The Australian Government has agreed to provide a third loan to support the giant Perdaman urea project in the Pilbara, taking its total commitment to $475 million.
The Australian Government has agreed to provide a third loan to support the giant Perdaman urea project in the Pilbara, taking its total commitment to $475 million.
The government's Northern Australia Infrastructure Facility (NAIF) has committed a $220 million loan to support development of the multi-billion dollar urea project on the Burrup Peninsula.
It comes at a time when Perdaman – owned by Perth businessman Vikas Rambal – is striving to avoid further delays.
In May last year, Perdaman said it planned to commence construction in the first quarter of 2022.
In May this year, Perdaman said construction would get under way during the third quarter of 2022.
It has failed to meet both targets.
In the meantime, the project has become politically contentious after some traditional owners appealed to environment minister Tanya Plibersek to impose a works moratorium.
She rejected their appeal, declaring the Murujuga Aboriginal Corporation and its Circle of Elders – which support the project – as the most representative organisation for the traditional owners in the region.
The $220 million loan, to be provided at commercial rates, comes after NAIF approved two other loans for the project earlier this year.
It will lend $160 million to the Pilbara Ports Authority for a new multi-user wharf and facilities at the Port of Dampier and $95 million to the Water Corporation for the expansion of its Burrup seawater supply and brine disposal scheme.
Resources minister Madeleine King hailed the economic contribution of the project, which will cost $US4.2 billion ($A6.4 billion) to develop.
The company confirmed today that $US4.2 billion was the right number after various other estimates had been published.
Perdaman has also said the project was expected to generate between 1,500 and 2,000 construction jobs and 200 operational and indirect jobs once it begins production.
Perdaman today thanked the NAIF board and minister King for all their support for its local manufacturing project.
It has previously signed up two engineering companies – Perth-based Clough and Italian company Saipem – as EPC contractors for the project.
They signed a $US2.7 billion contract in May covering the construction of a two million tonne urea plant, ammonia production facilities, a 100-megawatt gas plant, a water treatment plant and seven kilometres of closed conveyor to the port.
Perdaman has also previously signed a 20-year gas supply contract with Woodside Energy and a 20-year offtake deal with fertiliser manufacturer Incitec Pivot.
It is expected that just under half the urea will be kept in Australia, replacing imports, with the balance to be exported.
NAIF said its loans will only be released when all required regulatory approvals and financing conditions have been met.
