WA Kaolin has closed in on first production for the Wickepin kaolin project in Western Australia, after receiving a 15-year LNG (liquefied natural gas) supply agreement from Mid-West LNG.
The $22 million LNG supply agreement will power Wickepin’s rotary kiln which is used to dry its kaolin ore.
This is part of WA Kaolin’s proprietary dry processing method.
“We are thrilled to have entered into a 15-year contract with CEFA, one of Western Australia’s leading energy solution providers,” he said.
“As we continue to progress our stage one work program towards our target to be producing by year end 2021, it is vital for our development program that we lock in such important long term supplier agreements like this.
“The stage one work program at Wickepin continues on track and within budget and I look forward to providing the market with a further update of progression from on site shortly.”
The gas supply will commence on January 1, 2022 with commissioning gas to be supplied from September 2021.
WA Kaolin stated the 15-year contract will be reviewed in its fifth and tenth year, with two options to extend it for a further five years, respectively.
The contract will also provide storage and re-vapourisation infrastructure, which includes delivery of LNG by a virtual pipeline.
The Wickepin kaolin project has a mineral resources of 644.5 million tonnes of high-grade premium kaolinised granite.
It is one of the largest known remaining resources of premium kaolin in the world.