AIE Inks Pipe MoU for Oz Import Terminal

Australian Industrial Energy (AIE) has signed a memorandum of understanding (MoU) with energy infrastructure company Jemena to connect the A$250mn (US$185mn) Port Kembla LNG import terminal in New South Wales (NSW) with the Eastern Gas Pipeline (EGP), the companies said in a joint statement issued on November 27.

Under the MoU, Jemena intends to construct a 12-km underground pipeline capable of transferring gas from the terminal directly into the EGP – the gas trunk line between Victoria and NSW. It plans to invest over A$70mn to build the connecting pipeline and modify the EGP so that it can deliver over 200 TJ/day of gas from NSW into the Victorian market, while being able to supply up to 450 TJ/day of gas to NSW – a 25% increase on its current capacity, according to the statement.

The project comprises the development of a gas terminal incorporating LNG carrier vessels, a floating storage and regasification unit, wharf facilities and a pipeline connection to the existing EGP. AIE, part of the Squadron Energy Group, had signed an agreement for lease for up to 25 years with NSW Ports earlier this month.

AIE secured approval from the state of NSW to expand the terminal's capacity earlier this year. The Port Kembla terminal was declared a critical project by the state in 2018, fast-tracking its approval process. The venture began securing customers and awarding construction contracts last year.