The company behind an undersea intercontinental renewable power system that would connect Darwin to Singapore, backed by billionaires Andrew ‘Twiggy’ Forrest and Atlassian’s Mike Cannon-Brookes, has fallen into administration this week.
Announced yesterday, Sun Cable has appointed FTI Consulting to head up the voluntary administration process with an aim to either recapitalise the company or sell it to new owners in order to progress with the next stage of its ‘marque’ project - the Australia-Asia PowerLink (AAPowerLink).
According to a statement from Sun Cable, the appointment of administrators to the $30 billion project followed the ‘absence of alignment with the objectives of all shareholders’.
“Whilst funding proposals were provided, consensus on the future direction and funding structure of the company could not be achieved,” Sun Cable said.
As reported by the Sydney Morning Herald, major shareholders Cannon-Brookes and Forrest were unable to agree on a path forward for the business and had ‘clashing ideas’ on ways to fund the company after the project missed a key milestone in September.
The masthead added that Forrest’s Squadron Energy and Cannon-Brookes’ Grok Ventures were both willing to invest further money into the company, but the two could not agree on terms.
Both billionaires previously invested serious capital into Sun Cable, founded by David Griffin, Mac Thompson and Fraser Thompson, and led a $210 million Series B in March 2022 for the project - tipped to be the world’s largest intercontinental renewable power system once complete.
Christopher Hill, David McGrath and John Park of FTI Consulting have been appointed as voluntary administrators of the company. They intend to work with the company’s management team and key stakeholders to determine appropriate next steps for the business.
This may include a process to seek expressions of interest for either a recapitalisation or sale of the company.
“Sun Cable continues to represent an outstanding strategic opportunity to operationally deliver the largest renewable energy project in the world, with the AAPowerLink project to supply power to the Northern Territory and Singapore, commencing late this decade,” Sun Cable said.
“Sun Cable currently has a portfolio of a further 11 GW of proposed projects, which is equivalent to over 3 times that of the AAPowerLink.”
The company's co-founder and CEO David Griffin said the project remained well placed for completion.
“Sun Cable has made extraordinary progress in developing the AAPowerLink,” Griffin said.
“As we have progressed our work, the demand for delivering reliable, dispatchable 24/7 renewable energy in the NT and the region has risen materially.
“Sun Cable looks forward to developing and operating the projects to meet this demand.”
Cannon-Brookes, who is the chair of Sun Cable, said he remained excited about the company’s future.
“Sun Cable has achieved so much since it was founded in 2018,” the entrepreneur said.
“I’m confident it will play a huge role in delivering green energy for the world, right here from Australia.
“I fully back this ambition and the team, and look forward to supporting the company’s next chapter.”
This setback comes seven months after the project was deemed ‘investment ready’ by Infrastructure Australia, which advanced Sun Cable’s ambitious plans on the Infrastructure Priority List.
Once up and running, Sun Cable’s project will transmit renewable electricity from the Barkly region of the Northern Territory to Darwin and Singapore, drawing on the favourable sunlight conditions in the nation’s top end.
The project involves a solar generation precinct near Elliott, just north of Tennant Creek in the Northern Territory, with 800km of overhead transmission to Darwin and 4,200km of undersea power cables between the coast and Singapore.
If successful the $30 billion-plus development would give Darwin a significant increase in electricity supply and account for around 15 per cent of Singapore's energy usage, while reducing CO2 emissions by 8.6 million tonnes annually.
The project was first identified by Infrastructure Australia in 2021, at the time noting the “significant opportunity” to harness the NT’s advantage by developing large-scale renewable energy generation, supported by transmission infrastructure to supply domestic and export markets.
Prior to the appointment of administrators, the AAPowerLink was targeted to reach financial close by the start of 2024, with construction to commence in the same year and electricity supply to Darwin in 2027. It was expected be fully operational by 2029.
Sun Cable anticipates around 14,000 direct and indirect jobs will be created by AAPowerLink, which will abate around 2.6 million tonnes of carbon emissions.
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