Japanese energy firms could be making upwards of $1 billion by on-selling Australian liquefied natural gas to other countries at a time when there are looming shortfalls in supply within Australia itself.
Australia is the top supplier to Japan‘s third-party trade business, a new analysis shows, making up roughly 40 per cent of cargos with an estimated 600-800 petajoules onsold via the intermediary.
The findings from the Institute for Energy Economics and Financial Analysis follow repeated warnings of domestic gas shortages and show Japanese figures were getting involved in debates about Australian energy policy.
In 2023, Japanese ambassador to Australia, Yamagami Shingo, warned the ‘neon lights of Tokyo’ could go out if Australia stopped producing energy resources, including gas.
IEEFA Australia chief executive Amandine Denis-Ryan said it was ‘quite extraordinary’ for Australia to be running out of gas for domestic use – and considering importing it – while Japan resells ‘enormous volumes of our gas overseas for a profit’.
The energy analysts drew on shiptracking and contracts data to understand how much Australian LNG was being resold via Japan.
The upwards of 600PJ estimated annually surpasses the total amount used by eastern Australian markets last year, which was 511PJ.
Resales of Australian LNG also surpassed the projected annual gas shortfalls in both the eastern and western Australian regions.
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Emerging nations were not the top customers of repackaged Australian LNG.
Two-thirds of on-sold Australian product was going to Taiwan and South Korea.
‘This should be concerning for Australian producers, for whom these are premium markets with high purchasing power and low credit risk,’ Ms Denis-Ryan said.
In her view, the findings supported the case for putting aside more gas for local use through domestic reservation.
‘Energy exports are currently hurting Australian consumers and the Australian economy,’ she told AAP.
