AIE Selects Port Kembla for Oz LNG Import Project
The Australian Industrial Energy (AIE) consortium has chosen Port Kembla as the site for its proposed east coast Australia LNG import terminal and executed twelve memorandums of understanding with industrial and commercial domestic customers for gas offtake agreements, AIE said June 4.
AIE chief executive officer James Baulderstone said: “New South Wales is facing significant challenges in ensuring available and affordable gas supplies and we are working to make this project a reality as quickly as possible”.
“The world-leading expertise of the AIE partners, now combined with the enthusiasm of NSW Ports and Port Kembla’s regional business community to see this project realised, means AIE is well placed to deliver firm, long term gas on highly competitive pricing and terms as soon as 2020,” he said.
AIE, which is a consortium of energy players, including Japanese trading house Marubeni, compatriot JERE – the world’s largest LNG buyer, and Australian mining magnate Andrew Forrest’s Squadron Energy, has signed a memorandum of understanding with NSW Ports which provides it with exclusive rights enabling AIE to enter into the detailed engineering design phase, the consortium said.
JERA senior vice president for fuel business development Gaku Takagi said: “As the largest buyer of LNG in the world, JERA is able to bring ample, competitively priced LNG to NSW”.
He said Marubeni will bring world-wide energy investment and infrastructure expertise and Squadron Energy brings deep knowledge of the Australian gas and energy markets.
“Together, we believe we can make a major contribution to NSW and east coast energy supply competition and security,” he said.
Construction of the terminal is likely to require a capital investment of between A$200mn and A$300mn ($152mn-$228), AIE said.
The Port Kembla Gas Terminal is planned to have the ability to supply in excess of 100PJ (2,670mn m3) of gas per year, which is sufficient to meet over 70% of NSW’s total gas needs, AIE said.
Major Australian energy retailer AGL also has a plan to build an east coast LNG import terminal, which it is expected to make a final investment decision on between July this year and June next year.
The AGL plan is for a 100 PJ/year project with construction intended to commence in 2019 and for the terminal to come into operation by 2020/2021. It’s planned to be built at Crib Point in the Australian state of Victoria.
The moves to build the Australian import terminals comes while the country is expected to next year become the largest LNG exporter.