APA Group looks set to build a new gas pipeline connecting Queensland's Bowen Basin to NSW, Victoria and South Australia.
The major energy infrastructure company will undertake a feasibility study into expanding its east coast grid, and consider route options and cost estimates for the new pipeline.
APA has signed an initial agreement with junior explorer Blue Energy, chaired by former Santos chief executive John Ellice-Flint, to help transport its gas resources from the Bowen Basin.
Under the agreement, APA will consider building, owning and operating the pipeline infrastructure, and transport Blue Energy's gas.
APA signed a similar agreement with explorer Comet Ridge last year to connect that company's gas resources in the nearby Galilee Basin to its east coast grid.
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
On Tuesday, APA said the two projects combined have material resources to supply additional resources to the east coast gas market.
Gas from the Bowen Basin is currently routed northwards into the Moranbah and Townsville markets, but the pipeline link now being considered would allow this to be supplied to and traded anywhere between Townsville and Hobart, Blue Energy managing director John Phillips said.
APA shares were down five cents at $9.66 shortly before the close of trade, while Blue Energy shares were up 0.9 cents, or 16 per cent, at 6.5 cents.
