Plans by billionaire Andrew Forrest to have a liquefied natural gas (LNG) terminal ready by 2022 means Australia won’t suffer a supply shortfall until 2026, two years later than previously forecast, the energy market operator said.

“This development comes at a critical time, as existing Victorian production is declining faster than previously projected,” Nicola Falcon, group manager of the Australian Energy Market Operator (AEMO) said in a statement accompanying its closely watched outlook.

Producers’ forecasts for maximum daily capacity from existing, committed and anticipated southern fields in 2023 are nearly 20 percent lower now than they were a year ago, AEMO said.

Gas fields in the Gippsland Basin, which largely supplies the southern states are becoming exhausted, and losing flexibility to ramp up output during peak winter demand.

LNG imports and gas storage will be needed to cover peak demand.

Forrest’s privately owned Squadron Energy won state approval to build an LNG import terminal at Port Kembla in New South Wales, aiming to be ready by late 2022.

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29th March 2021