Gas crisis hits WA mining industry. Gold and nickel operations badly affected

The dominant mining State of Western Australia has suffered its first serious energy supply crisis through a major explosion at the Varanus Island gas plant off the northwest coast and today it was made clear it may take several months to restore to normality.

PERTH - 

Western Australian Premier Allan Carpenter has called an urgent conference between industry, power utilities and the government for this Sunday to resolve the near-term problems that hit the State on Wednesday.

Carpenter told the media that solutions needed to be found, particularly with the government power utility Alinta Gas indicating total supply to the State grid would be down at least 30%.

The government indicated today that alternate supplies for energy were being negotiated but prices negotiated would remain confidential.

Affected immediately yesterday was industry and some mining plants, including those on the Eastern Goldfields pipeline system that supplies mining plant and general facilities at gold and nickel operations and towns in that region.

Mining operations elsewhere that have been forced to cut production are the mines and processing plant of Iluka Resources.

Chief operator of the Varanus Island facility, Apache Energyy, warned that it may take at least three months to restore the damaged facilities to full capacity.

Oxiana Ltd, which owns the Golden Grove lead-zinc-silver operation in the Yalgoo Goldfield of the State's mid north, announced today that it was now sourcing electric power for its operation and expected to be restore full production this afternoon.

The gas supply cuts have had a major impact on towns in the Kimberleys and Pilbara regions and also the big domestic market of Perth.

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