Cue Energy Resources Ltd. has signed a binding multi-year gas sales agreement (GSA) with the Northern Territory government.
The deal, which runs until the end of 2034, is set to underpin a new phase of production at the Palm Valley gas field.
Under the agreement, Cue Energy will supply its 15 per cent share of gas, totalling up to 3.2 petajoules (PJ), to the Northern Territory market. The contract includes fixed pricing indexed to the Consumer Price Index (CPI) and take-or-pay provisions, providing the company with significant long-term cash flow certainty.
To meet the supply requirements of the new GSA, the Palm Valley joint venture has reached a final investment decision (FID) to drill two new production wells.
Preparations for the drilling campaign are already well advanced, with civil works nearing completion, long-lead items secured, and a drilling rig already under contract.
“This agreement materially increases Cue’s contracted gas position through to 2034 and supports new production from Palm Valley,” said Cue Energy CEO Matthew Boyall.
“It adds long-term contracted cashflow and underwrites investment in the two new wells and increased production at Palm Valley.”
Drilling for the first well is scheduled to commence mid-year, with production from the new assets expected to come online progressively throughout the second half of 2026.
This new GSA replaces a previous letter of intent with the Northern Territory’s Power and Water Corporation announced in December 2025. The company noted that while the previous arrangement contemplated supply from the Mereenie gas field, the parties were unable to reach an agreement on pricing and volume.
By pivoting to this new commitment, Cue Energy believes it has secured a more stable path for both operational growth and near-term cash flow.
The Palm Valley joint venture is operated by Central Petroleum who holds 50 per cent of the venture, with Echelon Palm Valley holding 35 per cent, and Cue Palm Valley with 15 per cent, rounding out the participating interests.
