Japanese Firms Profit Reselling Australian LNG at Higher Prices
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- 8 hours ago
- 2 min read
Japanese energy companies are making at least $1 billion by buying Australian liquefied natural gas (LNG) and then on-selling it to other countries—all while parts of Australia are facing potential gas shortages, according to a new report.
The research, released today by the Institute for Energy Economics and Financial Analysis (IEEFA), comes at a time when both Western Australia and the eastern states are looking at possible future shortfalls in gas supply.
It turns out that Australia is the top source of LNG being resold by Japan, making up about 41% of the shipments that Japan passed on to third countries last year. The United States was the next biggest source.
What’s particularly concerning is that the volume of Australian gas resold by Japan is actually greater than the expected gas shortfalls forecast in both eastern and western parts of the country in the coming years.
IEEFA Australia CEO Amandine Denis-Ryan didn’t hold back. She said the situation should be “ringing alarm bells” for the federal government.
“It’s quite extraordinary that Australia is now facing gas shortfalls on both sides of the country—and is even thinking about importing LNG—while Japan resells enormous volumes of our gas overseas for a profit,” Denis-Ryan said.
The IEEFA dug into shipping records and contract details to figure out just how much Aussie LNG is being resold through Japan. They estimated that in the past year, at least 600 petajoules (PJ) of LNG were resold this way. For comparison, eastern Australia only consumed 511PJ during the same period.
And it’s not just a one-off. The research found that the amount of LNG Japan resells from Australia is larger than the projected gas shortfalls we’re expected to see in both regions in the near future.
Where’s all that gas going? Mostly to Taiwan and South Korea, both of which are considered premium markets for Australian gas producers.
Japan, citing energy security concerns, has been strongly opposed to any efforts by Australia to restrict LNG exports—despite profiting from them in a way that’s now raising eyebrows back home.
More updates to come on AusNewsLanka.
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