Pilbara urea project could deliver 96% of Australia’s needs

Deputy Prime Minister Barnaby Joyce told Parliament during Question Time today that the proposed $4.3 billion Perdaman Urea Project will be capable of delivering 96% of the urea required for Australian needs.

Mr Joyce said that prior to the current supply issues, 80% of the urea Australia uses had come from China.

“This government has put $255 million on the table for the construction of a urea plant at Karratha,” he said.

The money is channeled through the Northern Australia Infrastructure Facility, a development financier to infrastructure projects in the Northern Territory, Queensland and Western Australia.

The $4.3 billion project, located 20 kilometres north-west of Karratha, will convert Western Australian liquefied natural gas into about two million tonnes of urea per year.

The project is set to be delivered by Perdaman Chemicals and Fertilisers who have already signed MoU’s for the supply of gas and a twenty year agreement with Incitec Pivot for a substantial portion of the plant’s output.

The $4.3 billion Karratha urea plant is scheduled to start production in the 4th quarter of 2025. It will be Australia’s first world scale urea plant, converting Australian gas into urea.

Perdaman Chairman Vikas Rambal said the signing of the offtake agreement represented a major step forward in the development of the plant.

“The Karratha urea plant has the potential to make Australia a major player in the global urea market” Mr Rambal said.

IPL Managing Director & CEO Jeanne Johns said the world-scale plant will make it one of the most energy efficient plants in the world utilizing low emissions technology.

“We are pleased to support such a significant domestic manufacturing project that will use Australian gas to produce urea fertiliser, essential for our Australian and international agricultural markets”

Perdaman has now achieved several major milestones and is on track to commence construction of the Karratha urea plant during Q1 of 2022.

It is estimated the Perdaman project will create around 2,500 jobs during construction and 200 operational jobs.

Western Australia’s State Development, Jobs and Trade Minister Roger Cook said that recent international supply chain issues have highlighted just how important urea is to agriculture and transport industries.

“Western Australia has the potential to supply these sectors with the urea they need.

“As the first new gas manufacturing project in the Pilbara for more than a decade, the Perdaman Urea Project will play a role in helping diversify Western Australia’s economy and create local jobs.”

WA Ports Minister Rita Saffioti said the development of a new multi-user wharf at the Port of Dampier will maximise the use of this important piece of infrastructure by facilitating the Perdaman Urea Project, as well as accommodating bulk carriers, cruise ships, and general cargo vessels.

 “This investment in the new wharf will also encourage trade diversification by opening up access to worldwide markets for urea from the Perdaman Project.”

According to WA’s Environmental Protection Authority, Perdaman will use efficient ammonia and urea production technology and a combined cycle gas turbine plant to reduce greenhouse gas and nitrogen and sulphur dioxide emissions.