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Freeport to build $1b gas-fired power plant to move away from coal
Gold and copper mining giant PT Freeport Indonesia (PTFI) says it will invest approximately US$1 billion in a gas-fired power plant to advance its energy transition plans.
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Heavy vehicles are used for open pit mining operations at gold and copper miner PT Freeport Indonesia’s Grasberg mine in Papua. (JP/Nethy Dharma Somba)
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old and copper mining giant PT Freeport Indonesia (PTFI) has announced plans to invest approximately US$1 billion in a new power plant to shift from coal as an energy source to the less-polluting liquefied natural gas (LNG).
The investment is to be used for the construction of a 265-megawatt gas-fired combined cycle gas turbine power plant, which is slated to replace the coal units that were developed to power the Grasberg mine in Papua over 25 years ago.
The facility is targeted to begin operations in 2027, with near-term key activities including engineering, procurement and construction, as well as securing LNG fuel supply.
Kathleen Quirk, the president director of United States-based mining giant Freeport McMoRan, said the incremental economic cost of the project, which is expected to significantly reduce PTFI’s greenhouse gas emissions (GHG), is roughly $400 million.
“The project [is expected to] cost roughly a billion dollars, and the economics as we looked at it would eliminate the cost to refurbish and expand the existing coal units over time,” she said in a Freeport McMoRan third-quarter conference call on Thursday.
“Importantly, the transition would reduce significantly PTFI’s GHG emissions, and together with other initiatives PTFI has undertaken, the total reduction would be in [the] order of 60 percent compared to the 2018 baseline,” Quirk said.
Read also: Miners shift to LNG for smelters amid mounting ESG pressure
