Keppel Infrastructure Trust unit Basslink says it 'strongly rejects' Hydro Tasmania's claims

SINGAPORE - Keppel Infrastructure Trust (KIT) said on Monday (Oct 22) that Australian subsidiary Basslink "strongly rejects" the allegations by Australian state government enterprise Hydro Tasmania that its facilities did not satisfy certain operational requirements.

The dispute relates to the 2015 outage of the Basslink Interconnector cable that links the state's electricity grid to the Australian mainland. In March this year, the Tasmanian Government formally lodged a notice of dispute, claiming damages of A$122 million (S$119.3 million) for the outage. The dispute went to arbitration in April.

On Sept 14, Basslink issued Hydro Tasmania a notice of disputes which has since been referred to arbitration.

In a separate statement on Monday, Basslink said it received a fresh notice of disputes from Hydro Tasmania on Oct 19.

All but one of the disputes are based upon the allegations in reports that Hydro Tasmania's lawyers procured from consultants at DNV GL, Basslink said. Based on the DNV GL reports, Hydro Tasmania has alleged that the Basslink facilities did not satisfy certain operational requirements.

"However, an independent project inspector certified that the Basslink facilities met these operational requirements and signed off on them at the commissioning of the Basslink facilities in 2006," Basslink said in a statement on Monday.

"The DNV GL reports... are based on theoretical modelling and not on any testing of the Basslink HVDC cable, as none was undertaken by DNV GL," it said.

"Basslink maintains its position that the analysis in those DNV GL reports is flawed, as DNV GL used theoretical models based on certain assumptions and not on actual facts (including facts observed and reported on by Cable Consulting International in the independent investigation of failure of the Basslink HVDC cable)."

The last matter that Hydro Tasmania has claimed as a dispute relates to the content of Basslink's Asset Management Plan and Marine Disaster Recovery Plan. Basslink has advised Hydro Tasmania that the content of these plans are under review, it said.

"Nonetheless, Hydro Tasmania has preemptively chosen to institute a dispute about the content of these plans prior to Basslink completing its review of those plans," Basslink said.