AAP Finance

Genex says pumped hydro project on track

By AAP Newswire

Genex Power says its $700 million Kidston pumped storage hydro project in Far North Queensland is back on track after this month's financing setback.

EnergyAustralia pulled back from committing to a multi-decade deal to buy energy from the hydro, solar and wind project, throwing its financing into jeopardy as two key commitments expired.

But on Wednesday, Genex announced that the Morrison government's Northern Australia Infrastructure Facility (NAIF) has extended its $610 million loan offer, which was set to expire November 30, through to June 30.

Genex chairman Simon Kidston said the company was also in talks with Japan's J-Power, which is investing $25 million in the project in exchange for an equity stake, about an extension to its financing.

He also believed EnergyAustralia would commit to a shorter deal.

All of the stakeholders on the project are saying "let's get it done," Mr Kidston said.

"The project is on track. ... We are committed to this," Mr Kidston said.

"We've worked long and hard on this project."

Genex shares - which plummeted from 27 cents to 16 cents after the EnergyAustralia setback - were trading up 0.5 cents to 18.5 cents at 1125 AEDT.

The pumped hydro portion of the project will turn the abandoned Kidston gold mine 270 km northwest of Townsville into a giant battery, with two existing mining pits transformed into upper and lower reservoirs.

Water will be pumped into an upper reservoir during off-peak hours, and then released during peak hours.

As the water flows into the lower reservoir it will turn two turbines to generate 250 megawatts of power over an eight-hour period - roughly enough to power 75,000 homes.

The project will help solve issues with the intermittent nature of Queensland's energy network and volatile spot power prices, Mr Kidston said.