Cue Energy Resources Limited (ASX: CUE), along with the Mereenie and Palm Valley Joint Ventures, has entered a binding Letter of Intent (LOI) with the Northern Territory’s Power and Water Corporation (PWC). Cue Energy Resources Limited is an Australian Securities Exchange (ASX:CUE) listed oil and gas production and exploration company based in Melbourne. The LOI supports the immediate commencement of early works for a four-well drilling program and aims to establish conditional gas supply terms into binding Gas Sales Agreements, ensuring firm gas supply through to 2034.
To expedite gas delivery into the Northern Territory market, the Joint Ventures will promptly begin early works. This includes ordering long-lead items, progressing civil works, and selecting a drilling rig. The drilling program will consist of two wells at the Mereenie field and two wells at the Palm Valley field, with a targeted drilling start in mid-2026.
The LOI outlines non-binding, conditional terms for long-term gas supply, encompassing uncontracted gas from the Mereenie and Palm Valley fields, as well as new production from the planned drilling program. The parties intend to finalise and execute binding Gas Sales Agreements by early 2026, subject to final internal approvals by each Joint Venture participant and PWC. The LOI also provides for the Joint Ventures to be reimbursed by PWC for costs associated with the drilling program’s early works if binding GSAs are not executed by 20 February 2026.
Cue Energy CEO Matthew Boyall commented, “The Mereenie and Palm Valley fields have been important contributors to the Northern Territory’s energy supply. This Letter of Intent supports new development activity and long-term gas supply, helping to ensure reliable, locally sourced energy for the Territory through to 2035. This is an exciting opportunity for Cue with short term production growth and long term contract stability. We look forward to finalising agreements and commencement of the four well drilling program in mid-2026.”
