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BHP Nickel West puts forward renewable hydrogen project for ARENA funding

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BHP’s Nickel West division is among seven companies to have been shortlisted and invited to submit a full application for the next stage of the Australian Renewable Energy Agency’s (ARENA) A$70 million ($49 million) hydrogen funding round.

In April, ARENA opened the Renewable Hydrogen Deployment Funding Round to help fast track the development of renewable hydrogen in Australia. The funding round is expected to play a significant role in supporting commercial-scale deployments of renewable hydrogen in Australia and commence the pathway to achieving the Australian Government’s goal of ‘H2 under $2’, ARENA said.

Nickel West is a fully integrated mine-to-market nickel business where all operations (open pit and underground mines, concentrators, a smelter and refinery) are in Western Australia. The integrated business adds value throughout the company’s nickel supply chain, with the majority of Nickel West’s current production sold as powder and briquettes, BHP says.

In addition to BHP Billiton Nickel West Pty Ltd, the other shortlisted applicants are APT Management Services Pty Ltd; ATCO Australia Pty Ltd; Australian Gas Networks Ltd; Engie Renewables Australia Pty Ltd; Macquarie Corporate Holdings Pty Limited; and Woodside Energy Ltd.

The total grant requested across all seven is over A$200 million, with a total project value of almost $500 million, ARENA said.

“All applicants have well developed projects that involve deploying 10 MW or larger electrolysers, made up of various end uses including transport, gas injection, renewable ammonia production, power and industrial use,” it said.

ARENA aims to support two or more of the shortlisted large-scale renewable hydrogen projects, with these projects expected to be among some of the largest electrolysers in the world.

“Each project will need to be powered by renewable electricity, either directly or through a contracting approach,” ARENA explained.

During the initial application stage, ARENA received 36 expressions of interest, totalling more than A$3 billion of renewable hydrogen projects.

ARENA CEO, Darren Miller, said: “We’re excited to be able to invite these seven projects to submit full applications for ARENA funding. Our ultimate goal is to bring the price of renewable hydrogen down to be competitive with other forms of energy and be at the forefront of renewable hydrogen production. The best way to help build a hydrogen industry is to support projects that will help demonstrate the technology at scale, and share the lessons learned to help the industry as a whole reduce risk and costs as well as increase efficiency.”

Applicants invited to the full application stage will have until January 2021 to prepare their application, with ARENA expecting to select the preferred projects by mid-2021.

Successful projects are expected to reach financial close by late 2021 and commence construction in 2022.

All applicants may also be considered for financing from the Clean Energy Finance Corp (CEFC) under the CEFC’s A$300 million Advancing Hydrogen Fund.

ARENA says it has already committed over A$55 million for renewable hydrogen projects including $22.1 million towards R&D projects, as well as feasibility studies into large-scale projects and smaller-scale demonstrations looking at renewable ammonia, power to gas and hydrogen mobility.

FMG to lead from the front in Pilbara renewable energy pursuit

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Fortescue Metals Group (FMG) has signed an agreement with Alinta Energy that will see up to 100% of daytime stationary energy requirements at its Chichester Hub iron ore operations, in the Pilbara of Western Australia, powered by renewable energy.

The Chichester Solar Gas Hybrid project will see the construction of a 60 MW solar photovoltaic generation facility at the Chichester Hub, comprising Fortescue’s Christmas Creek and Cloudbreak iron ore mining operations.

In addition, an approximately 60-km transmission line linking the Christmas Creek and Cloudbreak mining operations with Alinta Energy’s Newman gas-fired power station and a 35 MW battery facility will be constructed, with completion due mid-2021.

FMG said: “Once completed, up to 100% of daytime stationary energy requirements at the Chichester Hub will be provided by solar generation, with the remaining power requirements to be met through the integrated battery storage and gas power station facilities.”

The project is expected to displace around 100 million litres annually of diesel used in the existing Christmas Creek and Cloudbreak power stations, according to FMG.

Fortescue Chief Executive Officer, Elizabeth Gaines, said: “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 also 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% at Fortescue’s Christmas Creek and Cloudbreak mining operations, while driving long-term sustainable cost reductions to maintain Fortescue’s global cost leadership position.”

Gaines added that the agreement with Alinta Energy represented a further step in the creation of Fortescue’s Pilbara Energy Connect project, which builds on the company’s previous energy initiatives, including the construction of the Fortescue River Gas Pipeline, the conversion of the Solomon Power Station from diesel to gas generation, as well as a partnership agreement with the Commonwealth Scientific and Industrial Research Organisation to develop and commercialise hydrogen technologies.

As part of the agreement, FMG will invest an estimated $250 million in energy transmission infrastructure to complete the integration of Fortescue’s iron ore operations in the Pilbara into an efficient energy network.

Alinta Energy Managing Director and Chief Executive Officer, Jeff Dimery, said: “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 will receive federal funding of A$24.2 million ($16.5 million) from the Australian Renewable Energy Agency (ARENA) and A$90 million from the Northern Australia Infrastructure Facility (NAIF), upon satisfaction of standard conditions.

The NAIF loan remains subject to ratification from the Western Australian Government.

NAIF Chief Executive Officer, Laurie Walker said: “NAIF’s A$90 million loan for this project will help provide low emission renewable energy generation for large off-grid customers and paves the way towards the creation of a more interconnected regional energy grid in the Pilbara.

“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, said: “The project could unlock further investment in renewable energy in the mining sector and other remote and energy intensive operations.

“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.”

Gold Fields goes for low-carbon energy solution at Agnew gold mine in Australia

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Gold Fields says its Agnew gold mine, in Western Australia, will become one of Australia’s first mining operations to be predominantly powered by renewable and low-carbon energy following a deal with global energy group EDL.

Gold Fields and EDL have agreed on a A$112 million ($78 million) investment in what the gold miner says is a “world-leading energy microgrid combining wind, solar, gas and battery storage”.

The Agnew mine consists of two underground complexes and one processing plant, with a capacity of 1.3 Mt/y consisting of a three-stage crushing circuit, two-stage milling circuit, gravity circuit and carbon-in-pulp circuit.

The microgrid will be owned and operated by EDL, which will recoup its investment via a 10-year electricity supply agreement with Agnew.

The project, which is already under construction, has the backing of the Australian Government with the Australian Renewable Energy Agency (ARENA) contributing a recoupable A$13.5 million to its construction, according to Gold Fields.

The Agnew microgrid is initially forecast to provide 55-60% of the mine’s energy needs, with potential to meet almost all energy requirements at certain times, Gold Fields said. The Agnew microgrid will consist of five wind turbines delivering 18 MW of power, a 10,000-panel solar farm contributing 4 MW, a 13 MW/4 MWh battery energy storage system, and a 16 MW gas engine power station to underpin supply when required.

EDL said stage one consists of a new off-grid 23 MW power station incorporating 16 MW gas and 3 MW diesel generation and 4 MW photovoltaic solar, which is on track for completion in mid-2019. Stage two includes 18 MW wind generation, a 13 MW battery and an advanced micro-grid control system, with construction recently started and due for completion in 2020.

The hybrid microgrid at Agnew follows the announcement of a microgrid at Gold Fields’ Granny Smith mine, featuring 20,000 solar panels and a 2 MW/1 MWh battery system planned for completion in the December quarter.

Gold Fields Australia Executive Vice President, Stuart Mathews, said the Agnew hybrid microgrid project reflects the company’s strategic objective to strengthen energy security, optimise energy costs and reduce its carbon footprint through innovation and the adoption of new technologies.

“The ARENA contribution supports and encourages our efforts. We are making staged investments across our mines in Western Australia to significantly ramp up the innovative use of renewables to meet our dynamic and growing load requirements,” Mathews said.

The funding is part of ARENA’s Advancing Renewables Programme. ARENA CEO, Darren Miller, said the project marks a growing shift in the mining sector’s thinking around powering mine sites.

“The project Gold Fields is undertaking will provide a blueprint for other companies to deploy similar off-grid energy solutions and demonstrate a pathway for commercialisation, helping to decarbonise the mining and resources sector,” Miller said.

Gold Fields says it is embracing innovation and technology across all levels of its mining operations and Mathews said this also extended to its approach to power supply and demand management.

“At Agnew, we will be using instrumentation to detect approaching cloud cover for solar and, potentially in the future, detect changes in wind velocity. Based on this data, the gas power station will have forward-looking systems in place to schedule gas generators in response to forecast changes in the renewable energy supply,” he said.

EDL CEO, James Harman, said the company has seen increasing momentum towards hybrid energy solutions, particularly in remote, off-grid locations. “EDL is pleased to be an active contributor to Australia’s transition to sustainable energy,” Harman said. “Our knowledge and experience from our successful hybrid renewable projects will enable us to provide Agnew with greater than 50% renewable energy over the long term, without compromising power quality or reliability.”

Mathews said: “The configuration of Agnew’s hybrid solution is a first for Gold Fields and is an excellent example of using innovation and technology to improve efficiencies and lower costs. We are fast sharing lessons from this project with our other regions, as part of our global strategic initiatives to improve our security of supply and reduce carbon emissions.”

Gold Fields is the third largest gold producer in Australia. It currently owns and operates three mines in Western Australia and is completing the construction of a fourth, Gruyere, in joint venture with Gold Road Resources.