Tamboran Resources Ltd (ASX:TBN, OTC:TBNRF) has signed four separate non-binding Letters of Intent (LOIs) with major Australian energy players Origin, AGL, EnergyAustralia and Shell (LON:RDSa) Energy Australia.
These LOIs are for the purchase of an aggregate 510-750 TJ per day, equivalent to 185–270 PJ per annum, of gas from Tamboran’s low-reservoir CO2 Beetaloo Basin gas assets in the Northern Territory.
The term of these potential agreements is for between 10 and 15 years.
Key East Coast buyers
“The initial interest from key East Coast gas buyers for the long-term purchase of Tamboran’s low-reservoir CO2 Beetaloo Basin gas volumes demonstrates gas’ viability and role in the energy transition in Australia,” Tamboran managing director and CEO, Joel Riddle, said.
“We are excited to be working with these important gas and energy retailers who are expected to provide key offtake agreements which we expect will support the progress of APA’s proposed Beetaloo to East Coast Gas Pipeline.
"Tamboran plans to work closely with the Northern Territory, Australian Federal Government, APA Group and potential gas purchasers to progress development of this important piece of future Australian infrastructure.
“With AEMO and the ACCC forecasting a potential domestic gas shortfall of ~500 TJ per day by 2030, volumes from the Beetaloo Basin could be a key solution to meeting this forecast demand.”
Steps toward binding agreements
Alongside these LOIs, Tamboran is planning to work separately with each of the companies to formulate binding fully termed Gas Sales Agreements (GSAs).
These will detail the purchase price, transport arrangements and other essential commercial terms with the agreements seen as a significant step in fostering stronger collaboration among the industry's key players.
The company is targeting 2028 to start first gas production, subject to the achievement of commercial flow rates from its Beetaloo Basin assets. This sets a clear timeline for bringing this significant amount of natural gas to market.
Support for APA Group’s proposed pipeline
The binding GSAs are also expected to bolster the progress of APA Group Ltd’s proposed pipeline, which aims to connect the Beetaloo Basin to the East Coast gas transmission network.
APA has already started preliminary land access approvals and pre-engineering studies to realise this connection with the existing East Coast Gas Grid.
Natural Gas in Australia’s energy mix
Despite recent developments in Victoria where gas has been banned in the construction of new homes, natural gas continues to play a key role in the energy mix.
Through these LOIs and potential GSAs, Tamboran is looking to play a key role in leveraging its gas resources while fostering collaboration among major energy companies.
The progress in connecting Beetaloo Basin to the existing infrastructure also highlights the concerted efforts being made to enhance Australia's energy grid, reinforcing natural gas as a vital part of the nation's energy future.
“Tamboran is committed to developing a gas project with Net Zero Scope 1 and 2 equity emissions from first commercial production to provide energy security to Australia’s Northern Territory and East Coast gas markets,” Riddle said.