Western Australia to See 2 Multibillion-Dollar Urea Manufacturing Facilities Amid Global Shortage

A truck on a dry road. Gabriel Santos/Unsplash

Western Australia (WA) is set to host two separate billion-dollar urea manufacturing projects that will sever Australia’s dependence on imports amid global supply chain chaos.

Australia relies almost entirely on imports of urea to sustain its agricultural and trucking industry, with the ingredient used in the production of fertiliser, along with being the primary ingredient in AdBlue, which is required in trucks to limit emissions.

Concerns had escalated when the world’s biggest producer, China, banned exports of urea to prioritise domestic fertiliser supply, putting Australia at risk of having a grounded fleet of trucks normally responsible for transporting food, fuel, and other goods.

The Australian federal government has approved Strike Energy Limited’s Project Haber, a $3 billion facility in the Narngulu Industrial Area near Geraldton, WA.

Energy and Emissions Minister Angus Taylor said the project would end up producing around 1.4 million tonnes of urea each year from hydrogen and natural gas in a way that is more environmentally friendly.

“The facility has the potential to deliver significant emissions reduction to Australia’s urea manufacturing sector through the use of advanced ammonia and gas processing technology, as well as dedicated clean hydrogen,” Taylor said.

“It also aims to reduce the reliance of Australian farmers on international supply chains to enhance our food security, given more than 90 percent of urea is currently imported.”

Australia's Energy Minister Angus Taylor speaks during question time in the House of Representatives at Parliament House in Canberra, Australia, on July 4, 2019. Tracey Nearmy/Getty Images

The WA state government has also welcomed a $255 million investment into a second facility, the proposed $4.3 billion Perdaman Urea Project, which will use gas to create about two million tonnes of urea per year.

“Recent international supply chain issues have highlighted just how important urea is to industry sectors such as agriculture and transport,” said Roger Cook, WA’s minister for state development, jobs, and trade.

“Western Australia has the potential to supply these sectors with the urea they need.”

Australia has recently experienced a surge in calls to bring manufacturing back to the country as supply chain chaos squeezes the supply of many products sourced from overseas.

The global supply crisis has impacted Australia and the rest of the world, caused by the SARS-CoV-2 pandemic and the lockdown of critical areas of China in a bid to enforce the communist regime’s zero-COVID policy.

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One of Australia’s ambitions includes a gigafactory to make batteries, with approval granted for the nation’s first pilot battery manufacturing plant in the Hunter Region of New South Wales.

National Opposition Leader Anthony Albanese has also pledged that a Labor government would, if elected, prioritise the production of medical equipment in Australia, such as testing equipment, masks, PPE, and ventilators, to avoid experiencing shortages of critical medical supplies. The Victorian state Labor government has already committed to support locally manufactured rapid antigen tests.

But despite being one of the world’s top adopters of solar, wind, and battery technology, Australia continues to have virtually no manufacturing capability of its own, with 90 percent of Australia’s solar panels coming from China—a point that has raised concerns from the Australian Human Rights Commission given China’s human rights abuses.