Commodities Group buys land for $1.5bn prawn farm project

Perth-based company Commodities Group has signed an access and option agreement for a 180,000-hectare cattle station, to continue its pursuit of an industrial scale prawn farming operation.

The site will be on Legune Station in the Northern Territory, near the border with Western Australia.

Former Avatar Industries director Ian Trahar is executive chairman of Commodities Group, which has spent just more than $15 million on aquaculture acquisitions in the past 18 months.

Following today's announcement, Commodities Group subsidiary Seafarms Group will have access to the site for carrying out assessments, including a bankable feasibility study, and an option to purchase the station at a predetermined price.

The group plans to spend around $1.45 billion constructing the project, which it has dubbed Project Sea Dragon, but will require a series of land use and environmental approvals, which it plans to undertake immediately.

Around 5 million hectares of property were analysed for the project, with Legune Station chosen as the optimal site.

Last week, Business News revealed that the company planned to capitalise on a trend in aquaculture demand from Australia’s northern neighbours, with the sector set to play an increasing role in meeting global food needs.

The company forecast that Australia’s aquaculture industry would expand from less than $1 billion annually to about $13 billion in 2020.

It plans to industrialise the aquaculture industry, using economies of scale to drive down power and labour costs.

In a number of phases, the company will build and operate a land-based operation featuring a series of ponds to grow its product, initally black tiger prawns.

Phase one will be around 1,000ha.

Commodities Group was up 4.9 per cent to 8.5 cents per share at the time of writing.