Australia Vows to Keep Asia’s Gas Flowing Despite Emissions Cut

(Bloomberg) -- Australia is committed to remaining a major natural gas supplier for Asia’s largest economies, Resources Minister Madeleine King said, less than a week after the nation passed targets to drastically cut emissions from its export plants.

There will be “difficult times ahead” for the natural gas market due to accelerating policies to end carbon emissions across the region, but Australia will remain a reliable supplier of energy, King said. 

“Australia can never consume as much gas as it produces, we just don’t have the population,” she said in an interview in Singapore. “The reason we have a gas industry at all is because of exports, is because of the needs of our Asian neighbors, and because of their investment, and that investment is continuing.”

Australia last week passed legislation targeting 4.9% annual cuts in emissions from its most-polluting industrial facilities, including from the massive LNG plants that are forecast to earn A$91 billion ($61 billion) from exports in the year through June. The law led major importers such as Japan, which gets almost half of its LNG from Australia, to voice concerns about security of supply.

As part of the government’s signature policy to tackle climate change, new gas projects will need to produce net zero emissions, imposing greater costs on developers. King sought to reassure Australia’s trading partners, saying new supply would come online and all existing contracts would be honored.

“We all want to get to the same place — we want to decarbonize our economies,” she said. “Gas will be a critical transition fuel for my country, and for all of our Asian neighbors.”

©2023 Bloomberg L.P.