The New York Times has reported that the Australian Signals Directorate (ASD) offered to share with the US National Security Agency (NSA) its surveillance of an American law firm that was representing Indonesia in trade disputes with the US.
The article is based on a top-secret document obtained by former NSA systems analyst Edward Snowden and provided by an NSA liaison office in Canberra, in a monthly bulletin.
Asked about the report, Abbott said: "We never comment on operational intelligence matters."
Australia did not use any intelligence it gathers "to the detriment of other countries", he told reporters in Bourke in western New South Wales.
"We use it for the benefit of our friends. We use it to uphold our values. We use it to protect our citizens and the citizens of other countries.
"We certainly don't use it for commercial purposes."
The New York Times reported that the ASD notified the NSA that it was conducting surveillance of the talks, and offered to share the information.
Liaison officials asked the NSA general counsel's office, on behalf of the Australians, for guidance about the spying.
The bulletin notes only that the counsel's office "provided clear guidance" and that the Australian eavesdropping agency "has been able to continue to cover the talks, providing highly useful intelligence for interested US customers".
In statements to the newspaper and the Associated Press, the NSA said it "does not ask its foreign partners to undertake any intelligence activity that the US government would be legally prohibited from undertaking itself".
The allegations come just months after relations between Australia and Indonesia hit a low over revelations that Australia had tapped the mobile phones of President Susilo Bambang Yudhoyono and his inner circle.
Indonesia late last year downgraded its relationship with Australia, suspending military and police cooperation, including in the key area of people smuggling.
More NSA officers implicated with Snowden
Three people at the NSA have now been implicated in Edward Snowden's efforts to copy classified material, including a civilian employee who resigned in January after acknowledging that he allowed Snowden to use his computer ID, according to an NSA memo sent to Congress.
The other two were an active-duty member of the military and a civilian contractor. The memo does not describe their conduct, but says that they were barred from the NSA and its systems in August.
The memo from the director of the NSA's legislative affairs office, Ethan L Bauman, to the House Judiciary Committee staff does not identify the three or say whether they all worked with Snowden at an NSA post in Hawaii last year.
But it offers a glimpse into the internal investigation of what intelligence officials have called the largest theft of classified material in US history.
The NSA employee who resigned did not know that Snowden, an agency contractor employed by the consulting firm Booz Allen Hamilton, planned to reveal classified NSA operations and systems to the media.
But the employee admitted to the FBI in June that he had used his Public Key Infrastructure certificate, a special digital ID, to give Snowden access to material he was not authorised to see on an internal network called NSA Net.
The employee used his password to sign onto the network and Snowden secretly captured the password without the employee's knowledge, Bauman wrote, and later used it to download additional material.
The employee had his security clearance revoked in November and resigned on January 10, according to the memo. Bauman's memo was first reported on Thursday by NBC News.
An NSA spokeswoman declined to comment on Friday.
Snowden, who is living in Moscow, has denied that he stole colleagues' passwords to gain access to classified documents.
US officials have confirmed reports that he used so-called web crawler software to automatically troll the spy agency's networks and secretly access up to 1.7 million documents without being detected.
It's still unclear how many he copied. News organisations have published a few dozen at most so far.
US officials say Snowden mostly took documents that explained how NSA surveillance programs work, rather than fruits of eavesdropping and code-breaking operations.
The officials say he was walled off from many NSA secrets, including recordings of private calls or conversations by world leaders.
But he appears to have accessed documents that could compromise military communications systems, satellite orbits and even the names of clandestine agents, officials say. Mitigating the damage, they say, will take years and cost billions of dollars.