Ocean Power Technologies and US technology company Lockheed Martin will jointly develop a 19MW wave-energy project in the Australian state of Victoria.
The news follows the announcement that the Commonwealth of Australia's department of resources, energy and tourism had issued a A$66.5 million ($65m) grant to finance the project.
Lockeed Martin will assist with the design of OPT's PowerBuoy technology and produce wave-energy converters.
The two companies have been collaborating since 2004, first on the development of an Advanced Deployable System for the US Navy and most recently to design and launch utility-scale wave energy converters off the coast of Oregon, US.
Lockheed Martin's Mission Systems and Sensors vice president Dan Heller said: "Lockheed Martin is applying its expertise to commercialize promising, emerging alternative energy technologies.
"We see great potential in harnessing the vast power of the ocean. By working with OPT and Australian industry on this project, we will advance wave energy in Australia and globally."
According to the World Energy Council, wave energy has the potential to produce around 2,000 terawatt hours of electricity a year, or enough power to meet 10% of the world's current energy needs.