Plans for Mid-West LNG Hub at Mount Magnet to boost industry and remote communities

Sep 2020

Industry and remote communities in Western Australia’s Mid-West region stand to benefit from reduced energy costs and lower greenhouse gas emissions with plans for a state-of-the-art liquefied natural gas (LNG) production hub.

Perth-based Clean Energy Fuels Australia (CEFA) has secured a long-term site lease for the plant near the town of Mount Magnet, approximately 300 kilometres East of Geraldton in regional WA.

The project is currently under assessment by the WA Planning Commission (WAPC) as a “significant development” in the new State Government planning pathway to support economic recovery from COVID-19.

Subject to approval, construction of the plant is set to commence later this year.

The plant will form part of the Mid-West LNG Hub, which has a total cost of more than A$100-milion. The Hub will supply LNG as a lower emission fuel to generate electricity for mines and remote communities across the region, providing a greener alternative to diesel with reduced energy costs and lower greenhouse gas emissions.

CEFA selected Mount Magnet for its first WA-based LNG hub due to the location’s excellent transport links, existing access to gas pipeline infrastructure, and proximity to remote power customers.

CEFA is supported by global infrastructure fund I Squared Capital to deliver the Mid-West LNG Hub and has secured access to natural gas, pipeline transport capacity, and a long-term lease for the site.

CEFA Managing Director, Romano Bernhard, said: “It is great to see the Mid-West LNG Hub coming to life. Our recent execution of the site lease is a great milestone for the project and it keeps us on track to deliver LNG to our customers in the second quarter of 2021.

“In addition to being significantly more environmentally friendly, domestically produced LNG is materially cheaper than diesel – almost all of which is sourced from imported oil. As well as contributing positively to Australia’s balance of payments, miners will benefit from an immediate reduction of operating cost without any capital expenditure. We are also working on innovative solutions to displace diesel consumed in heavy mine haul vehicles with LNG while maintaining the same power delivery needed for mining operations,” Mr Bernhard said.

The new facility is expected to create close to 100 jobs during construction, and contribute significantly to the local economy, creating new skilled roles in the Mount Magnet region.

Shire of Mount Magnet CEO, Kelvin Matthews, said the Council fully supports the development of the Mid-West LNG Hub.

“The Council welcomes appropriate developments in the Mount Magnet region, especially those that create long term jobs, provide opportunities for local residents to develop new skills, improve the competitiveness of existing business, and help to unlock other development opportunities in the region”.

CEFA worked with a US-based specialist to design and engineer the modular LNG process plant. The Hub will include the first LNG liquefaction train, LNG transport tankers, customer storage, and regasification facilities.

CEFA estimates that over 25 years of operation, the first LNG train at the Mid-West LNG Hub could displace around 3 billion litres of imported diesel with domestically-sourced natural gas and reduce customers’ CO 2 emissions by over 2 million tonnes.

The LNG facility’s modular design will enable CEFA to add more LNG trains over time to facilitate further displacement of diesel with domestic gas.

In implementing its Mid-West strategy, CEFA will draw on its experience in distributing LNG safely and reliably to customers on the east coast of Australia. It will use the same innovative LNG logistics and storage solutions to link energy users within 1,000 kilometres of the Mid-West LNG Hub to Western Australia’s vast natural gas resources while providing the flexibility to cope with changing power demands and renewable energy solutions.

For more information please contact:

Romano Bernhard – Managing Director
David Trembecki – Director

+61 8 9212 6700

About CEFA

Clean Energy Fuels Australia (CEFA) is an established Perth-based company developing small-scale LNG infrastructure assets in Australia. The company focuses on long-term fuel supply partnerships with regional mining, industrial and commercial energy users, providing fuel cost savings, reducing pricing volatility and delivering significant and immediate emissions reductions. CEFA’s virtual pipeline (or Trucked LNG) model lowers long term regional energy costs and emissions and provides a viable alternative to diesel for new and existing energy users.

About I Squared

I Squared Capital is an independent global infrastructure manager focussing on investments in energy, utilities, transport, telecom and social infrastructure. With commitments from some of the world’s largest pension and sovereign wealth funds, I Squared Capital manages over $14 billion of assets across various infrastructure asset classes. The firm is headquartered in Miami and has offices in New York, New Delhi, London, Hong Kong and Singapore. I Squared Capital has portfolio companies with operations in over 44 countries.