How Horizon Oil’s Thailand Assets Sparked an 18% Production Surge in Q2 FY26

Robust Production Growth Anchored by Thailand Assets

Horizon Oil Limited has delivered a strong performance in the quarter ending 31 December 2025, with production and sales volumes climbing by 18% and 17% respectively. This growth was largely propelled by the first full quarter of production from its recently acquired Thailand assets, which now account for about a third of the Group’s total output. The integration of these assets has been seamless, with early optimisation efforts at Nam Phong already yielding a 7% uplift in production rates without additional capital expenditure.

Thailand’s low operating costs have also contributed significantly to Horizon’s financial health, providing nearly 30% of the Group’s net operating cashflow during the quarter. The Nam Phong Booster Compressor Project, which reached final investment decision shortly after the quarter, is poised to further enhance production by at least 40% from mid-2026, underscoring the region’s growing strategic importance to Horizon’s portfolio.

Financial Strength and Shareholder Returns Maintained

Despite a challenging oil price environment, with prices settling in the US$60–65 per barrel range, Horizon has maintained robust cashflow and a disciplined approach to shareholder returns. The company paid a final FY25 dividend of AUD 1.5 cents per share in October 2025, bringing cumulative distributions over the past five years to more than AUD 250 million. Net operating cashflow for the quarter stood at US$15.8 million, supported by production revenue of US$27.4 million, which included over US$6 million from the Thailand assets.

Horizon’s cash reserves remained healthy at US$35.6 million at quarter-end, with a modest net debt position of US$9.8 million following dividend payments and debt repayments. An additional US$8.9 million cash receipt is expected shortly from December oil lifting, further bolstering liquidity.

Strategic Contracts and Development Initiatives

In a significant commercial development, Horizon signed a binding Letter of Intent with the Northern Territory’s Power and Water Corporation to supply uncontracted Mereenie gas through to the end of 2034. This agreement not only secures a long-term customer but also accelerates plans to drill two additional infill wells later this year, aimed at unlocking further value from the asset.

Meanwhile, the Block 22/12 joint venture in offshore China is progressing feasibility studies for a potential new development phase of the WZ12-8E field, with ongoing workovers and optimisation programs designed to sustain production levels. In New Zealand, Horizon continues to manage regulatory compliance and maintenance activities at the Maari and Manaia fields, with a scheduled inspection shutdown planned for early 2026.

Outlook and Strategic Positioning

Horizon’s CEO Richard Beament highlighted the quarter as a “step-change” in the Group’s production base, reinforced by the ten-year permit extension at Maari and the strong performance of the Thailand assets. The company’s hedging strategy remains in place, covering 185,000 barrels of oil at an average price of around US$64 per barrel through May 2026, providing a buffer against price volatility.

With a clear focus on operational optimisation, disciplined capital allocation, and shareholder returns, Horizon appears well-positioned to navigate the current market environment. The combination of legacy asset stability and new growth from Thailand and the Northern Territory underpins a confident outlook for sustained cashflow generation and production expansion.