AUSTRALIAN Industrial Energy has welcomed New South Wales government approval of its application to modify the existing development consent for the Port Kembla Gas Terminal.

The modification will allow increased volumes of gas to flow through the terminal, satisfying the market need for more gas during winter months. This will be achieved by increasing the permitted output of the terminal, as well as increasing the number of LNG cargoes able to be received by the terminal.

With the additional capacity now approved, AIE will continue working with government agencies to complete post-consent requirements and with customers to firm up supply contracts. With firm supply contracts in place, AIE will be able to take its final investment decision and commence the 14–16 months construction program for the terminal.

If customers now commit to supply agreements, making FID possible in 2020, gas could be flowing into NSW as early as 2022. The terminal has the capacity to deliver well over 100PJ’s of gas each year, representing about 75% of NSW total market needs. It can source LNG supplies from WA, QLD, NT or anywhere in the world offering the most competitive prices.

The approval cements the PKGT’s position as the only project in NSW with a potential timeframe able to assist the NSW government to meet the terms of its  recent MOU with the Commonwealth to support the injection of 70PJ’s of new natural gas supplies into the market by 2022.

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AIE has appointed a major construction contractor, Spiecapag Soletanche Bachy, and secured the Höegh Galleon as the floating storage and regasification unit for the terminal.

Mr Peter Mitchley, the head of AIE’s PKGT project said, “Import terminals can be operational faster and cheaper than on-shore resources. Production rates can be dialled up or down quickly to reflect market demands and the capacity of terminals can, in some instances, exceed volumes available from onshore gas fields.

“When located in industrial zones, like our NSW Port Kembla site, there is also the added benefit of significantly reduced environmental and community impacts.

“AIE welcomes the NSW government’s approval and looks forward to working with our customers to secure a reliable, affordable supply of gas for the businesses, electricity generators and households who will need it as we move into economic recovery post COVID-19,” he said.

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