AGL on lookout for any state power sell-offs

SYDNEY - Australian Gas Light, the country's biggest energy retailer, is looking to invest in power generation in eastern states to tap rising electricity demand. AGL Chairman Mark Johnson told the ABC's Inside Business programme that the Sydney-based company would also pounce on opportunities arising from any privatisation of energy assets.

"We're making a basic assumption that state governments are ultimately going to behave rationally and there is going to be increased openness in their assets," he said.

"Whether it comes with partial privatisation or joint ventures, we don't know.

"So there is going to be opportunities there.

"The acquisition of new retail is more problematic. Those looked to be pretty locked up and in pretty firm hands at the moment but new power generation across the east is highly likely."

Although the power sector in Victoria and South Australia is deregulated, most of the assets and services in New South Wales and Queensland are state-run.

Johnson's comments come after AGL's A$1.43 billion ($1.53 billion) purchase last week of hydro and wind power business Southern Hydro from New Zealand Government-owned Meridian when it also announced plans to split into two listed companies.

- REUTERS