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By Keira Wright
Australia’s liquefied natural gas exporters are missing out on meeting rising Asian demand because of a lack of capacity that’s partially down to an uncertain investment environment, according to Chevron Australia Corp.
Demand for Australian LNG, particularly from Japanese buyers, is outstripping operational supply limits, said Chevron Australia’s Managing Director Balaji Krishnamurthy.
“The first question from buyers always is, can you do more? And right now, we are facility constrained,” he said in an interview at the Committee for Economic Development of Australia’s Climate and Energy Summit in Melbourne. “If we are able to sell more, people would absolutely like to buy it,” he said.
Source: Shipping data compiled by Bloomberg
The protracted closure of the Strait of Hormuz has cut about a fifth of global supplies, lifting prices and intensifying competition for spot cargoes across Asia. Australia is one of the world’s largest LNG exporters, shipping almost 80 million tons last year, mainly to Japan, China and South Korea.
Looking ahead, LNG demand remains “very robust,” particularly in Southeast Asia and Japan, but shifting fiscal and tax settings are creating uncertainty for long-dated energy projects and deterring new developments in Australia, Krishnamurthy said.
“The fiscal and tax settings are just foundational to any country’s investment environment, so that absolutely would have to remain stable for us to have an environment to invest in it for the long haul,” he said.
Public pressure has been mounting to increase taxes on Australia’s LNG exporters, but Prime Minister Anthony Albanese said on Wednesday his government wouldn’t “undermine” existing shipments with new taxes, warning that doing so during a global energy crunch would risk investment and fuel security.
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