Australia-based miner
Fortescue Minerals Limited has announced that it has signed a long-term natural gas transportation agreement to reduce costs at its Pilbara iron ore operations. Gas will be delivered via the existing Dampier to Bunbury natural gas pipeline and the new
Fortescue River gas pipeline to
Fortescue's 125MW Solomon Hub power station. The gas pipeline is expected to be operational in early 2015.
According to
Fortescue, the planned natural gas pipeline is a key component of
Fortescue's broader strategy to reduce energy costs and carbon emissions. The conversion of the power station from diesel to gas will underpin the initial stage of the
Fortescue River gas pipeline and is expected to save the company around $20 million annually.