Muradel Demonstration Project

Mr HUGHES (Giles) (15:25): I rise today to acknowledge the formal opening on 31 October of the Muradel demonstration project in Whyalla. It is a highly innovative and exciting project, not just for Whyalla but also for the state and the nation. The $10.7 million project is designed to demonstrate the ability to produce biofuels using the sun, sea water, carbon dioxide, nitrogen and phosphorous. With those inputs Muradel is able to grow a specialised strain of oil-rich algae. Algae essentially captures sunlight and turns it into oil and produces 100 times more oil than land-based plants, such as canola, sunflowers or soybeans.

The approach has a major advantage compared to many other biofuel endeavours in that it does not require productive agricultural land. The ultimate aim is to establish, in Whyalla and elsewhere, commercially viable projects that will deliver cost-competitive greener diesel and aviation fuel plus, potentially, a range of other useful by-products. It is intended that the green crude oil produced can be processed in existing oil refineries.

The project is a good example of collaboration. Muradel was incorporated in 2010 as a joint venture between the University of Adelaide, Murdoch University and SQC, which is an offshoot of India's largest infrastructure company. The Australian Renewable Energy Agency provided $4.6 million to assist the project, which comes on top of the private sector investment. The Whyalla city council actively assisted Muradel to establish its presence in Whyalla and has provided in-kind assistance and made land available on a lease basis.

Muradel initially established a pilot plant in Karratha in the north-west of Western Australia but decided on Whyalla for its demonstration plant due to a number of competitive advantages. If the demonstration plant is a success, Muradel will scale up to a fully commercial facility in Whyalla and that will be used as a launch pad to develop plants elsewhere in Australia. The initial commercial plant will be a series of ponds covering approximately 1,000 hectares. It is anticipated that the 1,000-hectare site will be able to produce 80 million litres of green crude per year. It is worth noting that Muradel has already shown that it is able to generate the highest oil production rates in the world from algae grown in open saline ponds. The 1,000-hectare project has the potential to generate 100 jobs.

University of Adelaide associate professor, David Lewis, is Muradel's chief technology officer. He has expressed the view that if all goes to plan the potential exists in South Australia to produce hundreds of millions of dollars worth of clean biofuel within 20 years. The staged, systematic approach undertaken by Muradel permits a significant degree of confidence in the future progress of algae culture in South Australia. It is still early days but there has been a very promising start. Expectations are, on current trends, that we will be importing 70 per cent of our liquid fuels by 2030. In addition, 23 per cent of our greenhouse gas emissions come from using liquid transport fuels. On top of that, Australia has only 20-odd days of fuel available at any one time, which some see as a risk in the event of an international oil crisis.

Muradel is rightly taking things a step at a time, but others have observed that Australia has the potential to become self-sufficient in transport fuels based on algae culture. One estimate projects, on a national basis, $50 billion in new revenue and over 50,000 jobs. Most of that investment and jobs will occur in regional Australia. Estimates of the land needed to ensure fuel self-sufficiency range from 6,000 square kilometres to less than half that area, and 6,000 square kilometres is around .07 per cent of Australia's land mass.

South Australia is at its best when it is curious and open to new ideas and willing to innovate, when it is willing to take the first step. I wish Muradel well, and I look forward to the company achieving the goals it has set itself for the benefit of investors, for Whyalla, for our state, and for the environment.