REFILE-UPDATE 1- Australia PM sees gas crisis hitting economy

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By James Regan

SYDNEY, June 18 (Reuters) - Australia's economy is under threat from a power crisis in the country's west, the premier declared on Wednesday, and ordered the navy to divert diesel to keep mining and other industries running.

The state of Western Australia, which is five times the size of Texas, lost a third of its gas supply two weeks ago when a gas plant blew up.

The loss could weigh on the Australian economy, one of the world's healthiest, thanks in large part to the injection of billions of dollars from the state's mining exports.

"Given Western Australia's crucial significance to the overall performance of the Australian economy, there will be wash through for us all on this over time, but in Western Australia right now it's being felt directly," Prime Minister Kevin Rudd said.

Rudd has already ordered six megalitres of diesel fuel earmarked for the Australian Navy to be diverted to the state to help ease the crisis.

An explosion at the Apache Corp (APA.N) gas plant on June 3 knocked out about a third of the gas supplies to industrial users in the key mining region, hitting output of gold, nickel, alumina and other raw materials.

The Australian Defence Force had agreed to give up the order for the diesel from a BP (BP.L) refinery in Western Australia to allow the refinery to supply the affected industries.