May 30, 2025 [Reuters]- Vopak has started talks with gas suppliers and offtakers for its liquefied natural gas import terminal project in Victoria, Australia, and expects to take a final investment decision in 2026-2027, a senior executive told Reuters.

The global energy storage operator announced last week it was confident in advancing the project in Australia’s biggest gas-consuming state after laws were passed to ease supply shortfalls.

Paul Kanters, managing director of Vopak Terminals Australia, said operations could begin as soon as 2029 if all the necessary environmental permits and commercial contracts are in place in 2026-2027.

Vopak’s Victorian Energy Terminal in Port Phillip Bay is one of four proposed across Australia’s southeastern states to meet domestic gas needs, as regulators warn there could be shortages as soon as 2027.

The global energy storage operator plans to charter a floating storage regasification unit (FSRU) to act as an import terminal to supply gas to the state of Victoria.

While Vopak is seeking an FSRU with a capacity of 170,000 cubic metres, it has been “extremely difficult” to secure one after the Russia-Ukraine war drove Europe to secure more floating terminals to import more LNG, Kanters said.

“We are in final talks with a FSRU provider to have an FSRU designated for this project,” he said.

The company aims to start operations at the terminal in 2029 when there will be a structural gas shortage, and would run for at least 10 years, Kanters said.

“The Victoria market is somewhat difficult, but sometimes because it’s a peak market, you need to build infrastructure to allow for accommodating peak demand,” he added.

Using an FSRU also provides flexibility for operators to react to Australia’s gas needs which may decline if electrification of its economy gathers speed, Kanters said.

“The FSRU can simply float away and will not leave any legacy infrastructure sitting there for tens of years that needs to find a home or needs to be depreciated,” he added.

Australia was the world’s second-largest LNG exporter last year after the U.S., shipping over 81 million metric tons of the chilled fuel, according to Kpler data.

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