Echelon Reports 1.8% Production Dip, Secures 22.5 PJ Gas Sales Through 2034
Echelon Resources reported a slight dip in production but secured long-term gas sales contracts extending to 2034 and plans four new development wells in the Amadeus Basin. The company also reduced its debt by A$7 million, maintaining financial flexibility for growth.
- 1.8% production decline to 407,252 barrels of oil equivalent
- New long-term gas sales agreements through 2034 covering 22.5 PJ
- Four new development wells planned in Amadeus Basin starting mid-2026
- Debt reduced by A$7 million, loan facility balance now A$35.5 million
- Ongoing development and optimisation in Indonesian and New Zealand assets
Production and Financial Overview
Echelon Resources Limited reported a modest 1.8% decrease in production volumes for the quarter ending 31 December 2025, delivering a total output of 407,252 barrels of oil equivalent (boe) at a daily rate of 4,427 boe. Despite this slight dip, the company’s financial position remains robust, with a cash balance of A$32.9 million and a continued focus on debt reduction. During the quarter, Echelon repaid A$7 million of its loan facility, bringing the outstanding debt down to A$35.5 million from A$54.5 million in March 2025. This disciplined approach to managing leverage preserves flexibility to fund upcoming development projects.
Strategic Gas Sales and Development Plans
A key highlight for Echelon this quarter was securing new long-term gas sales arrangements with Power and Water Corporation, extending through to 2034. These agreements cover firm volumes of up to 22.5 petajoules (PJ) net to Echelon from existing production in the Amadeus Basin, underscoring the enduring value of their Northern Territory assets. In support of these contracts, the company is advancing plans for four new development wells, two each at Palm Valley and Mereenie fields, targeting an additional 13.3 PJ of gas supply. Drilling is expected to commence mid-2026, signalling a clear growth trajectory.
Operational Updates Across Regions
In Indonesia, development continues at the Mahato Production Sharing Contract (PSC) with recent drilling and optimisation efforts supporting production. The Sampang PSC fields are in their late production stages, prompting the operator to explore options to maximise output, including installing a compressor at the Grati gas processing plant, now expected early this year. Negotiations are ongoing for the Paus Biru development, critical PSC extensions, and economic incentives, with a Final Investment Decision anticipated soon.
Meanwhile, in New Zealand, Kupe field production was affected by unplanned maintenance but remains under review for future interventions. The Maari and Manaia fields maintained steady oil output, supported by ongoing optimisation and a recent 10-year permit extension that opens doors for further development opportunities.
Outlook and Strategic Positioning
Echelon’s combination of securing long-term gas contracts, advancing new well developments, and reducing debt positions the company well for sustainable growth. The alignment with local market demand in the Northern Territory and ongoing operational improvements across its international portfolio reflect a balanced approach to managing risk and opportunity. However, some projects remain contingent on joint venture approvals and regulatory clearances, which will be critical to watch in the coming quarters.
Bottom Line?
Echelon’s strategic moves set the stage for growth, but execution and approvals will be key to unlocking full potential.
Questions in the middle?
- Will the planned four new wells in the Amadeus Basin deliver the targeted 13.3 PJ of additional gas supply on schedule?
- How will ongoing negotiations and regulatory approvals impact the timing and viability of the Paus Biru development in Indonesia?
- What are the implications of the recent debt reduction on Echelon’s capacity to fund future exploration and development projects?
