Japan hoses Aussie gas all over as East Coast starves

Japan is reselling considerable quantities of Australian liquefied natural gas (LNG), according to JERA, the nation's largest LNG importer and power producer. JERA's CEO, Irtiza Sayyed, stated that the company aims to identify additional markets for selling excess gas supply if domestic demand is low. JERA recently established a wholly-owned subsidiary, JERA Global Energy Solutions, to develop and manage its LNG, upstream, low-carbon fuels, and shipping businesses, reflecting its response to the volatile and complex energy markets.

Meanwhile, Mitsui OSK Lines, a leading Japanese shipping firm, expects the resumption of LNG shipments through the Strait of Hormuz to be delayed, which may continue to elevate prices and reduce demand across Asia. This development comes amid concerns over the prolonged disruption and its impact on the region's energy markets.

The situation has also affected the Australian state of Western Australia (WA). In June 2023, the WA government took action to curb the impact of a potential gas price squeeze caused by Woodside's practices, even though the price remains relatively high. Despite this, the exports from Queensland (QLD) are still significant, accounting for around 3-4% of Japan's total gas resales in the region.

The consequences of this gas export situation are far-reaching, with industrial hollowing out and a collapsing energy transition becoming increasingly apparent. The lack of government action and the absence of gas backup for the future energy transition, as advocated by the reporter, are contributing to the struggles of investors in gas and gas-fed industries. The reporter emphasizes the vital role of gas in supporting industry and the energy transition, lamenting the ongoing mismanagement of the sector.