Inpex Ichthys LNG Strike Threatens Japan and Taiwan Supply as June 11 Escalation Looms

Australia's Ichthys liquefied natural gas project, operated by Tokyo-listed Inpex Corporation, entered its second day of industrial action on Wednesday after the Offshore Alliance union imposed rolling stoppages at all three facilities. Workers are downing tools for four hours each day, between 6:00 and 8:00 a.m. and again from 6:00 to 8:00 p.m. Australian Western Standard Time. The union also imposed bans on overtime, shift changes without four weeks' notice, and early demobilization.

Three Facilities, One Supply Chain

The Offshore Alliance represents workers across all three Inpex sites: the onshore Darwin LNG processing terminal, the floating production, storage, and offloading vessel, and the Central Processing Facility offshore. Ichthys carries a nameplate LNG capacity of 9.3 million tonnes per year. The project also produces roughly 100,000 barrels per day of condensate and 1.65 million tonnes per year of LPG, making it a multi-commodity supply hub for Asia-Pacific.

Ichthys accounted for eight percent of both Japan and Taiwan's LNG import volumes in 2025, delivered under long-term sales and purchase agreements. Those contracts run primarily to Japanese and Taiwanese utilities. Any sustained stoppage therefore carries direct consequences for electricity and gas distribution across both markets.

Who Owns Ichthys

Inpex holds a 67.82 percent operating interest in Ichthys, having acquired Tokyo Gas's 1.575 percent stake in January 2024. TotalEnergies, the French supermajor, holds 26 percent. The remaining interests belong to CPC Corporation Taiwan (2.625 percent), Osaka Gas (1.2 percent), Kansai Electric Power (1.2 percent), JERA (0.735 percent), and Toho Gas (0.42 percent). The concentration of Japanese utility buyers in the joint venture means any production shortfall falls disproportionately on Japan's power sector.

What a Full Stoppage Costs at Today's JKM

At 9.3 million tonnes per year, Ichthys produces roughly 25,480 tonnes of LNG daily. Each tonne of LNG contains approximately 52 MMBtu. The Japan Korea Marker, the benchmark Asian spot price, was assessed at $18.30 per MMBtu by Platts as of May 29, up 50.6 percent year-on-year and 8.25 percent over the past month, per CME data. Multiplying daily volume by energy content and the spot price, Ichthys generates roughly $24.2 million per day in LNG value at current JKM.

The current four-hour stoppages represent about 17 percent of daily output. Applied to the $24.2 million daily figure, the bans put roughly $4.1 million per day of production at risk. The Offshore Alliance has served Inpex notice of a broader, continuous strike from June 11 through June 23. If that full 13-day stoppage materializes, the value of disrupted LNG supply reaches approximately $314 million at current JKM prices, before condensate and LPG losses.

Talks at Impasse

The union called off an earlier planned strike on May 26 after progress in bargaining, then resumed action on June 2 citing unresolved wage and conditions demands. Inpex general manager Bill Townsend said the company "remains committed to engaging in good faith to reach a fair and equitable agreement, maintaining safe operations and ensuring reliable energy supply." Talks between the Offshore Alliance and Inpex management have been underway for more than a year without resolution.

The timing adds to broader LNG supply uncertainty across Asia-Pacific. Middle East conflict has disrupted Persian Gulf energy flows since February 2026, tightening spot markets for both crude and LNG. JKM's 50.6 percent year-on-year gain reflects that sustained tightening, and an Ichthys escalation from June 11 would add Australian supply risk to an already strained system.