VICTORIA-based Lakes Oil has signed letters of intent to supply gas to Dow Chemical and Simplot Australia – the food manufacturer behind brands such as Edgell, Bird’s Eye and John West.

Both agreements will last for ten years.

Dow plans to use gas from Lakes Oil at its Victorian manufacturing sites, with Lakes saying the gas would help ensure the competitiveness of its products used in household applications such as furniture and paints, Lakes Oil said.

Simplot, which has manufacturing sites in Echuca, Pakenham and Flemington, decided to buy gas from Lakes because of its Victorian locations and commercial benefits.

In both cases, the supply is subject to the execution of a formal supply agreement, final commercialisation of the Wombat field together with the lifting of the State’s moratorium on drilling for gas onshore Victoria.

The Victorian Government announced a ban on any further approvals on fracking in new coal seam gas exploration wells in 2012 – but Lakes Oil maintains its developments are not coal seam gas related.