APA will develop 152km pipeline to supply gas to the Gabanintha vanadium project in Western Australia
Technology Metals Australia (TMT) has signed a non-binding Memorandum of Understanding (MoU) with APA Group to supply gas to the £260m ($318m) Gabanintha vanadium project in Western Australia.
The Gabanintha vanadium project is a proposed open-pit mining development. It is expected to be one of the biggest primary vanadium producers in the world.
Under the terms of the MoU, the two firms will investigate the provision of gas transportation services along a new gas pipeline, which will be developed by APA from the south to supply gas to the Gabanintha project.
The 152km gas pipeline, which links to the project in the Mid West region, is expected to provide more cost-effective and efficient energy supply solution than the gas pipeline envisaged in the Gabanintha definitive feasibility study (DFS).
In return, TMT has agreed to take or pay tariff over a period, linked to the operational life of the Gabanintha project.
APA and TMT agrees on an exclusivity period on negotiating transportation services
Additionally, the TMT and APA have agreed on a commercial framework for the provision of gas transportation services as well as an initial work plan to finalise and execute the transaction documents.
The two companies have also agreed on an exclusivity period on negotiating transportation services, for the term of the MoU.
TMT managing director Ian Prentice said: “We are very pleased to have entered into this agreement with APA on the development of a proposed new gas pipeline; providing low risk delivery of gas to the project, cost reductions compared to the DFS as well as the opportunity to source gas from the significantly closer emerging Perth basin gas fields.
“We will be working together to develop a reliable energy solution for the Gabanintha vanadium project.
“This represents another key milestone as we progress the development of this lowest cost quartile, large scale, long-life world-class vanadium project.”