Fortescue Metals Group plans to spend a further $570 million on energy infrastructure in the Pilbara, after recent investments in gas power, batteries and a solar farm.
Fortescue Metals Group plans to spend a further $570 million on energy infrastructure in the Pilbara, after recent investments in gas power, batteries and a solar farm.
The new spending will expand the group’s private transmission network, from about 320 kilometres currently to more than 500km.
Once completed, the expanded network will allow electricity generated at any of its Pilbara sites to move between its five mining hubs and its port operations.
Details of the new spending were included in Fortescue’s climate change and sustainability reports, released earlier this week with its financial results.
The reports said FMG’s board had approved spending a further $US373 million ($570 million) on electricity transmission.
The board decision came ahead of the federal government’s announcement this week it has allocated $3 billion to help fund upgrades to WA’s electricity transmission networks in the South West and Pilbara.
Fortescue’s new spend builds upon its Pilbara Energy Connect project, which had a total cost of $US700 million.
While Fortescue and its executive chairman Andrew Forrest have highlighted the group’s focus on developing renewable energy, its recent investments include a new gas-fired power station.
It contracted Pacific Energy to build a 165 megawatt ‘high efficiency’ gas power station at its Solomon hub, alongside an existing 125MW gas power station.
Pacific Energy has also built and commissioned two batteries – a 16MW unit at Solomon and 26MW at Iron Bridge.
The new facilities help to power its Iron Bridge operation, which uses large amounts of energy to process magnetite ore.
The final leg of Pilbara Energy Connect is the North Star Junction solar farm, currently under construction.
Fortescue had previously flagged building a 150MW solar farm but it has been scaled back to 100MW.
This $180 million North Star project is due to start commissioning in June next year.
Fortescue’s climate change report signalled further spending on renewables, with feasibility studies underway for proposed wind and solar sites.
The company said it anticipated final investment decisions on these projects over FY24, FY25 and FY26.
Any new developments will go towards Fortescue’s stated goal of having an additional 2-3GW of renewable energy generation and battery storage by 2030.
The only operational solar farm in Fortescue’s network is the Chichester Hub solar farm.
With a capacity of 60MW, it is part of a gas-solar hybrid owned and operated by Alinta Energy.
The proposed capital spending of $US373 million is part of Fortescue’s group capex of about $US3.4 billion in FY24.
The new projects include a 132km transmission line from Solomon to Eliwana, with construction due to start in November.
It has also approved a 111km line from Lambda to Cloudbreak and Christmas Creek, with procurement underway and construction due to start in March next year.
Both projects are due to be completed by 2025-26.
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