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The NSW government has today ruled out Garden Island as an option to ease the pressure on Sydney Harbour as the cruise industry continues to grow.

Instead, Port Botany’s Molineaux Point or Yarra Bay will be the choices for a new terminal.

According to The Sunday Telegraph, the move comes after Prime Minister Malcolm Turnbull personally ruled out Garden Island saying the naval base was not an option.

The state government will spend the next six months making a business case for the new berths, including taking soundings from local residents.

Once the news was out, cruise industry chiefs expressed relief that a decision had been made which would allow them to being making plans to increase the presence of bigger ships in Sydney.

Cruise industry chiefs have been lobbying hard for months to try and persuade NSW political leaders that a decision had to be made, after big ship operator Royal Caribbean and others signalled they would move ships to other ports in Brisbane and Melbourne, taking millions out of the NSW economy.

Most hoped Garden Island could be shared, as the majority of foreign cruise passengers demand the harbour and Opera House views as they sail into Sydney.

Instead, many will have to settle for container ships and cranes.

Former Liberal leader Peter Collins, who chaired an industry inquiry, said he was disappointed but said Mr Turnbull had “no interest in engaging in what is a serious issue”.

And NSW Tourism Minister Adam Marshall said he was disappointed by the Federal Government’s decision not to allow ships to dock at Garden Island.

“That was our first preference, both of the NSW Government and of the cruise industry,” Mr Marshall said. “But of course we don’t own or control Garden Island, that is only controlled by the Commonwealth and they have the final say.”

Royal Caribbean Australia and New Zealand managing director Susan Bonner, however, said: “It feels as though we have some clarity”.

Cruise Lines International Association (CLIA) Australasia, chair Sture Myrmell said the industry would work constructively with the NSW Government in relation to the feasibility studies required for the development of an additional cruise facility at Port Botany.

Mr Myrmell, who is also president of Carnival Cruise Lines, added:  “Our industry has been advocating for a solution to Sydney’s infrastructure constraints for some years and having a clear plan of action with the NSW Government is a step forward to achieve greater certainty and a platform for growth.

“As well as being at the centre of Australia’s largest cruise market, Sydney is one of the world’s most popular cruise destinations and requires facilities that can support cruising growth and its contribution to the economy.

“Last year alone, the cruise industry contributed more than $5 billion to the national economy supporting the equivalent of 21,000 full time jobs with the majority of this contribution, at 60 per cent, centred on NSW.”

A state government plan, which has been in the pipeline for months, also supports regional ports improvement as cruise destinations.

No timing has been put on the beginning of development, as there will need to be consultation exercises, environmental impact studies and funding agreements. Some industry experts believe it could take as long as five years before a building start.

Yarra Bay is on the northern side of Botany Bay in the suburb of Phillip Bay, approximately seven kilometres south of the centre of Sydney. The bay has a south-westerly orientation, making it unique among Sydney beaches.

It is a quiet beach ideal for families and swimmers.

Molineaux Point is more industrial, and is already used for freight and shipping.