Queensland Pacific Metals Ltd (ASX:QPM) has received strong endorsement from Foster Stockbroking after executing three key agreements with Incitec Pivot’s subsidiary Dyno Nobel for the Moranbah Gas Project, in what the analyst says is a classic win-win for both parties.
The analyst says these deals are a strong vindication of QPM's strategy in owning Moranbah and aggressively growing its production profile and reserves.
The agreements include:
- a new gas sales agreement;
- a funding agreement; and
- a provision of take-or-pay guarantees.
Read: Queensland Pacific Metals lands $80 million in initial debt funding to secure gas for TECH Project
Agreement highlights
Under the agreement, Dyno Nobel, a wholly owned subsidiary of IPL, will provide an initial development funding facility of up to $80 million, with the option to increase it to $120 million if necessary.
This funding will be allocated to accelerate the development of the Moranbah Project by covering the capital costs of new infill production wells.
In addition, both parties have entered into a new gas supply agreement (GSA), which will come into effect in April 2026 upon the expiration of the existing GSA.
Looking ahead, this long-term gas supply agreement is vital for QPM's TECH Project and Dyno Nobel's Moranbah operations, ensuring a stable and cost-effective gas supply.