The prime ministers of Australia and Japan today inked an energy cooperation agreement that also covers critical mineral supply.
Australia is a leading supplier of energy commodities to resource-poor Japan and the top supplier of liquefied natural gas, Reuters noted in a report on the news.
“Australia and Japan are taking action to protect our economies from future economic shocks and uncertainty,” Australia’s Prime Minister, Anthony Albanese, following the signing of the deal with Japan’s Sanae Takaichi, who is on a three-day visit to Canberra.
“By working together, we will achieve more secure and resilient supply chains that will benefit Australian and Japanese businesses and consumers now and into the future,” Albanese also said.
Australia is a top-three LNG exporter but has recently experienced problems with production, after several LNG projects suffered damages caused by a cyclone. The cyclone affected operations at three production facilities, including the country’s largest, Chevron’s Gorgon platform, which has a capacity to produce 15.6 million tons of the superchilled fuel annually.
The deal with Japan also comes at a time when parts of Australia face gas shortages, which prompted the Albanese government to announce curbs on LNG exports in December last year. The curbs would come into effect from 2027, building on the so-called Australian Domestic Gas Security Mechanism that the government of Australia approved back in 2017, giving itself powers to limit exports of liquefied natural gas in order to ensure domestic supply.
In separate problems, Australia’s Offshore Alliance trade union last month threatened a strike at one of the country’s biggest LNG production facilities, Ichthys, which is operated by Japan’s Inpex.
In addition to energy commodities, Australia and Japan will also partner on critical minerals, of which Down Under has substantial reserves. Plans are to turn Australia into a major supplier of gallium, nickel, graphite, rare earths, and fluorite, among others, to Japan.
By Irina Slav for Oilprice.com
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