Fast-tracking Queensland’s Taroom Trough may be answer to East Coast gas fears

Located around 480 kilometres north of Brisbane, the Taroom Trough area is gaining a local and international reputation as a world-class asset with the potential to help overcome Australia’s east coast gas shortage fears.

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Numerous agencies and analysts are forecasting that Sydney and Melbourne are facing the potential of significant blackout periods, especially with domestic gas supplies on the East Coast dwindling rapidly.

The Australian Competition and Consumer Commission reported in late CY25 that the southern states of Victoria, New South Wales, South Australia, Tasmania, and the Australian Capital Territory will all collectively need to rely on surplus gas from Queensland and gas stores to meet demand in CY26.

Those fears have already led to a big push for the establishment of a gas reservation policy, which could significantly impact Australia’s high-value global LNG exports.

However, the continued discovery of world-class gas potential in the Taroom Basin could be the real long-term answer to the issue.

Led by local specialists like Santos (ASX:STO), Omega Oil & Gas (ASX:OMA), and Elixir Energy (ASX:EXR), as well as global energy giant Shell (listed in London and Amsterdam), exploration has uncovered an unconventional, basin-centred gas play, stretching over some 50,000 square kilometres. (Shell recently brought in a specialist rig to help confirm the potential of its Taroom Trough acreage.)

The Helmerich & Payne (H&P) FlexRig 3 was subsequently snapped up by neighbour Elixir as it begins appraisal of several recent significant discoveries.

While Shell is not actually required to release information on its Taroom Trough activities in Australia – as mentioned, the company is listed overseas – industry sources have suggested it may be onto something significant.

There have been numerous sightings of significant gas flares from the area of its exploration drilling work and unconfirmed reports of strong gas flows from the Shell wells. It has also been reported that the global major has committed to investing millions to continue its Taroom Trough testing program.

Elixir will use the Shell rig to drill the high-impact Lorelle-3 appraisal well into the same reservoirs as Shell, on the boundary of the global powerhouse’s primary area of operations.

Elixir MD and CEO, Stuart Nicholls, said Lorelle-3 may be a defining well for the Taroom Trough. “Lorelle-3 will be the first well outside of the Shell acreage drilled on the upper western flank of the trough. On successful logging and testing, Lorelle-3 will be validation of [our] Shell-like quality acreage.”

In late CY25, Omega meanwhile made a significant corporate move by acquiring a 19.43% equity interest in Elixir Energy for $13.9M. Omega’s CEO (and Taroom Trough champion) Trevor Brown said the move was a further step toward achieving the company’s goal to be the partner of choice in the trough.

“Omega is very favourably positioned with exposure to opportunities across the trough, Australia’s most prospective onshore gas and liquids province,” he said.

Minister for Natural Resources and Mines, Dale Last, said the release is delivering more gas supply and more certainty for Queensland. “This exploration investment sends a clear message that Queensland is open for business, and we’re serious about getting more gas into the system to relieve pressures,” he said.

The Natural Resources and Mines minister added, “Gas is critical to our state’s energy mix and to the industries that power regional economies. These exploration areas are the next step in delivering the supply needed to support investment, create jobs and ease energy pressures across the board.”

In late January, the state’s gov’t again made a big move to increase activity in the gas sector. They this month released three new gas exploration areas near the Queensland–South Australia border. Santos and Drillsearch Energy have already been named preferred tenderers for the Cooper-Eromanga Basin.

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