By Cordelia Hsu and Helen Clark

NEWCASTLE/PERTH, June 18 (Reuters) - Australia’s first carbon refinery opened in New South Wales, capturing ‌carbon dioxide from explosives giant Orica's ammonia-making operations ‌on Kooragang Island and turning it into products such as concrete, paper and ​glass.

MCI Carbon has been developing the Myrtle Carbon Capture Utilisation and Storage technology for 15 years and the demonstration plant can potentially capture 2,500 metric tons of CO2 a year.

"MCI ‌Carbon's technology is ⁠based on what's called mineral carbonation. This is the Earth's own natural process for taking ⁠CO2 out of the atmosphere and putting it into rock," CEO and co-founder Marcus Dawe said at Wednesday's event.

The opening ​function was ​attended by Chris Bowen, Australia’s ​energy and climate change ‌minister, along with the ambassadors of Japan and Austria.

Australia's total CO2 emissions are around 400 million tons a year. Last year Bowen updated its emissions reduction target to 62% to 70% from 2005 levels by 2035.

Unlike carbon capture and ‌storage technology, which moves CO2 ​into underground caverns, CCUS produces a ‘carbon-embodied’ ​product.

"This will help (emitters) decarbonise, ​while also making a profit," Bowen said.

MCI ‌is also working on plans ​for a factory-scale ​carbon refinery in Austria to capture up to 50,000 tons of CO2 a year. Its technology is one ​of several mineral ‌carbonation technologies being developed.

Another, from Canada’s Arca, uses mining ​waste or ‘tailings’ to trap carbon permanently.

(Reporting by Helen ​Clark; Editing by Kirsten Donovan)