Forrest mulls bid to buy Sun Cable solar farm, ditch Singapore link
Mining magnate Andrew Forrest has declared he still supports Sun Cable’s plans to build a giant solar farm in northern Australia despite a fallout with the project’s other billionaire investor, Mike Cannon-Brookes, over whether to link it to Singapore via a 4200-kilometre underwater cable.
The company behind the visionary 20-gigawatt Sun Cable solar and battery farm in the Northern Territory was plunged into voluntary administration last week after Forrest and Cannon-Brookes – the country’s two richest men – were unable to agree on new funding terms.
Its collapse came amid a disagreement between the former business partners about whether to export a portion of the project’s renewable energy to Singapore or use it all domestically. Tech billionaire Cannon-Brookes’ privately owned Grok Ventures on Friday said all shareholders except Forrest wanted to prioritise the original plan.
“This was the reason the founders started the company, and the reason investors invested in the company, in the first place,” a Grok spokesperson said. “Once operating, there would be energy generation coming out of Sun Cable to provide renewable energy to both Singapore and various projects in the Northern Territory.”
Squadron Energy, part of the Forrest family’s private company Tattarang Group, has confirmed it is considering making a proposal to buy Sun Cable. It said it supports plans for an 800-kilometre link from the solar and battery farm to Darwin, but no longer supports the Singapore connection.
“Following a comprehensive technical and financial analysis, that included listening to customer feedback, Squadron Energy has concluded that Sun Cable’s Australia-Asia PowerLink project is not commercially viable,” Squadron Energy chairman John Hartmann said.
“However, Squadron Energy continues to believe in the vision for a game-changing solar and battery project in the North Territory’s Barkly region, including the proposed connection to Darwin.”
A technical and financial analysis, as well as customer feedback, had led Squadron Energy to conclude that the Sun Cable’s Australia-Asia PowerLink project was not commercially viable, the company said.
Sources close to the Sun Cable board not authorised to speak publicly on the matter said Forrest had become concerned about increases in subsea survey costs and cable costs, while Singapore now had “numerous proposals” from other competitors planning projects in more favourable locations.
Another source said Forrest had his eye on using the renewable electricity from Sun Cable’s proposed solar farm to create green hydrogen – a clean fuel made by using a renewable energy-powered electrolyser to split water into hydrogen and oxygen. Fortescue Future Industries, the green energy arm of the Forrest-backed iron ore miner Fortescue Metals Group, is proposing several green hydrogen projects across the country, including in the Northern Territory.
“As Australia’s largest renewable energy company, Squadron Energy is best placed to help Australia become a green energy exporting superpower by generating renewable energy to produce green hydrogen and green ammonia,” Squadron said on Monday.
Sun Cable is now in the hands of its administrators, FTI Consulting, which is expected to launch a sale or a recapitalisation process for the company.
Grok Ventures insists the intercontinental power link is key to the wider project’s success, and would generate enough energy to supply both Singapore and various local projects in the Northern Territory.
“This lighthouse project will likely deliver significant outcomes for the company, attract further investor capital and create a new industry in Australia,” it said.
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Source: Thanks smh.com