21st May 2007 08:00
Rio Tinto PLC21 May 2007 BP and Rio Tinto plan clean coal project for Western Australia BP and Rio Tinto today announced that they are beginning feasibility studies andwork on plans for the potential development of a A$2 billion (US$1.5 billion)coal-fired power generation project at Kwinana in Western Australia that wouldbe fully integrated with carbon capture and storage to reduce its emissions ofgreenhouse gases. This will be the first new project for Hydrogen Energy, the new company launchedby BP and Rio Tinto last week, subject to regulatory approval. The planned project would be an industrial-scale coal-fired power and carboncapture and storage project. It would generate enough electricity to meet 15 percent of the demand of south west Western Australia, while each year capturingand permanently storing about four million tonnes of carbon dioxide whichotherwise would have been emitted to the atmosphere. The project would gasify locally-produced coal from the Collie region to producehydrogen and carbon dioxide. The hydrogen would be used to fuel the powerstation and around 90 per cent of the carbon dioxide would be captured andstored permanently in a deep underground geological formation. The costs of this low-carbon hydrogen-fuelled power generation are higher thanthose of traditional power generation. For the project to be economic and ableto compete effectively in the electricity market, it would require appropriatepolicy support and a regulatory environment which recognises and encourages thelow-carbon benefits it can deliver. Subject to the successful outcome of detailed engineering and commercialstudies, and providing government policy is in place to make the projectcommercially viable, a final investment decision to develop the project could bemade in 2011, with the project coming into operation after a three yearconstruction period. Speaking at today's announcement in Perth, Lewis Gillies, named last week aschief executive of Hydrogen Energy, said: '"This has enormous potential to affect the way that coal will be used for powergeneration across the world. Clean coal technology such as this will beessential to reducing greenhouse gas emissions, both in Australia and globally. "This project could play an important role in influencing our future power mix,strengthening Australia's energy security while also minimising our impact onthe environment. Hydrogen Energy is now working to deploy this technology aswidely and rapidly as it practically can." The project's gasification facility and power station would be located inKwinana, 45km south of Perth, alongside BP's refinery and Rio Tinto's HIsmeltfacility. The power station would be capable of producing 500 megawatts oflow-carbon electricity or enough power for half a million homes. At the sametime, about four million tonnes of CO2 each year would be captured, transportedand permanently and securely stored in a geological formation deep beneath theseabed of the Perth basin. This would be the first hydrogen-fuelled powerproject to store CO2 in a saline formation, a type of geological structure whichis more common globally than suitable oil and gas reservoirs. Kwinana is an ideal location for a project of this type. The availability of asuitable site immediately adjacent to BP's refinery, Rio Tinto's HIsmelt plantand other industrial operations which may benefit from its output providessynergies and potential additional revenue streams that greatly assist thecommercial viability of the project. Increasing power demand combined withgrowth in the Perth area also provides an attractive market for new powergeneration. Plans are also underway for the proposed development of two other hydrogen powerprojects, at Peterhead, Scotland, and at Carson, California, USA. Notes to editors: • For further information on Hydrogen Energy see: www.hydrogenenergy.com • Rio Tinto is a leading international mining group headquartered in the UK, combining Rio Tinto plc, a London listed public company, and Rio Tinto Limited, which is listed on the Australian Securities Exchange. The Group finds, mines and processes the earth's mineral resources - metals and minerals essential for making thousands of everyday products that meet society's needs and contribute to improved living standards. The Group's major products include aluminium, copper, diamonds, energy products (coal and uranium), gold, industrial minerals (borates, titanium dioxide, salt and talc), and iron ore. Its activities span the world but are strongly represented in Australia and North America. There are also significant businesses in South America, Asia, Europe and southern Africa. For further information see: www.riotinto.com • BP is one of the world's largest oil and gas companies with operations in more than 100 countries across six continents. The company's main businesses are exploration and production of oil and gas; refining, manufacturing and marketing of oil products and petrochemicals; transportation and marketing of natural gas; and a growing business in renewable and low-carbon power, BP Alternative Energy. BP's low carbon interests combined in BP Alternative Energy include: BP Solar; the company's fast growing interests in wind power; gas-fired power generation; and BP's interest in Hydrogen Energy. For further information see: www.bp.com and www.bpalternativeenergy.com. Further information: LONDON AUSTRALIA Media contacts: BP BPDavid Nicholas Jamie JardineOffice: +44 (0)20 7496 4708 Office: +61 (0) 9268 3255Mobile: +44 (0)7831 095541 Mobile: +65 9295 0887 Rio Tinto Rio TintoNick Cobban Ian HeadOffice: +44 (0)20 8080 1305 Office: +61 (0) 3 9283 3620Mobile: +44 (0) 7920 041003 Mobile: +61 (0) 408 360 101 Christina MillsOffice:+44 (0)20 8080 1306Mobile: +44 (0) 7825 275605 Investor relations contacts: BPNick WaythOffice: +44 (0)20 7496 4638 Rio Tinto Rio TintoNigel Jones Dave SkinnerOffice: +44 (0)20 7753 2401 Office: +61 (0) 3 9283 3628Mobile: +44 (0)7917 227 365 Mobile: +61 (0) 4 0833 5309 David Ovington Susie CreswellOffice: +44 (0)20 7753 2326 Office: +61 (0) 3 9283 3639Mobile: +44 (0)7920 010 978 Mobile: +61 (0) 4 1893 3792 - ENDS - This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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