PORT of Newcastle has inked a deal with South Korean project development company EPIK to develop a floating storage and regasification unit (FSRU) at the port for the import of LNG.

The project, dubbed Newcastle LNG, is to include a 170,000 cubic metre new-build FSRU and associated onshore infrastructure and will be worth between US$400m and US$430m.

Port of Newcastle executive manager customer and strategic development Ian Doherty said the port was uniquely placed for such a development due to its significant land and channel capacity.

“This type of development opportunity is consistent with our diversification plans and we’re pleased to be supporting EPIK as it conducts preliminary investigation work, especially given its potential benefits for the NSW economy,” he said.

EPIK managing director Jee Yoon said the company was excited to be working with the port and hopes to look at other projects such as a gas-fired power plant and an LNG bunkering facility.

“Based on our assessment of the New South Wales gas market, particularly along coastal demand regions such as Newcastle and Sydney, we are confident that by importing LNG via a new, low cost FSRU terminal, we will be able to provide an infrastructure solution that is capable of delivering a cost-efficient source of alternative gas supplies to the region on a long-term basis,” he said.

ADVERTISEMENT

In response to questions from Daily Cargo News about where the facility would be located within the port, a Port of Newcastle spokesperson said it was too early to speculate on that level of detail.

“EPIK is conducting preliminary work in response to demand for this type of facility on the East Coast. Port of Newcastle has significant land holdings to accommodate a facility of this kind and is supporting EPIK as it develops the proposal further,” the spokesperson said.

“Port of Newcastle is a deepwater port uniquely placed on Australia’s east coast due to its significant land and channel capacity, making it an attractive location for the Newcastle LNG project. This type of development opportunity is consistent with our diversification plans and we’re pleased to be supporting EPIK as it conducts preliminary investigation work, especially given its potential benefits for the NSW economy.”

The spokesperson noted that Port of Newcastle has significant land holdings to accommodate a facility of this kind and said the port was supporting EPIK as it develops the proposal further.

Plans for a similar LNG-import facility at Port Kembla was earlier this year declared “Critical State Significant Infrastructure”. Australian Industrial Energy (AIE) signed a memorandum of understanding in June to develop a FSRU LNG import terminal at Port Kembla.

AIE is a consortium comprising Andrew “Twiggy” Forrest’s Squadron Energy, energy infrastructure investor Marubeni and Japanese LNG company JERA.

ADVERTISEMENT