Australia’s first LNG import terminal 70pc complete

Australia's first LNG facility designed for imports, the 2.4mn t/yr Port Kembla, has reached 70pc completion, with developer Squadron Energy to shortly take possession of a floating storage and regasification (FSRU) unit for the terminal.

The facility in New South Wales (NSW) is 70pc built and on track to reach mechanical completion by the end of this year, a Squadron spokesperson said on 18 September, following a delay announced last year , partly because of a lack of demand for 2023 imports.

The FSRU, constructed by Norwegian energy and shipping firm Hoegh LNG , will shortly be transferred to Squadron but the firm plans to sublease it until it is required in Australia from 2025 onwards.

The LNG import terminal will have capacity for supply of around 304 TJ/d (8.1mn m³/d) when complete, or 86pc of NSW's estimated maximum demand for the summer of 2025 of 353 TJ/d.

Gas shortages are possible in southern Australia during the cooler winter months from next year , the Australian Competition and Consumer Commission (ACCC) has warned.

NSW and the nation's largest gas consumer Victoria state will rely on increased transport and storage of Queensland coal-bed methane gas, which has increasingly been flowing to southern states because of local output declines and little new supply entering the market.

Infrastructure developers are attempting to boost supply from Queensland's Surat basin with new pipelines and compression facilities to drive a 13pc capacity increase on the critical Moomba-Sydney pipeline from mid-2024.

But limits may still prevent greater southbound transport on peak demand days, the Australian Energy Market Operator warned in its 2023 Gas Statement of Opportunities . There are three other proposed LNG import terminals in two other Australian states — the 2.5mn t/yr Geelong LNG and 4.7mn t/yr Port Phillip Bay LNG terminals in Victoria and the 1.1mn t/yr Port Adelaide LNG terminal in South Australia.

Squadron has invested heavily in renewable power with its wholly-owned company Windlab presently building the A$3bn ($1.9bn) Clarke Creek renewable energy hub in central Queensland state.

But gas-fired power is likely to play an important role in Australia's future energy mix as older coal-fired generators are retired in the coming decade. This was highlighted in June 2022 when around 3,000MW of coal-fired generation dropped out of the system, forcing regulators to intervene in the national electricity market.

By Tom Major

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