Industry news... BHP tied to gas until 2053 as power needswells on electric fl eetPeter KerResources reporterApr 17, 2024 – 5.00am
BHP’s fl agship iron ore division will consume almost seven times more power by2040 because offleet electrifi cation [https://www.copyright link/companies/mining/fortescueand-rio-say-batteries-will-beat-hydrogen-for-trucks-20230614-p5dgj4], compelling the minerto expand a gas-fi red power station which it will rely on until 2053.It sought permission from the West Australian government to double thegeneration capacity of the Yarnima power station in the Pilbara iron ore district, asa fi rst step toward meeting the additional demand required to power trucks andtrains with batteries rather than diesel.
Listen to this article5min4/17/24, 6:41 AM Net zero: BHP iron ore wants new gas fired power station in Pilbarahttps://www.copyright link/companies/mining/bhp-tied-to-gas-until-2053-as-power-need-swells-on-electric-fleet-20240416-p5fk6p 2/6
The huge increase in power demand from the decarbonisation of Australia’sbiggest export industry comes asdevelopers of artifi cial intelligence and moderndata centres [https://www.copyright link/technology/nextdc-raising-1-3b-for-record-data-centredemand-20240411-p5fi z9]warn their industry is getting more energy-intensive.Yarnima’s generation capacity currently stands at 154 megawatts, comprised of 119MW of gas generation and 35 MW of diesel generation.BHP is seeking an extra 120 MW of gas-fi red generation, which would take totalcapacity at the site to 274 MW.
BHP CEO Mike Henry pictured in the Pilbara in 2022.4/17/24, 6:41 AM Net zero: BHP iron ore wants new gas fired power station in Pilbarahttps://www.copyright link/companies/mining/bhp-tied-to-gas-until-2053-as-power-need-swells-on-electric-fleet-20240416-p5fk6p 3/6The miner said the extra gas generation would enable it to phase out the 35 MWdiesel section of Yarnima, achieving a notional capacity of 239 MW, or 55 per centmore than it currently generates.However, in the fi ne print of the EPA submission, BHP said diesel generationcapacity would be retained as a contingency. The miner wants to complete theexpansion by 2027.BHP forecasts WA iron ore will need 1 gigawatt of power by 2040 fromapproximately 150 MW today.“The additional power is required for reasons including iron ore production anddecarbonisation projects, such as rail and mining fl eet electrifi cation, which areforecast to increase power demand substantially while BHPIO transitions torenewable energy sources.”The gas expansion will see 11.8 million tonnes of greenhouse gases released overthe 26-year operating life of the new gas engines.The diesel displaced by the extra gas-fi red generation would mean actualemissions between 2027 and 2052 would be about 3 million tonnes lower than ifdiesel consumption remained steady. This assumes that Yarnima’s dieselRELATED QUOTESBHP$44.970-1.75%ViewBHPrelated articlesRIO$128.700-2.90%1 year1 dayUpdated:Apr 17, 2024 – 6.41am.Data is 20mins delayed.Apr 23Jul 23Oct 23Apr 2439.00042.00045.00048.00051.0004/17/24, 6:41 AM Net zero:
BHP iron ore wants new gas fired power station in Pilbarahttps://www.copyright link/companies/mining/bhp-tied-to-gas-until-2053-as-power-need-swells-on-electric-fleet-20240416-p5fk6p 4/6generators are not used in emergencies nor for maintenance campaigns, whichBHP has declined to rule out.Yarnima is one of the 219 biggest emitters of greenhouse gas in Australia and istherefore obliged to reduce emissions under the federal government’s fl agshipsafeguard mechanism policy.Under reforms to the policy introduced by theAlbanese government last year, sites likeYarnima are supposed to reduce emissions byan annual average of 4.9 per cent between nowand 2030, then by about 3.28 per cent per yearbetween 2030 and 2050.This underpins a path to net-zero emissions by2050, and BHP told the EPA it could use severalcarbon offset schemes to realise this objective.Gas-fi red power stations can switch on and offquicker than coal-fi red power stations, makingthem better suited to a future where intermittent solar and wind energy sourcesprovide a large portion of power.This, BHP argued, was a better option than renewables and batteries: “Batterystorage can provide peaking and fi rming support, however, is not able to providebaseload power to meet demand,” it said.
The future of energy supply to Australia’s biggest export industry in the Pilbara isbeing decided to protect the economy’s No.1 earner.In February, British oil giant BP took a bigger stake in a giant renewables and greenhydrogen project, which is being built near the Pilbara town of Pardoo. BP steppedup after one of its big partners, Macquarie, sold its stake in the project, which alsocounts Andrew Forrest’s private company CWP as a shareholder.Dubbedthe Australian Renewable Energy Hub, the project[https://www.copyright link/companies/energy/bp-takes-major-slice-of-us36b-wa-green-hydrogen-hub-20220614-p5atn1]was originally envisaged as a giant green hydrogen export business,but challenges with shipping hydrogen long distances have convinced theproponents to pivot their strategy to fi nding customers for renewable electricityand green hydrogen nearby.Solar farms are becoming more common inthe Pilbara iron ore region.Carla Gottgens4/17/24, 6:41 AM Net zero: BHP iron ore wants new gas fired power station in Pilbarahttps://www.copyright link/companies/mining/bhp-tied-to-gas-until-2053-as-power-need-swells-on-electric-fleet-20240416-p5fk6p 5/6
The Pilbara iron ore miners have become its key targets.Proponents seeking to use hydrogen as a reductant to turn iron ore into “greeniron” also loom as potential customers of the hub.South Korean steel giant POSCO [https://www.copyright link/policy/foreign-affairs/pm-s-greedybattery-plan-alarms-korean-giant-20230430-p5d4fz]has sought federal approval to buildan iron ore pellet-making plant at Port Hedland. The plant would use hydrogen tostrip the oxygen off iron ore and make a higher-grade feedstock for its SouthKorean steel mills.Rio Tinto struck a partnership in October with theYindjibarndi native titlecustodians [https://www.copyright link/companies/mining/independent-expert-denies-bias-inblockbuster-fortescue-case-20240411-p5fj48]. The deal would potentially see theIndigenous group host clean energy generation assets on its ancestral lands in thePilbara.The Yindjibarndi have initially targeted 750 MW of combined wind, solar, andbattery storage.And French energy giant Neoencontinues to dismantle[https://www.copyright link/companies/energy/how-a-big-new-solar-farm-became-a-stranded-asset-20231219-p5eshb]more than 34,000 functional solar panels that were installed next toWA’s Degrussa copper mine with help from taxpayers just seven years ago.The copper mine has ceased to operate and there are no other customers nearby.
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