Squadron Energy boss hits back at ‘more expensive’ gas imports claim
Andrew Forrest’s Squadron Energy, which hopes to open Australia’s first LNG import terminal at Port Kembla, has hit back at claims that gas prices will soar if users on Australia’s eastern seaboard are required to rely on imported gas supplies.
Disputing the findings of a new report released by Frontier Economics on Thursday, Squadron said import terminals would put downward pressure on prices as they would provide access to a growing supply of global LNG.
Frontier’s research, funded by listed pipeline operator APA Group, found that importing gas would cost both industrial and residential customers significantly more than sourcing it domestically – due to the costs of shipping and regasification, and the exposure to international gas pricing, which spiked following Russia’s war with Ukraine.
However Squadron Energy chief executive Rob Wheals – a former chief executive of APA Group who joined Squadron in March this year – said the Port Kembla terminal provided the fastest solution to bridging looming gas shortages on Australia’s east coast.
“It also plays a pivotal role in opening up the Australian gas market to the lowest price gas, either domestic or international, which ultimately helps Australian industry and consumers,” he said. “Global LNG supply is forecast to grow by 50 per cent to 200MMt (million metric tonnes) by 2028, dwarfing the domestic Australian market, so it follows that connecting to global LNG markets can put downwards pressure on prices.”
Squadron is nearing completion of its LNG import terminal at Port Kembla, while Viva Energy proposes a terminal for Geelong, and Venice Energy wants one built at Port Adelaide. They are being contemplated in the context of a looming gas shortfall.