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Highlights
- Viva Energy gains green light for LNG import terminal
- Project targets looming gas shortfall in Victoria
- Construction to kick off in 2026 and span two years
Viva Energy (ASX:VEA) has received a crucial environmental approval from the Victorian government for its proposed LNG import terminal in Geelong. The move signals a significant development in Australia's energy infrastructure, particularly amid rising concerns over future gas shortages in the state of Victoria.
The terminal, once completed, will possess the capacity to import up to 160 petajoules of liquefied natural gas per year. To put that into context, this volume accounts for approximately 88% of the state’s projected gas consumption for 2024, according to figures from the Victorian government. This strategic approval comes at a time when both the Australian Energy Market Operator and the Australian Competition and Consumer Commission have flagged impending structural gas supply shortfalls expected to emerge in the coming years.
The Geelong project encompasses a comprehensive development plan. It includes extending the existing refinery pier, building a floating storage and regasification unit, installing a treatment facility, and constructing a connecting pipeline to link with Victoria’s primary gas transmission system.
Construction is set to commence in the second half of 2026 and will span roughly two years, with the bulk of work scheduled for 2027. The initiative positions Viva Energy (ASX:VEA) to progress toward a final investment decision and obtain additional regulatory clearances.
Lachlan Pfeiffer, Chief Strategy Officer at Viva Energy, emphasized the urgency surrounding the terminal’s timeline, noting that hitting specific milestones is essential to ensure the terminal becomes operational in time to counteract gas supply constraints anticipated from 2028 onward. Discussions with potential commercial partners and off-takers are already underway, with multiple capital and commercial structures currently being evaluated.
From a broader market perspective, the development reinforces the significance of infrastructure within the ASX200 index, where companies contributing to energy transition and security are garnering increased investor interest. Viva Energy’s latest move also aligns with long-term themes linked to essential services, which are often seen as key players among ASX dividend stocks due to their cash flow resilience and utility-like business models.
Energy Minister Lily D’Ambrosio underscored the state's dual approach of supporting gas infrastructure while helping homes and businesses transition to electricity where feasible. This dual-track strategy aims to preserve critical gas supply for industries unable to electrify, ultimately promoting both energy reliability and affordability.
As the energy landscape evolves, projects like Viva Energy’s LNG terminal are likely to play a pivotal role in shaping Victoria’s gas supply resilience while also contributing to infrastructure growth within the broader ASX200 ecosystem.
