Japanese firms in consortium to bring LNG to Australia's east coast

[MELBOURNE] A consortium including Japan's JERA and Marubeni Corp is planning to import liquefied natural gas (LNG) to Australia's east coast, aiming to supply industrial gas users and possibly a new power plant, a spokesman for the group said on Monday.

This is the second proposed LNG import terminal for Australia, the world's no.2 LNG exporter, looking to fill a supply gap at a time when the country's gas producers have locked in long-term contracts to supply LNG to Japan, China and South Korea.

A final investment decision is expected this year on the project to import up to around 2 million tonnes a year of LNG starting in 2020 into a market where energy prices are soaring, said the spokesman for the group, Australian Industrial Energy.

"This market is desperate for new gas," James Baulderstone, a former Santos Ltd executive who is leading Australian Industrial Energy, told Reuters.

The LNG receiving terminal would be able to meet up to three-quarters of the gas needs of Australia's most populous state, New South Wales.

The proposed new LNG import terminal would be located at one of three ports that are being considered.

Australian Industrial Energy's investors are mining billionaire Andrew Forrest's Squadron Energy, Marubeni and JERA, the world's biggest LNG buyer, which is a joint venture of Tokyo Eletric Power and Chubu Electric Power.

General Electric is providing technical support and design services for development and construction of a gas-fired power plant.

A JERA spokesman declined to comment.

REUTERS