2.704 billion barrels net prospective resources added to PEL 87 inventory

Namibia resource inventory expands as funding pressure persists

Pancontinental Energy NL (ASX:PCL) has added two prospects to its offshore Namibia portfolio and lifted the best-estimate prospective resource attributed to its 75%-owned PEL 87 permit to 2.704 billion barrels. The larger inventory sharpens the exploration story, but the annual report makes clear that the next step remains funding: the company still needs a farm-in partner or further capital to move towards drilling.

“PEL 87 Location Map”

“PEL 87 and Neighbouring Activity”

Caption and image © Pancontinental Energy NL. From “Annual Report to shareholders”, 29 Oct 2026.

The total PEL 87 inventory is estimated at 3.606 billion barrels on a 100% gross, best-estimate basis, with a high estimate of 8.174 billion barrels. Pancontinental’s 75% interest equates to 2.704 billion barrels on the best estimate and 6.131 billion barrels on the high estimate. These are prospective resources in undiscovered accumulations, not reserves, and remain subject to both discovery and development risk.

Northern Channel and Phoebe West strengthen PEL 87 prospect map

“PEL 87 Prospects/Leads with Line of Section A-A’.”

The updated inventory includes Northern Channel and Phoebe West, identified through quantitative interpretation of PEL 87’s 3D seismic data. Pancontinental describes Oryx, Hyrax and Northern Channel as its three anchor prospects, while the Northern Channel and Phoebe West additions build on the earlier two new PEL 87 prospects identified by the company.

The company says Northern Channel contains three stacked, channelised turbidite reservoir sequences and sits near the northern edge of the 3D seismic survey. Phoebe West lies above the Kudu source rock sequence and is described as the largest connected sand body mapped outside the Saturn Complex. Pancontinental has not yet tested these interpretations with an exploration well.

Seismic reprocessing targets data quality before drilling

Pancontinental has awarded DUG Technology a pilot reprocessing contract after identifying possible attenuation in ultra-far-offset seismic amplitudes. The company says high-energy multiples may not have been adequately removed before migration, and the pilot will return to pre-migration gathers in an effort to improve the reservoir and fluid response. The work extends the PEL 87 seismic reprocessing study reported earlier this year.

The technical work is running alongside regulatory preparation. Namibia’s Ministry of Industry, Mines and Energy approved a 12-month extension of the first renewal exploration period in March 2026, taking it to 22 January 2027. The extension requires an environmental impact assessment, seismic reprocessing and an exploration well, although the company says the proposed work programme is conditional on securing a suitable farm-in partner.

Cash runway and farm-out outcome dominate the investment case

Pancontinental held $2.344 million in cash at 30 June 2026, down from $2.493 million a year earlier. Operating activities consumed $1.133 million, while a further $663,729 was spent on exploration interests. The company raised $1.794 million through the exercise of 149.5 million listed options, but all remaining listed options expired during the year.

The group reported a $1.430 million loss, narrower than the $1.753 million loss recorded in the prior year. That improvement does not remove the funding issue. The auditor highlighted a material uncertainty related to going concern, citing the company’s reliance on future capital raisings and a farm-in partner. A proposed exploration budget of about US$76 million is conditional on a partner being secured and is not an unconditional commitment of Pancontinental.

New Zealand application adds another unawarded opportunity

Pancontinental is also pursuing a 9,972.5-square-kilometre deepwater Taranaki Basin application offshore New Zealand. The application has been accepted by New Zealand Petroleum and Minerals and the three-month competitive window closed on 8 October 2026, but the permit has not been awarded. The proposed initial two-year programme would focus on reprocessing and interpreting 2D seismic data, basin modelling and identifying exploration targets.

For now, PEL 87 remains the company’s central asset and its clearest route to a value-defining drilling decision. The outstanding questions are whether a partner will accept the geological and commercial terms, how much funding Pancontinental must raise before then, and whether the upgraded seismic interpretation can convert an expansive resource estimate into a drillable prospect.