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AngloGold sign gas agreements for WA gold mines

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AngloGold Ashanti has signed natural gas transportation agreements for its WA Sunrise and Tropicana gold mines.

The agreement with APA Group will see the contractor build a new 292 kilometre pipeline, dubbed the Eastern Goldfields Pipeline, that will connect to the existing Goldfields Gas Pipeline via the lateral pipeline at the Murrin Murrin nickel mine, and then extend past Sunrise Dam to Tropicana.

Construction on the $140 million work is slated to start in February next year, with first gas at Tropicana in January 2016.

The power stations at both mines will be modified to run on 100 per cent natural gas, while retaining diesel back up capacity.

"Gas power generation is expected to reduce cash operating costs at both sites by between $25 to $30 per ounce," AngloGold senior vice president Australia, Michael Erickson, said.

According to APA managing director Mick McCormack "the Eastern Goldfields Pipeline can be further extended to service other mines in the region in addition to these initial contracts [with AngloGold Ashanti}".

AngloGold is not the only miner turning towards gas rather than diesel or the grid for its remote WA operations.

Earlier this year Fortescue announced the signing of a long term gas transportation agreement to slash its overheads.

The agreement will see the construction of a 270 km long Fortescue River Gas Pipeline to deliver gas from the existing Dampier to Bunbury Natural Gas Pipeline to Fortescue Metals Group’s 125MW Solomon Hub power station.

The pipeline will cost $178 million construct, and be built by Monadelphous and the DBP Development Group (which is a joint venture between the DUET Group and TransAlta subsidiary TEC Pilbara).

The development of the pipeline is part of the miner’s wider strategy to cut energy costs and reduce carbon emissions across its operations.

As part of this pipeline development FMG is also converting power station from diesel to gas, which is predicted to save the miner around US$20 million annually.

The miner was able to easily do this as it had already installed dual fuel turbines at the site in line with the eventual plan to convert to gas.

A 20 year, 100% take-or-pay gas transportation contract has been signed between the joint venture DBPP Group and the miner, with Fortescue already securing Shipper Rights under the Gas Transportation Agreement

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