11/02/2016 - 09:53

Goldfields gas pipeline commissioned

11/02/2016 - 09:53

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The state government has officially commissioned the $140 million Eastern Goldfields Pipeline, which will support the ongoing development of mining projects in the region and benefit operators of existing mines due to reduced costs

Goldfields gas pipeline commissioned
AngloGold senior vice-president Australia Michael Erickson (left) with Mines and Petroleum Minister Bill Marmion and APA managing director Mick McCormack. Photo: Aaron Bunch

The state government has officially commissioned the $140 million Eastern Goldfields Pipeline, which will support the ongoing development of mining projects in the region and benefit operators of existing mines due to reduced costs.

Turning on the gas at Independence Group and AngloGold Ashanti’s Tropicana gold mine today, Mines and Petroleum Minister Bill Marmion said the 239-kilometre pipeline, constructed and now operated by APA Group, would be a game-changer for the Goldfields.

“Replacing diesel and LNG for power generation by piping in natural gas at Sunrise Dam and Tropicana will slash fuel truck movements by 1,450 per year (to 450), a huge benefit to graziers and other local road users,” Mr Marmion said.

“While Sunrise Dam and Tropicana gold mines will reap the rewards of dependable, cleaner fuel, some of the state’s most exciting new gold, uranium and rare earths ventures are now within reach of the gas network.

“Not only did the pipeline support up to 330 jobs during construction, it will underpin even more jobs and opportunities in this rich and diverse mineral province.”

Extensions to the pipeline mean gas could be supplied to several projects including Gold Road Resources’ Gruyere project, Dacian Gold’s Mount Morgans project, Vimy Resources’ Mulga Rock uranium project, and Gold Fields’ Granny Smith gold mine.

The Tropicana mine is 70 per cent owned by AngloGold Ashanti and 30 per cent owned by Independence Group, while Sunrise Dam is wholly owned by AngloGold.

The pipeline was completed in under 12 months and extends from the existing Murrin Murrin-Yarraloola terminus of the main Goldfields Gas Transmission Pipeline to Sunrise Dam, and then on to Tropicana.

It extends the Goldfields gas system to nearly 1,800km.

AngloGold senior vice-president Australia Michael Erickson described the pipeline as an enabler that would support the long-term future of the company’s operations, as well as potentially providing gas for other projects in the region.

“The natural gas delivered by the EGP will underpin the future of AngloGold’s operations by reducing exposure to diesel price volatility and reducing the number of truck movements on the road by almost 60 per cent, which has an important safety benefit as well as reducing road maintenance costs," he said.

“The EGP is also a significant piece of infrastructure for Western Australia and has the potential to benefit other users in this very isolated part of the state.”

Chamber of Minerals and Energy of Western Australia chief executive Reg Howard-Smith said the opening of the pipeline would underpin the future of the Yilgarn mining province in the state.

“This represents a significant milestone for AngloGold’s Australian operations and for several other world-class deposits in the area,” he said.

“The delivery of additional infrastructure to isolated parts of the region will support the feasibility of projects which were previously considered to be unviable while securing a brighter future for many resources sector personnel.”

Mr Howard-Smith said the pipeline presented a great example of multiple stakeholders working together to deliver operational efficiencies and long-term sustainable cost reductions.

“Western Australia’s ongoing prosperity relies on innovative solutions which support efficiency and productivity improvements in a challenging commodities market,” he said.

“Access to a cleaner dependable fuel source is expected to reduce operational exposure to diesel price volatility, improve environmental outcomes and decrease substantial annual road maintenance costs.”

Association of Mining & Exploration Companies chief executive Simon Bennison said access to cost-effective regional infrastructure was a significant issue for AMEC members due to the remote location of many resources projects.

“There are nine operational, proposed and potential mining sites that should benefit from this pipeline,” he said.

“Replacing diesel fuel and LNG for piped natural gas power generation will provide a cleaner, more reliable and cost effective energy source.

“This will encourage more developments in the region, creating jobs and government revenue streams for years to come.

“The state government continues to make improvements in resource development approvals timeframes and reducing red tape which, in addition to targeted regional infrastructure, will assist in attracting investment to the minerals sector.

“The provision of cost effective infrastructure and improved approval processes will go a long way to improving Western Australia’s reputation as an investment destination.”

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