Xstate Resources Wins Preferred Tenderer Status for Queensland Gas Block
Key Takeaways
- Xstate Resources and three equal JV partners have been awarded preferred tenderer status for Block PLR2026-1-7, covering 305km² on the eastern flank of the Taroom Trough in Queensland.
- The four-way joint venture — Xstate, Amplitude Energy, Betaloo Energy, and Eastern States Energy — each hold a 25% working interest, with Xstate serving as initial Operator.
- The block sits adjacent and along-trend with Omega Oil & Gas's Canyon project, which is currently being drilled and appraised, providing direct geological validation for the acreage.
- Stacked overpressured Permian reservoir intervals give the JV multiple targets per drilling location, and recent Taroom Trough exploration has also identified associated liquids and light crude oil alongside Basin Centred Gas.
- The formal grant is not yet finalised — completion of Queensland Government processes, including a Native Title process and Environmental Authority lodgement, must occur before the licence is issued.
XST joint venture secures preferred tenderer status for new Taroom Trough acreage
Xstate Resources (ASX: XST) and its joint venture partners have been awarded preferred tenderer status for Block PLR2026-1-7, covering approximately 305km² on the eastern flank of the Taroom Trough in Queensland. The announcement was made on 2 October 2026.
The Taroom JV comprises four equal partners: Xstate Resources, Amplitude Energy Limited, Betaloo Energy Limited, and Eastern States Energy Pty Ltd, each holding a 25% working interest. Xstate will serve as initial Operator of the joint venture.
The formal grant has not yet been finalised and remains subject to completion of Queensland Government processes, which are currently being undertaken.
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What makes Block PLR2026-1-7 significant
The block sits between Condamine and Miles on the Western Downs, forming part of the broader Surat over Bowen Basin. Its location within an established hydrocarbon province, combined with proximity to pipeline infrastructure and services, gives it meaningful commercial appeal from the outset.
The geological case rests on stacked overpressured Permian reservoir intervals, which form part of a Basin Centred Gas (BCG) play analogous to BCG plays across the USA and Canada. Recent exploration activity in the Taroom Trough has also uncovered associated liquids and light crude oil alongside Basin Centred Gas, adding a liquids upside dimension that broadens the resource potential of the acreage.
Critically, Block PLR2026-1-7 is adjacent and along-trend with Omega Oil & Gas’s Canyon project, which is currently being drilled and appraised. That active appraisal campaign provides geological validation for the setting that Xstate and its JV partners are stepping into.
What is a Basin Centred Gas play?
A Basin Centred Gas play is a large, regionally distributed accumulation of natural gas that is trapped across a basin rather than in a single discrete structural trap. These plays are typically overpressured and can hold substantial resource volumes spread across a wide area, which is why they are often compared to the major unconventional gas provinces developed in North America.
The stacked Permian reservoir intervals at Block PLR2026-1-7 mean the JV has multiple reservoir targets within a single drilling location. That stacking reduces the per-well cost of testing multiple horizons and increases overall prospectivity. It is this BCG play type that underpins the announcement’s reference to “substantial potential for a significant oil and gas resource.”
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Queensland Government backing and next steps
The preferred tenderer award reflects the Queensland Government’s confidence in the joint venture’s appraisal strategy, technical capability, and commitment to developing Queensland and Australia’s future energy resources. The pathway forward is supported by streamlined regulatory coordination via the Coordinator-General’s Taroom Trough Development Plan 1.
Before the formal grant is issued, regulatory processes must be completed, including initiating a Native Title process and lodging an Environmental Authority. These are routine requirements for new petroleum acreage in Queensland, not barriers unique to this block.
The initial work commitment covers seismic processing and early-stage geological and geophysical activities.
Andrew Bald, Managing Director
“We are extremely pleased to have joined with some high-profile industry partners who share our excitement for this compelling and prospective project. We are already preparing to commence work on the ground and our joint venture partners bring a wealth of expertise. We are very much looking forward to working with them to explore and appraise this new eastern Taroom Licence.”
Xstate’s growing Queensland footprint
Block PLR2026-1-7 sits alongside Xstate’s existing Diona project, giving the company a two-asset position in Queensland’s oil and gas sector. The company holds a 51% working interest in the Diona block (ATP 2077) and serves as Operator there as well. Its first well, Diona-1, was spudded on 27 September 2025.
The Diona-1 gas discovery confirmed an over-pressured gas system at ATP 2077, providing Xstate with operational momentum and geological read-through ahead of its expanded Taroom Trough position.
Xstate’s current project inventory across Queensland:
- Diona block (ATP 2077): 51% working interest, Operator; Diona-1 well spudded 27 September 2025
- Taroom Trough Block PLR2026-1-7: 25% working interest, initial Operator; preferred tenderer status awarded 2 October 2026
The JV structure for Block PLR2026-1-7 is summarised below.
| Partner | Working Interest | Role |
|---|---|---|
| Xstate Resources | 25% | Initial Operator |
| Amplitude Energy Limited | 25% | JV Partner |
| Betaloo Energy Limited | 25% | JV Partner |
| Eastern States Energy Pty Ltd | 25% | JV Partner |
With preferred tenderer status now secured, Xstate moves into the regulatory completion phase before a formal grant can be issued. The geological setting, active neighbour activity, and infrastructure proximity make Block PLR2026-1-7 a material addition to the company’s Queensland portfolio, though investors should note that the grant is not yet finalised.
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