The Australian Competition and Consumer Commission said it would not oppose the merger after accepting court enforceable undertakings from Alinta.

“Our concerns arose principally in relation to the aggregation of ownership interests in gas pipeline interests in New South Wales and Western Australia,” ACCC chairman Graeme Samuel said.

In particular, Samuel said the ACCC was concerned over aggregation of interests in the Eastern Gas Pipeline and the Moomba-Sydney Pipeline and aggregation of interests in the Dampier-Bunbury Pipeline and the Parmelia Pipeline.

“By ring fencing Alinta’s interests in the Australian Pipeline Trust, the owner of the Moomba to Sydney Pipeline and Parmelia Pipeline, and providing for the eventual divestment of that interest, Alinta has alleviated these gas pipeline aggregation competition concerns,” he said.

Alinta has also committed to divest AGL’s contracts for the supply of management and operational services to the Moomba-Sydney and Parmelia pipelines.

But the ACCC will conduct further market inquiries to determine whether divestment of these contracts is required.

It has invited comments from the market before making a decision.

Alinta told the market yesterday that it welcomed the ACCC's approval, describing it as an important milestone in the progression of the merger.

“This transaction will catapult Alinta into the largest energy infrastructure utility and asset manager in the country, with the potential for strong organic growth,” Alinta CEO Bob Browning said.

“With this logical extension to our established strategy we believe that significant cost savings and synergies will be available, and we will continue to deliver superior shareholder returns.”