hazelwood is owned by the Hazelwood Power Partnership (92 per cent International Power.)

The Government has endorsed an Environment Effects Statement Panel recommendation that the project should proceed. The Government and Hazelwood have also signed an agreement that will cap the carbon dioxide emissions from Hazelwood at 445 million tonnes over the remaining life of the power station, a saving of 34 million tonnes. This is the first time an Australian power generator has capped its greenhouse emissions.

As a result of the agreement, the West Field mining licence boundary will be realigned to ensure the Hazelwood power station has access to the fuel supply that was intended when the business was purchased from the Government in 1996.

IPRA Managing Director, Mr Tony Concannon described the Government’s decision as an important outcome for the electricity consumer, for the environment, and for the Latrobe Valley.

“This decision not only provides vital security for Victoria’s electricity supply, it will also help secure the long-term viability of the International Power Hazelwood (IPRH) business and the 800 jobs it supports,” he said.

“The Government was determined in its resolve to get the best environmental outcome for the community. We were similarly committed to ensuring that the business could remain a viable player in the highly competitive national electricity market.”

Mr Concannon acknowledged the role played by departing Hazelwood chief executive Mr Dave Quinn in negotiating the agreement with the Government and leading the planning approval process.

“This has been a long and complex process and Dave made a major contribution to ensuring we received the go ahead for this crucial project.”

Hazelwood’s new chief executive, Mr Graeme York said the greenhouse agreement would complement and strengthen environmental management programs already under way at the power station.

“We are committed to the greenhouse reductions and will continue to research and develop new technologies that will help achieve the CO2 targets.”

Mr York said IPRH would now take the necessary steps to enable work on the major river and road diversion projects required for the West Field development to begin in the coming summer construction season.