WA Kaolin signs 15-year LNG agreement
Western Australian miner WA Kaolin (WAK) has signed a 15-year A$22mn ($17mn) contract for the supply of LNG for its Wickepin Kaolin project, with Mid-West LNG (MWLNG), a unit of Perth-based Clean Energy Fuels Australia (CEFA), it said on May 26.
The LNG will be used to fire the rotary kiln at Wickepin that dries the kaolin ore, which is the first step in the company’s proprietary K99 dry processing method, WAK said.
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The contract, which includes the supply of commissioning gas from September 1, 2021, to the end of 2021, will start on January 1, 2022, and will run for 15 years with reviews at year five and year 10, and provides for two options to extend for a further five years respectively. The contract provides for the storage and revapourisation infrastructure, including delivery of LNG by a virtual pipeline.
CEFA is developing small-scale LNG infrastructure assets for remote mining operations and communities within Australia. CEFA, through MWLNG, is in the process of building a new LNG plant in Mount Magnet, located approximately 600 km north of Wickepin, and WAK will be the second customer supplied from this new facility. The Mount Magnet LNG hub is expected to supply in excess of 500 metric tons/day LNG when fully ready, WAK said.
Approval for the development of the Mid-West LNG hub at Mount Magnet was confirmed by the Western Australian Planning Commission in November 2020.