Australian workers at Inpex's Ichthys LNG project will continue striking through June 23 after a tribunal rejected the Japanese gas giant's bid to halt the walkout.
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Inpex faces 4 LNG cargo delays as Australian tribunal rejects bid
An Australian labour tribunal on Sunday rejected Inpex's bid to halt a strike by about 400 workers at its Ichthys LNG project, clearing the way for at least four cargoes to miss their loadings.
"I do not regard this to be a significant disruption," Michael Easton, deputy president of the Fair Work Commission, said in his ruling, adding that he found no evidence of an adverse economic effect from the strike or a danger to Australia's Northern Territory.
The strike, which began with two-hour blocks and escalated to eight-hour periods on Thursday, will now run until June 23 with a complete ban on cargo loading. Two condensate cargoes have already missed their loadings, and if production halts for a full week, four LNG cargoes will be delayed, an Inpex employee told the commission. The Ichthys facility has a capacity of 9.3 million tons per year.
The walkout threatens to tighten Asia-Pacific LNG supply at a time when Japan — already grappling with a weak yen and rising wholesale inflation that accelerated to its fastest in three years — relies on Ichthys for a significant portion of its gas imports. Inpex is expected to submit another offer to workers on Monday as bargaining continues under the commission's orders.
Inpex filed its petition with the Fair Work Commission on Wednesday, arguing the strike would hurt the Australian economy through lost export revenue and risk dangerous blackouts in the Northern Territory. Easton rejected both claims, noting that Power and Water Corp, the government-owned utility, had organized contingency measures to avoid blackouts and that the facility had sustained more comprehensive outages in the past with no adverse effect.
The Ichthys project is a joint venture between Inpex, France's TotalEnergies, and Australian subsidiaries of CPC Corporation Taiwan, Osaka Gas, Kansai Electric Power, JERA, and Toho Gas. Any prolonged disruption at the facility could ripple through Japan's utility sector, where companies including JERA and Kansai Electric rely on Ichthys for contracted LNG volumes.
Damien Chandler, Inpex's superintendent for onshore operations, told the commission that LNG and condensate storage onshore would reach capacity within a few days, forcing a production shutdown. Another Inpex employee said offshore production could slow and create technical challenges that would also lead to a halt.
The strike adds to supply-side pressures in global energy markets, where Asian spot LNG prices have already climbed this year on heightened competition for cargoes. Japan's core inflation has remained below the Bank of Japan's 2 percent target for four consecutive months through May, according to a Reuters poll, giving the central bank room to focus on the yen's weakness rather than energy-driven price pressures.
This article is for informational purposes only and does not constitute investment advice.
