Liontown and Zenith Energy have executed a binding Power Purchase Agreement for the supply of electricity to the Kathleen Valley Lithium Project in Western Australia.
The agreement expands on the material terms agreed in the Letter of Award announced on 12 September 2022.
Zenith Energy will finance, design, construct, own, operate and maintain the 95MW hybrid power station at Kathleen Valley (Hybrid Power Station) for an initial term of 15 years from commercial operation of the Hybrid Power Station, which is expected to coincide with the commissioning of the process plant in the first half of 2024.
Zenith Energy has advanced the necessary planning, legal, engineering and design works, as well as placing orders for long lead items, each of which is required to facilitate the delivery of the Hybrid Power Station in line with the Kathleen Valley Project schedule.
With 46MW of emissions-free power generation capacity, the 95MW hybrid power station is expected to be one of the largest off-grid wind-solar-battery storage renewable energy facilities in the mining industry in Australia.
The Hybrid Power Station will include wind generation from five wind turbines each capable of generating 6MW. A 16MWp fixed axis solar PV array coupled to a 17MW/19MWh Battery Energy Storage System (BESS) will provide additional clean energy, supported by highly reliable synchronous condensers that provide critical system stability and resilience.
Additionally, the thermal power component will comprise 27MW of gas generation and 5MW of diesel standby generation.
The thermal components are designed to operate in “engine off” mode at various times, enabling Liontown to operate from 100 per cent renewable energy during periods of high wind and solar resource.
Liontown has also secured approval for a $25 million guarantee facility from Export Finance Australia (EFA) as part of the security package under the Power Purchase Agreement, which will underpin the construction of the Hybrid Power Station at Kathleen Valley. Provision of the facility is subject to a number of conditions which are customary for facilities of this nature, and finalisation of facility agreements.
EFA is the Commonwealth of Australia’s export credit agency.
Liontown’s Kathleen Valley Lithium Project has been identified as a critical minerals project under Austrade’s Critical Minerals Prospectus.
Liontown’s Managing Director and CEO, Tony Ottavian, said, “Finalising the Power Purchase Agreement marks another important milestone for Liontown and the development of Kathleen Valley, paving the way for the construction of one of the largest off-grid wind-solar-battery storage facilities of its kind in the Australian resource sector.
“This reflects our unwavering commitment to delivering on our ESG credentials and establishing industry-leading carbon emissions from the outset.
“Zenith Energy’s commitment to deliver a high-capacity hybrid power solution includes incentives to produce renewable power over thermal power and, together with a renewable energy guarantee, sets us up to meet our renewable energy target of 60 per cent at start up.
“Securing the $25 million guarantee from Export Finance Australia assists to reinforce Liontown’s position as a new globally significant producer and exporter of lithium integral to the transition to a low-carbon future.”
