ALBANY WAVE ENERGY
PROJECT — CARNEGIE CLEAN ENERGY — FINANCIAL ASSISTANCE
949. Hon PETER COLLIER to the Minister for Regional Development:
I refer to the minister's
response to question without notice 885, asked on Tuesday, 9 October.
(1) Was the legal
advice that the government received to the effect that the government was
obliged to pay $2.625 million?
(2) If yes to (1), was the
obligation in relation to the original agreement or the renegotiated agreement?
(3) When was the legal advice sought
and received?
Hon
ALANNAH MacTIERNAN replied:
(1) Yes.
(2) The
obligation was in relation to the variation to the financial assistance
agreement. Milestone 1 in the original FAA was in dispute regarding the
interpretation of whether procurement of the common-user infrastructure had
been demonstrated. The Department of Primary Industries and Regional
Development and Carnegie negotiated a variation, which DPIRD believed mitigated
the risk to the state while still honouring the contractual obligations to
Carnegie. The variation prepared, following advice from DPIRD's
internal counsel, included a staged payment arrangement for milestone 1, which
limited the state's financial exposure to payment of the full
milestone. DPIRD sought legal advice on the state's options regarding
payment of the renegotiated milestone following Carnegie's releases to
the ASX and the resignation of the chief executive officer.
(3) Legal advice was sought and
received over the period 3 to 5 October 2018.