A regional town in central-west New South Wales is set to become a major player in oil production and the renewable fuels market.

Key points: 20 million tyres are disposed of in Australia every year and end up in landfill

20 million tyres are disposed of in Australia every year and end up in landfill They pose an environmental threat due to pollution and extreme fire danger

They pose an environmental threat due to pollution and extreme fire danger A new recycling plant in regional NSW will turn old tyres into oil, steel and carbon

The NSW Environment Protection Authority (EPA) has issued a licence allowing the first green tyre-recycling plant to operate in the town of Warren, north-west of Dubbo.

The project aims to solve the current problem of mass waste caused by tyres and offers a new way to create oil, steel and carbon.

The proponent, Green Distillation Technologies, has already partially constructed the plant in Warren, but the project was stalled for years by negotiations with the EPA.

Old tyres pose a major environmental threat due to pollution and extreme fire danger. ( Supplied: Green Distillation Technologies )

"There's been a lot of frustration and hard work, this is a really big step for us," said chief operating officer Trevor Bayley.

"We have one-sixth of the plant operational and we can start production with the module that's up and running."

The approval will allow tyres to be turned into high-grade products through a process called destructive distillation.

A plant running at full capacity is expected to process 19,000 tonnes a year equating to 685,000 tyres.

Once operating at full capacity, the plant will be able to process about 685,000 tyres a year. ( Supplied: Green Distillation Technologies )

The company has plans to launch seven plants around Australia, including the pilot plant in Warren. In April, the development application was approved for a second recycling plant in Toowoomba in southern Queensland.

Warren Shire Mayor Milton Quigley said it was exciting that the world-first technology was being launched in the town, which has fewer than 3,000 residents.

"It's a fantastic result. The fact it will occur in Warren is a great vote for the decentralisation of these industries," Mr Quigley said.

"It's innovation at its best and it's happening in western New South Wales.

"It's putting Warren on the world map for a huge reason."

Twenty million tyres are disposed of in Australia every year and end up in landfill.

Mr Quigley said it was an important environmental development, given 1.6 billion tyres were created every year.

"What a good result for Australia and the world. It's a huge ongoing problem: what do you do with all the tyres that have reached their use-by date?"

Used tyres are typically burnt or shredded for inclusion in surfacing products. ( Supplied: Green Distillation Technologies )

How it works: Tyres are recycled back into three raw products: oil, carbon and steel

A plant can produce more than 7,000 tonnes of oil, 7,000 tonnes of carbon and 2,000 tonnes of steel a year

Destructive distillation involves a chemical reaction to bring tyres back to raw materials

The tyres are loaded into a process chamber, all the oxygen is removed and the chamber is sealed

Heat is applied, triggering the chemical reaction and the tyres are reduced to different compounds

The compounds are then extracted and cooled to create oil, carbon and steel

In a statement, the EPA said the licence was "consistent with the development consent and has taken into account the comprehensive assessment process and consideration of the EPA Energy from Waste Policy Statement.

"The licence requires the operator to meet strict emission limits and undertake comprehensive monitoring to ensure that the environment and community are protected."

Warren is in the seat of Barwon, where Shooters Fishers and Farmers Party member Roy Butler is the new state member.

"This sounds like common sense has prevailed in relation to the approval to go ahead," Mr Butler said.



"End-of-life tyres are a huge issue. They're ending up in landfill.

"This is an environmentally friendly solution in that there are no emissions from the process.



"This allows end-of-life tyres to be turned into something that can be used again and this is the sort of thinking we need to see."

The Barwon MP said there were major benefits to establishing industries in regional towns like Warren.

Roy Butler says having the tyre recycling plant in Warren is important for decentralisation. ( Facebook: Roy Butler )

"When I look at the community of Warren, this will be a fantastic boon for the town.

"Land is affordable, it's easy to get it there, there are lots of transport options to get the tyres in and get the products out.

"This is great thinking and I'm glad the EPA has applied some common sense and allowed this project to go ahead."

Green Distillation Technologies is applying for a licence to process more tyres after the EPA conducted further air quality testing. Initial testing found the recycling process did not create any emissions.



A deal has been struck to supply the oil to Northern and Southern Oil for refining and the carbon and steel to Bluescope Steel.

"The product from our plant is simple to refine, the loss in the refining process is small and the quality of the end product is high," Mr Bayley said.