$60 Billion Investor Slams Green Australia for “Quietly Quitting” on Gas

From Watts Up With That?

From Watts Up With That?

Economic ruin approaching? $60 billion of Japanese investment in Australia is in peril, along with 10s of billions of dollars exports, because of Australia’s green energy policies.

Japan’s Inpex says Australia risks unintended consequences as it ‘quietly quits’ LNG

By energy reporter Daniel Mercer

Posted Thu 30 Mar 2023 at 6:03pm

The head of Japan’s biggest oil and gas producer has warned that Australia risks undermining global security through a decision to “quietly quit” the international gas trade.

Key points:

  • A gas company executive says Japan has been rattled by government interventions in Australia’s gas industry
  • He says Russia, China and Iran will likely fill any void if Australia exits LNG production
  • A Japanese ambassador says his country depends on Australia for resources

In an extraordinary speech delivered at a federal parliamentary event on Thursday, Inpex chief executive Takayuki Ueda suggested Japan had been rattled by government interventions in Australia’s gas industry.

…Read more: https://www.abc.net.au/news/2023-03-30/japan-warns-world-peace-at-stake-in-australian-gas-exit/102167908

From the speech by Ueda-San, head of INPEX, Japan’s largest energy producer.

… Australia is competing for global investment and the changes we are seeing to Australian policy settings will choke investment and strangle the expansion of LNG projects in this country.

The consequence of these well-intentioned policies will be that the increasing energy demand in our region will be met by coal and not by natural gas.

The result will be much higher global greenhouse gas emissions and will make net zero by 2050 an impossible task.

On the geopolitical front, Australia’s “quiet quitting” of the LNG business has potentially very sinister consequences. The question of who will replace Australian supply into the market is front and center.

Alarmingly, the “inconvenient truth” is most likely that Russia, China and Iran fill the void. …Read more: https://www.au.emb-japan.go.jp/files/100483933.pdf (backup copy here)

The ambassador also made a speech, but the Ambassador’s speech was tame compared to the speech by the Inpex boss.

This energy policy madness is a recipe for driving inflation and mortgage interest rates into double digits.

The only reason inflation and mortgage interest rates haven’t soared into double digits is because Australia’s high value energy and mineral exports are propping up the value of the Australian dollar. High value exports make imports cheaper, which puts downwards pressure on inflation.

Rud and Nick mentioned they weren’t sure why Ueda-San is accusing Australia of “quietly quitting” on gas.

I believe the problem is gas exporters like Inpex are being squeezed between growing hostility towards fossil fuel extraction on one side, and price caps and demands for adequate supply for domestic users on the other, shrinking the supply of gas available for export.

Aussie government is making it more difficult to drill for gas – not an outright ban, but strong evidence of hostility towards fossil fuel extraction. Labor’s compromises with their Green Party coalition partners are making fossil fuel extraction more difficult.

There is also growing regulatory hostility to fossil fuel extraction. A coal field development was rejected recently over concerns it would impact the Great Barrier Reef, but climate change was also listed as a reason to reject the development of the coal field.

Coal and gas field developers notice these things.

Update (EW): Japanese companies are showing interest in methane clathrate mining.

Clathrates are a type of ice which forms when methane and water mix, at significantly higher temperatures than normal water ice. The advantage for Japan is if they develop clathrates they don’t have to rely on unreliable foreign partners like Australia. Substantial clathrate deposits may be available on the sea floor just off the coast of Japan. But clathrates are unstable. Any attempt to mine clathrates could result in large, uncontrolled releases of methane, which is a bit of a bogeyman for climate worriers.