FMG turns to renewable energy to power its Chichester Hub in WA

Monica Gameng   |   October 20, 2019

Fortescue Metals Group (FMG) is making a move towards utilising solar power to provide up to 100 per cent of daytime energy to its Chichester Hub iron ore operations in the Pilbara and the company has signed an agreement with Alinta Energy for the development of the Chichester Solar Gas Hybrid project.

“Reliable and competitive energy generation remains an important consideration for the mining sector in Western Australia and as a significant consumer of energy, we continue to identify opportunities that have the potential to lower our costs while improving our carbon footprint.

“This landmark project is a first on this scale for the Pilbara and will reduce carbon emissions from stationary generation by around 40 per cent at Fortescue’s Christmas Creek and Cloudbreak mining operations, while driving a long-term sustainable cost reduction to maintain Fortescue’s global cost leadership position,” FMG Chief Executive Officer Elizabeth Gaines said.

The Chichester Solar Gas Hybrid project will deliver a 60MW solar PV farm as well as a 60-kilometre transmission line that will connect the Christmas Creek and Cloudbreak mining operations to Alinta Energy’s Newman gas-fired power station, and a 35MW battery storage facility.

“The agreement with Alinta Energy makes a significant milestone in Fortescue’s energy strategy and represents a further step in the creation of Fortescue’s Pilbara Energy Connect project. In addition, Fortescue will invest an estimated US$250m in energy transmission infrastructure, which will complete the integration of Fortescue’s iron ore operations in the Pilbara into an efficient energy network,” Ms Gaines said.

Once operational, the solar farm will be able to provide up to 100 per cent of the mining hub’s daytime stationary energy requirements and the rest of the Chichester Hub’s energy requirements will be provided by the battery storage and gas power station facilities.

The Chichester Solar Gas Hybrid project is also anticipated to displace approximately 100 million litres of diesel that is used annually by the existing Christmas Creek and Cloudbreak power stations.

“We’d like to thank Fortescue and our Chichester Hub project partners for helping to make the company’s long-held vision for a cleaner and more connected energy supply for the Pilbara a reality.

“There’s a lot to be proud of in this project. Working together, we are on the cusp of demonstrating that renewables can drive Australia’s economic powerhouses forward - even for remote and complex industrial applications,” Alinta Energy Managing Director and Chief Executive Officer Jeff Dimery said.

The Australian Renewable Energy Agency (ARENA) will be providing $24.2 million in Federal funding to Alinta Energy for the development of the Chichester renewable energy project, together with $90 million loan from the Northern Australia Infrastructure Facility (NAIF) if standard conditions are met. The NAIF loan is still subject to ratification from the State Government.

NAIF Chief Executive Officer Laurie Walker said: “The project innovatively combines solar and gas fired power to compensate for the variability of solar sourced energy. This investment by NAIF offers the opportunity to make a long-term difference to the Pilbara.”

ARENA Chief Executive Officer Darren Miller added: “Alinta’s project will demonstrate how renewable energy solutions can deliver critical energy requirements for major mining operations and help reduce emissions. This will also show how interconnection of loads and different generation and storage - including solar, gas and battery storage - can provide secure and reliable electricity.”

In addition, Alinta Energy has awarded a $165 million contract to Downer EDI to deliver the 60MW solar farm and associated infrastructure for the Chichester Solar Gas Hybrid project.

Downer’s contract includes engineering, procurement and construction (EPC) of the solar farm as well as the 60-kilometre transmission line, construction of two new substations and upgrade works to another substations.

“We are looking forward to delivering the project in partnership with Alinta Energy and we are expecting an efficient integration of the solar farm and supporting power infrastructure into Alinta Energy’s existing network in the Pilbara,” Downer Chief Executive Officer Grant Fenn said.

Construction of the Chichester Solar Gas Hybrid project is due to be completed in mid-2021.

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Source: Fortescue Metals Group; Downer EDI; Australian Mining

Monica Gameng
As Felix's Marketing Assistant since 2015, Monica is responsible for researching and sharing new and progressing projects within the construction and mining sectors in Australia. It's no surprise that Monica has her finger on the pulse of Australian major projects given she has produced more than 1,000 posts. She truly is an industry expert.
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