REVEALED: Massive new $1b project planned for Gladstone

A $1 BILLION project, expected to create hundreds of jobs for more than three decades, has been placed in the fast lane by Queensland's Coordinator General.

Australia Future Energy has revealed its plans to transform Gladstone's State Development Area with the construction of an above-ground coal gasification plant.

Chief executive officer Kerry Parker told The Observer the plant would use Australia-first technology to convert low-quality, high-ash coal into domestic gas and ammonia.

The Queensland Government announced its support for the project today, with the state's independent Coordinator General declaring it a "coordinated project".

Minister for Development Cameron Dick said the declaration would help streamline approvals for the project and "fast-track" its delivery.

The company anticipates the Environmental Impact Statement process to be finished by the end of next year or early 2020.

This will allow the plant to move ahead into its two-year construction phase.


Australia Future Energy's chief operating officer Ron Higson and chief executive officer Kerry Parker anticipate construction to start in 2020 on its above-ground coal gasification project.
NEW PLANT: Australia Future Energy's chief operating officer Ron Higson and chief executive officer Kerry Parker anticipate construction to start in 2020 on the company's above-ground coal gasification project. Tegan Annett

The plant is estimated to create a peak of 800-1000 construction jobs and 250 ongoing jobs for at least 30 years.

With interest already generated by large ammonia users in Australia, Mr Parker said the company felt it was in the "right place at the right time".

"One of the attractions for us to come to Gladstone was the highly skilled local workforce," Mr Parker said.

"The region has plenty of very valuable construction and gas industry experience."

The plant will produce up to eight petajoules of syngas, suitable for domestic use, per year and about 330,000 tonnes of ammonia per year for at least the next 30 years.

It will also produce up to 96 megawatts of electrical power from waste gas and heat.

The project comes amid increased concerns about gas prices rising for domestic users.

Credit Suisse gas researcher Saul Kavonic recently estimated the gas price for east coast Australia users per petajoule would reach the early teens by Christmas.

"From the customers we're talking to and the other industrial players in the region, we're certainly in the right place at the right time, especially considering the east coast of Australia's current gas supply issues," Mr Parker said.

"The interest from industrial parties is very strong for the gas and ammonia we're looking to produce.

"We can offer it for 30 years at what we think is a relatively competitive price and this is all for the domestic market," he said.

With a focus on products needed domestically, rather than for export, Mr Parker said the company had already received interest from two "relatively large" ammonia users looking for a secure long-term supply.

The company is in the process of applying for a Northern Australian Infrastructure Facility loan to help fund part of the project.

The products

Ammonia is used to produce agricultural fertiliser, household cleaners, water purification systems and in the manufacture of plastics, fabrics and explosives.

The plant will also produce pipeline-suitable gas, which will be sold into the domestic market.