Horizon Oil Hits Record Production and Reserves Growth After Cue and Thailand Acquisitions

Record Production Fueled by Strategic Acquisitions

Horizon Oil Limited (ASX:HZN) posted a standout FY26, hitting a record net production of 2.15 million barrels of oil equivalent (boe), a 33% jump from the previous year. This surge was largely propelled by the integration of its Thailand assets, acquired in August 2025, and the completion of the Cue Energy Resources takeover in June 2026. The Cue acquisition alone lifted Horizon’s current production to approximately 7,300 barrels of oil equivalent per day (boepd), broadening its footprint to nine producing assets across five Asia-Pacific countries.

Underlying revenue remained steady at US$107.2 million despite the production leap, reflecting disciplined pricing and cost management. Notably, Horizon held around 130,000 barrels of crude inventory at 30 June 2026, which was sold in FY27, generating an additional US$10 million-plus in revenue.

Reserves and Resources Expansion Strengthens Long-Term Outlook

The company's net 2P reserves swelled by 51% year-on-year to 13.6 million boe, with acquisitions, revisions, and extensions contributing 6.7 million boe, effectively replacing production nearly twofold. The Thailand assets added 3.9 million boe to 2P reserves, while Cue’s contribution was 2.6 million boe. Meanwhile, contingent resources (2C) climbed 61% to 19.8 million boe, and unrisked prospective resources (2U) surged over 450% to 14.3 million boe, primarily driven by Thailand opportunities.

This growth underpins a substantial infrastructure-led opportunity set, with Horizon targeting infill drilling, compression upgrades, and potential concession extensions across key assets such as Nam Phong and Sinphuhorm in Thailand, Mahato and Sampang in Indonesia, and mature fields in Australia and New Zealand.

Robust Financial Performance and Capital Discipline

Horizon’s financials reveal a company balancing growth with shareholder returns and balance sheet strength. EBITDAX edged up to US$56.4 million, supported by cash operating costs maintained below US$25 per boe. Operating cash flow jumped 32% to US$47.2 million, funding US$33.1 million in dividends and US$10.6 million in debt repayments, leaving net debt modest at US$11.3 million.

Dividends declared for FY26 totalled AUD 2.5 cents per share, split between a 1.5 cents interim and 1.0 cent final dividend, reflecting Horizon’s ongoing commitment to returning capital to shareholders. The company’s cumulative distributions now exceed AUD 270 million over six years, underscoring consistent shareholder value delivery.

Diverse Asia-Pacific Portfolio with Near-Term Growth Catalysts

Horizon’s portfolio spans Thailand, Indonesia, Australia, New Zealand, and China, with nine producing assets and a combined 2P reserves base that supports production well into the next decade. Key assets include the oil-linked domestic gas fields of Nam Phong and Sinphuhorm in Thailand, where near-term projects like booster compression and infill drilling aim to enhance deliverability and extend field life.

In Indonesia, the Mahato PSC is driving near-term oil growth through infill wells and exploration, while the Sampang PSC is being optimised with compression projects ahead of Cue’s planned exit at PSC expiry in 2027. Australia’s Amadeus Basin assets, including Mereenie, Palm Valley, and Dingo, provide stable domestic gas supply with ongoing appraisal drilling and development reviews underway.

Offshore, the Maari oil project in New Zealand remains a mature, cash-generative asset with infill drilling opportunities and a recent permit extension to 2037. In China’s Beibu Gulf, Block 22/12 continues to deliver reliable offshore oil production, with optimisation and development studies progressing.

ESG and Operational Excellence Remain Priorities

Horizon maintained safety performance better than industry benchmarks, developed a comprehensive sustainability strategy aligned with new material topics, and successfully integrated Thailand assets into its ESG governance framework. Efforts to reduce field emissions include commissioning a vapour recovery unit and energy efficiency projects, while employee wellbeing and community engagement continue to be focal points.

Operational discipline, combined with strategic acquisitions, has positioned Horizon as a resilient, cash-generative producer with a clear path to sustainable growth and shareholder returns.