Plans unveiled for new 1-2m tonne/year urea plant in South Australia

LONDON (ICIS)–Plans for a 1m tonne/year granular urea plant in South Australia to serve the domestic and, potentially, foreign markets were announced on Monday by Leigh Creek Energy Limited (LCK).

The Adelaide-based firm has published a pre-feasibility study (PFS) for an Australian dollar (A$) 2.6bn ($1.85bn) nitrogen fertilizer facility that could double capacity in the medium term, and is already in talks with possible offtake partners.

In a presentation announcing the completion of the PFS for the coal gasification project, LCK revealed it expects a nominal urea production cost of around $77/tonne, with the ammonia feedstock generated via the processing of significant coal reserves.

The project would not only improve national food security, but likely lead to urea cargoes heading to export markets in southeast Asia and New Zealand, LCK managing director Phil Staveley said.

“The project is expected to be carbon neutral by 2030 and will encompass the latest proven technologies in its upstream (sub-surface ISG) and downstream urea manufacture and associated logistics, supply chain and distribution network infrastructure such as power, water and railway,” he added.

“LCK will also be the lowest-cost sovereign producer of urea, providing additional security to a critical product for the Australian agricultural sector.

“Building significant infrastructure in a remote part of Australia will not be without its challenges, but the Leigh Creek Energy Project will be a fully integrated urea production project with gas feedstock generated on site and the PFS has reduced and eliminated a number of potential project risks.”

LCK will now prepare a bankable feasibility study to “define and progress the critical path activities, including funding, urea production technology selection, and site activity preparation”.

($1 = A$1.40)