Australian gov't to buy state's shares in major hydroelectricity project

CANBERRA, March 2 (Xinhua) -- The Australian government has announced it will purchase state's shares in the country's biggest infrastructure project.

Prime Minister Malcolm Turnbull announced on Friday that the government would spend 6 billion Australian dollars (4.65 billion U.S. dollars) acquiring Snowy Hydro Limited, the company that managed the Snowy Mountains Hydro-electric scheme.

New South Wales' 58 percent stake will be bought for 4.1 billion Australian dollars (3.18 billion U.S. dollars) and Victoria will receive two billion Australian dollars (1.55 billion U.S. dollars) for its 29 percent. The Federal government already owned 13 percent of the project.

The Snowy Mountains Scheme is a hydroelectricity and irrigation scheme consisting of 16 dams, seven power stations and two pumping stations in New South Wales and Victoria.

Acquiring Snowy Hydro Limited takes the Federal government a step closer to starting work on the Snowy Hydro 2.0 scheme which has an estimated cost of between 3.8 billion and 4.5 billion Australian dollars (2.9 billion to 3.49 billion U.S. dollars).

"The historic agreement will generate more reliable energy, cheaper electricity, better infrastructure and more jobs for New South Wales (NSW) and Victoria," Turnbull said in a statement on Friday.

"In a win for Australian energy consumers, the agreement will pave the way for the Snowy 2.0 pumped hydro project to proceed to a final investment decision by the independent Snowy board.

Under the deal, both New NSW and Victoria must spend the money they receive on funding "productive infrastructure."

Energy Minister Josh Frydenberg said despite that stipulation, the Federal government would not have a say on which projects were funded.

"While we don't have a final say over their choice of projects, we would expect the states to invest the money consistent with that broad commitment," he said.

"They will have responsibility for using this money wisely." Enditem