ADX Energy Reports 23% Production Increase, $2.6M Revenue Despite 10% Oil Price Drop
ADX Energy reported a 23% rise in production to 303 BOEPD for Q2 2025, offsetting a 10% drop in Brent oil prices, while advancing key drilling plans and awaiting new permit awards.
- 23% increase in average net production to 303 BOEPD
- 4% growth in sales revenue to A$2.6 million despite 10% lower Brent oil prices
- Acquisition of 20% interest in Anshof Field Area from Xstate Resources
- Welchau-1 well testing suspended pending environmental court decision
- Multi-well shallow gas drilling program planned for early 2026 in Upper Austria
Production Gains Amid Price Headwinds
ADX Energy Ltd (ASX – ADX) has reported a solid 23% increase in its average net production rate for the quarter ended 30 June 2025, reaching 303 barrels of oil equivalent per day (BOEPD). This uplift was driven by a 25% rise in oil production and a 47% jump in gas output from its Vienna Basin fields, supported by successful well workovers and the strategic acquisition of a 20% economic interest in the Anshof Field Area from Xstate Resources.
Despite this production growth, the company faced a 10% decline in Brent crude oil prices, averaging US$67.82 per barrel for the quarter. Nevertheless, ADX managed to increase its sales revenue by 4% to A$2.6 million, reflecting the higher volumes sold. Cash on hand stood at A$4.8 million, down from A$6.7 million in the previous quarter, partly due to timing of payments and capital expenditures.
Strategic Asset Expansion and Operational Advances
The acquisition of Xstate’s 20% stake in the Anshof Field Area has boosted ADX’s net share of production and control over the 3,000 barrels per day capacity Anshof Permanent Production Facility (PPF). The company exercised its option to purchase the PPF outright, with ownership transferring after November 2025, enhancing operational flexibility and cost control.
ADX’s Executive Chairman, Ian Tchacos, highlighted the company’s focus on near-term production gains and rapid commercialisation of low-risk shallow gas prospects in Upper Austria. The company has matured seven drill-ready shallow gas prospects within its 100% owned ADX-AT-I and ADX-AT-II licences, targeting a combined mean prospective resource of 29 billion cubic feet (Bcf). A multi-well drilling campaign is planned to commence in early 2026, starting with the high-value GOLD gas prospect.
Regulatory and Environmental Challenges
Testing of the Welchau-1 well remains suspended due to environmental objections lodged by NGOs, with the matter pending resolution by the State Administrative Court of Upper Austria. This legal uncertainty has delayed further flow testing, although technical work has advanced the maturation of the Welchau Deep and Rossberg prospects, which hold promising oil and gas potential.
Meanwhile, ADX awaits the formal award of the Sicily Channel gas exploration permit offshore Italy, following completion of anti-mafia clearance requirements. This permit offers access to a highly prospective gas play with attractive fiscal terms and proximity to existing infrastructure, positioning ADX for further resource maturation and potential development.
Renewable Energy and Portfolio Diversification
Beyond hydrocarbons, ADX is progressing renewable energy initiatives in the Vienna Basin, including solar photovoltaic projects and feasibility studies for underground hydrogen storage. These efforts align with the company’s long-term vision to transform its assets into a multi-energy hub, integrating low-emission oil and gas production with clean energy solutions.
Financially, ADX maintained a rolling hedging strategy to mitigate oil price volatility, with hedges on a portion of Vienna Basin crude production providing some downside protection during the quarter. Capital expenditure was modest at A$0.28 million, primarily related to CO2 reduction infrastructure, while operating cashflows benefited from increased production revenue.
Looking Ahead
ADX plans to finalise land access, rig contracting, and permitting for its upcoming drilling programs, while continuing to mature exploration prospects across Austria and Italy. The company’s ability to navigate regulatory hurdles and capitalise on its expanded asset base will be critical to sustaining growth and enhancing shareholder value.
Bottom Line?
ADX’s production momentum and strategic asset growth set the stage for a pivotal 2026 drilling campaign, though regulatory uncertainties linger.
Questions in the middle?
- When will the State Administrative Court resolve the environmental objections delaying Welchau-1 testing?
- How will the formal award of the Sicily Channel permit impact ADX’s exploration and development timeline?
- What terms and partners will ADX secure in its farmout discussions for the shallow gas prospects?