News: AGL AGL Energy updates on decision to exit gas exploration & production

Feb 4 (Reuters) - AGL Energy Ltd (AGL) :

• Review of gas assets & exit of gas exploration & production (AGL)
• Taken a strategic decision that exploration and production of natural gas assets will no longer be a core business for co
• AGL has impaired its Queensland natural gas assets at moranbah, silver springs and spring gully
• Says charge will be recognised as a significant item in the financial results for the six months ended 31 December 2015
• Says AGL expects to recognise an impairment charge of $640 million after tax ($795 million pre- tax)
• Apart from gas storage and related plant at silver springs, AGL expects to sell these assets
• FY 2016 cash impact of this strategic decision, excluding potential sale of assets, is expected to be less than $10 million
• Likely that sale of moranbah will require a cash payment in relation to onerous contract provisions previously booked
• Says has impaired its Queensland natural gas assets at moranbah, silver springs and spring gully
• Says will not proceed with the Gloucester gas project and will cease production at the Camden gas project
• Economic returns to support the investment of 1 approximately $1 billion were not adequate
• AGL will establish a $2 million independent trust fund and will work with the Gloucester community to identify investment options
• Camden site and wells will be progressively decommissioned and the sites rehabilitated
• Says no change to agl's commercial or retail gas activities
• Says incremental future gas requirements are likely to be sourced from the southern markets