EnergyAustralia to buy 15 PJ a year for five years...

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    • EnergyAustralia to buy 15 PJ a year for five years
    • EnergyAustralia to pay oil-linked price
    • Contract starts in Jan 2021

    (Adds comments from EnergyAustralia, AIE)

    MELBOURNE, May 22 (Reuters) - EnergyAustralia, Australia's third-largest energy retailer, on Wednesday reached a preliminary agreement to buy gas from a liquefied natural gas import terminal planned by Australian Industrial Energy, the companies said.

    EnergyAustralia is the first customer to sign up to buy gas from the Port Kembla LNG import terminal backed by Japan's JERA and Marubeni Corp 8002.T and mining magnate Andrew "Twiggy" Forrest's Squadron Energy.

    The Australian Industrial Energy joint venture is looking to lock in customers for gas before making a final investment decision on the A$250 million ($172 million) project.

    The plan is to park a ship, or floating storage and regasification unit (FSRU), at Port Kembla, about 100 km (62 miles) south of Sydney, which could import about 2 million tonnes a year of LNG.

    That would be able to supply about 100 petajoules (PJ) annually to New South Wales, Australia's most populous state, which relies on neighbouring states for most of its gas.

    Australian Industrial Energy (AIE) has agreed to supply 15 petajoules a year of gas to EnergyAustralia over five years starting from January 2021 at an oil-linked price, the companies said.

    "It's an agreement that provides their business with certainty in the face of increasingly challenging domestic gas market supply," Squadron Energy Chief Executive Officer Stuart Johnston said in a statement on behalf of the AIE joint venture partners.

 
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