Australian Potash Ltd (ASX:APC) has engaged specialised power provider PWR Hybrid to build, own and operate a 35-megawatt hybrid renewable energy microgrid at its Lake Wells Sulphate of Potash Project (LSOP) in Western Australia.
The microgrid will integrate an innovative gas-fuelled power station with solar, wind and battery energy storage technology, and is expected to achieve a Renewable Energy Fraction (REF) of above 65%.
That will make the hybrid facility one of the leading remote mine site power installations in Australia, supplying energy to what is Australia’s greenest SOP project.
Green goals achieved
Australian Potash Ltd managing director and CEO Matt Shackleton said the company had worked exceptionally hard to ensure LSOP would be a world leader in terms of its low environmental impact.
“Strategically, we shifted the focus of the LSOP development and operations to a sustainable energy footing to capture and leverage the already low GHG footprint of a solar-salt project,” he said.
“With the benefit of time, and rigorous and methodical planning, several alternative configurations for the LSOP microgrid were presented and assessed, and we are now pleased to appoint PWR Hybrid to work with us in developing what will be Australia’s greenest SOP project.
“Our SOP distribution partners operate across global geographies and markets where sustainable industries are valued for their contribution to the reduction of greenhouse gases.
“With our vision on the operational future of the LSOP, and therefore our end users, we consider it vital to address sustainable production of SOP as a critical path item.”
Low greenhouse gas impact
As part of the development of LSOP, Australian Potash commissioned an assessment of the project’s greenhouse gas footprint.
Taking into consideration the power balance across the project and energy usage through to ports of loading in Western Australia, the report concluded that LSOP will produce a CO2-equivalent greenhouse gas footprint that is materially lower than either a comparable Mannheim operation (lower by 68%) or solar salt/brine operation (lower by 49%).
“This report will further provide our distribution partners, end-users and investors with third-party validation of the project’s ESG qualities,” Shackleton said.
K-Brite sulphate of potash products
“The LSOP suite of K-Brite products are being progressively certified for use in organic agriculture in the world’s most lucrative markets, which when coupled with the very low CO2-equivalent footprint, will provide our end users with confidence that they are using sustainable products of the highest quality,” Shackleton said.
A previous front-end engineering design (FEED) study conducted by Australian Potash found that the K-Brite products would be at the premium end of the global SOP market.
The LSOP has a net present value of $614 million at an internal rate of return of 21%, which is estimated to deliver annual EBITDA to the company of $124 million.
Pre-production costs are expected to hit $292 million, including granulation and bragging circuits, with the operating cost set at US$251 per tonne.
Annual production is estimated at 170,000 tonnes SOP per year, with an estimated mine life of 30 years.
- Daniel Paproth