Oil and gas explorer and developer Strike Energy has entered into an option agreement with packaging supplier Orora to supply 30 petajoules of gas to Orora over 10 years.

The gas will come from Strike Energy’s Southern Cooper Basin gas project in South Australia.

The gas will be delivered at three petajoules per annum, at a fixed price, from 2017, when production from the project is expected to start.

Orora has agreed to pay an option fee to Strike conditional upon a pilot production test project proceeding.

Strike said on Wednesday that the option agreement with Orora complemented the foundation contract with explosives supplier Orica for the supply of 150 petajoules of gas from the Southern Cooper Basin over 20 years.

The foundation contract was announced in July 2013.

“The Orora gas supply option agreement is another important milestone in the rapid commercialisation of our substantial gas resource in the Southern Cooper Basin and follows our successful appraisal drilling program completed in December 2013,” Strike managing director David Wrench said in a statement.

“This agreement and our foundation gas sales agreement with Orica demonstrate that Strike is well positioned to play an important part in the gas supply solution required to meet increasing uncontracted demand for gas in eastern Australia.”

Shares in Strike were 0.75 cents higher at 10.25 cents at 1230 AEDT.