Port Kembla Terminal Stands Ready as Delayed Gas Demand Alters Forecasts

Recent changes to the Australian Energy Market Operator's (AEMO) gas supply forecasts suggest that New South Wales might not experience critical gas shortfalls until 2027 — a significant shift from earlier predictions. Despite the new timeline, Squadron Energy maintains its Port Kembla Energy Terminal is still the best solution to ensure energy security as Australia transitions away from fossil fuels.

Owned by Andrew and Nicola Forrest’s Tattarang group, Squadron fast-tracked the terminal’s construction in early 2024 to counter the looming gas shortage. The terminal is designed to handle more than 70% of NSW’s gas demand and, in the future, support green hydrogen import/export once commercially viable.

Squadron CEO Rob Wheals emphasized the urgency of having infrastructure in place, regardless of updated forecasts. “Infrastructure takes time, and time is short,” Wheals stated. “Port Kembla is the practical, near-term answer.”

The terminal’s integration with Jemena’s Eastern Gas Pipeline reversal project enables it to distribute gas to both NSW and Victoria, offering a flexible, ready-to-activate solution.

While the long-term vision includes transitioning the terminal to support green hydrogen, the current uncertainty surrounding Australia's hydrogen market means Port Kembla will likely focus on natural gas for the foreseeable future.

Adding to the national conversation, the Victorian Government has greenlit a new floating gas terminal near Geelong, backed by Viva Energy. Construction is planned to begin next year, with an eye toward addressing a projected gas shortfall in 2028. However, with no offtake agreements secured yet, the project remains in early stages.

In contrast to Viva's project, which is still in its infancy, Squadron's Port Kembla terminal is fully constructed and uniquely positioned with a Floating Storage Regasification Unit (FSRU) already contracted. “We are the only facility in Australia ready in time for the 2027/28 shortfalls,” Wheals asserted.

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