Australia's AIE signs FSRU deal with Norway's Hoegh for LNG import project

Australian Industrial Energy, or AIE, has signed a long-term charter party deal with Norway's Hoegh LNG to supply the first Floating Storage and Regasification Unit, or FSRU, it said in a statement Nov. 30.

The plan to start importing LNG through Australia's Port Kembla has progressed.

The Port Kembla Gas Terminal, or PKGT, will have a maximum daily capacity of 530 TJ and will annually supply as much as 115 PJ.

"With the phasing down of Australia's fossil fuel industry already underway, the Terminal will be critical to ensuring hundreds of thousands of Australian businesses and households to avoid supply shortfalls from 2023 onwards," AIE Chairman Andrew Hagger said in the statement.

"Now that critical infrastructure agreements and approvals are in place for the Terminal, we look to New South Wales and Victorian natural gas retailers to now take active steps to help resolve the energy security crisis they have warned about," he said.

The Australian government Nov. 26, in its first National Gas Infrastructure Plan, labelled PKGT as Australia's most advanced of five proposed import projects and said it is a key element in keeping the east coast supplied so that it can meet both its domestic and export needs.

The agreement between AIE and Hoegh is to see the terminal operational by mid-2023 -- "making it the first project of its kind in Australia," AIE said.

The design is intended to be a "new generation FSRU" which is capable of receiving clean fuels along with LNG.

"Initial feasibility work on the new FSRU will now begin, and while the final design is yet to be confirmed, the vessel is expected to have the capability of delivering both natural gas and green hydrogen or derivatives thereof, unlocking further opportunities for the Terminal to support a future hydrogen energy industry in Australia," AIE said.

Plans for PKGT include having a dual fuel power station that will be able to transition from gas via imported LNG to hydrogen.

PKGT has consent to receive 46 cargoes/year. Standard sized LNG vessels are 170,000 cubic metres.