APA Group (APA) 2011年年度報告「ASX」.pdf

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1、Whats in the pipeline?annual RepoRt 2011 apt investment trust Contents Directors report 90statement of comprehensive income 92statement of financial position 93statement of changes in equity 94statement of cash flows 95notes to the financial statements 96Declaration by the Directors of australian pi

2、peline Limited 112auditors independence declaration 113independent auditors report 114austraLian pipeLine trust ContentsDirectors report 2Corporate governance statement 21statement of comprehensive income 27statement of financial position 28statement of changes in equity 30statement of cash flows 32

3、notes to the financial statements 33Declaration by the Directors of australian pipeline Limited 85auditors independence declaration 86independent auditors report 87australian pipeline trust and its controlled entitiesarsn 091 678 7782 APA AnnuAl REPORT 2011the directors of australian pipeline limite

4、d(“Responsible entity”)submit their report and the annual financial report of australian pipeline trust(“apt”)and its controlled entities(together“apa”or“Consolidated entity”)for the financial year ended 30 June 2011.this report refers to the consolidated results of apt and apt Investment trust(“apt

5、It”).Directorsthe names of the directors of the Responsible entity during the year and since the year end are:Leonard Bleasel am Chairmansteven Crane appointed 1 January 2011John Fletcherrussell Higgins aopatricia mcKenzie appointed 1 January 2011muri muhammadGeorge ratilal Resigned 26 august 2010ro

6、bert Wright michael mcCormack Managing DirectorDetails of the directors,their qualifications,experience,special responsibilities and directorships of other listed entities are set out on pages 10 to 12.George Ratilal was appointed as alternate director for Muri Muhammad on 26august pany secretarymar

7、k KnapmanDetails of the Company Secretary,his qualifications and experience are set out on page 11.principal activitiesthe principal activities of apa during the course of the year were the ownership and operation of energy infrastructure assets and businesses,including:energy infrastructure,primari

8、ly gas transmission and distribution businesses located across australia;energy investments in listed and unlisted entities;and asset management and operations services for the majority of apas energy investments and third parties.During the year apa acquired the emu Downs wind farm as part of its s

9、trategy to maintain or increase revenue from its portfolio of gas transmission and distribution assets.Consequently,apa has changed the name of the segment previously known as Gas transmission and Distribution to energy Infrastructure which includes the emu Downs wind farm as well as the gas transmi

10、ssion and distribution assets.significant changes in state ofaffairsno significant change in the state of affairs of apa occurred during the year.DistributionsDistributions paid to securityholders during the year were:FinaL FY 2010 DistriBution paiD 15 septemBer 2010semi-annuaL FY 2011 DistriBution

11、paiD 17 marCH 2011Cents per securitytotal distribution$000Cents per securitytotal distribution$000apt profit distribution1.739,3649.5552,681apt capital distribution8.5846,5522.4613,592aptIt profit distribution3.6719,9283.7520,629aptIt capital distribution3.0216,3500.754,127total17.092,19416.591,029o

12、n 24 august 2011,the directors declared a final distribution for apa for the year of 17.9 cents per security payable 15 September 2011,made up of:FinaL FY 2011 DistriBution paYaBLe 15 septemBer 2011Cents per securitytotal distribution$000apt profit distribution3.4219,054apt capital distribution8.414

13、6,761aptIt profit distribution3.4118,951aptIt capital distribution2.6614,793total17.999,559total distribution for the financial year ended 30 June 2011 is 34.4 cents per security,an increase of 1.65 cents or 5.0%on last year.Distribution information is presented on an accounting classification basis

14、.the apa Group annual tax Statement and annual tax Return Guide(released in September 2011)provides the classification of distribution components for the purposes of preparation of securityholder income tax returns.auStRalIan pIpelIne tRuSt anD ItS ContRolleD entItIeSDirectors report3APA AnnuAl REPO

15、RT 2011AusTRAliAn PiPElinE TRusT And iTs cOnTROllEd EnTiTiEsDirectors report continueDfinancial anD operational reviewthe following table provides a summary of key financial data for the year:Year enDeD 30 June2011$0002010$000CHanGes$000%operating results including significant itemstotal revenue exc

16、luding pass-through(1)720,256659,54860,7089.2total revenue1,101,989989,490112,49911.4eBitDa492,109459,97532,1347.0Depreciation and amortisation expense(100,350)(91,426)(8,924)(9.8)eBit391,759368,54923,2106.3net interest expense(247,072)(229,369)(17,704)(7.7)pre-tax profit144,687139,1805,5064.0Income

17、 tax expense(35,862)(38,672)2,8107.3Minorities(316)(150)(166)(110.8)operating profit after tax and minorities,including significant items108,508100,3588,1508.1Significant items after income tax(2)(432)-(432)-profit after income tax and minorities,excluding significant items108,940100,3588,5828.6oper

18、ating cash flow(3)(5)290,029267,76122,2688.3operating cash flow per security(cents)(5)52.651.90.71.4earnings per security(cents)(5)19.719.40.21.3Distribution per security(cents)34.432.751.655.0Distribution payout ratio(4)65.764.4net tangible asset per security$1.51$1.28$0.2318.0Weighted average numb

19、er of securities(000)551,222516,243(1)pass-through revenue is revenue on which no margin is earned.It arises in the nt Gas business and the asset management operations in respect of costs incurred in,and passed on to envestra limited in respect of,the operation of the envestra limited assets(2)Signi

20、ficant items in the 12 months to 30 June 2011 include apas equity share of the eII2 investment allowance concession benefit($6.9 million),profit on the sale of apas investment in CaMS($1.7 million)offset by transaction costs of the emu Downs wind farm acquisition($9.0 million).Refer to note 8 of the

21、 financial statements(3)operating cash flow=net cash from operations after interest and tax payments,adjusted for significant items(4)Distribution payout ratio=total distribution payments as a percentage of operating cash flow(5)adjusted for significant itemsapa reported operating profit after tax a

22、nd minorities of$108.5 million,an increase of 8.1%compared with$100.4 million last year.apas profit contained three significant items with an overall net negative impact of$0.4 million.Revenue(excluding pass-through)increased by$60.7 million to$720.3 million,an increase of 9.2%on last year,while ear

23、nings before interest,tax,depreciation and amortisation(“eBItDa”)increased by$32.1 million to$492.1 million,an increase of 7.0%.the main factors driving the increase in operating profit and eBItDa include:growth in Queensland and Victorian transmission pipeline revenue,offset somewhat by flood damag

24、e repair costs in Queensland and reduced revenue from Western australian pipelines;growth in asset Management third party work and revenue for managing envestra limiteds assets;increase in energy Investments revenue due to an increase in apas investment in Hastings Diversified utilities Fund and env

25、estra limited;and increase in debt costs due to an increase in debt margins which have been experienced globally.operating cash flow increased by 8.3%to$290.0 million(2010:$267.8 million),while operating cash flow per security increased by 1.4%or 0.7 cents to 52.6 cents per security(2010:51.9 cents

26、per security).apas distributions for the financial year total 34.4 cents per security,an increase of 5.0%,or 1.65 cents on last year.apa achieved its guidance of at least 5%growth in distributions for the 2011 financial year while maintaining a prudent payout ratio.the distribution payout ratio for

27、the year was 65.7%,further demonstrating apas ability to fully fund its distributions out of operating cash flows.CapitaL manaGementDuring the year,apa undertook capital raising activities to assist in the funding of the continuing strong growth of the business.this involved issuance of new securiti

28、es under the operation of the Distribution Reinvestment plan and an institutional placement.apa issued the following two tranches of new securities under its Distribution Reinvestment plan:on 15 September 2010,9,370,489 securities at$3.69 per security raising$34.6 million;and on 17 March 2011,4,504,

29、833 securities at$3.95 per security raising$17.8million.on 23 June 2011,apa announced an institutional placement to fund the emu Downs wind farm acquisition and to partially fund organic expansion of apas energy infrastructure over the period to June 2012.on 29 June 2011,apa AustrAliAn PiPeline trus

30、t And its controlled entitiesDirectors report continueD4 APA AnnuAl REPORT 2011issued77,922,078 new securities at$3.85 per security through this institutional placement,raising$300.0 million.the securities issued were not entitled to the final distribution for the year which will be paid on 15Septem

31、ber 2011.as at 30 June 2011,there were 634,116,029 securities on issue(30 June 2010:542,318,629).apa continued to use the Distribution Reinvestment plan in providing equity support to its ongoing strong organic growth and investment projects.on 22 July 2010,apa continued to lengthen the average tenu

32、re of its debt position of its balance sheet with the issue of$300 million of 10 year fixed rate a$Medium term notes to australian and international institutional investors,the proceeds of which were used to repay$102 million of uS private placement notes which matured in September 2010 and also to

33、refinance bank facilities ahead of maturity.this had the effect of extending the average maturity of apas debt portfolio and reducing long term borrowing costs.on 30 June 2011,apa successfully refinanced$165 million of bilateral debt facilities(drawn to$145.3 million)which were due to mature in July

34、 2011.apa replaced these three bilateral bank facilities with three new facilities,each providing a commitment of$75 million,totalling$225 million.the new facilities have a term of just over three years,maturing in mid July 2014,and will be used for general corporate purposes.at 30 June 2011,apas de

35、bt portfolio has a broad spread of maturities extending out to 2022,with an average maturity of 4.5 years.apa has gearing of 66.2%1 at 30 June 2011,down from 69.8%at 30 June 2010.at 30 June 2011,apa had in excess of$320 million in cash and committed undrawn facilities available to meet the continued

36、 capital growth needs of the business.apa has a prudent treasury policy which requires conservative levels of hedging of interest rate exposures to minimise the potential impacts from adverse movements in rates.all interest rates and foreign currency exposures on uS private placement notes have been

37、 hedged.apa also enters into interest rate hedges for a proportion of the interest rate exposure on its other floating rate borrowings.at 30 June 2011,73.5%of interest obligations were either hedged or at fixed interest rates for varying periods extending out for 11 years.a level of interest rate pr

38、otection is also provided through Consumer price Index(“CpI”)indexing in most revenue contracts and the regulatory revenue setting process operating on a number of apas assets.at 30 June 2011,current liabilities exceed current assets by$888.6 million due primarily to the fact that$900.0 million of s

39、yndicated facilities are due for repayment in June 2012.apa has a number of Debt Capital Market programs in place and underway which,along with the local bank syndication market,will provide sources from which apa will undertake refinancing of this facility in coming months.BorroWinGs anD FinanCe Co

40、stsas at 30 June 2011,apa had borrowings of$3,239.9 million($3,156.8 million at 30 June 2010),principally from syndicated bank debt facilities,bilateral debt facilities,uS private placement notes and australian Medium term notes.Following the$300 million australian Medium term note issue in July 201

41、0,significant additional debt facility headroom was created.this headroom was reduced in December to a more normalised position by cancelling$412 million of syndicated bank facilities which were otherwise due to mature on 1 July 2011.the increase in borrowings compared with last year is primarily du

42、e to the additional funds drawn($83 million)to support equity and operating cash flows retained to fund apas strong organic growth and investments($498million).net underlying finance costs increased by$17.7 million,or 7.7%,to$247.1million(2010:$229.4 million)over last year primarily as a result of i

43、ncreased floating interest rates and borrowing margins,amortisation of borrowing costs related to bank debt facilities and increased commitment fees associated with maintaining a higher level of debt facility headroom during the first half of the year.the average interest rate(including credit margi

44、ns)applying to drawn debt was 7.47%for the year.apas interest cover ratio for the year decreased to 2.03 times from 2.11 times last year,while remaining well in excess of its debt covenant default ratio of 1.1times,and distribution lock up ratio of 1.3 times.CreDit ratinGapt pipelines limited,the bo

45、rrowing entity of apa,maintained its two investment grade credit ratings:BBB long term corporate credit rating(outlook Stable)assigned by Standard&poors in June 2009,and Baa2 long term corporate credit rating(outlook Stable)assigned by Moodys Investors Service in april 2010.inCome taxthe effective i

46、ncome tax rate before significant items is 24.8%,down from 27.8%last year.the decrease has arisen predominantly as a result of amendments to prior year tax returns following changes to tax consolidation rules dealing with“rights to future income”and recognition of deductions for previous equity rais

47、ing costs,plus the impact of investment allowances credits for the current year.CapitaL anD investment expenDitureCapital and investment expenditure totalled$516.0 million,$163.9 million or 47%higher than last year(2010:$352.1 million).this includes stay in business or maintenance capex of$18.0 mill

48、ion.expenditure was generally either fully underwritten through long-term revenue arrangements or had regulatory approval through the relevant access arrangement.1 Gearing ratio determined in accordance with covenants in all debt facilities as net debt to net debt plus book equity5APA AnnuAl REPORT

49、2011AusTRAliAn PiPElinE TRusT And iTs cOnTROllEd EnTiTiEsDirectors report continueDCapital and investment expenditure for the year is detailed in the table below.CapitaL anD investment expenDiture(1)DesCription oF 2011 maJor proJeCts2011$miLLion2010$MIllIonGrowth expenditureRegulatedVictorian transm

50、ission Systemnorthern augmentation project33.432.3apa Gas networks(Qld)Includes southern network expansion16.121.249.553.5Major projectsQueenslandRoma Brisbane pipeline expansion and lateral19.611.6new South Wales Moomba Sydney pipeline expansion;Young to Wagga looping project;Young Marsden compress

51、ion project34.331.1Western australiaMondarra Gas Storage Facility39.814.4otherCorporate financial and Customer Management systems12.210.0105.867.1Acquisitionsenergy Infrastructureamadeus Gas pipeline;emu Downs wind farm228.883.3energy InvestmentsIncreased interest in Sea Gas pipeline,envestra limite

52、d and Hastings Diversified utilities Fund;eII2 equity113.9137.2342.6220.5total growth capex498.0341.1stay in business capex18.014.7total capex516.0355.8(1)the capital expenditure shown in this table represents actual cash payments as disclosed in the cash flow statement;it excludes accruals brought

53、forward from the prior year and carried forward to next yearAustrAliAn PiPeline trust And its controlled entitiesDirectors report continueD6 APA AnnuAl REPORT 2011Business seGment perFormanCesapas operations and financial result for the year reflects strong growth across all business segments.Statut

54、ory reported revenue and eBItDa performance of apas business segments is set out in the following table:Year enDeD 30 June2011$0002010$000CHanGes$000%revenueEnergy InfrastructureQueensland164,308151,20413,1048.7new South Wales126,657120,7735,8844.9Victoria151,209136,85214,35710.5South australia 2,04

55、92,005442.2Western australia143,643144,145(502)(0.3)northern territory13,85011,2422,60823.2energy Infrastructure total601,716566,22135,4956.3asset Management68,64760,0538,59414.3energy Investments27,12119,4087,71339.7total segment revenue697,484645,68251,8028.0pass-through revenue381,733329,94251,79

56、115.7unallocated revenue12,93213,866(934)(6.7)Significant items(1)9,839-total revenue1,101,989989,490112,49811.4eBitDaEnergy InfrastructureQueensland106,799103,3023,4973.4new South Wales101,26696,8414,4254.6Victoria114,263103,98710,2769.9South australia 1,6181,720(102)(5.9)Western australia94,223100

57、,800(6,577)(6.5)northern territory5,5781,9383,640187.8energy Infrastructure total423,747408,58815,1593.7asset Management38,74032,3176,42319.9energy Investments27,10219,0708,03242.1total segment eBitDa489,588459,97529,6146.4Significant items(1)2,521-2,521total eBitDa492,109459,97532,1347.0(1)eBItDa c

58、ontribution of significant items in the 12 months to 30 June 2011(net$2.5 million)includes apas equity share of the eII2 Investment allowance Concession benefit($9.8million in revenue and eBItDa),profit on the sale of apas investment in CaMS($1.7 million)offset by transaction costs of the emu Downs

59、wind farm acquisition($9.0 million)7APA AnnuAl REPORT 2011AusTRAliAn PiPElinE TRusT And iTs cOnTROllEd EnTiTiEsDirectors report continueDenerGY inFrastruCtureapa has changed the name of the segment previously known as Gas transmission and Distribution to energy Infrastructure.the segment includes th

60、e emu Downs wind farm acquired in June 2011,as well as the gas transmission and distribution assets.the energy Infrastructure segment contributed 86%of revenue and 87%of eBItDa.Revenue(excluding pass-through revenue)was$601.7 million,an increase of 6.3%on the$566.2 million reported last year.eBItDa

61、increased by 3.7%to$423.7 million(2010:$408.6 million).the following key factors contributed to this result:Victorian revenue and eBItDa contributed the greatest increase,with higher gas volumes through the Victorian transmission System due to colder weather,together with the annual increase in tari

62、ffs;Queensland revenue increase was due to the increased use of the pipeline asset(gas volume and peak capacity)and general tariff increases across all assets,and a full year of earnings from the Berwyndale Wallumbilla pipeline(2010:3 months).eBItDa was impacted by the repair costs on the Roma Brisb

63、ane pipeline and apa Gas network following the summer flood events;new South Wales revenue and eBItDa was boosted by the new revenues for additional capacity and services on the Young to Wagga lateral,offset by the loss of short term contract revenue on the Moomba Sydney pipeline system;and Western

64、australian earnings were lower primarily due to the regulatory tariff reduction on the Goldfields Gas pipeline and lower gas volumes transported through the parmelia Gas pipeline.apa continues to focus on the operation and development of its energy Infrastructure assets across mainland australia.Que

65、ensland Roma Brisbane PipelineDuring the year apa entered into commercial agreements that underpin a$50 million expansion of the pipeline.the additional capacity has been substantially contracted under long term transportation agreements with an energy retailer and a major industrial gas user.the pi

66、pelines capacity will be increased by approximately 10%by means of additional compression,pipeline pressure upgrades and augmentation of the pipeline in the Brisbane metropolitan area.Design and procurement activities for the expansion project commenced with the expansion scheduled to be completed i

67、n the second half of 2012.apa completed the construction of a 6 km lateral from the Roma Brisbane pipeline to the Caltex oil refinery in Brisbane in September 2010.the lateral and associated infrastructure increases the capacity of natural gas supply to the refinery.APA Gas Network,Queenslandnetwork

68、 meter connections in the year increased by 2,837,taking connections to 84,799 at 30 June 2011(81,962 at 30 June 2010).Gas volume transported through the network and to large customers was 12.9pJ,0.8 pJ or 6%below the 13.7 pJ last year,mainly due to a large gas user connecting directly to the Roma B

69、risbane pipeline and ceasing to be a network customer.expansion of the gas network continued,including reticulation into new housing developments in the Gold Coast area.Gas mains laid for the year totalled 38 km,reaching over 2,500 new and existing home sites.on 17 June 2011,the australian energy Re

70、gulator released its final decision on apas access arrangement proposal for apa Gas network,Queensland(allgas).Further information on the submission and process is found on page 9 under Regulatory matters.Berwyndale Wallumbilla PipelineIn the first full 12 months of apa ownership,the pipeline is per

71、forming in line with acquisition expectations.apa and aGl entered into commercial agreements to build a lateral between the Berwyndale Wallumbilla pipeline and the Silver Springs pipeline owned by aGl.this work was completed in July 2011.Carpentaria Gas PipelineIn December 2010,in response to the Qu

72、eensland Governments northwest Region energy Review,apa submitted a proposal to supply gas-fired electricity to major energy users in the Mt Isa region,which is competing with alternative electricity options.the proposal is for a 240MW gas-fired power station to commence generation in 2013,with gas

73、volumes underpinning pipeline capacity on the Carpentaria Gas pipeline.the gas fired-power station proposal is being jointly developed by apa and aGl,and is currently the preferred gas generation proposal for the two major energy users within the Mt Isa region.the competing non-gas option is known a

74、s“Copper String”which is the construction of an electricity transmission line between townsville and Mt Isa.Copper Strings viability is heavily reliant on both state and federal government financial support.new south Wales Moomba Sydney PipelineWork continued on the$100 million five-year capacity ex

75、pansion program of the Moomba Sydney pipeline.Capital expenditure for this year,the third year of the program,was$9 million,bringing the total spent thus far to$56 million.the first stage of the Young Wagga looping project was completed in november 2010,with partial capacity available to customers a

76、 month earlier.the storage capacity of the southern section of the Moomba Sydney pipeline system was increased by looping a 61 km section of the Young to Wagga lateral.the additional capacity is fully underwritten by long-term transportation and storage agreements.During the year compressors at Youn

77、g and Marsden were reconfigured to increase pipeline capacity on the Moomba Sydney pipeline and the Central West pipeline.victoria and south australia Victorian Transmission Systemtotal gas volume transported through the Victorian transmission System this year was the highest recorded at 245.7 pJ,up

78、 7.6%on last years volume of 228.4 pJ and 0.4%above the previous record volume(244.6 pJ in FY09).Colder than normal winters in 2010 and 2011 contributed to the increased volume of gas used by residential and commercial users and broadly improved economic activity lead to higher gas consumption by ba

79、se load industrial customers.apa completed the northern section expansion of the Victorian transmission System in March 2011.the work included the upgrade of the Wollert Compressor Station and an increase in the working pressure for a section of the pipeline,which has resulted in increased capacity

80、for gas transmission between nSW and Victoria.the expansion is included in the systems regulatory arrangement.apa is constructing the first stage of the Western outer Ring Main expansion at Sunbury to satisfy organic and future growth on the Victorian transmission System,and will also maintain unint

81、errupted gas supply to the Sunbury and Ballarat regions.Dandenong LNG facility,VictoriaDuring the year,the use of the lnG facility for trucking transport fuel increased,contributing to increased earnings.Contracts were renegotiated with customers using the facility for gas supply peak shaving storag

82、e,which also contributed to the increase.AustrAliAn PiPeline trust And its controlled entitiesDirectors report continueD8 APA AnnuAl REPORT 2011Western australia Goldfields Gas Pipelineon 5 august 2010,the economic Regulatory authority of Western australia issued its further final decision on apas p

83、roposed access arrangement.Refer to Regulatory matters on page 9 of this report for additional information.Mondarra Gas Storage FacilityIn May 2011,apa entered into commercial agreements that will lead to the further development and expansion of its Mondarra Gas Storage Facility.the foundation contr

84、act is with Verve energy,Western australias government-owned electricity generator,for a substantial part of the increased capacity of the facility.apa is in discussions with other potential customers for further gas storage services.During the year,apa progressed the initial stages of expansion,inc

85、luding reservoir analysis,engineering and design,and procurement work.over the next two years apa will construct further surface facilities,pipeline interconnects and treatment plants,with expected capital expenditure of up to$140 million.Completion of the expanded capacity is scheduled for 2013.the

86、 facility will continue to operate its existing contracted storage services during the expansion period.the expansion is expected to result in commercial storage capacity of 15pJ and a significant increase in daily injection and withdrawal rates.the expanded facility will provide apas customers with

87、 supply options and flexibility to better manage their gas supply and demand portfolios.the Mondarra expansion project has been welcomed by the Western australian Government,which recognises the major role the expanded facility will play in enhancing future gas supply security for the state.Emu Down

88、sIn June 2011,apa acquired the emu Downs wind farm and development site in Western australia.the 80 MW wind farm has been in operation since 2006 and is located 200 km north of perth,10 kilometres from apas existing parmelia Gas pipeline.apa secured long term revenue agreements for the total output

89、of the 80MW wind farm-both the electricity and Renewable energy Certificates(ReCs)-for the remaining operating life of this asset of approximately 20 years.these agreements are with large,highly creditworthy energy retailers,including the Western australian government owned energy retailer Synergy.o

90、perations and maintenance services are provided by the wind turbine manufacturer under a comprehensive service and availability agreement for the medium term.the acquisition price of$171.9 million includes the 80 MW wind farm and the wind farm development rights for a further 130 MW on adjacent land

91、.this excludes stamp duty and transaction costs which total$8.6 million.northern territory Amadeus Gas Pipelineapa acquired the amadeus Gas pipeline and associated infrastructure for$63 million in June 2011.Since 1986,the amadeus Gas trust has leased the pipeline from a consortium of financial insti

92、tutions,and nt Gas as trustee for the amadeus Gas trust has managed and operated the pipeline.apa holds a 96%interest in nt Gas and the amadeus Gas trust.apa acquired the pipeline and associated assets at the end of that lease.the acquisition is supported by a new long term gas transportation agreem

93、ent between apa and power and Water Corporation,the northern territorys government-owned electricity provider.on 20 July 2011,the australian energy Regulator released its final decision on apas access arrangement proposal for the amadeus Gas pipeline.Further information is found on page 9 under Regu

94、latory matters.asset manaGementapa provides asset management and operational services to the majority of its energy investments and a number of third parties.Its main customers are envestra limited,ethane pipeline Income Fund,Sea Gas pipeline and energy Infrastructure Investments.asset management an

95、d operational services are provided to these customers under long term contracts.Revenue(excluding pass-through revenue)from such services increased by 14.3%to$68.6 million(2010:$60.1 million)and eBItDa increased by 19.9%to$38.7 million(2010:$32.3 million),mainly due to increased envestra limited re

96、venue and additional third party work.During the year,envestra limited acquired the Wagga Wagga Gas network.the operation and asset management of this network has been added to apas asset management of envestra limiteds networks,under the same terms and conditions.Consequently,apa employed 14 existi

97、ng Wagga Wagga network operations personnel and integrated operations into apas management of envestra limiteds assets.enerGY investmentsapa has an interest in a number of energy investments across australia,including envestra limited,Sea Gas pipeline,energy Infrastructure Investments,ethane pipelin

98、e Income Fund,eII2 and Hastings Diversified utilities Fund.apa holds a number of roles in respect of these vehicles in addition to its ownership interest.all investments are equity accounted,with the exception of apas interests in ethane pipeline Income Fund and Hastings Diversified utilities Fund.e

99、nvestra Limitedapa increased its interest in envestra limited from 31.7%to 33.0%by participating in envestra limiteds Distribution Reinvestment plan in october 2010 and March 2011.the total value of distributions reinvested during the year was$24.8million.sea Gas pipelineIn november 2010,apa acquire

100、d a further 16.7%of the Sea Gas pipeline from International power for$46.3 million.apa exercised its pre-emptive right over part of International powers interest,and with this acquisition apas overall interest in the pipeline increased to 50%.In august 2011,Sea Gas successfully refinanced its non-re

101、course debt facility for a further five years.eii2In october 2009,apa(20.2%),together with Marubeni Corporation and osaka Gas,acquired the north Brown Hill Wind Farm from aGl.all turbines on the wind farm were constructed and the wind farm connected to the grid by December 2010,ahead of schedule.as

102、a result of the commencement of generation from the wind farm,accounting profits were generated within eII2(apa share:$9.6 million)primarily due to an investment allowance concession benefit recognised on commencement of generation(included as a significant item).Final handover from the epC(engineer

103、ing procurement and construction)constructor occurred in June 2011.apas funding commitment for equity arose in June 2011,at which time apa provided$19.7 million for its eII2 investment.the investment is secured by a long term off-take agreement with aGl energy,covering both the electricity generated

104、 and the Renewable energy Credits produced from the wind farm.9APA AnnuAl REPORT 2011AusTRAliAn PiPElinE TRusT And iTs cOnTROllEd EnTiTiEsDirectors report continueD Hastings Diversified utilities FundDuring the year,apa increased its interest in Hastings Diversified utilities Fund from 16.8%to 19.4%

105、at a cost of$22.5 million.this investment is consistent with apas strategy of long term investment in gas transmission pipelines.apa flooD anD weather impacteastern australia was subjected to a number of extreme weather events during the year which had an impact on both apas assets and people.these

106、weather events included heavy rain,flooding and a cyclone(Cyclone Yasi).assets affected by the flood and weather included the Roma Brisbane pipeline and apa Gas network in Queensland,and the Central Ranges pipeline in new South Wales.the impact on apas assets and operations from these events has bee

107、n managed safely and efficiently by local and interstate apa staff,in accordance with apas sound and well developed emergency response and asset management plans,with the result that there was minimal disruption of gas transportation services.Repairs to apa assets were substantially completed within

108、 the year.there was minimal impact on apa operations and the costs associated with these events have been fully provided for.regulatory mattersKey regulatory matters addressed during the year included:apa Gas networks access arrangementon 30 September 2010,apa submitted the access arrangement propos

109、al for its Gas network(allgas)in Queensland to the australian energy Regulatory(“aeR”).the proposal establishes the basis for the terms and conditions of access for users and prospective users of the gas distribution network for the period 1 July 2011 to 30 June 2016.aeR released its draft decision

110、on 16February 2011 and its final decision on 17 June 2011.aeRs final decision on 17 June 2011 did not approve apas proposed revised access arrangement and instead aeR has issued its own revised access arrangement and access arrangement information for apa Gas network.the final decision accepted apas

111、 forecast operating and capital expenditure for the period.However,apa does not agree with aeRs approach in respect of some key elements of the weighted average cost of capital and has sought a merits review by the australian Competition tribunal of aeRs decision in respect of the debt risk premium.

112、amadeus Gas pipeline access arrangementon 23 December 2010,apa submitted the access arrangement proposal for the amadeus Gas pipeline to aeR.the access arrangement proposal outlines the proposed terms and conditions of access for the transmission pipeline for the period 1 July 2011 to 30 June 2016.F

113、ollowing the release of aeRs draft decision in March 2011,apa submitted a revised access arrangement proposal.aeR released its final decision on 20 July 2011,which did not approve apas revised access arrangement proposal.Instead,the final decision outlined the revisions required to the access arrang

114、ement,including the reference tariffs and terms and conditions.aeR approved and published its own access arrangement and access arrangement information for the amadeus Gas pipeline on 27 July 2011.the gas transportation agreement between apa and power and Water Corporation is not impacted by this ac

115、cess arrangement.Goldfields Gas pipeline access arrangementFollowing the release of the economic Regulation authority of Western australia(“eRa”)final decision on 13 May 2010,apa,on behalf of the Goldfields Gas pipeline owners,submitted an access arrangement which sought to address elements of the f

116、inal decision.on 5 august 2010,eRa released its further final decision on the proposed access arrangement.eRa did not accept apas proposed access arrangement,and installed an access arrangement it had prepared which reflected the requirements and tariffs specified in its final decision.these tariffs

117、 came into effect on 20 august 2010 and apply to approximately 40%of the annual revenue apa receives from the Goldfields Gas pipeline.apa has pursued the merits review process available within the regulatory framework.short-term trading market in gasa short-term trading market(“SttM”)in natural gas

118、was introduced by the australian energy Market operator(“aeMo”)into new South Wales and South australia on 1 September 2010,and operates alongside Victorias established wholesale gas market.the SttM facilitates the trading of natural gas at defined hubs of Sydney and adelaide and consequently has an

119、 impact on pipelines which deliver gas to these hubs,including the Moomba Sydney pipeline.apa has implemented a program to ensure that systems and procedures are compliant with SttM requirements.apa is working with aeMo and market participants to introduce the SttM in Queensland,with a natural gas t

120、rading hub in Brisbane.trials will commence on 1 September 2011,and market operations are scheduled to commence on 1December 2011.health,safety anD environmentHealth and safety reportingthe lost time Injury Frequency Rate(“ltIFR”)for apa employees was 6.2 for this year,up from 4.9 last year.there we

121、re 13 reportable lost time injuries during the year,compared with 10 last year.apa remains committed to a zero harm environment and is developing a national apa Group Health Safety&environment Management System,integrating the various legacy systems and adopting best practice across the Group.the sy

122、stem,known as SaFeGuaRD,will be launched on 1September2011.environmental regulationsall pipeline,distribution and gas processing assets owned and/or operated by apa are designed,constructed,tested,operated and maintained in accordance with pipeline and distribution licences issued by the relevant st

123、ate and territory technical regulators.all licences require compliance with relevant federal,state and territory environmental legislation and australian standards.the pipeline licences also require compliance with the australian Standard aS 2885“pipelines Gas and liquid petroleum”,which has specifi

124、c requirements for the management of environmental matters associated with all aspects of the high pressure pipeline industry.environmental management plans satisfying part a of the australian pipeline Industry association Code of environmental practice are prepared and independently audited for con

125、struction activities.In accordance with part 3 of aS 2885,environmental management plans satisfying part B of the Code are in place for all operating pipelines and are managed in accordance with apas contracts and the terms and conditions of the licences that apa has been issued.the Safety and opera

126、ting plan for apas distribution networks have been audited in accordance with the Queensland and new South Wales technical regulator requirements.the board reviews external audit reports and,on a monthly basis,the internal reports prepared relating to environmental issues.no breaches have been repor

127、ted during the year and apa has managed the assets in accordance with the environmental management plans that are in place.AustrAliAn PiPeline trust And its controlled entitiesDirectors report continueD10 APA AnnuAl REPORT 2011environmental reportingIn october 2010 apa complied with australias natio

128、nal Greenhouse and energy Reporting obligations for financial year 2010.energy reporting for financial year 2011 will be submitted in october 2011.apas performance on two key measures is set out in the following table:FinanCiaL Year20102009 CHanGeScope 1 Co2 emissions(tonnes)305,076298,9066,170+2.1%

129、energy consumption(GJ)3,248,0693,260,347-12,278-0.4%impact of carbon policythe impact of the currently proposed federal carbon policy,Clean energy Future,will depend on its final form.However,apa expects its costs will be immaterial.apa expects to recover all carbon related costs from its regulated

130、assets under the access arrangement review process.For non-regulated assets,apa has implemented changes to its contracts with carbon pass-through clauses included in all new contracts.apas financial exposure is limited to some legacy contracts that do not contain the pass-through of carbon costs to

131、customers.apa will have virtually no carbon costs if the proposed carbon policy is deemed a change in tax law.subsequent eventsexcept as disclosed elsewhere in this report,the directors are unaware of any matter or circumstance that has occurred since the current period end that has significantly af

132、fected or may significantly affect the operations of the Consolidated entity,the results of those operations or the state of affairs of the Consolidated entity in future years.future DevelopmentsDisclosure of information regarding likely developments in the operation of the Consolidated entity in fu

133、ture years and the expected results of those operations,other than information disclosed elsewhere in this report,is likely to result in unreasonable prejudice to the Consolidated entity.accordingly,this information has not been disclosed in this report.information on Directors anD company secretary

134、Information relating to the qualifications and experience of the directors and Company Secretary is set out below:Leonard Bleasel amFaiCD FaimIndependent Chairmanappointed 28 august 2007Appointed Chairman 30 october 2007leonard(len)Bleasel is a non-executive director of QBe Insurance Group limited a

135、nd a director of oConnell Street associates pty limited.He is Chairman of the taronga Conservation Society australia and Chairman of the advisory Council for RBS Group(australia)pty limited.len had a long career in the energy industry before retiring from management in 2001.He started his career in

136、aGl in 1958 and worked in a variety of roles,culminating in the position of Managing Director and Chief executive officer from 1990 to 2001.lens past appointments have included Chairman of Foodland associated limited,aBn aMRo australia Holdings pty limited,Solaris power,the australian Gas associatio

137、n,natural Gas Corporation Holdings ltd(newZealand),elgas ltd,auscom Holdings pty ltd,Industrial pipe Systems pty ltd and east australian pipeline ltd,a director of St George Bank limited and Gas Valpo(Chile)and Vice president of the Royal Blind Society.len was awarded an aM in the General Division o

138、f the order of australia for services to the australian gas and energy industries and the community.steven CraneBComm FaiCD sFFinIndependent Directorappointed 1 January 2011Steven Crane has over 30 years experience in the financial services industry.Stevens background is in investment banking,having

139、 previously been Chief executive officer of aBn aMRo australia(now RBS Group australia)and BZW australia.Steven has considerable experience as a non-executive director of listed entities.He is currently a director of Bank of Queensland limited,transfield Services limited and nIB Holdings limited,and

140、 was formerly Chairman of adelaide Managed Funds limited,Investa property Group limited and formerly a director of adelaide Bank limited,Foodland associated limited and apa ethane limited,the responsible entity of ethane pipeline Income Fund.Steven is a member of the audit and Risk Management Commit

141、tee and the Remuneration Committee.John FletcherBsc mBa FaiCDIndependent Directorappointed 27 February 2008John Fletcher has over 35 years experience in the energy industry,having held a number of executive positions in aGl prior to his retirement in 2003,including Chief Financial officer.John has p

142、reviously been a director of Integral energy,natural Gas Corporation Holdings ltd(new Zealand),Foodland associated limited and alinta energy Group.He brings a wide commercial and financial practical knowledge to the board.John was previously an aGl appointed director of australian pipeline limited f

143、rom 2000 to 2005.He is also a director of Sydney Water.John is the Chairman of the Remuneration Committee and a member of the audit and Risk Management Committee.11APA AnnuAl REPORT 2011AusTRAliAn PiPElinE TRusT And iTs cOnTROllEd EnTiTiEsDirectors report continueDrussell Higgins aoBec FaiCDIndepend

144、ent Directorappointed 7 December 2004Russell Higgins has extensive experience both locally and internationally in the energy sector and in economic and fiscal policy.He was Secretary and Chief executive officer of the Department of Industry,Science and Resources from 1997 to 2002 and Chairman of the

145、 australian Governments energy task Force from 2003 to 2004.Russell is a director of telstra Corporation limited.He is the Chairman of the Global Carbon Capture and Storage Institute and the CSIRo energy transformed Flagship advisory Committee,and a director of Ricegrowers limited(trading as SunRice

146、)and the St James ethics Foundation.He is a former Chairman of the Snowy Mountains Council and the australian Governments Management Improvement advisory Committee and a former director of australian Biodiesel Group limited,eFIC(export Finance and Insurance Corporation),CSIRo,austrade,the australian

147、 Industry and Development Corporation as well as a former member of the australian Governments Joint economic Forecasting Group.In 2006-07,he was a member of the prime Ministerial task Group on emissions trading.Russell is Chairman of the Health Safety and environment Committee and a member of the a

148、udit and Risk Management Committee.patricia mcKenzieLLB maiCDIndependent Directorappointed 1 January 2011patricia McKenzie has considerable expertise and experience in energy market regulation and,as a qualified solicitor,extensive corporate legal experience.She was formerly a director of australian

149、 energy Market operator limited(aeMo),the national energy market operator for electricity and gas,and the Chief executive officer of Gas Market Company limited,the market administrator for retail competition in the gas industry in new South Wales and the australian Capital territory.patricia is also

150、 Chair of Diabetes australia limited.patricia is a member of the Health Safety and environment Committee and the Remuneration Committee.muri muhammadmscDirectorappointed 8 March 2000Muri Muhammad retired from petronas in august 2002 and was reappointed as petronas adviser,Gas Business in the preside

151、nts office until 30 March 2005.He brings 30 years experience in the chemicals and petroleum industry as well as expertise in the domestic and international gas transmission and distribution,gas utilisation,cogeneration and conversion businesses where he has held various senior executive positions.Mu

152、ri was petronas Vice president for Gas Business from 1998 until his retirement and held several directorships,some as Chairman,of a number of petronas subsidiaries and associate companies in Malaysia and abroad.He currently sits on the boards of gas transmission companies transportadora de Gas Del n

153、orte of argentina,petronas Gas Berhad of Malaysia,and papua new Guineas national petroleum and minerals corporation,petromin pnG Holdings limited.He was also a member of the Malaysian energy Commission,a Malaysian Government regulatory body.Muri is a member of the Remuneration Committee and the Heal

154、th Safety and environment Committee.George ratilalmBaDirectorappointed 31 July 2007 Resigned 26 august 2010Alternate Directorappointed 26 august 2010Manharlal(George)Ratilal is executive Vice president(Finance)of petronas.He is a member of petronas board and executive Committee.prior to joining petr

155、onas in 2003,he was employed by a local Malaysian merchant bank for 18 years.During that time,George specialised in corporate finance where he advised on mergers and acquisitions and the capital markets.robert WrightBComm FCpaIndependent Directorappointed 11 February 2000Robert Wright has over 30 ye

156、ars financial management experience,having held a number of Chief Financial officer positions,including Finance Director of David Jones limited.He is currently the Chairman of SaI Global limited,Super Cheap auto Group limited,RCl Group limited and apa ethane limited,the responsible entity of ethane

157、pipeline Income Fund and was previously Chairman of Dexion limited.Robert is the Chairman of the audit and Risk Management Committee and a member of the Health Safety and environment Committee.michael mcCormackBsurv GradDipengmBa FaiCD Managing Directorappointed Managing Director 1 July 2006Michael(

158、Mick)McCormack has been Chief executive officer of apa since 1 July 2005 and Managing Director since 1July 2006.Mick has over 25 years experience in the energy infrastructure sector in australia,with particular focus on gas pipeline and distribution infrastructure,where he has worked on the developm

159、ent,construction and operation of new and existing pipelines and distribution networks across australia.Mick is Chairman of nt Gas pty ltd and a director of envestra limited and the australian pipeline Industry association.mark KnapmanBComm LLB FCisCompany Secretaryappointed 16 July 2008In addition

160、to being responsible for the secretariat function,Mark Knapman oversees corporate governance and the legal,risk management and financial services compliance functions.Mark has extensive experience as a Company Secretary.He was Company Secretary and General Counsel of an aSX-listed company and asia p

161、acific legal Counsel and Company Secretary for a uS multinational company prior to joining apa.prior to those roles,he was a partner of an australian law firm.Mark is a Fellow of the Chartered Institute of Company Secretaries and is admitted to practice as a solicitor.AustrAliAn PiPeline trust And i

162、ts controlled entitiesDirectors report continueD12 APA AnnuAl REPORT 2011Directorships of other listeD companiesDirectorships of other listed companies held by directors at any time in the three years immediately before the end of the year are as follows:nameCompanYperioD oF DireCtorsHipleonard Blea

163、sel aMQBe Insurance Group limitedSince January 2001Steven Cranetransfield Services limitedBank of Queensland limitednIB Holdings limitedapa ethane limited(1)Since February 2008Since December 2008Since September 2010July 2008 to June 2011John Fletcheralinta energy Group october 2006 to april 2010Russ

164、ell Higgins aotelstra Corporation limitedRicegrowers limitedSince September 2009Since December 2005patricia McKenzie-Muri Muhammad-George Ratilal(2)-Robert WrightSaI Global limited Super Cheap auto Group limited RCl Group limited apa ethane limited(1)Dexion limitedSince october 2003Since May 2004Sin

165、ce May 2006Since 10 July 2008March 2005 to august 2010Michael McCormack envestra limitedSince July 2007(1)apa ethane limited is the responsible entity of the registered investment schemes that comprise ethane pipeline Income Fund,the securities in which are quoted on the aSX(2)George Ratilal resigne

166、d as a director and was appointed an alternate director for Muri Muhammad on 26 august 2010options granteD In this report,the term“apa securities”refers to the stapled securities each comprising a unit in australian pipeline trust stapled to a unit in apt Investment trust and traded on the australia

167、n Securities exchange(“aSX”)under the ticker symbol“apa”.no options over unissued apa securities were granted during or since the end of the year.no unissued apa securities were under option as at the date of this report.no apa securities were issued during or since the end of the year as a result o

168、f the exercise of an option over unissued apa securities.inDemnification of officers anD external auDitorDuring the year,the Responsible entity paid a premium in respect of a contract insuring the directors of the Responsible entity,the Responsible entitys Company Secretary,and all executive officer

169、s of the Responsible entity and any related body corporate of apa against any liability incurred in performing those roles to the extent permitted by the Corporations act 2001.the contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.australian pipel

170、ine limited,in its capacity as Responsible entity of australian pipeline trust and apt Investment trust,indemnifies each person who is or has been a director or Company Secretary of the Responsible entity or of any related body corporate of apa under a range of deed polls and indemnity agreements wh

171、ich have been in place since 1 July 2000.this indemnity may extend to such other officers or former officers of apa as the board in each case determines.the indemnity operates to the full extent allowed by law but only to the extent not covered by insurance and is on terms the board considers usual

172、for arrangements of this type.under its constitution,australian pipeline limited(in its personal capacity)indemnifies each person who is or has been a director,Company Secretary or executive officer of that company.the indemnity operates to the full extent allowed by law but only to the extent not c

173、overed by insurance.the Responsible entity has not otherwise,during or since the end of the year,indemnified or agreed to indemnify an officer or external auditor of the Responsible entity or of any related body corporate of apa against a liability incurred as such an officer or auditor.13APA AnnuAl

174、 REPORT 2011AusTRAliAn PiPElinE TRusT And iTs cOnTROllEd EnTiTiEsDirectors report continueDDirectors meetingsDuring the year,16 board meetings,three Remuneration Committee meetings,four audit and Risk Management Committee meetings and three Health Safety and environment Committee meetings were held.

175、the following table sets out the number of meetings attended by each director while they were a director or a committee member:BoarDremuneration CommitteeauDit anD risK manaGement CommitteeHeaLtH saFetY anD environment CommitteeDireCtorsaBaBaBaBleonard Bleasel aM(1)1616-Steven Crane(2)881111-John Fl

176、etcher16163344-Russell Higgins ao1616224433patricia McKenzie(2)8811-11Muri Muhammad161533-32Robert Wright1615-4433Michael McCormack1616-George Ratilal(3)21-a:number of meetings held during the time the director held office or was a member of the committee during the yearB:number of meetings attended

177、(1)the Chairman also attends all committee meetings ex officio(2)appointed 1 January 2011(3)George Ratilal resigned as director and was appointed as alternate director for Muri Muhammad on 26 august 2010Directors securityholDingsthe aggregate number of apa securities held directly,indirectly or bene

178、ficially by directors or their director related entities at the 30 June 2011 is 862,422(2010:710,620).the following table sets out directors relevant interests in apa securities as at 30 June 2011:DireCtorsFuLLY paiD seCurities as at 1 JuLY 2010seCurities aCQuireD seCurities DisposeD FuLLY paiD seCu

179、rities as at 30 June 2011leonard Bleasel aM359,77115,634-375,405Steven Crane100,000(1)-100,000John Fletcher56,8073,219-60,026Russell Higgins ao72,9546,549-79,503patricia McKenzie-Muri Muhammad42,818-42,818Robert Wright31,2652,806-34,071Michael McCormack147,00523,614-170,619George Ratilal(2)-810,6205

180、1,882-862,442(1)these securities were held by Steven Crane at the date of his appointment during the year(2)George Ratilal resigned as a director and was appointed an alternate director for Muri Muhammad on 26 august 2010 the directors hold no other rights or options over apa securities.there are no

181、 contracts to which a director is a party or under which the director is entitled to a benefit and that confer a right to call for or deliver apa securities.the Company Secretary holds 4,484 apa securities.AustrAliAn PiPeline trust And its controlled entitiesDirectors report continueD14 APA AnnuAl R

182、EPORT 2011remuneration reportintroductionat apa,we are committed to disclosing a clear and transparent summary of our remuneration arrangements.this report explains our approach to remuneration and sets out key 2011 remuneration details for the directors of the Responsible entity and key management

183、personnel of apa.the people currently in these positions are listed below:DireCtors oF tHe responsiBLe entitYLeonard Bleasel am Chairman apa Groupsteven CraneJohn FletcherChairman Remuneration Committeerussell Higgins aoChairman Health Safety and environment Committeepatricia mcKenziemuri muhammadro

184、bert WrightChairman audit and Risk Management Committeemichael mcCormackChief executive officer and Managing DirectorKeY manaGement personneLmichael mcCormackChief executive officer and Managing Directorpeter FredricsonChief Financial officerross GersbachGroup Manager Commercialstephen ohlGroup Mana

185、ger operations mark KnapmanCompany Secretarypeter WallaceGroup Manager Human ResourcesHave there been any changes to the executive remuneration structure during FY 2011?there have been no changes to the remuneration structure during the year.However,the remuneration structure remains continuously un

186、der review to ensure that that the organisation maintains appropriate pay structures to attract and retain suitably qualified staff.remuneration CommitteeWhat is the role of the Remuneration Committee?the Remuneration Committee has been established by the board to govern and oversee executive remune

187、ration.the role of the Remuneration Committee is to:ensure the provision of a robust remuneration and reward system that provides for the alignment of employee and securityholder interests;consider and make recommendations to the board on remuneration policies and packages applicable to directors an

188、d to senior executives of apa;facilitate effective attraction,retention and development of talented employees;and ensure compliance with relevant legislation and corporate governance principles on remuneration practices and employment policies.the members of the Remuneration Committee,all of whom ar

189、e non-executive directors,are:John Fletcher(Chairman);Steven Crane;patricia McKenzie;and Muri Muhammad.the Chairman of the board attends all meetings of the Remuneration Committee and the Managing Director attends by invitation.the Remuneration Committee met three times during the year.the Remunerat

190、ion Committee may seek external professional advice on any matter within its terms of reference.our approach to non-executive director remuneration We seek to attract and retain a high calibre of directors who are equipped with diverse skills to oversee all functions of apa in an increasingly comple

191、x environment.We aim to fairly remunerate directors for their services relative to similar sized organisations.non-executive director remuneration comprises:a base board fee;an additional fee for serving on a committee of the board;and superannuation guarantee levy contributions.the board determines

192、 base board fees and committee fees annually.the board acts on advice from the Remuneration Committee which obtains external professional advice from independent remuneration specialists.Such advice includes market comparisons paid by comparable companies in the aSX 200.non-executive directors do no

193、t receive incentive payments of any type.one off per diems may be paid in exceptional circumstances.no payments have been made under this arrangement in this reporting period.In 2003,the board terminated the non-executive directors retirement benefit plan so that the benefits to participating direct

194、ors that had accrued up to that termination date were then quantified and preserved for payment on retirement of those directors.Robert Wright is the only current director entitled to benefits under the plan on his retirement from the board.15APA AnnuAl REPORT 2011AusTRAliAn PiPElinE TRusT And iTs c

195、OnTROllEd EnTiTiEsDirectors report continueDBoard approved fees and committee feesFollowing external benchmarking and a review of apas performance relative to other companies,base board fees and fees for serving on a committee of the board were increased effective 1 January 2011.Base board fees and

196、committee fees excluding superannuation guarantee levy are outlined below:CHairman$000/pamemBer$000/paEffective 1 January 2011Board fees280102Remuneration Committee fees2311.5audit and Risk Management Committee fees3216Health Safety and environment Committee fees2311.5Effective 1 January 2010 to 31

197、December 2010Board fees26596Remuneration Committee fees2211audit and Risk Management Committee fees3015Health Safety and environment Committee fees2211Actual payments for periodactual remuneration received by non-executive directors during the year is outlined in the table below:non-exeCutive DireCt

198、ors(1)FeeS$SupeRannuatIon$totaL paiD 2011$total paID 2010$leonard Bleasel aM272,50020,750293,250271,300Steven Crane(2)57,8755,20963,084-John Fletcher107,00042,335149,335135,937Russell Higgins ao145,37513,077158,452149,320patricia McKenzie(2)56,7505,10861,858-Muri Muhammad121,500-121,500113,000Robert

199、 Wright141,25012,715153,965143,875George Ratilal(3)16,000(4)-16,00093,000total918,25099,1941,017,444906,432(1)the remuneration for the Chief executive officer and Managing Director,Michael McCormack,is included with the actual remuneration disclosures for key management personnel for FY 2011 on page

200、 18(2)appointed 1 January 2011(3)George Ratilal resigned as a director and was appointed an alternate director for M Muhammad on 26 august 2010(4)George Ratilals board fees were paid to petronas australia pty ltdAustrAliAn PiPeline trust And its controlled entitiesDirectors report continueD16 APA An

201、nuAl REPORT 2011our approach to executive remuneration What is our executive remuneration strategy?our executive remuneration strategy is to:attract and retain key executives who will create long-term sustainable value for securityholders;motivate and reward executives having regard to the overall p

202、erformance of apa,the performance of the executive measured against pre-determined objectives and the external compensation environment;target at least the market median using external benchmark data;appropriately align the interests of executives with those of securityholders;and comply with applic

203、able legal requirements and appropriate standards of governance.We aim to pay competitive remuneration and this is communicated as total Remuneration opportunity(“tRo”).each individuals tRo is dependent on their level in the organisation and their capacity to influence outcomes.What is the remunerat

204、ion mix?apas remuneration mix for senior executives is structured as a mix of fixed remuneration and at risk short and long-term incentive components.the proportion of fixed versus at risk remuneration varies at different levels within apa,reflecting the varying capacity of employees to influence ap

205、as operational performance and returns to securityholders.For the Chief executive officer and Managing Director and other key management personnel,the remuneration mix is:40%30%30%50%25%25%at risk components at risk componentsTFR STI LTIManaging Directorother key management personnel 2An overview of

206、 remuneration componentseach remuneration component has a different purpose:remuneration ComponentpurposeHoW reWarD is DeLivereDtotal Fixed Remuneration(“tFR”)to reflect the market value of the role and the individuals skills and experience.the total of base salary(which includes cash,superannuation

207、 guarantee levy,vehicles and parking)and incidental benefits paid in monthly instalments.at risK ComponentsShort-term incentive(“StI”)to reward strong performance against the achievement of specific business objectives.Cash-based incentive based on a mix of financial and non-financial key performanc

208、e indicators paid annually after the audited accounts are approved.long-term incentive(“ltI”)to link executive reward with securityholder value.Cash-settled incentive based on achievement of an annual board mandated key financial hurdle paid in three equal annual instalments starting one year after

209、the year of allocation.+Total RemunerationOpportunityTotal FixedRemuneration(TFR)Performance based at risk remunerationShort-termIncentive(STI)Long-termIncentive(LTI)=2 other than the Company Secretary who has a mix of 58%,21%and 21%ltI+Total RemunerationOpportunityTotal FixedRemuneration(TFR)Perfor

210、mance based at risk remunerationShort-termIncentive(STI)Long-termIncentive(LTI)=each individuals tRo is dependent on their level in the organisation and their capacity to influence outcomes.What is the remuneration mix?apas remuneration mix for senior executives is structured as a mix of fixed remun

211、eration and at risk short and long-term incentive components.the proportion of fixed versus at risk remuneration varies at different levels within apa,reflecting the varying capacity of employees to influence apas operational performance and returns to securityholders.For the Chief executive officer

212、 and Managing Director and other key management personnel,the remuneration mix is:40%30%30%50%25%25%at risk components at risk componentsTFR STI LTIManaging DirectorOther key management personnel 2An overview of remuneration componentseach remuneration component has a different purpose:remuneration

213、ComponentpurposeHoW reWarD is DeLivereDtotal Fixed Remuneration(“tFR”)to reflect the market value of the role and the individuals skills and experience.the total of base salary(which includes cash,superannuation guarantee levy,vehicles and parking)and incidental benefits paid in monthly instalments.

214、at risK ComponentsShort-term incentive(“StI”)to reward strong performance against the achievement of specific business objectives.Cash-based incentive based on a mix of financial and non-financial key performance indicators paid annually after the audited accounts are approved.long-term incentive(“l

215、tI”)to link executive reward with securityholder value.Cash-settled incentive based on achievement of an annual board mandated key financial hurdle paid in three equal annual instalments starting one year after the year of allocation.2 other than the Company Secretary who has a mix of 58%,21%and 21%

216、APA002 Annual Report 2011_v3C.indd 167/09/11 11:47 AM17APA AnnuAl REPORT 2011AusTRAliAn PiPElinE TRusT And iTs cOnTROllEd EnTiTiEsDirectors report continueDtotal Fixed remuneration(“tFr”)The total of base salary,including cash,superannuation guarantee levy,vehicles and parking and incidental benefit

217、s.tFR is reviewed annually and is determined by reference to independent external remuneration benchmarking information,taking into account an individuals responsibilities,performance,qualifications and experience.at risk remuneration at risk remuneration is made up of two elements,StI and ltI.Befor

218、e any StI payments or ltI allocations are made the organisation must achieve at least the board approved performance hurdle.each of these components is discussed in more detail below.What is the key performance hurdle for at risk remuneration?operating cash flow per security(”oCFpS”)has been chosen

219、by the board as the current key performance hurdle for at risk remuneration.this is directly linked to apas strategic goal of increasing operating cash flows over the medium term,thereby improving total securityholder value.using oCFpS as the key performance hurdle ensures the interests of executive

220、s and securityholders are aligned.If the security price rises over the period of allocation,both parties benefit and likewise if it falls,both are similarly affected.at the start of the year,the board,having regard to the longer term strategy and annual budget,established the oCFpS gateway that need

221、s to be achieved before any StI and ltI was triggered.the oCFpS gateway was not changed over the course of the year.Short-term incentive(“STI”)A cash-based incentive used to reward strong performance against the achievement of financial and non-financial targets or key performance indicators.What is

222、 the purpose of the STI plan?the StI plan is designed to put a proportion of executive remuneration at risk against meeting key performance indicators(“KpIs”)linked to:various financial measures such as cost control,revenue and cash generation and capital expenditure management.this reflects apas st

223、rategic goal of increasing oCFpS over the medium term,thereby increasing securityholder returns and aligning the interests of StI participants with those of securityholders;and non-financial targets through the delivery of individual KpIs linked to long-term strategic measures including health,safet

224、y and environment targets,and reinforcement of an ethical and values based culture.at least 50%of the key management personnels KpIs are linked to financial measures.How is performance measured?at the beginning of the financial year,the board,at the recommendation of the Remuneration Committee,deter

225、mines the appropriate financial and non-financial KpIs for the Chief executive officer.the board also reviews the KpIs the Chief executive officer will use to assess the performance of his direct reports.at the end of the financial year,after the audited financial results are available and provided

226、that the performance hurdle is met,the board determines the performance against KpIs of the Chief executive officer and the Chief executive officers direct reports and approves the StI amounts to be paid.What is the performance hurdle?StI payments are made from the general operating budget.executive

227、s participating in the StI will not receive any incentive payments unless the performance hurdle for the financial year is reached and individual KpIs have been achieved.What is the value of the STI opportunity?the StI amount payable is capped at the StI target amount.that is,the Chief executive off

228、icers StI is capped at 30%of tRo and for his direct reports at 25%of tRo3.How is the STI reward delivered?all StI payments are made in cash and paid in September of the new financial year following the completion of audit of the annual accounts.For FY 2011,the StI outcomes are shown in the table bel

229、ow for all key management personnel:KeY manaGement personneLsti earneD($)sti earneD(%)sti ForFeiteD($)sti ForFeiteD(%)Michael McCormack621,00090.0069,00010.00peter Fredricson 270,75095.0014,2505.00Ross Gersbach 308,75095.0016,2505.00Stephen ohl201,37589.5023,62510.50Mark Knapman 130,70690.2514,1229.

230、75peter Wallace(1)34,35695.001,8085.00(1)appointed 4 april 2011.StI has been prorated3 other than for the Company Secretary whose StI is capped at 21%of tRoManaging DirectorOther key management personnel 2An overview of remuneration componentseach remuneration component has a different purpose:remun

231、eration ComponentpurposeHoW reWarD is DeLivereDtotal Fixed Remuneration(“tFR”)to reflect the market value of the role and the individuals skills and experience.the total of base salary(which includes cash,superannuation guarantee levy,vehicles and parking)and incidental benefits paid in monthly inst

232、alments.at risK ComponentsShort-term incentive(“StI”)to reward strong performance against the achievement of specific business objectives.Cash-based incentive based on a mix of financial and non-financial key performance indicators paid annually after the audited accounts are approved.long-term ince

233、ntive(“ltI”)to link executive reward with securityholder value.Cash-settled incentive based on achievement of an annual board mandated key financial hurdle paid in three equal annual instalments starting one year after the year of allocation.2 other than the Company Secretary who has a mix of 58%,21

234、%and 21%APA002 Annual Report 2011_v3C.indd 167/09/11 11:47 AMAustrAliAn PiPeline trust And its controlled entitiesDirectors report continueD18 APA AnnuAl REPORT 2011Long-term incentive(“LTI”)A cash-settled incentive used to link executive reward to securityholder value based on the achievement of ke

235、y financial measures.What is the purpose of the LTI?the ltI plan is designed to put a proportion of executive remuneration at risk against meeting financial targets linked to oCFpS.this reflects apas strategic goal of increasing oCFpS over the medium term,thereby increasing total securityholder valu

236、e and aligning the interests of ltI participants with those of securityholders.What form does the LTI take?eligible participants are entitled to an ltI allocation in the form of reference units which exactly mirror the value of apa securities.the reference units allocated under the ltI plan are not

237、actual apa securities,but notional securities with a value equivalent to the ltI allocation.each reference unit is valued at the equivalent of the 30 day volume weighted average market price(“VWap”)of an apa security immediately prior to the opening of the apa security trading window,following the a

238、nnouncement of apas annual financial results to the aSX.What is the value of the LTI opportunity?ltI participants are advised of their maximum ltI opportunity,expressed as a percentage of their tRo.the actual individual ltI allocation is determined at the completion of the financial year and is base

239、d on oCFpS performance relative to the achievement of the performance target.the maximum ltI allocation is capped at 120%of the participants maximum ltI opportunity.What is the performance target?no ltI allocations are made unless apa achieves the target oCFpS and the oCFpS result determines the siz

240、e of participants ltI allocations up to their maximum ltI allocation.How are the LTI allocations delivered?an ltI allocation vests in three equal instalments over the three financial years following the allocation,with the initial one-third vesting at the end of the first financial year,one-third at

241、 the end of the second financial year,and one-third at the end of the third financial year.as ltI allocations are subject to the achievement of a pre-allocation performance hurdle,they are not subject to further performance tests at the vesting dates.However,participants must remain employed by apa

242、to access the vested benefit.upon vesting,the ltI is delivered in cash.the cash payment is equal to the number of reference units vesting on the vesting date multiplied by the 30 day VWap of apa securities immediately prior to the opening of the apa security trading window,following the announcement

243、 of apas annual financial results to the aSX.apa provides fully in its accounts for the obligations of the ltI in the year in which the ltI allocation is made.What rights are attached to an LTI reference unit?the ltI is a cash-settled plan and participants are not allocated apa securities.ltI alloca

244、tions do not entitle participants to vote at securityholders meetings or to be paid distributions.no options or other equity instruments are issued to apa employees or directors under the ltI plan.actual remuneration received during FY 2011actual remuneration received by the Chief executive officer

245、and Managing Director and other key management personnel is defined as the take home pay received by them in the relevant year.actual ltI payments represent the amount of reference units that vested and were converted to cash payments to the individual during the year,regardless of when the ltI was

246、initially allocated.What amounts are excluded?the table below does not show ltI allocations in FY 2011 or previous years that are still subject to performance or employment conditions because those ltI allocations are still at-risk of forfeiture.the table below sets out actual cash payments made to

247、the relevant key management personnel during FY 2011.this table differs from the information disclosed in note 44 of the financial report for australian pipeline trust and note 18 of the financial report for apt Investment trust that reflects the total remuneration earned by key management personnel

248、 in FY 2011,but not yet fully paid due to future vesting of ltI earned.the major differences are in respect of StI entitlements for which the amount paid in FY 2011 represents the amount earned in FY 2010,and ltI allocations for which the amounts paid in FY 2011 relate to allocations made in prior y

249、ears that have vested in FY 2011.the following table outlines the actual remuneration received by key management personnel during FY 2011:KeY manaGement personneLtotaL FixeD remuneration$sti$Lti$otHer$totaL paiD 2011$totaL paiD 2010$Michael McCormack(1)920,000538,130521,984-1,980,1142,146,533peter F

250、redricson(2)570,000228,125-798,125501,800Ross Gersbach650,000260,062192,660-1,102,722921,883Stephen ohl450,000181,562168,122-799,684642,809Mark Knapman400,000121,18067,901-589,081489,600peter Wallace(3)73,809-73,809-total3,063,8091,329,059950,667-5,343,5354,702,625(1)2010 included a retention paymen

251、t paid to the Chief executive officer as agreed by the board in 2006 when the organisation was under threat of takeover by the then alinta energy(2)peter Fredricson joined apa as CFo in June 2009.ltI earned for FY 2010 and FY 2011 but not paid until future years are disclosed in the financial report

252、(3)peter Wallace joined apa as Group Manager Human Resources on 4 april 2011.StI and ltI earned for FY 2011 but not paid until future years are disclosed in the financial report19APA AnnuAl REPORT 2011AusTRAliAn PiPElinE TRusT And iTs cOnTROllEd EnTiTiEsDirectors report continueDCurrent Lti referenc

253、e units outstandingthe following table sets out the number of reference units that have been allocated to key management personnel but have not yet vested or been paid,and the years in which they will vest,based on an estimated VWap of$3.9760:KeY manaGement personneLBaLanCe oF reFerenCe units(1)vest

254、inG Year2011(2)201220132014Michael McCormack615,599189,901220,638135,64369,417peter Fredricson166,78026,92155,59355,59528,671Ross Gersbach282,24182,558103,59863,38832,697Stephen ohl204,26062,41974,22444,98122,636Mark Knapman124,13532,90147,47129,19214,571peter Wallace(3)10,920-3,6403,6403,640(1)Incl

255、udes reference units subject to allocation by the board in august 2011(2)Reference units multiplied by 30 day VWap to be paid as cash in September 2011(3)peter Wallace joined apa as Group Manager Human Resources in april 2011 executive contracts the terms of the contractual arrangements for each of

256、the key management personnel are set out below:name anD titLe anD CommenCement Dateterm anD termination provisions/BeneFitsmichael mcCormack Managing Director since 1 July 2006Chief Executive Officer 1 July 2005 to 30 June 2006Commenced 1 March 2000.no defined term.on termination with cause or follo

257、wing long-term illness or incapacity,apa will pay any tFR due and owing at the date of termination and any accrued leave entitlements.on termination without cause,apa will pay 52 weeks tFR,any incentives earned but not paid on their due date and any accrued leave entitlement.apa will also pay any tR

258、o due and owing at the date of termination.MrMcCormack is required to give apa one months notice.peter FredricsonChief Financial OfficerCommenced 1 June 2009.no defined term.on termination with cause or following long-term illness or incapacity,apa will pay any tFR due and owing at the date of termi

259、nation and any accrued leave entitlements.on termination without cause,apa will pay 26 weeks tFR,any incentives earned but not paid on their due date and any accrued leave entitlement.apa will also pay any tRo due and owing at the date of termination.Mr Fredricson is required to give apa three month

260、s notice.ross GersbachGroup Manager CommercialCommenced 1 February 2008.no defined term.on termination with cause or following long-term illness or incapacity,apa will pay any tFR due and owing at the date of termination and any accrued leave entitlements.on termination without cause,apa will pay 26

261、 weeks tFR,any incentives earned but not paid on their due date and any accrued leave entitlement.apa will also pay any tRo due and owing at the date of termination.If Mr Gersbach gives notice to terminate his employment,apa may(after consulting with the board)at its discretion agree to make a termi

262、nation payment of an amount up to 26 weeks tFR.Mr Gersbach is required to give apa three months notice.stephen ohl Group Manager Operations Commenced 2 May 2005.no defined term.on termination with cause or following long-term illness or incapacity,apa will pay any tFR due and owing at the date of te

263、rmination and any accrued leave entitlements.on termination without cause,apa will pay 26 weeks tFR,any incentives earned but not paid on their due date and any accrued leave entitlement.apa will also pay any tRo due and owing at the date of termination.If Mr ohl gives notice to terminate his employ

264、ment,apa may(after consulting with the board)at its discretion agree to make a termination payment of an amount up to 26 weeks tFR.Mr ohl is required to give apa six months notice.AustrAliAn PiPeline trust And its controlled entitiesDirectors report continueD20 APA AnnuAl REPORT 2011name anD titLe a

265、nD CommenCement Dateterm anD termination provisions/BeneFitsmark KnapmanCompany SecretaryCommenced 16 July 2008.no defined term.on termination with cause or following long-term illness or incapacity,apa will pay any tFR due and owing at the date of termination and any accrued leave entitlements.on t

266、ermination without cause,apa will pay 26 weeks tFR,any incentives earned but not paid on their due date and any accrued leave entitlement.apa will also pay any tRo due and owing at the date of termination.Mr Knapman is required to give apa three months notice.peter WallaceGeneral Manager Human Resou

267、rcesCommenced 4 april 2011no defined term.on termination with cause or following long-term illness or incapacity,apa will pay any tFR due and owing at the date of termination and any accrued leave entitlements.on termination without cause,apa will pay 26 weeks tFR,any incentives earned but not paid

268、on their due date and any accrued leave entitlement.apa will also pay any tRo due and owing at the date of termination.Mr Wallace is required to give apa three months notice.remuneration advisersDuring FY 2011,the following remuneration information was sought:egan&associates were appointed by the Ch

269、airman of the Remuneration Committee to provide remuneration benchmarking information for all directors;ernst&Young were appointed by the Chairman of the Remuneration Committee to provide benchmarking information for the Chief executive officer and Managing Director and key management personnel;and

270、both those advisers were engaged directly on instruction by the committee,reported directly to the committee and were independent and free from influence by key management personnel.information requireD for registereDschemesFees paid to the Responsible entity and its associates(including directors a

271、nd secretaries of the Responsible entity,related bodies corporate and directors and secretaries of related bodies corporate)out of apa scheme property during the year are disclosed in note 45 to the financial statements.except as disclosed in this report,neither the Responsible entity nor any of its

272、 associates holds any apa securities.the number of apa securities issued during the year,and the number of apa securities at the end of the year,are disclosed in note 28 to the financial statements.the value of apas assets as at the end of the year is disclosed in the balance sheet in total assets,a

273、nd the basis of valuation is included in note 3 to the financial statements.auDitors inDepenDence Declarationa copy of the auditors independence declaration as required under section 307C of the Corporations act 2001 is included on page 86.rounDing of amountsapa is an entity of the kind referred to

274、in aSIC Class order 98/0100 dated 10July 1998 and,in accordance with that Class order,amounts in the directors report and the financial report are rounded to the nearest thousand dollars,unless otherwise indicated.Signed in accordance with a resolution of the directors of the Responsible entity made

275、 pursuant to section 298(2)of the Corporations act 2001.on behalf of the directorsLeonard Bleasel am robert Wright Chairman DirectorSYDneY,24 august 201121APA AnnuAl REPORT 2011corporate governance statementapa Group(“apa”)comprises two registered investment schemes,australian pipeline trust and apt

276、 Investment trust,the securities in which are“stapled”together,and their controlled entities.australian pipeline limited(“Responsible entity”)is the responsible entity of those trusts and is responsible for apas corporate governance practices.the aSX Corporate Governance Councils Corporate Governanc

277、e principles and Recommendations articulate eight core principles of good corporate governance and,for each of those principles,recommendations as to their implementation.adoption of the Councils recommendations is not compulsory.However,under the listing Rules of aSX limited(“aSX”)companies are req

278、uired to provide a statement in their annual report disclosing the extent to which they have followed the recommendations in the reporting period and,where companies have not followed all the recommendations,they must identify which ones they have not followed and give reasons for not following them

279、.In 2010,the aSX Corporate Governance Council released amendments to the Corporate Governance principles and Recommendations relating to diversity(in particular,gender diversity on boards and with respect to senior management and other employees),share trading policies,shareholder communications and

280、 remuneration committees.those amendments will apply to companies with a July/June financial year from and including the year ending 30 June 2012 with appropriate disclosures to be made in the 2012 annual report,but apa has decided to report against those amendments in this statement.each of the pri

281、nciples of good corporate governance has been responded to in turn in this statement and the table at the rear of this statement provides a checklist of apas adoption of the aSX Corporate Governance Councils recommendations.explanations for departures from the recommendations are set out in this sta

282、tement.Various references are made below to apas website as a source of information on corporate governance practices and documentation.the home page for apas website is .au,and the link entitled“about apa”leads to the corporate governance material.Securityholders who do not have internet access but

283、 wish to read that material should telephone 1800 992 312(or+61 2 8280 7132,if calling from outside australia)and ask for a copy of the relevant material to be sent to them.In this statement the term“Reporting period”means the period of 12 months to 30 June 2011.prinCipLe 1:LaY soLiD FounDations For

284、 manaGement anD oversiGHt Board and its committeesthe board of directors of the Responsible entity(“board”)is accountable to securityholders for the proper management of apas business and affairs.It operates in accordance with a charter,which is published on apas web site.the board normally meets 11

285、 times each year,with additional meetings being held as required.the number of times it met during the Reporting period and directors attendance at those meetings are set out in the directors report for that period.to assist the board in carrying out its responsibilities,the following standing commi

286、ttees of its members have been established:audit and Risk Management Committee;Remuneration Committee;and Health Safety and environment Committee.each committee has its own charter that describes the roles and responsibilities delegated to the committee by the board,and those charters are published

287、on apas web site.the charters for the board and its committees are reviewed by the board annually,and were last reviewed in July 2011.the board delegates responsibility for implementing the strategic direction and managing the day-to-day operations of apa to the Managing Director.the Managing Direct

288、or consults with the Chairman,in the first instance,on matters that are sensitive,extraordinary or of a strategic nature.non-executive directors letter of appointmentthe current non-executive directors have each received a letter of appointment documenting,among other issues:the roles and responsibi

289、lities of the board and each of its committees;expectations of the time commitment to be made by directors in serving on the board and its committees,and of their participation in an annual review of the board,its committees and individual directors;requirements with respect to the disclosure of dir

290、ectors interests;the fees payable to the directors;and key policies that directors are required to comply with,such as apas securities trading policy.management:service contracts,induction and performance evaluationsthe Managing Director,Chief Financial officer and other senior management have servi

291、ce contracts setting out their responsibilities,conditions of service and termination entitlements.newly appointed senior executives complete an induction program on the management of the business covering topics that include financial matters,strategic direction,operations,risk management,health an

292、d safety,environmental issues and governance matters.apa also conducts annual processes relating to talent and succession management,and the development of leadership capabilities.apa has processes in place to review the performance of senior management.each senior executive,including the Managing D

293、irector,has personal objectives as well as objectives related to the performance of business or functional units and apa as a whole.they are reviewed against those objectives at least annually.a performance review of senior management has been conducted during the Reporting period.performance evalua

294、tion of the Managing Director is handled by the Chairman with the assistance of the Remuneration Committee and a report is provided to and reviewed by the board.assessment and monitoring of the performance of other senior executives are handled by the Managing Director who reports on those matters t

295、o the Chairman and the Remuneration Committee.prinCipLe 2:struCture tHe BoarD to aDD vaLue Board membershipthe board determines its size and composition,subject to limits imposed by the Responsible entitys constitution.the constitution provides for a minimum of three directors and a maximum of 12.th

296、e names of the current directors and their experience,terms of office and membership of board committees are set out in the directors report for the Reporting period.the composition of the board is determined in accordance with the following principles:a majority of the board will be comprised of in

297、dependent directors;the Chairman will be an independent director;and a person cannot hold the positions of both Chairman and Chief executive officer.under the Responsible entitys constitution,petronas australia pty limited is entitled to appoint one director of the Responsible entity while the petro

298、nas Group holds not less than 10%of the issued securities in apa.the Responsible entitys constitution requires one-third of its directors corporate governance statement continued22 APA AnnuAl REPORT 2011(excluding the Managing Director,the petronas-appointed director and any director who is standing

299、 for re-election after having been appointed as an additional director or to fill a vacancy)to retire from office at the annual general meeting of the Responsible entity each year.If the calculation of that one-third is not a whole number,the number of directors required to retire by this“rotation”p

300、rocess is rounded to the nearest whole number.Retiring directors are eligible for re-election.the Responsible entitys constitution also provides that if the board appoints a director to fill a vacancy or as an addition to the board,the new director will hold office until the end of the next annual g

301、eneral meeting of the Responsible entity and is eligible for re-election.securityholders right to nominate a director and to vote on nomineesthe Deed poll executed by the Responsible entity in 2004(a copy of which is available on apas web site)affords apa securityholders certain rights in respect to

302、 nominees for the position of director on the board.at least 60 days before annual general meetings of the Responsible entity,securityholders are notified by an announcement to aSX that they may nominate a person to fill a vacancy on the board that arises on retirement of either a director under the

303、“rotation”process or a director appointed by the board since the last annual general meeting.If securityholders wish to exercise that right,at least 45 days before the annual general meeting they must send the Responsible entity a signed nomination form and the nominees signed consent to act as a di

304、rector.the Responsible entity advises securityholders of all candidates who have been validly nominated and presents its nominations to the annual meeting of securityholders.independence of directorsthe board assesses the independence of non-executive directors on appointment and annually having reg

305、ard to the independence of directors policy(published on apas web site).the directors report for the Reporting period identifies which directors are considered to be independent at the date of the report.a majority of the current directors are independent.selection and appointment of directorsthe fo

306、rmer nominations and Remuneration Committee of the board became the Remuneration Committee in early 2008 so that the functions with respect to selection and appointment of new directors and related matters previously handled by that committee then reverted to the board.ultimate responsibility for su

307、ch matters rests with the full board and the board considers the efficient handling of those matters is not diminished by the absence of a nominations Committee.the board considers that a diverse range of skills,experience and backgrounds is required on the board to effectively govern the business.I

308、t determines and reviews from time to time the mix of skills and diversity that it looks to achieve in its membership.Having regard to the nature of apas business,that mix includes financial,strategic,operational,legal,regulatory and general commercial expertise.When looking to appoint a new directo

309、r,the board predefines the skills and experience required of candidates for the role to ensure that the required mix of skills and experience will be represented on the board and,based on that work,seeks a list of potential candidates believed to satisfy those requirements.If the board is not satisf

310、ied with the quality or diversity of the candidates identified in that process,it may consider it appropriate to instruct a search firm to identify additional suitable candidates.the board recognises that an experienced search firm with a clear brief from the board as to the required characteristics

311、 of candidates can assist in identifying potentially suitable candidates from diverse backgrounds.the Chairman conducts an initial interview of the short-listed candidates and,subject to them being available for and interested in the position,they are then interviewed by the board.the board assesses

312、 potential candidates against the predefined requirements and also considers their qualifications,backgrounds and personal qualities before the new director is appointed.In the interest of gender diversity,the board has determined that the short-listed candidates for an available board position must

313、 include at least one qualified female candidate and,where a search firm is engaged,the board will instruct them accordingly.annual review of performance of the board,its committee and directorsa review process to assess the performance of the board,its committees and individual directors is underta

314、ken each year.the last review was conducted in September 2010 and the review for the Reporting period will be completed in october 2011.each director completes a questionnaire,the responses are collated and the board then meets to discuss and consider the results of that process and to determine any

315、 actions arising from the review.the Chairman also meets with each director to discuss the review and the directors own performance.Matters covered by the review include the role and performance of the board and its committees,directors understanding of apas long-term objectives and key risks to the

316、 business and achievement of those objectives,succession planning and the effectiveness of the Chairman in leading the board.Directors access to records and information,management and professional adviceSubject to normal privacy requirements,directors have access to apas records and information,and

317、to the Company Secretary and other relevant senior management personnel.they receive regular detailed reports on financial and operational aspects of apas business and may request elaboration or explanation of those reports.While most board meetings are held in Sydney,where apas head office is locat

318、ed,some are held in other locations where apa has a presence,providing directors with the opportunity to receive presentations from and speak to local apa employees about the business and to inspect apas assets and facilities.the board collectively,and each director individually,may seek independent

319、 professional advice at apas expense.prior approval of the Chairman is required,but this may not be unreasonably withheld.Directors and senior management are encouraged to broaden their knowledge of apas business and to keep abreast of developments in business more generally by attending relevant co

320、urses,seminars and conferences.Where appropriate,apa will meet expenses involved in such activities.prinCipLe 3:promote etHiCaL anD responsiBLe DeCision-maKinG Code of conduct and policiesthe board and senior management are firmly committed to ensuring that they and all employees observe high standa

321、rds of ethical behaviour and conduct.apas code of conduct sets out the behaviour required of directors and employees and recognises the responsibilities of apa and its personnel to securityholders,customers,suppliers,employees and the community.It also requires that breaches of the code are reported

322、 and provides a mechanism to enable breaches to be reported without fear of retribution.the code is published on apas web site.a number of apas policies aim to foster a culture of compliance and ethical and responsible decision-making.apas whistleblower policy encourages the reporting of matters of

323、concern and suspected wrongdoing,such as dishonest or fraudulent conduct,breaches of legislation and other conduct that may 23APA AnnuAl REPORT 2011corporate governance statement continuedcause financial loss to apa or be otherwise detrimental to its reputation or interests,and describes the protect

324、ion to be afforded to whistleblowers who report such conduct against reprisals,discrimination,harassment or other disadvantage resulting from their reports.apas securities trading policy,published on its web site,provides that directors and designated management personnel may buy or sell apa securit

325、ies only during:the periods,each of one calendar month,starting on the second business day after each of three events,namely the release to aSX of the half year and full year results and apas annual meeting of securityholders;and at such other times as the board permits,unless exceptional circumstan

326、ces apply.Directors and employees are precluded from buying or selling securities at any time if they are aware of any price-sensitive information which has not been made public.Diversity Changes made to the aSX Corporate Governance Councils principles and Recommendation in 2010 include the recommen

327、dation that companies establish a diversity policy that includes requirements for the board to establish measureable objectives for achieving gender diversity and to assess annually both the objectives and progress in achieving them.apa values diversity and recognises that to continue to be a releva

328、nt and innovative organisation,it must leverage the full potential of its people.embracing individual diversity encourages diversity of thought,which is conducive to better decision-making and opportunity for innovation.It is also about taking advantage of all available talent for the benefit of the

329、 organisation.Diversity in this context refers to all characteristics that distinguish individuals from each other,and includes ethnicity,religion,gender and age.Historically,the industry in which apa operates has been dominated by men,to a greater degree than some other industries.today,approximate

330、ly 75%of apas employees are involved in operating and maintaining apas and third parties gas and pipeline and infrastructure assets and that many of those roles require physical,field-based work has meant they have been predominantly filled by men.apa is nevertheless committed to increasing the numb

331、er of women in its workforce and the pool of talented women from which managers are drawn.under apas equal employment opportunity policy,employment-related decisions are based on merit,with an additional emphasis towards proactively seeking to increase the female participation rate in senior managem

332、ent.With respect to the board,it is apas intention,when looking to fill a board position,to always have at least one qualified female candidate on the short-list of candidates.apa operates a talent program through which future leaders,both men and women,are identified and developed with a range of t

333、raining programs with a view to them moving into leadership roles in the future.apa respects that employees may have domestic responsibilities and seeks to retain such employees in the workforce,for example through its paid parental leave policy and flexible workplace practices policy.the latter provides a process where managers and employees can discuss and assess suitable workplace practices tha