QPM Energy Unveils 112MW Isaac Power Station, Raises $12M to Fuel Growth

• Launch of 112MW Isaac Power Station as Stage 1 of Isaac Energy Hub
• Equity raise of approximately $12 million via placement and share purchase plan
• 435PJ of 2P gas reserves underpinning long-term electricity generation
• Fixed price contract secured for two 55.8MW GE Vernova gas turbines
• Targeting 500MW electricity generation capacity by 2030

QPM’s Integrated Energy Vision

QPM Energy Limited (ASX, QPM) has taken a significant step forward in its ambition to become a leading integrated energy utility in Queensland. The company announced the launch of the Isaac Energy Hub, with Stage 1 comprising a 112MW Isaac Power Station (IPS) targeted for commissioning by mid-2027. This development marks a pivotal expansion of QPM’s electricity generation capacity, leveraging its substantial gas reserves and infrastructure.

QPM’s business model is distinctive in its integration, from gas production through to electricity dispatch into the National Electricity Market (NEM). The company controls 435PJ of independently certified 2P gas reserves at its Moranbah Gas Project, supporting decades of energy generation. With current production around 27-30TJ per day, QPM is well positioned to scale its electricity output significantly.

Robust Economics and Secured Equipment

The feasibility study for the 112MW Isaac Power Station reveals attractive financial metrics, forecasting average annual revenue of $71 million and EBITDA of $49 million over a 30-plus year operating life. The project benefits from a low short run marginal cost of $59 per megawatt-hour, positioning it competitively within Queensland’s electricity market.

Crucially, QPM has secured a fixed price contract for two 55.8MW aeroderivative gas turbines from GE Vernova, a major de-risking milestone given industry-wide turbine lead times now exceed five years. These turbines, proven technology with strong reliability and efficiency, underpin the project’s development schedule and capital cost certainty.

Capital Raise and Development Pathway

To fund the next phase of development, QPM is conducting an equity raise of approximately $12 million. This comprises a $10 million placement and a $2 million share purchase plan offered to existing shareholders, priced at a 14% discount to recent trading levels. Proceeds will be directed towards procurement of long lead equipment, detailed engineering, regulatory approvals, and general working capital.

QPM is advancing approvals, including environmental and grid connection permits, with Powerlink processing the application for connection to the Moranbah 132kV substation. The company aims for a Final Investment Decision (FID) in the fourth quarter of 2025, setting the stage for construction and commissioning by mid-2027.

Market Context and Strategic Positioning

The launch of the Isaac Energy Hub aligns with Queensland and Federal government policies supporting gas-fired generation as a critical component of the energy transition. QPM’s integrated model allows it to capture value across the gas-to-electricity value chain, benefiting from strong netback gas prices and electricity market volatility driven by increasing peak demand and the retirement of coal-fired assets.

With a long-term target of 500MW generation capacity, QPM is positioning itself to meet rising energy needs, including those from emerging sectors such as AI and data centres. The company’s experienced management team has already demonstrated capability by increasing reserves by over 60% and securing key commercial contracts.

Risks and Considerations

While the project is well advanced, risks remain. These include securing final regulatory approvals, managing capital costs amid currency fluctuations (notably the US dollar-denominated turbine contract), and operational risks related to gas supply and infrastructure dependencies. The company also faces the typical challenges of project financing and market price volatility.

QPM’s equity raise aims to mitigate some of these risks by ensuring funding for critical path activities and equipment procurement. Investors will be watching closely as the company moves towards FID and construction commencement.

Bottom Line?

QPM’s Isaac Energy Hub launch and equity raise mark a decisive step in Queensland’s energy transition, but execution risks and market dynamics will shape the journey ahead.

Questions in the middle?

• Will QPM secure final regulatory approvals and grid connection on schedule for mid-2027 commissioning?
• How will currency fluctuations impact the final capital cost and financing structure of the Isaac Power Station?
• What offtake agreements or power purchase contracts will QPM finalize to underpin project financing?