Global infrastructure fund lands in Australia to feed gas to energy-hungry remote mines
A US$24 billion American infrastructure fund has established an outpost in Australia with the aim of trucking LNG to diesel-reliant mines in remote Western Australia.
I Squared Capital has acquired Perth-based Clean Energy Fuels Australia and will pump up to $500 million into an ‘energy transition platform’ to set up low-carbon and renewable energy assets across the country, with the first being a $100 million LNG terminal at Mount Magnet in WA’s Mid West.
I Squared Capital is headquartered in Miami, Florida, and manages investments in energy, utilities, digital infrastructure, transport and social infrastructure in the Americas, Europe, and Asia.
The platform’s initial focus will be displacing the 4.8 million litres of diesel consumed by WA’s mining sector every year.
The Mid West hub will be built in two phases. Capacity at the end of the first phase will be about 20,000 tonnes a year, up to 100,000 tonnes a year when complete.
Its first customer will be Silver Lakes Resources’ Deflector gold mine, which will begin receiving trucked LNG from the third quarter.
CEFA’s Romano Bernhard said CEFA had also secured a site in Port Hedland, which will serve as CEFA’s second LNG hub.
“Across these hubs, CEFA aims to build modular and flexible LNG liquefaction plants with cumulative capacity of up to 200,000 tonnes per annum,” he said.
“CEFA estimates that over 25 years of operation, these projects could displace around 6 billion
litres of imported diesel with domestically sourced natural gas and reduce customers’ CO2
emissions by over 4 million tonnes.”
While piped gas is the most cost effective form of transporting energy, the upfront costs and red tape make it prohibitive for remote mines that may not be anywhere near gas infrastructure.
The WA government has recognised the Mid West hub as a significant regional development, the first such project under planning reforms supporting economic recovery from COVID-19.
The ‘gas-led’ economic recovery touted by the federal government has drawn criticism from green groups, who argue reliance on fossil fuels in whatever form should be scrapped.
Hamish Hastie is WAtoday’s business reporter.
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Source: Thanks smh.com