Melbana’s Funding and Drilling Plans Could Define Its 2026 Outlook
Melbana Energy has commenced continuous oil production from its Amistad-2 well in Cuba, building a significant crude inventory while preparing for further drilling. The company maintains a solid cash position as it markets its Australian offshore assets.
- Continuous oil production from Amistad-2 well since mid-April
- Over 22,000 barrels of crude oil in inventory at quarter end
- Drilling preparations for Amistad-2 and Amistad-3 wells largely complete
- Cash reserves stand at $5.1 million as of June 30, 2025
- Marketing of 100% interest in Australian AC/P70 permit ongoing
Cuban Production Milestone
Melbana Energy Limited (ASX – MAY) has reported a significant operational milestone with continuous oil production from its Amistad-2 well in Cuba's Block 9 Production Sharing Contract (PSC) since mid-April 2025. The company has accumulated a crude oil inventory exceeding 22,000 barrels by the end of the June quarter, underscoring the well's early productivity and potential for sustained output.
The Amistad-2 well represents the first dedicated production well in Block 9, with all civil works, permits, and materials in place to support ongoing operations. Notably, Melbana has incorporated lessons learned from previous drilling to optimize well design, including targeting multiple fracture zones and employing a reservoir-friendly drilling fluid developed and lab-tested specifically for this project.
Advancing Drilling Campaigns
Preparations for the next well, Amistad-3, are well advanced, with civil construction of the well pad and access roads nearing completion. The drilling permit has been secured, and all necessary equipment has arrived in Cuba. Amistad-3 is strategically positioned to intersect several fracture sets within the reservoir and is planned to follow immediately after Amistad-2, aiming to enhance production capacity further.
These developments signal Melbana's commitment to expanding its footprint in Cuba’s oil sector, leveraging geological insights and operational experience to maximize reservoir performance.
Financial Position and Corporate Activity
On the financial front, Melbana closed the quarter with $5.1 million in cash reserves, providing a buffer to support ongoing operations and upcoming drilling activities. The company is actively marketing its 100% interest in the AC/P70 permit located offshore in the Ashmore Cartier Territory, northwestern Australia. Interest from prospective partners has been encouraging, given the area's existing infrastructure and resource potential.
Corporate governance remains robust, with no lost time incidents reported during the quarter and payments to related parties amounting to $137,000, primarily for directors’ fees. Melbana is also progressing several funding options to underpin its drilling and development plans, with one funding arrangement expected to conclude in the first quarter of 2026.
Looking Ahead
As Melbana advances its Cuban operations and explores opportunities in Australia, the company’s strategic focus on reservoir optimization and capital management will be critical. The upcoming drilling campaigns and funding outcomes will likely shape Melbana’s trajectory in the near term, with investors keenly watching for operational updates and financial developments.
Bottom Line?
Melbana’s Cuban production gains and disciplined capital strategy set the stage for pivotal drilling and funding milestones in 2026.
Questions in the middle?
- Will the upcoming Amistad-2 and Amistad-3 wells meet or exceed production expectations?
- How will Melbana’s funding initiatives impact its operational flexibility and growth plans?
- What level of market interest and potential valuation can Melbana expect from its Australian AC/P70 permit?
