Australia is facing pushback from key Asian energy partners over its new gas export policy, which could disrupt long-standing contracts. The Albanese government introduced legislation requiring the nation’s largest liquefied natural gas (LNG) exporters to reserve up to 20% of their annual export volumes for domestic use starting in 2028. While existing contracts signed before December 22, 2025, are exempt, the bill explicitly states that any contract renewals or extensions after that date will lose this protection, angering major buyers like Japan and South Korea.
Korea Gas Corporation (KOGAS), one of Australia’s largest foreign investors, has expressed frustration, arguing that contract protections should extend to the entire duration of their agreements, including extension options. Similarly, Japan’s INPEX, which operates the $US40 billion Ichthys LNG project, warned that the policy undermines historical investment decisions. Resources Minister Madeleine King defended the bill, stating that extending contracts is a new commercial decision made with full knowledge of the domestic gas reservation scheme.
Local gas-intensive manufacturing firms have welcomed the intervention, hoping it will moderate soaring gas prices. However, energy analysts caution that the policy may not deliver immediate benefits, as surplus gas is limited until Asian export contracts begin expiring in the 2030s. The bill is expected to face considerable debate before becoming law, with industry leaders raising concerns over forced uncommercial deals and potential trade tensions.