Australian LNG sours for the locals

Exporters have prioritised foreign markets and the domestic price has spiked, angering consumers back home

Selling a commodity to foreign markets instead of the local one was always going to lift prices in the home market. But no one expected this. Eighteen months after Australia’s LNG-export surge began, local spot gas prices are now triple those paid by Japanese buyers of gas sourced from newly minted Queensland facilities. The inflation has caught regulators and the government on the hop. It shouldn’t have: large industrial consumers have repeatedly said that gas producers are prioritising long-term LNG-export contracts over the local market and pitching domestic prices at higher-than-international rates to gouge a captive market. As far back as 2011, when BG sanctioned Queensland Curtis LNG (