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Fortescue Metals Group Limited (ASX:FMG) has signed a long-term gas transportation agreement, aimed at reducing costs at its Pilbara operations.
The conversion of the 125 megawatt Solomon Power Station from diesel to gas is set to save about $US20 million per year.
The 270km Fortescue River Gas Pipeline will be built, owned and operated by the FRGP joint venture, owned by DBP Development Group, a subsidiary of
Duet Group (ASX:DUE) and TEC Pilbara Pty Ltd.
The pipeline is set to be operational by 2015 and Fortescue says it may open up long-term expansion opportunities across the Pilbara.
Fortescue Metals Group reported a net profit of $1.9 billion in the 2013 financial year.
