Agreement to supply gas to S Dongara lime plant welcomed

13/9/96

Energy Minister Colin Barnett has welcomed today's announcement of an agreement between Westlime (WA) Limited and the Australian Gas and Light Company (AGL) for the supply of gas to a new lime plant being built at South Dongara.

Mr Barnett said that the co-operative arrangement was an example of the effects of deregulation of gas markets in Western Australia which had led to competition and lower gas prices to industry.

"This project, and others like it which are particularly sensitive to the price of energy in the production process, are benefitting from deregulation," Mr Barnett said.

The agreement will involve the East Spar Joint Venture as a producer of gas, the AlintaGas transmission division as transporter and AGL as the trading partner.

Natural gas will be used by the new Westlime project where quicklime will be produced. Quicklime is a highly alkaline chemical used extensively for countering acidity in gold and mineral sands processing, for regenerating caustic solutions in the alumina industry and as a cementing agent in the building industry.

The total project cost is $21 million and the reserves are sufficient to last in excess of 100 years.

Mr Barnett said that from January 1, 1997, deregulation of the gas market would benefit customers using more than 500 terajoules per year at a single site. Further deregulation in the future would provide additional benefits to a larger number of customers.

AGL would construct a gas lateral off the Dampier-to-Bunbury Natural Gas Pipeline to supply Westlime. The gas lateral would have sufficient capacity for future planned expansion.

The first gas deliveries would coincide with the start of the operations of Westlime, due early in 1997.

Media contact: Justine Whittome (09) 222 9699