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Australian Labor Tribunal Dismisses Inpex Attempt to Stop Strike at Ichthys Plant

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FINWIRES Analysis

The ruling shifts leverage toward labor by setting a high bar for the 'economic damage' defense that operators typically lean on to suspend strikes, suggesting future Australian LNG disputes may be harder to shut down pre-emptively. With contingency measures deemed adequate and revenue framed as merely delayed, Inpex's path now runs through a sweetened wage offer rather than legal escape. Watch whether missed cargo loadings cascade into wider buyer penalties or spot-market substitution.

Key Takeaways

  • Tribunal sets high bar for halting LNG strikes
  • Inpex pivots to sweetened wage offer
  • Cargo slippage risk if shutdown materializes

The Fair Work Commission, an Australian labor tribunal, on Sunday rejected an application by Japan's Inpex to halt a strike by 400 oil and gas workers at its Ichthys LNG project, it said in a statement.

While the commission agreed that the strike action could lead to a full production shutdown at the company's 9.3-million-ton-per-year facility, it said there were no grounds to claim it would endanger the welfare or safety of the Northern Territory population, with contingency measures in place.

The Commission also rejected Inpex's claim that the industrial action would cause significant damage to the Australian economy or an important part of it, finding that the company had failed to demonstrate that any lost production or export revenue would be permanent rather than merely delayed.

Inpex's senior vice president, Bill Townsend, called the outcome "disappointing," while noting that an updated offer was being prepared for workers at the plant.

"Reaching an equitable and sustainable agreement with employees is a priority," he said, according to a Reuters report.

Ichthys was set to receive 122 LNG vessels, 33 LPG vessels and 22 condensate tankers this year, with just one week of downtime leading to two condensate cargoes having missed their loading, according to one Inpex employee quoted by Reuters.

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