Fortescue enters 25-year power purchase agreement with Genex Power
Fortescue Metals (ASX:FMG) and Genex Power (ASX:GNX) have entered a 25-year power purchase agreement (PPA) for the proposed Gibson Island project.
The PPA will secure 337.5MW of the energy generated from the first stage (proposed at 450MW) of Genex’s Bulli Creek solar project, which it is developing in partnership with J-POWER.
Fortescue chief executive Mark Hutchinson says the agreement would secure some of the required power for Gibson Island as well as underpin the development of a new renewable energy project in Queensland.
“This agreement is the first step in securing renewable power supply for the Gibson Island project over the long term,” he said.
“It is the first PPA for the project and finalising it is an important milestone in our pursuit of a targeted final investment decision this calendar year.
“By entering this agreement, we’re also helping Genex and J-POWER to deliver their project and bring new renewable energy capacity online in Queensland — close to 115MW from this first stage is surplus to our contracted share and will therefore flow back into the electricity grid.”
The PPA is conditional on Genex achieving financial close on the first stage of Bulli Creek by December 31, 2024 and Fortescue reaching a final investment decision on Gibson Island by December 31, 2023.
The proposed Gibson Island project involves the production of around 385ktpa of green ammonia from the green hydrogen produced onsite through a 550MW hydrogen electrolysis facility.
Genex chief executive Craig Francis says the agreement is a major milestone for the company’s portfolio.
“Genex acquired the up to 2GW Bulli Creek battery and solar project in August 2022, initially envisioning a stand-alone battery energy storage system as a first stage for the project,” he said.
“However, securing this long term 25-year offtake agreement with Fortescue for 337.5MW of solar capacity at Bulli Creek has reshaped the first stage of the project into a large-scale solar farm.”
