Senex Energy is forking out $80 million to acquire undeveloped gas fields near its Atlas natural gas development from Australia Pacific LNG.

It comes as the Senex Board backed an improved takeover bid for the company from Korean steelmaker POSCO International.

The new areas to be acquired from Australia Pacific LNG will feed into Senex’s plans to expand Atlas production to 30 PJ/year in 2024.

Managing director and chief executive officer Ian Davies said the acquisition increased the quality and scale of Senex’s natural gas supply portfolio

“The acquisition of these undeveloped gas fields adjacent to Atlas continues Senex’s growth trajectory in the Surat Basin and reinforces the company’s low-cost, hub-and-spoke infrastructure operating model,” he said.

“Atlas is a high-quality development, providing reliable, affordable and sustainable supplies of natural gas to Australian manufacturers, supporting the economy and jobs in local communities.”

In August 2021, Senex Energy announced FID for the expansion of Atlas gas production by 50 per cent to 18 PJ/year. This acquisition will allow the further expansion of Atlas to plateau production of 30 PJ/year in 2024.

Related: Green light for $40m Senex gas project

The purchase price comprises an initial acquisition cost of $50 million, with a further $30 million payment upon receipt of satisfactory Commonwealth environmental approvals.

Senex said this would be funded from an acquisition bridge facility and existing cash and debt facilities.

Senex has received a non-binding proposal from POSCO to acquire 100 per cent of the company for $4.60 per share by way of a scheme of arrangement.

In an announcement today, the company said the Senex Board intended to unanimously recommend the proposed scheme, subject to conditions.

Related: POSCO in Senex Energy takeover bid

Senex has agreed to extend POSCO International’s exclusivity period to November 26 to provide time to negotiate and enter into a binding scheme implementation agreement and for POSCO International to obtain its internal approvals.

During the diligence process, Senex provided information regarding the proposed acquisition of APLNG natural gas fields PL 209 and PL 445.

POSCO International has confirmed to Senex that its cash offer price is inclusive of the value attributable to those assets.