Tamboran Resources has said it has signed an agreement with the APA Group to build three gas pipelines to connect its Beetaloo basin development to the east coast gas market, hoping to supply gas there in 2028, as well as the company’s proposed NT LNG plant at Middle Arm in Darwin.

Managing director and chief executive officer Joel Riddle said in a statement the new terms sheet stated APA would pay for all activities proposed under the partnership, including spending up to $10 million on studies and approvals over the next year. No cost was put on the overall plan.

He said the agreement included building a pipeline connecting Tamboran’s planned Shenandoah South pilot development, south of Daly Waters, to the existing bi-directional Amadeus pipeline which runs from the Amadeus basin near Alice Springs to Darwin.

The company said that pipeline was targeted to be finished by 2025.

The agreement also states APA would connect Tamboran’s Beetaloo basin gas to APA’s existing east coast gas network by 2028.

The Australian reported that would mean building a new pipeline to APA’s Carpentaria gas pipeline, which runs 840km southeast from Mount Isa, and connects to several other gas pipes that run to the east coast. The paper also reported the Carpentaria gas pipeline could be expanded if needed.

Mr Riddle said connecting to the Amadeus pipeline would allow it to begin selling gas under its existing 36.5 PJ a year agreement with Origin Energy.

“APA will undertake the initial studies and approvals for a proposed pipeline connecting the Beetaloo basin to their existing pipeline network on Australia’s east coast, where the gas market is expected to be in a material shortfall by the end of the decade,” Mr Riddle said in the statement.

“The pipeline is planned to have capacity of more than 500 million standard cubic feet per day, reflecting the anticipated market shortfall forecast by the Australian Energy Market Operator in the southern states by 2030.

“I believe gas is expected to play a key role in meeting Australia’s emissions reduction targets while supplying affordable cost of electricity and food prices to Australian families.

“Longer-term, APA will also work closely with Tamboran to potentially build a pipeline from the Beetaloo basin to Middle Arm in Darwin, supplying Tamboran’s proposed NT LNG development on the site under exclusivity from the NT government, which was announced earlier this month.”

While The Australian reported un-named industry sources saying Tamboran’s Beetaloo basin drill test data showed results between 25-30 per cent lower than what the company and the market had anticipated, but results could be increased with an additional cost with more drilling..

The paper quoted Mr Riddle saying the results were “encouraging” but that it was early days.

“Importantly, this is an early-stage result with potential improvements when key learnings and design changes are implemented in future wells,” Mr Riddle said.

In May, the NT Government announced it would allow fracking in the Beetaloo