How Melbana’s AC/P70 Upgrade Could Reshape Offshore Gas and Oil Prospects

Resource Upgrade Highlights

Melbana Energy Limited (ASX – MAY) has announced a substantial update to its prospective resource estimates for the AC/P70 exploration permit, located offshore northwestern Australia. The company reported a 37% uplift in prospective gas resources, now estimated at 2,857 billion cubic feet (Bcf), alongside an 81% increase in prospective oil resources, rising to 78 million barrels (MMbbl). Notably, the Hadrosaurus lead has been elevated to prospect status following advanced geophysical analyses, signaling enhanced confidence in its potential.

Geophysical Advances and Exploration Potential

These upgrades stem from proprietary reprocessing of publicly available 3D seismic data, which improved data quality and allowed Melbana to refine volumetric estimates, particularly for the Plover Formation at the Vesta location. The Hadrosaurus prospect, situated just 3.5 kilometers from the Vesta-1 discovery, now presents a well-defined structural and stratigraphic trap, making it a prime candidate for future drilling and potential subsea tieback to existing infrastructure.

The AC/P70 permit encompasses multiple prospects and leads within known hydrocarbon play fairways, including the undeveloped Swan gas field and Vesta oil and gas field. These fields have been appraised but remain undeveloped, with contingent resources unchanged at 276 Bcf of gas and 34 MMbbl of oil. The permit's proximity to the Darwin LNG Plant and existing pipeline infrastructure offers a clear commercialisation pathway for any discoveries.

Strategic Farmout Process

Melbana has engaged an advisor to facilitate a farmout process aimed at securing a suitably qualified partner to fund the forward work program, including an exploration well planned for 2027. The company targets closing this farmout by the fourth quarter of 2025. Interest in the farmout is reportedly strong, driven by the scale of the prospective and contingent resources, the strategic location near existing infrastructure, and the growing importance of gas as a transition fuel in the energy market.

Outlook and Industry Context

Melbana’s updated resource estimates and the maturation of Hadrosaurus to prospect status reinforce the AC/P70 permit’s potential for LNG-scale gas accumulations alongside multiple oil prospects. This positions the company well within a competitive landscape where new offshore exploration opportunities have been limited in recent years. The combination of advanced seismic technology, strategic location, and a clear development pathway could attract significant partner interest and investment.