Allan government gives the green light to mega gas project in Geelong
A giant floating terminal capable of storing enough gas to supply Victoria for almost a year has been approved by the state government, as Jacinta Allan hit back at the energy boss who compared Victoria to North Korea.
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A giant floating terminal capable of storing enough gas to supply Victoria for almost a year has been approved by the Allan government.
The mega project, first proposed by Viva Energy in 2020, would include an LNG storage ship, an extension of the Geelong refinery pier, and a 7km pipeline to connect to the existing network.
The green light allowed Premier Jacinta Allan to clap back at the head of gas giant Santos, who had compared Victoria to North Korea earlier in the week, saying his “smears” were driven by a fear of competition.
Import terminals have been put forward as part of a plan to tackle gas supply woes expected later this decade in Victoria, where more than 2 million households and businesses use the fuel source to heat homes and cook.
The national market operator has warned that shortages are likely once power stations at Yallourn in Victoria and Eraring in NSW are retired, because renewables are unlikely to be ready to take over and gas will be needed to keep the lights on.
But environmental groups have campaigned hard against the $250m terminal, which went through two environmental assessments following concerns raised during an initial process.
On Thursday night Ms Allan told a Victorian Chamber of Commerce and Industry event that the terminal at Refinery Pier in Corio Bay was now “one step closer” and that “securing much needed additional gas supply is an energy decision”.
The energy industry has been highly critical of Victoria in the past few years as it turbocharged its push to wean the state off gas, including a plan to force households to electrify when gas heaters or hot water systems expire.
The long-awaited approval of the Viva proposal was viewed as a test of whether the Allan government had softened its hard line stance on “fossil gas” and the role it is expected to play in the transition to net zero.
On Wednesday, Santos chief executive Kevin Gallagher quipped that Victoria was similar to North Korea when it comes to development decisions.
Ms Allan told the VCCI event that Victoria had created more jobs than other states, which was “not bad for a place apparently run like North Korea”.
She told the Herald Sun his comments were driven by fear of competition.
“Victoria is growing, open for business, and investing in energy – including gas.”
The Viva terminal allows for up to 160 petajoules of gas a year to be imported and stored from interstate or overseas – up to 88 per cent of the state’s annual gas use.
Viva has previously signalled it could be operating by 2028, and is in a race to establish the terminal due to a facility at Port Kembla in NSW expected to be operational within two years, and a decision looming on a second terminal for Victoria by energy giant Vopak.
If built, it would likely be used to deliver gas during peak periods or during shortages, depending on how contracts were structured.
An import terminal proposed for Melbourne’s southeast by AGL earlier this decade was knocked on the head by the Andrews Government due to concerns about the impact on wetlands.
Ms Kilkenny’s approval of the Viva proposal, is based on strengthening environmental protocols to limit impacts on sea life, including whales, dolphins and turtles.
It will also be required to set up a community reference group that will manage concerns from locals about the projects.
The project, which still requires other regulator approvals before it can go ahead, would create up to 200 jobs during construction and up to 70 ongoing jobs.
Critics of the project say it will lead to higher gas bills if international prices rise, but the proponents say that local supplies are dwindling and extra sources are needed to ensure a smoother transition to renewables.
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