The NSW Government has approved Australian Industrial Energy’s (AIE) application to modify the existing Development Consent for the Port Kembla Gas Terminal (PKGT).

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 liquified natural gas (LNG) cargoes able to be received by the terminal.

With the additional capacity now approved, AIE states that it will continue to work 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 (FID) and commence the ‘relatively short and simple’ 14 –16 months construction program for the terminal. The project is forecast to generate 150 jobs during construction and up to 50 jobs once fully operational.

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.

If customers now commit to supply agreements, AIE expects that FID could be possible in 2020, and gas could be flowing into NSW as early as 2022.

The terminal has the capacity to deliver over 100 petajoules (PJ) of gas each year, representing approximately 75 per cent of NSW total market needs. It can source LNG supplies from WA, QLD, NT or anywhere in the world offering highly competitive prices.

The approval cements the PKGT’s position as the only project in NSW with a potential timeframe able to assist the NSW State 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.

Peter Mitchley, the head of AIE’s PKGT Project said: “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.”