Perdaman's $4.3bn urea plant awaits Scarborough move

Vikas Rambal’s planned $4.3 billion Burrup urea project has signed a big offtake deal, but will be waiting for Woodside’s Scarborough LNG decision before proceeding further. 

Mr Rambal’s Perdaman Chemicals and Fertilisers inked a 20-year offtake with Incitec Pivot subsidiary, Incitec Fertilisers.

That offtake will be for up to 2.3 million tonnes a year over 20 years, conditional on Perdaman securing project financing.

While a final investment decision had been planned within months, Business News understands Perdman will make a decision towards the end of this year, pending Woodside’s Scarborough LNG project moving ahead.

Scarborough will supply gas to Perdaman for 20 years under a deal between the company and Woodside.

Construction for the Burrup plant will begin in the first quarter of 2022, if all goes to plan.

Approvals are well advanced, Perdaman said.

The company said it would be the first world-scale urea plant in Australia, converting gas into urea, which is used as a fertiliser.

Mr Rambal, who chairs Perdaman, said the signing of the offtake agreement was a major step forward in the development of the plant.

“The Karratha urea plant has the potential to make Australia a major player in the global urea market,” he said.

Incitec managing director Jeanne Johns said the plant would be one of the most energy efficient in the world, with low-emission technology.

“We are pleased to support such a significant domestic manufacturing project that will use Australian gas to produce urea fertiliser, essential for our Australian and international agricultural markets,” she said.

Perdaman is being advised by E&Y and Société Générale and represented by White and Case.

Mr Rambal said he wanted to thank the state and federal governments and traditional owners for their support.