Wesfarmers to upgrade LNG plant

Wesfarmers subsidiary Evol LNG has announced plans to upgrade its liquefied natural gas plant in Kwinana to increase production capacity by 40 per cent.

Evol said the upgrade was driven by a growing demand from the mining sector to replace the use of diesel for power generation with a cleaner and more cost-effective natural gas solution.

The expansion is set to increase the plant's production capacity from 175 tonnes to 250t processed per day from April next year, with plans for a further expansion to 300t/day in 2021.

Evol LNG wholesale manager Nick Rea said the company was well-positioned to make the most of new growth opportunities.

“Our expertise in small-scale LNG and proven capability to deliver lower cost and cleaner LNG is enabling off-grid mines to move away from diesel,” he said.

“We are in advanced negotiations with several parties, and our confidence in future growth prospects has enabled us to commit to the first stage expansion, with front end engineering design under way for the second stage expansion.”

Mr Rea said the Kwinana processing plant could be expanded at a relatively minor cost.

In June, Evol announced it had secured a six-year deal to supply gas for a 14.5-megawatt power station at Adaman Resources’ Kirkalocka gold mine near Mt Magnet in Western Australia.

Evol said today it predicted Adaman Resources would save more than $2 million a year and will reduce greenhouse emissions by 25 per cent by fuelling the mine’s power station with LNG instead of diesel.

The company added it had agreements in place with seven other miners in the Goldfields and Mid West regions in WA.