An LNG import terminal set to be approved by the Victorian government near Geelong to avoid a state gas shortage would require extensive dredging of Port Phillip Bay, cause environmental damage and cost taxpayers millions, a rival firm warned in an eleventh-hour bid to scuttle the project.

Viva Energy, the petrol and diesel supplier that owns the Shell service station network, expects a decision from the state government on its Geelong terminal this month, after public hearings about the project wrapped up in January.