Australia's LNG Industry Struggles to Meet Rising Asian Demand

Australia's liquefied natural gas (LNG) industry is struggling to meet rising demand from Asia, particularly from Japanese buyers, due to a lack of available capacity. Chevron Australia Corp's Managing Director Balaji Krishnamurthy pointed out that buyers are eager to purchase more Australian LNG if only they could sell it. However, the company is 'facility constrained', meaning it can't produce more gas.

The Strait of Hormuz closure has exacerbated the situation by reducing global supplies and driving up prices in Asia. Australia is one of the world's largest LNG exporters, shipping around 80 million tons last year to countries such as Japan, China, and South Korea.

Looking ahead, demand for LNG remains 'very robust' in Southeast Asia and Japan, but shifting fiscal and tax settings are creating uncertainty for long-dated energy projects. This is deterring new developments in Australia, according to Krishnamurthy.