A planned $415 million battery chemicals plant in Townsville will be powered by gas from the Bowen Basin under an agreement announced today.

Blue Energy has signed a non-binding MOU with Queensland Pacific Metals, the proponents of the Townsville Energy Chemicals Hub (TECH) project.

The news comes one month after Blue Energy signed an MOU with North Queensland Gas Pipeline owner Palisade Investment Partners, whose 391km pipeline system stretches from Moranbah in the Bowen Basin to Townsville.

Blue Energy proposes to supply the TECH plant with about 7 PJ per year for 15 years from its Sapphire Block gas project.

“Blue is delighted to be able to offer our gas to underpin the development of a new domestic mineral processing business in Townsville, undertaken by another Australian owned company,” Blue Energy chairman John Ellice-Flint said.

“It underscores the vital relationship between access to energy for the mineral processing which underpins the gig economy, for the export industry and revenue for businesses in Townsville and the State, together with jobs for the region both in developing Blue’s upstream gas resource and the downstream QPM processing facility.”

Blue Energy says the broader Northern Bowen Basin Gas Province has a discovered resource of about 15,000 PJ of gas – sufficient to underpin the east coast domestic gas market for the next 30 years. Blue’s component of this estimate is currently 3,248PJ.