Central Petroleum Boosts Gas Sales Revenue by 8.7% with New Multi-Year NT Contract

Sales Revenue Growth Driven by Gas Volume and Pricing

Central Petroleum (ASX:CTP) posted an 8.7% increase in sales revenue to $11.3 million for the March 2026 quarter, reflecting a 3% rise in gas sales volumes to 1.1 PJ and a 5% boost in average gas prices to $10.06 per gigajoule. The volume uptick was partly due to resolved oil offtake constraints in the prior quarter, while pricing benefited from new contracts and indexed price adjustments.

Despite oil sales remaining subdued at an average of 297 barrels per day due to ongoing specification constraints, the company maintained full gas production capacity, with Mereenie field gas sales capacity nearing 27.9 TJ/day and Palm Valley steady at 6.2 TJ/day. The Dingo gas field also saw a 6.6% increase in sales volumes, supplying the Owen Springs Power Station near Alice Springs.

Multi-Year Gas Supply Agreement Secures Future Revenue and Production Expansion

In a key development post-quarter, Central secured a multi-year Gas Sales Agreement with the Northern Territory Government to supply up to 21 PJ of gas through to 2034, underpinning firm demand for the Palm Valley Joint Venture’s output. This contract supports the drilling of two new wells at Palm Valley, expected to commence mid-2026 and boost production capacity by approximately 40%, potentially increasing output to the plant’s 15 TJ/day capacity.

The new wells will be connected to existing infrastructure, enabling a rapid ramp-up in supply. This agreement replaces an earlier letter of intent and is backed by a fixed market price with CPI escalation and take-or-pay provisions, providing Central with greater revenue certainty.

Strategic Expansion into Otway and Cooper Basins Advances

During the quarter, Central invested $10.9 million to acquire interests in exploration permits across the Otway and Cooper Basins, marking a strategic expansion beyond its Northern Territory core. These acquisitions complement the company’s existing portfolio and position it for a multi-well drilling campaign starting in the second half of 2026, including prospects with significant gas-in-place estimates.

Central has also entered a conditional agreement to sell its interests in sub-salt Amadeus Basin permits EP112 and EP125 to UK-listed Georgina Energy Plc, in exchange for a 25% equity stake in Georgina. Should this transaction complete, drilling of a sub-salt exploration well targeting helium and hydrocarbons is planned for mid-2027.

Financial Position and Capital Management

Central’s cash balance declined to $19.5 million at quarter-end from $29.4 million in December, largely reflecting the exploration permit acquisitions and related costs. Operationally, the company generated positive net operating cash inflows of $2 million after exploration and interest costs. Net debt stood at $5.2 million, including $2.5 million held as security for the loan facility.

To support the Palm Valley drilling acceleration, the company increased its loan facility to $15 million in April, with flexible repayment terms starting in 2027. Meanwhile, Central continued its on-market share buy-back program, acquiring 1.39 million shares in January at an average price of 6.3 cents per share.

Safety Record and Outlook

Central recorded no reportable safety incidents during the quarter, maintaining a Total Recordable Injury Frequency Rate of zero. With drilling preparations underway, including site works and equipment procurement for Palm Valley, the company is poised for a potentially transformative period of production growth.

While oil sales constraints persist, Central’s focus on gas production and the secured multi-year supply contract provide a clearer revenue pathway. The ongoing exploration and expansion into new basins add further optionality, though the success of drilling programs and permit transactions will be critical to watch.

This quarter’s results and strategic moves build on Central’s earlier announcements, including the binding gas sales agreement and Otway and Cooper Basin acquisitions, positioning the company at an inflection point between steady production and growth potential.