Yorke Biomass Energy is building a demonstration plant in South Australia to illustrate how a straw burning generator can provide miners with a competitively priced power source for the first 10-20MW of power, according to The Lead South Australia.

The plant, expected to be operational next year, is in the heart of Yorke Peninsula, a major grain-growing region with a rich mining history.

Terry Kallis, chairman of Yorke Biomass Energy, told the 2017 South Australian Resources and Energy Investment Conference in Adelaide that the technology would be ideal for new mining projects in farming areas.

He said: "This energy approach provides a mutually beneficial outcome for mining and farming communities and increases local economic activity through the collection, transport and storage of biomass fuel stock. There is a substantial stubble resource within a 50km radius of the proposed plant site and the stubble has a preferred moisture content of just 15%."

The Ardrossan plant is modelled on existing plants operated by Acciona in Spain and is expected should require around 90,000t/y of straw from local farms.

Kallis explained: "These power plants present opportunity for mutually exclusive feedstock supply agreements and profit sharing arrangements with local farmers. An open book process can be used to negotiate their supply price per tonne. The Ardrossan plant may also have the capacity to supply local domestic customers in the broader Ardrossan footprint."

The demonstration plant is near the proposed Rex Minerals Hillside copper and gold project. The adjacent Eyre Peninsula is also emerging as a mining hub with several graphite mines and the Iron Road project expected to begin operation in the coming years.