Woodside Petroleum Ltd, Australia's biggest listed oil and gas explorer, said on Tuesday it had signed a 20-year gas supply deal with Perdaman Chemicals and Fertilisers Pty Ltd.
The agreement is to supply about 125 TJ of gas per day for use in Perdaman's proposed urea plant, and gas will be primarily sourced from Woodside's proposed Scarborough development, the company said in a statement.
The agreement follows a memorandum of understanding between the companies signed in April.
"This is a significant domestic gas sale and represents another step towards the delivery of the proposed Burrup Hub," said Woodside Chief Executive Officer Peter Coleman.
Western Australia-based Perdaman is proposing to build a two million tonnes-per-annum urea plant on the Burrup Peninsula.
Financial terms of the deal were not disclosed.
Earlier this year, Woodside defined plans to accelerate and expand its Scarborough gas project off northwestern Australia, now expected to cost $10 billion.
(Reuters: Reporting by Aby Jose Koilparambil; Editing by Gopakumar Warrier)