The West

AngloGold okays Goldfields gas pipeline
The Tropicana gold mine's diesel-powered power station.

AngloGold Ashanti has signed a $140 million deal with APA Group to build a natural gas pipeline for its eastern Goldfields mines.

The 292km pipeline could save the South African giant millions of dollars in energy costs at its remote Sunrise Dam and Tropicana gold mines.

The pipeline would hook up to the 1380km Goldfields gas transmission pipeline, which connects to Alinta Energy's Newman power station and services Glencore Xstrata's Murrin Murrin nickel mine near Laverton.

Construction is expected to begin in February 2015, with first gas scheduled for the Tropicana mine in January 2016.

"Gas power generation is expected to reduce cash operating costs at both sites by between $25 and $30 per ounce," AngloGold senior vice president Australia Michael Erickson said.

"The pipeline and gas transportation agreement will also provide continuity of fuel supply, reduce exposure to diesel price volatility and significantly reduce the number of trucks on the road," Mr Erickson said.

APA managing director Mick McCormack said: "The Eastern Goldfields Pipeline can be further expanded to service other mines in the region in addition to these initial contracts.

"Access to natural gas, a reliable and cost competitive energy supply will assist our new and existing customers in reducing costs at their mining operations," Mr McCormack said.

AngloGold is the world's third-biggest gold producer. It fully owns Sunrise Dam and has a 70 per cent stake in Tropicana.

Independence Group holds the remaining 30 per cent of Tropicana.

The West Australian

Latest News From The West

Popular videos

Our Picks

Follow Us

More from The West