Sandfire Resources has signed a deal with Brisbane-based juwi Renewable Energy to build a $40 million solar power station at its DeGrussa copper project near Meekatharra to help power the mine and its processing operations.
The 10.6-megawatt station will involve construction of the biggest integrated off-grid solar array in Australia.
Sandfire said the project had potential to establish DeGrussa as an industry leader in the use of renewable power for mining and processing operations.
Sandfire said its cash contribution to the project would be less than $1 million. Juwi will arrange funding for the project, and own and operate the facility.
The station will utilise a 10.6-megwatt solar array comprising 34,080 solar photovoltaic panels that track the sun and a 6-megawatt battery.
It will be constructed on 20 hectares of land near the underground mine and concentrator.
Sandfire said the project would be one of the biggest integrated off-grid solar power systems to be used in the mining industry anywhere in the world.
The solar power station will be integrated with the existing 20-megwatt, diesel-fired power station at DeGrussa, which is owned and operated by Kalgoorlie Power Systems.
It will be structured to maximise the consumption of lower-cost solar power, thereby reducing reliance on diesel.
However the diesel power station will continue to provide base-load power to the DeGrussa mine.
The project is expected to achieve savings in diesel fuel and will deliver a significant environmental benefit for DeGrussa, reducing its carbon emissions by an estimated 12,000 tonnes a year.
Sandfire's managing director Karl Simich said the company had been working on the solar power initiative since 2013, with the project representing an attractive opportunity to participate in a low-risk renewable energy initiative with a minimal capital requirement.
He said the project would not affect the efficiency or safety of existing operations, and would allow the company to contribute to the broader challenge of reducing CO2 emissions and potentially reducing operating costs.
"We are continuing to explore other options to reduce our energy costs, including using alternatives such as compressed natural gas for gas-fired power generation," he said.
Juwi managing director Andrew Drager said the solar photovoltaic system would provide the majority of daytime electricity to substantially reduce the mine's dependence on imported diesel.
Sandfire shares were off 10 cents, or 2.23 per cent, to $4.39 at 11.40am.