PERTH (miningweekly.com) – Energy major AGL Energy has warned of about A$435-million in after-tax asset impairments for the 2015 financial year as it divests of its noncore assets.

The company told shareholders on Monday that the decision to divest of its noncore assets followed a comprehensive review of its upstream gas business.

Assets to be divested would include the Hunter gas project and associated agriculture activities. AGL noted that while there was significant coal seam gas (CSG) in the Hunter Valley, the overlay of critical industry clusters and the 2 km setback resulted in the resource not being economical to develop.

Other assets to be divested included the exploration licence covering the North Camden area, as well as AGL’s interest in the Cooper oil project, Spring Gully and the Moranbah assets.

The sale of Cooper Oil was already under way.

Core projects to be retained would include the Camden gas project, the Gloucester gas project, the Silver Springs underground storage facility, the Wallumbila liquefied petroleum gas plant and the recently opened Newcastle gas storage facility.

Effective immediately, these assets would be transferred to AGL’s recently formed group operations function, which the company hoped would deliver greater operational efficiency, productivity improvements and would leverage expertise from across AGL.

Meanwhile, AGL has also confirmed that it would not proceed with the proposed Camden Northern expansion project, which had been on hold since February 2013. The Camden gas project would continue, instead, with its current operations focused on reducing production costs.

The expansion plan called for an additional 12 well surface locations containing up to six wellheads each, as well as associated gas gathering and water lines, access roads and ancillary infrastructure, and subsurface drilling of lateral well paths within the boundaries of the project area.