The West Australian: Shell Boss Talks up Sydney LNG Terminal

Shell Australia chairman Andrew Smith says it may be time to build an LNG import terminal in Sydney as a way of dealing with a looming gas shortage in NSW and Victoria.

Mr Smith's idea came as Inpex flagged the potential for its 890km Ichthys pipeline, connecting Browse Basin fields with an LNG plant in Darwin, to one day feed gas into the proposed North East Gas Interconnector, which is to link Northern Territory gas fields with east coast markets.

The LNG industry is desperate to find new markets for its gas to offset a supply glut at a time of weaker than expected demand growth. Tapping into the east coast's looming gas shortage, driven because of a lack of offshore resources and bans on onshore drilling, is attracting increased attention though significant challenges including a lack of infrastructure remain.

The cost of re-gasification terminals, which turn the fuel from liquid back into a gaseous state, has fallen sharply over the past decade and cost only hundreds of millions of dollars, compared with billion-plus price tags previously. MORE