Partnership with CEFC

The Government’s Clean Energy Finance Corporation (CEFC) has provided SO4 with a US$47m loan as part of the US$138m debt financing package for the development of Lake Way.

The CEFC is a Commonwealth statutory authority that was established to facilitate increased flows of finance into clean energy projects to address some of Australia’s toughest emissions challenges – in agriculture, energy generation and storage, infrastructure, property, transport and waste. It is responsible for investing A$10 billion in clean energy projects on behalf of the Australian Government and works to deliver a positive return for taxpayers across its portfolio.

CEFC’s participation in the lending syndicate validates Lake Way’s green credentials and its contribution towards reducing carbon emissions from the fertiliser and agricultural sectors.

CEFC CEO Ian Learmonth said: “Low emissions SOP production is an exciting new Australian industry with the potential to substantially reduce greenhouse gas emissions from the hard-to-abate agricultural sector.

"Demand for SOP outside China is growing by about three per cent a year, and this is expected to continue as the world grapples with the question of how to produce more food, more sustainably and under increasingly difficult farming conditions"

"Using sustainably produced SOP means we can continue to decarbonise agriculture while meeting the growing demand for food. At the same time, we are supporting the development of a new export industry for WA, providing another great example of the economic benefits of transitioning to lower emissions."

Reducing Carbon Emissions

Agriculture is an emissions intensive sector, responsible more than 10 per cent of global greenhouse gas emissions, with synthetic fertilisers a key component of that figure. In Australia, agriculture accounts for 13 per cent of national emissions, including three per cent driven by fertiliser use. Australian agriculture emissions are forecast to increase by 50 per cent by 2030 as farm production returns to normal seasonal output

As part of the financing with CEFC, SO4 has committed to powering part of the Project with renewable energy through a 5MW solar farm and a 2MW battery. Third parties have expressed interest in delivering the solar facility at no upfront cost to SO4 under a build, own, operate (BOO) model. The solar facility will reduce the overall cost of power at the Project. In addition, SO4 is also investigating the potential to improve project economics and increase renewable energy penetration with on-site wind power and other sustainable initiatives.

As part of SO4's "Green Debt" certification Wood Canada Limited Consultants conducted a technical assessment of Green House Gas emissions of SOP production at Lake Way, relative to Mannheim SOP production in other locations. The assessment concluded that a Mannheim process plant of comparable capacity would have 60% higher CO₂ emissions than the Lake Way project. The 'Green' loan label is as set out by the LMA and APLMA green loan principles. The eligibility was assessed by DNV GL.