$35m infrastructure spend for Burrup plant

18/08/2020 - 11:00

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The state government says it will cover some of the infrastructure costs related to Perdaman Group’s $4.6 billion urea plant on the Burrup Peninsula.

$35m infrastructure spend for Burrup plant
Perdaman estimates the urea plant will generate $850 million in annual export revenue for WA. Photo: Perdaman Group

The state government says it will cover some of the infrastructure costs related to Perdaman Group’s $4.6 billion urea plant on the Burrup Peninsula, including for a new cargo wharf.

It comes after Perdaman signed a binding heads of agreement with a 50:50 joint venture between Perth-based Clough and Italian company Saipem early last month for engineering, procurement and construction work at the Karratha site.

Perdaman is planning to use the plant to transform natural gas into urea – a widely-used form of fertiliser – which the Perth-based company says will support future food production.

The project has been strongly endorsed by the state government, which today announced it would invest $35.5 million for road relocation costs, detailed design of a new Dampier Cargo Wharf and upgrades to seawater supply infrastructure.

Regional development minister Alannah MacTiernan said the plant would be the first gas manufacturing project in the Pilbara in 15 years.

It is expected to create an estimated 2,500 jobs during construction and 300 permanent Karratha-based jobs during operations, she said.

“Our government’s support is subject to a number of stringent conditions, but will help to give this job-creating project the best chance of success,” Ms MacTiernan said.

Conditions include Perdaman receiving a loan from the Northern Australia Infrastructure Facility, along with reaching financial close for the project and securing offtake agreements.

The project forms part of the state government’s Renewable Hydrogen Strategy and also supports the development of Woodside’s proposed Scarborough gas field, with a 20-year gas supply agreement already in place between both companies.

Perdaman has estimated the plant would produce 2 million tonnes of urea per year, generating $850 million in annual export revenue for Western Australia.

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