Gas shortage can be prevented with Port Kembla energy terminal

Gas customers may be shielded from future shortages on the east coast by bringing gas directly into NSW through the soon to be completed Port Kembla Energy Terminal (PKET).

Yesterday’s alarming Australian Competition and Consumer Commission’s (ACCC) 2022 interim gas report predicts significant gas shortfalls in 2023 and beyond as well as rising energy prices – resulting in a threat to a local industry and jobs.

Squadron Energy CEO Eva Hanly explained small and medium business customers who purchase gas on the spot market are increasingly worried about a gas shortage which could mean gas prices skyrocket – putting pressure on their ability to operate.

“It is extremely concerning that the ACCC’s outlook for the east coast gas market has significantly worsened. We are focused on getting the energy terminal at Port Kembla finished as quickly as possible to ensure gas will be available to help commercial and industrial users, gas-powered generators (GPG) and retailers,” said Hanly.

The Port Kembla Energy Terminal currently being constructed by Squadron Energy which is part of the Tattarang group of companies, owned by Andrew and Nicola Forrest.

Its wharf infrastructure is approximately 80 per cent complete and is due to be operational at the end of 2023.

“Our terminal will be available to bring in gas next year. It is the only solution that can supply gas directly into the East Coast gas network – the other proposals such as developing new gas fields at Narrabri or building new pipelines from Queensland will not be able to deliver gas for years,” Hanly said.

The ACCC has forecast that the east coast of Australia could face a shortfall of 56 petajoules (pj) in 2023. Furthermore, the PKET may deliver up to 130 pj per annum or, alternatively, 75 per cent of the gas needs of the entirety of NSW.

While the ACCC strongly encourages LNG exporters to immediately increase their supply into the market, physically getting the gas from QLD to NSW and VIC is set to be a challenge. Due to the congestion within the gas pipelines, there is a limited opportunity to bring more gas down from QLD.

“The great thing about this terminal is that it has the potential to ship gas from Queensland directly into NSW, bypassing the congested pipeline infrastructure,” said Hanly.

In January 2020 when the New South Wales Government signed the NSW Energy Package Memorandum of Understanding (MOU) with the Commonwealth, the Port Kembla Energy Terminal was named as one of the solutions.

Since that landmark MOU, Squadron Energy have been progressing construction of the terminal to ensure this solution will be in place as quickly as possible.

“We are speaking to energy retailers, energy customers, consumer groups and market bodies and I believe together we can deliver a solution which secures future supply for NSW and Victoria,” Hanly said.

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