According to APA chairman George Bennett, a major contributing factor to the pleasing result was the expansion of pipeline assets, primarily in Queensland, which helped lift pipeline revenue by $6.6 million or 3.8 per cent to $180.4 million.

Despite a number of issues facing the gas pipeline industry, such as sufficient future gas supplies to the southeast states and the ongoing review of the regulatory system, Mr Bennett said the board was confident of maintaining strong business performance.

Australian Pipeline Trust managing director Jim McDonald said that since listing in June 2000, APA had consistently performed above forecasts. "APA sees a great future in bringing further gas supplies to the southeast states from the Timor Sea and Papua New Guinea and developing a national grid," he said.

But he emphasised that unless there was greater certainty from the regulator on a number of issues, new investments in the transmission of gas from these or other areas were uncertain.

"APA awaits the release of the Productivity Commission report on Part 111A of the Trade Practices Act as it relates to pipeline regulation, and the Council of Australian Governments energy markets review.

"These will be important inputs to ensuring the future regulatory environment is conducive to investment in pipelines," Mr McDonald said.

Mr McDonald added an effective national energy policy was vital to delivering an affordable and sustainable natural gas supply for the benefit of the Australian community.

"The APA board remains committed to gas transmission, but will consider other related investment opportunities which maintain and enhance unit holders' returns and diversify the business risks associated with a regulated business," he said.