THE BOURSE WHISPERER: Sandfire Resources (ASX: SFR) is set to commence construction of a 10.6 megawatt (MW) solar power station at its DeGrussa copper mine in Western Australia.
Sandfire has signed final agreements for the $40 million project to proceed.
The company anticipates the DeGrussa Solar Photovoltaic (PV) System will set new benchmarks for the use of renewable power for mining and processing operations.
Sandfire has executed a final Power Purchase Agreement (PPA) with juwi Renewable Energy Pty Ltd, which will develop and operate the project.
Diversified infrastructure and survey solutions company OTOC Limited (ASX: OTC) has been awarded the procurement and installation contract for the project via a joint venture with juwi, while French renewable energy firm Neoen will own the facility.
The Clean Energy Finance Corporation (CEFC) is committing up to $15 million in finance towards the project, while the Australian Renewable Energy Agency (ARENA) is providing $20.9 million of funding with Neoen contributing most of the balance.
Sandfire’s cash contribution to the project will be less than $1 million.
“Sandfire is pleased to be participating in this project as part of an extensive consortium which brings together the expertise of some of the world’s leading renewable energy companies, backed by significant funding provided by ARENA and the Clean Energy Finance Corporation,” Sandfire Resources managing director Karl Simich said in the company announcement to the Australian Securities Exchange.
“We identified some time ago that solar power presented an exciting opportunity for us to participate in a low-risk renewable energy initiative at DeGrussa and we have no doubt that this project has the potential to be an Australian and possibly a world first – establishing DeGrussa as a reference site for the use of off-grid solar and battery storage technology in the mining industry.
“I would like to take this opportunity to acknowledge the hard work that has been put into this project over the past few months by all of the consortium members and, on our side, by our operations and commercial teams.
“We are very much looking forward to this exciting new addition to our mine site as it is progressively constructed over the second half of this year.
“The project has the potential to reduce the mine’s diesel consumption and is consistent with our relentless focus on driving down costs.
“At the same time, it will reduce our carbon footprint, make an important contribution towards achieving improved environmental outcomes and potentially help promote the use of renewable energy in the Australian mining industry.”