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APA Sign Agreement to Commence Early Works to Supply Energy to Arafura's Nolans Project
Published on
31 July 2023
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APA Sign Agreement to Commence Early Works to Supply Energy to Arafura's Nolans Project

Leading Australian energy infrastructure business, APA Group, today signed an agreement with Arafura Rare Earths to commence early works for a proposed high efficiency cogeneration plant to supply energy to Arafura’s Nolans Rare Earth Project.

Arafura’s Nolans Project includes a rare earth mine, processing plant and related infrastructure to be constructed 135 kilometres north of Alice Springs.

The early works agreement follows a formal competitive tender process through which APA was selected as the preferred Independent Power Provider by Arafura.

Under the early works agreement, APA will undertake engineering design and project development planning work for the proposed cogeneration plant, which is planned to include a gas turbine generator to supply electricity and a waste heat recovery system to supply steam.

The cogeneration plant would potentially be connected to APA’s nearby Amadeus Gas Pipeline. The proposed cogeneration plant and related long-term power purchase agreement is subject to further negotiations between APA and Arafura and approvals by each party.

Arafura has secured offtake agreements with a Tier 1 global electric vehicle manufacturer and wind turbine manufacturer, with the project to support the growing demand for critical minerals needed to support the energy transition.

“As the energy sector continues to transition the global demand for critical minerals, which are essential to a range of clean energy technologies, will increase significantly in coming years,” APA CEO and Managing Director Adam Watson said.

“The Nolans Project is particularly rich with neodymium and praseodymium – minerals that are key to the production of a range of green technologies including electric vehicles, wind turbines and consumer electronics.

“We are excited to play this role in the global decarbonisation process and contribute towards bringing these critical minerals to market.

“We will also work with Arafura to explore how we can deliver a bundled energy solution, pairing reliable gas firming with renewables, for the project.

“This is part of APA’s commitment to partnering with our customers across the resources sector to deliver efficient, cost-effective, reliable and low emissions energy for today and tomorrow.”

APA and Arafura have both committed to Net Zero operational emissions in their respective Climate Transition Plans (further details of which are available on APA’s website). It is expected that energy from the cogeneration plant for Nolans Project would be complemented by renewable energy in the future.

Early works for the project will commence immediately and are expected to be completed by early 2024.