Australian Industrial Energy (AIE) has announced another important milestone in the development of its Port Kembla Gas Terminal (PKGT) with the award of the key wharf facility and pipeline construction contract (Contract) for the LNG import facility.

New South Wales, Australia currently imports over 95 per cent of its domestic gas from other states. This means that local industries, business and households can be impacted by supply or price shifts occurring in other states.

AIE states that LNG will be sourced from international suppliers and transported by LNG carriers to Port Kembla, where it will be transferred to a floating, storage and regasification unit moored at the eastern side of the Inner Harbour. The company forecasts that an LNG carrier will arrive in Port Kembla every two to three weeks.

The PKGT has the potential to supply 70 per cent of the state’s annual gas demand and help to ease the cost of energy bills for the 33,000 businesses and a million households in NSW that depend on natural gas.

In April 2019, AIE received planning approval from the NSW Government to construct the gas terminal. Prior to the approval, the NSW Government assessed the environmental, social and economic impacts of the project identified by community, government and independent stakeholders.

Earlier this week, AIE awarded the contract to the SCSB joint venture which comprises Spiecapag and Soletanche Bachy. Both companies have extensive experience in major pipeline and infrastructure projects in Australia and around the world.

Construction work is set to include dredging, a new wharf within the existing Port Kembla dock and the pipeline to connect the new facility to the east coast gas network at Cringila.

The project will provide work and subcontracting opportunities for experts in demolition, concreting, welding, electrical works, steel reinforcement, traffic management, surveying, alongside other goods and services, with an estimated $76m being sub-contracted to local businesses.

AIE has advised that planning design is underway for the PKGT and construction is expected to commence immediately after the AIE joint venture partners complete their Final Investment Decision (anticipated to occur later this year).