Fortescue ends power agreement

Fortescue Metals Group has officially terminated a power purchase agreement with TransAlta Corp at the South Hedland Power Station in Western Australia.

The iron ore miner had been contracted for 40 megawatts of power from the recently-completed facility to be used at its nearby port operations.

In August, however, Fortescue said the station had not satisfied performance criteria in the agreement.

The miner this week confirmed that the agreement between the two companies would, therefore, end.

“Discussions between Fortescue and TransAlta have failed to reach a satisfactory outcome,” Fortescue reported.

“Fortescue is not satisfied that the performance conditions under the South Hedland Power Purchase Agreement have been met and accordingly, Fortescue has today issued a notice of termination to TransAlta and its related entities.”

Fortescue said the security of power supply to its Port Hedland operations was critical.

“Satisfaction of the performance conditions under the South Hedland Power Purchase Agreement is key to ensuring the continued performance of those operations,” the company said.