Origin Energy (ASX:ORG), an Australian gas and electricity company, will commit $80 million to expand the capacity of its gas-fired Quarantine Power Station, saying it will add to the security of electricity supplies in South Australia.

The power station expansion will be located about 25 km north Adelaide’s city center at Torrens Island, Origina announced in a statement on Thursday. The project includes the construction of a 120 MegaWatt (MW) peaking power generator next to the existing 95 MW installation, it said.

The $80 million power station expansion will be supplied with natural gas through the SEA Gas Pipeline that connects Adelaide with the southeast Australian gas network.

“This investment demonstrates the private sector’s commitment and ability to deliver new energy capacity to meet growing demand in South Australia and the eastern states,” Origin’s Managing Director Mr Grant King said.

The development plan received state’s approval in March and today, a contract will be signed with General Electric Company for the supply of a 120 MW Frame 9E gas turbine generator set.

Origin expects the power station’s expansion to be completed in the December quarter of 2008, in time to provide additional peak electricity capacity for that summer, and the summer of 2009.

Mr King added that“the expansion reflects the deepening integration of Origin’s energy business across eastern Australia.”