Project Haber to Deliver Further Benefits as Pre-FEED Completes

Source: 9/20/2021, Location: Not categorized

• Project Haber has completed the 7-month plant Pre-FEED study for the development of Australia’s lowest carbon urea production facility.
• Technip Energies capital estimates decreased 6% on a like for like basis from January 2021 feasibility study estimates.
• Strike has formally chosen Haldor Topsoe’s SynCORTM Autothermal Reformer technology to reduce carbon intensity of the urea, resulting in a further 24% reduction from previous estimates.
• Gas feedstock estimated to reduce by ~7% to 80 TJ/d and 584 PJ over 20 years.
• Strike to progress Front-End Engineering and Design (FEED) early works prior to drilling the highly prospective South Erregulla-1 well later this year.
• Shortlisted offtakers in negotiations to enter binding term sheets for total 1.4 mtpa of urea fertiliser offtake.

Strike Energy Limited is pleased to update that Project Haber has passed a major engineering milestone which has delivered additional carbon, capital, and technology benefits.

Pre-FEED Complete
Engineering firm Technip Energies has recently completed the base scope Pre-FEED study on Project Haber, a 1.4 mtpa ammonia to urea production facility to be located in Narngulu Industrial Area of Geraldton, Western Australia.

The Pre-FEED study has delivered a 6% reduction on the expected capital cost compared to the original Technip Energies feasibility report completed in January 20211. Pre-FEED capital estimates represents a base cost estimate of US$1.64 billion, which includes the engineering, procurement and construction of the Haber plant delivered on site in Narngulu2. The Haber plant incorporates the ammonia, urea and granulation plant technologies as provided by licensor partners; Haldor Topsoe, Saipem and Thyssenkrupp, as well as on-site supporting infrastructure, including the 10MW green hydrogen electrolyser, power generation, ammonia storage tanks, substantial fertiliser storage and offloading, and administration buildings.

Strike will now progress FEED early works scopes, which includes geotechnical and environmental surveys, impact assessments and various other agreements and studies on the water supply, logistics, port, construction camp and raw gas pipeline. Strike expects to conclude the majority of these activities prior to drilling South Erregulla-1 (SE-1) in Q4/21. Upon success at SE-1, Strike will look to formally enter FEED at Project Haber, which is expected to last less than a year and provide sufficient engineering and definition to award an EPC contract to an appropriate contractor at Final Investment Decision (FID).

Strike has, in parallel with the Pre-FEED study, progressed additional engineering by Technip Energies to incorporate Haldor Topsoe’s SynCORTM Autothermal Reforming (ATR) technology for ammonia production. This state-of-the-art technology is reported to have the following production advantages compared to the traditional and widely used steam methane reforming3:
• Up to 30% reduction in Carbon Dioxide (CO2) emissions
• More than 50% reduction in Nitrous Oxides (N2O) emissions
• Up to 50% reduction in water consumption

The adoption of ATR technology is estimated to also reduce gas feedstock requirements of the plant by ~7% from 86 to 80 TJ/d with only 552 PJ now required to underwrite the first 20 years of operations. Technip Energies and Haldor Topsoe, have undertaken additional studies in order to incorporate the low carbon SynCORTM technology with the ability to maximize the amount of green hydrogen consumed by Project Haber’s urea manufacturing process. As green hydrogen is phased in, the gas feedstock and resources required to support the project will reduce in kind.

Phasing in green hydrogen could see Project Haber become a regional carbon demand sink as integration of green hydrogen starts to dominate the total hydrogen supply.

Initially, Strike will supply 2% of its hydrogen demand from a dedicated 10MW hydrogen electrolyze within the Haber plant. This unit is planned to be powered from nearby cost effective wind and solar power or potentially by Strike’s geothermal resources in the Perth Basin should exploration and appraisal of Strike’s Mid-West Geothermal Power Project prove successful. As the renewable hydrogen market matures Strike intends to increase the import of green hydrogen up to 100% of the ammonia feedstock over the project’s life. As recently announced, Strike has entered into separate non-binding Memorandum of Understanding (MOU) with ATCO and Infinite Blue Energy (IBE) for (among other things) potential green hydrogen supply, which it can use as feedstock into the facility4

. Once operational, Project Haber via its ATR technology, lower carbon Greater Erregulla gas, shorter supply chains and green hydrogen inputs, will be able to produce some of the lowest carbon urea in the market at 0.37t CO2e per ton of urea initially and reducing overtime as green hydrogen imports increase. Strike estimates Project Haber’s urea will drastically reduce the carbon intensity of the agriculture industry it services by approximately 780-885k CO2e tonnes per annum or 60% from current imported baselines.

Urea Offtake Update
Strike is currently in negotiations with its shortlisted offtake partners and expects to progress and formalize a binding term sheet for the entire production volume (1.4 mtpa) in the final quarter of 2021.

Chief Executive Officer & Managing Director, Stuart Nicholls said:
“Using the best technology available, Strike is aiming to manufacture a globally unique and modern fertilizer in one of the country’s major agricultural heartlands. Through the application of this technology, Strike expects to be able to pass on substantial carbon savings to Australia’s farmers whilst also delivering shelter from global gas shortages and international shipping costs.

Progression of key engineering deliverables in parallel with developments in Haber’s offtake negotiations continues to materially de-risk the project on the path to a Final Investment Decision.”

This announcement is authorized for release by the Managing Director and Chief Executive Officer in accordance with the Company’s Continuous Disclosure Policy.

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