Basslink independent report says cable outage cause unknown

An independent report has supported Basslink's argument that its subsea cable outage was a result of a force majeure event, with the company's dispute with Hydro Tasmania also escalating to arbitration.

Basslink has revealed that an independent report by Cable Consulting International (CCI) has found that the cause of the December 2015 outage is still "unknown", countering claims by Hydro Tasmania and the state of Tasmania.

"Hydro Tasmania and the state of Tasmania made certain allegations about the Basslink subsea cable," Basslink said.

"The exact cause of the subsea cable failure that led to the December 2015 outage of the Basslink interconnector continues to be described as a 'cause unknown' by CCI.

"The recent CCI report further supports Basslink's view that the cable failure was a force majeure event under the BSA [Basslink Services Agreement] and BOA [Basslink Operations Agreement]."

Last week, Basslink said that after following the dispute resolution procedures under the BSA with Hydro Tasmania, it was unable to resolve Hydro Tasmania's Notice of Disputes issued on October 22 and Basslink's Notice of Dispute issued on October 8.

"Accordingly, the disputes relating to Hydro Tasmania's Notice have been referred to arbitration before the same arbitrator hearing the matters under Basslink's notice and the state of Tasmania's dispute with Basslink," the company said.

"Basslink will continue to vigorously defend the claims made against it by Hydro Tasmania and the state of Tasmania."

Basslink had in April said its dispute with the state of Tasmania would be referred to arbitration after the two were unsuccessful in resolving it during without prejudice meetings.

"Unfortunately, the dispute was not resolved, and has led to Basslink being notified by the state today that the dispute is referred to arbitration. Basslink intends to vigorously defend itself in the arbitration and continues to reserve all its rights in this matter," it said.

"Basslink maintains its position that there is no proper basis for these claims."

The Tasmanian government had in March said it is seeking AU$122 million in compensatory damages from Basslink due to a months-long outage of the wholesale telecommunications and energy subsea cable.

Basslink has continually refuted claims by the state government that it breached the BOA contract it has as the operator of the submarine cable.

"As part of the commissioning of the Basslink Interconnector in 2006, the Basslink Interconnector was rigorously tested to ensure the design and construction requirements were satisfied," the company previously said.

"Given that the Basslink Interconnector was completed and commissioned more than a decade ago, Basslink is extremely surprised at these very belated allegations by the state, and strenuously denies that any warranties under the BOA were breached."

According to Basslink, an independent inspector had signed off the design, construction, and commissioning requirements.

"The state, through Hydro Tasmania, was very closely involved in the design, construction, and commissioning process. This involvement included attending various meetings with both Basslink and the manufacturers," the company argued.

"Basslink maintains the cable failure was a force majeure event."

The Tasmanian government's threats of legal action against Basslink followed reports from two global experts provided to Hydro Tasmania a year ago that found the outage of 2015-16 was caused by Basslink exceeding its design limit, which then degraded the cable.

Hydro Tasmania, a state government business enterprise that is responsible for a majority of the state's energy generation, in December 2017 said the findings "vindicate" its decision to have the outage investigated.

Basslink responded by saying the outage was not caused by anything other than a chance occurrence.

The Basslink Interconnector was down from December 2015, with Basslink finally completing its cable jointing repairs in June 2016 following months-long delays due to excess water damage and inclement weather.

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