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New gas project for Queensland

The next stage of a major gas project in Queensland's Surat Basin has been hailed as a win-win for gas supply and jobs in the region.

The Ruby Project, a joint venture between QGC and Shell, is set to drill 161 new gas wells in the region, starting later this year.

Queensland Natural Resources Minister Anthony Lynham said the project would have major benefits.

"This is wonderful news, especially because it's 350 new jobs in an area that desperately needs 350 new jobs," Dr Lynham said.

"It's great news for Queensland as well, as this addresses the supply issue of gas going into our international and domestic markets."

Queensland Resources Council CEO Ian MacFarlane also welcomed the deal, saying supply issues for gas federally would be partially offset by the new wells.

"The QRC is pleased that Queensland is leading the way when it comes to working to address the problem of the east coast gas shortage," Mr MacFarlane said.

The new wells will be drilled in 2017 and 2018 in QGC's existing land, with deals currently being negotiated with neighbouring landholders for access and compensation.