Australian explosives giant Orica has announced that it will build a US$800M (approximately A$815M) ammonium nitrate plant in a joint venture with Yara International and Apache Energy on the Burrup Peninsula in the Pilbara region.
Ammonium nitrate is a base ingredient for civil explosives which are widely used by the mining industry. The plant is expected to produce 330,000 tonnes per annum and construction be completed in 2015.
“As well as creating at peak 600 construction jobs, and 60 operational positions when it is commissioned in 2014, the Burrup Nitrate plant will generate significant additional local business opportunities and employment over its expected 40-year lifespan,” said Colin Barnett, Premier of Western Australia. “Value-adding to the Pilbara’s existing resources is an important factor in ensuring Karratha’s continuing growth as a major regional centre, as part of the State Government’s Pilbara Cities Vision.”
Orica and Norwegian based chemical company Yara will both own 45% of the joint venture, and US based oil and gas explorer Apache the remaining 10%. Construction and ongoing operation will be managed by Yara.
The parties have also formed a joint venture company in the same proportions to market and distribute all ammonium nitrate and associated products and services, but this company will be managed by Orica.
“This is an extremely important project for Orica,” said Orica’s Managing Director and CEO Ian Smith. “Together with our partners, we have a clear vision for servicing the fast growing Pilbara iron ore market, which is being strongly embraced by our customers in the region”.