Genex said the AUD 44.5 million ($29.63 million) structured funding package will be used to shore up financing for the company’s flagship 250 MW/2 GWh Kidston Pumped Storage Hydro project in northern Queensland and to develop its multi-stage Bulli Creek solar and battery project near Toowoomba.

J-Power, which is among Genex’s largest shareholders following an AUD 25 million equity investment announced in 2019, has agreed to provide a corporate loan facility of AUD 35 million as a standby source of funding for the 250 MW, eight-hour pumped hydro project.

Genex said the funding may not be needed but in the wake of a drilling incident late last year that set construction back, the replenishment of the project contingency is considered prudent to ensure the project remains on track for energization in 2024.

It was estimated the incident, which resulted in water unexpectedly leaking into a tunnel, added AUD 10 million to AUD 15 million to the project’s cost.

“While the costs of the water ingress event at the Kidston pumped storage hydro project last year have been fully funded, we consider it prudent that additional funding is secured against any further unforeseen events during the balance of the construction program,” Genex Chief Executive Officer James Harding said. “The loan facility with J-Power gives us significant buffer to complete the construction of the project.”

On top of the loan facility, J-Power will also establish a joint development fund for Genex’s Bulli Creek solar and battery project which is expected to be developed in five stages. The first stage will entail the delivery of a 400 MW/1,600 MWh big battery. while the second proposed stage would deliver a 475 MW to 675 MW solar project.

The joint development agreement gives J-Power a 50% interest in the project courtesy of upfront acquisition funding of AUD 2.5 million and a further $6 million in upfront funding for third party development costs.