Kordia cashes in on Aussie energy boom – again – with $A90m win
NZ Crown company Kordia has had another major energy-sector win across the Tasman, this time a $A90 million contract with Australian Pacific LNG (APLNG).
Kordia is the sole prime contractor on a two-year communications and control infrastructure project for APLNG (a joint venture between Origin, ConocoPhillips and Sinopec), Kordia Solutions Australia managing director Peter Robson told NBR ONLINE.
APLNG's coal seam gas project in Queensland is one of the largest energy projects in Australia. It will ultimately employ 6000, and involve a 520km pipeline and two production trains producing 9 million tonnes of gas per year.
NBR understands the estimate of $A90 million in new revenue to Kordia is very much a base line figure. The SOE will get more build work if APLNG expands its operations. It also stands to win an operational contract once the network is up and running.
Changing the face of Kordia
Its fast-growing Australian business has already had a dramatic effect on Kordia's group accounts.
Last year, Kordia Solutions Australia's revenue grew 58% to $A175 million – or roughly half of the SOE's total revenue.
Mr Robson told NBR the APLNG contract could not simply be added to Kordia's existing Australian revenue. Other contracts will expire over the duration of the APLNG deal.
Kordia CEO Geoff Hunt recently told NBR the SOE is undergoing a strategic review. The review may involve bring in a partner or investor to help grow its Australian businesses.
Today, Mr Robson would not talk about the strategic review, but did say the APLG contract could be accommodated within Kordia's existing structure.
The strategy had begun to pay off. Kordia was in the running for other deals of a similar size to APLNG, but none are yet in the bag.
On the block?
Kordia – which began life as Broadcasting Communications (BCL) when first spun off from TVNZ – has sought to deal with the impending loss of its once-core analogue TV transmission business by diversifying into broadband (including the purchase of Orcon) and telecommunications.
Earlier this month, the Australian Financial Review reported Kordia was on the block (see New Zealand to sell Kordia). Request for proposal documents had gone to investment banks, asking them to pitch to handle its sale, the paper claimed.
A spokeswoman for SOE Minister Tony Ryall told NBR the AFR had "the wrong end of the stick. Kordia is not for sale."
Mr Hunt said Kordia was exploring the option of an Australian investor or partner to grow its business across the Tasman, but would not directly comment on industry rumours that its retail ISP, Orcon, would be put up for sale. The strategic review would not be completed until January or February, the Kordia CEO said. All elements of the businesses were being assessed.