Etihad Airways has announced details of a new codeshare agreement with Qantas, in a deal which signals the start of closer commercial cooperation between the two airlines.

The deal will see the Abu Dhabi-based airline place its two-letter ‘EY’ code on selected Qantas domestic services which operate beyond Sydney, Melbourne and Brisbane - the three gateway airports currently served by Etihad.

In addition, Etihad will place its code on daily Qantas flights from Melbourne to Auckland in New Zealand. The initial codeshare agreement comes into effect on March 29 and is likely to be extended to other routes in the future.

James Hogan, Etihad Airways’ chief executive, said: “Australia represents a key market for Etihad and one in which we are keen to grow further, both through the addition of new routes of our own, such as Melbourne, and through close co-operation with other well-established airlines such as Qantas.

“Qantas represents one of the most respected airlines in the world, and we see this codeshare agreement very much as the start of a deepening strategic relationship which both airlines are committed to developing further in the future,” he added.

The Qantas routes within Australia covered by the new codeshare arrangement will initially include services between Sydney and Brisbane, Sydney and Cairns and Melbourne and Adelaide.

In turn, Qantas will place its own ‘QF’ code on all services operated by Etihad between Australia and Abu Dhabi and a selection of Etihad services connecting the UAE capital to the Middle Eastern destinations of Amman (in Jordan), Bahrain and Beirut (in Lebanon).

John Borghetti, executive general manager, Qantas, said the new codeshare agreement with Etihad Airways was a significant strategic development for Qantas.

“The UAE and the broader Middle East are important markets for Australia in terms of both business links and tourism,' he noted.

“For the first time, Qantas will be able to offer direct access to multiple points in the Middle East from Sydney, Melbourne and from Brisbane.”

Etihad currently flies to three destinations in Australia: Sydney, Brisbane and, from March 29, Melbourne.

The Abu Dhabi airliner currently has codeshare deals with Aer Arann, Bangkok Airways, Brussels Airlines, Jet Airways, Kuwait Airlines, Malaysia Airlines, Middle East Airlines, Philippine Airlines, Royal Air Maroc, Saudi Arabia Airlines, Sri Lankan Airlines, Yemen Airways and UK-based airline, bmi.-TradeArabia News Service