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Government backs next gen power project for Pilbara mining project

18 October 2019

Joint media release with the Minister for Energy and Emissions Reduction Angus Taylor MP and Western Australia Senator Dean Smith

A new energy project in the Pilbara that will create up to 200 jobs, generate more than $220 million in public benefits, increase productivity and deliver reliable power and reduce emissions is a step closer with the backing of the Liberal National Government.

The Government is supporting Alinta Energy’s Chichester Solar Gas Hybrid project in the East Pilbara region of Western Australia through the Northern Australia Infrastructure Facility (NAIF) and the Australian Renewable Energy Agency (ARENA) for the construction of a 60 MW solar photovoltaic (PV) farm and new electricity substation.

Approximately 60 kilometres of transmission lines will also be constructed to connect the project to Alinta’s existing 145 MW gas-fired Newman Power Station and its 35 MW / 12 MWh battery storage system.

The solar gas hybrid project will reduce the reliance of our mining sector on imported diesel. Thanks to this investment more of our mining jobs will be powered by Australian gas and the Australian sun.

The project is also expected to increase the security of energy supply in the region with regional communities and pastoral stations expected to benefit from a reliable, local energy source. Port Hedland and Karratha could also enjoy lower power prices, should the project be a catalyst for any future expansion of transmission connections in the Pilbara.

Minister for Resources and Northern Australia Matt Canavan said the NAIF loan would support development of the approximately $200 million project, and reaffirmed the Liberal National Government’s commitment to harnessing the enormous potential of Northern Australia.

“This NAIF loan will underpin more jobs for Australians and more productivity in the East Pilbara, creating more prosperity throughout the north,” Minister Canavan said.

“The loan is an investment in the jobs and industries of the region, boosting productivity in the East Pilbara and creating more prosperity throughout the north.

“The NAIF is really delivering for Western Australia, with 50 per cent of the projects currently in the due diligence phase of assessment being from the West.”

Minister for Energy and Emissions Reduction Angus Taylor said the project was in line with the Government’s continued commitment to supporting the transition to a lower emissions economy while, at the same time, providing reliable, secure and affordable energy to industry and regional Australia.

“The project will highlight the benefits of integrating renewable energy into mining processes and demonstrate how renewable energy can help reduce emissions in the sector,” Minister Taylor said.

“The combination of solar and gas means the mining operation will have clean, secure and reliable energy supply from morning to night.

“Importantly, as mining operations move away from a reliance on diesel, and the costs for firmed renewable technologies decrease, electricity costs will fall and mines will become more competitive.”

Western Australia Senator Dean Smith said the announcement was a major boost for the Pilbara region and would generate valuable employment opportunities in WA’s north.

“It’s an exciting project because it involves the sustainable diversification of energy generation, harnessing the abundant sunshine of the north to power operations and increasing energy supplies for mining operations,” Senator Smith said.

“New mine operators, local communities and pastoral interests will be able to tap into the network once it is established, helping us meet our national emissions reduction targets through low-emission renewable energy generation.”

NAIF will provide a loan facility of up to $90 million and ARENA will provide a $24.2 million grant to Alinta Energy Pty Ltd for the Chichester Solar Gas Hybrid project.

It is forecast the project will deliver public benefits of $221 million, and around 200 jobs are expected to be created at peak construction of the project.

Alinta has also outlined plans for Indigenous participation, procurement and employment in the project, as well as developing a strategy to support Indigenous training and education throughout the operations phase of the project.

The deal is subject to ratification by the Western Australian Government.

The NAIF is a Commonwealth Government $5 billion lending facility to finance projects with the governments of the Northern Territory, Queensland and Western Australia to achieve growth in the economies and populations of northern Australia.

Media contacts:

Minister Canavan's office 02 6277 7180

Minister Taylor’s office 02 6277 7120       

Senator Smith's office 02 6277 3404