What's sillier is that apparently we wouldn't actually import the gas. I've spoken to people associated with the gas industry who have told me that we would actually buy a future allotment of gas from Japan, which would be pretty much directly supplied from Australian providers. In this case the Japanese companies basically become re-sellers who can undercut the local cost of buying the same gas, without that gas ever actually leaving the country.
If this is true, it doesn't surprise me. Australia has a terrible track record for taking advantage of primary resources. We've done similar things with iron ore, oil, gold, diamonds, coal and uranium (and probably pretty much everything else we dig out of the ground).
That's not true. They signed long term supply contracts with a price that was profitable.
at this point we could import the surplus back from Japan (that we sold them originally) for less than what we pay on the domestic market!
This is true. That's the problem with long term contracts! But on the other hand they did guarantee the revenue needed to develop the gas fields.
This is a huge problem because gas is required for a lot of our industry, but also because of where it sits in the energy pricing mix, the gas price almost entirely determines the price of electricity - https://www.macrobusiness.com.au/2017/07/truth-behind-electr...
The economists at MacroBusiness (I linked an article from their site above) believe a gas reservation policy (requiring the producers to sell a larger portion of their supply on the domestic market) could fix a lot of this.