AGL ENERGY has entered into a Gas Supply Agreement with ExxonMobil subsidiary Esso Australia Resources and BHP Billiton Petroleum to purchase up to 198 petajoules (PJ) of conventional natural gas from Bass Strait over three years.

The Esso Australia and BHP Billiton contract commences in January 2018 providing a continuation of gas supply from Bass Strait.

In a statement, AGL said the Gas Supply Agreement, which incorporates an oil linked pricing component, has enabled the company to secure competitively priced gas supply until 2020 for 1.5 million residential and small business gas customers.

AGL said its gas portfolio now had sufficient Queensland sourced supplies to release 30 to 50 PJ per year for sale into the high value Queensland market between the financial year 2018 and financial year 2020.