Australian Oil Company (ASX:AOK) Restarts Emu Apple-1 and Lines Up Gas Sales in the Surat Basin

Sonal Goyal

22 October 2026 12:11 PM AEDT

Australian Oil Company (ASX:AOK) Restarts Emu Apple-1 and Lines Up Gas Sales in the Surat Basin

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Key Highlights

Emu Apple-1 produced 10 to 20 barrels of oil per day after intervention and has continued at about 14 barrels per day with no water cut.
Tranche 2 of the April 2026 raising issued 380,834,367 shares at A$0.0029 to raise A$1,104,420 before costs.
Cash at 30 September 2026 was A$1.415 million, with net operating cash outflow of A$409,000 for the quarter.
California production reached about 350 mcf/day, with potential to move towards about 500 mcf/day through compression.

Australian Oil Company Limited (ASX:AOK) has reported on the quarter ended 30 September 2026, a period in which it completed a well intervention at Emu Apple-1 in Queensland's Surat Basin, advanced preparations for gas sales from the Major Gas Field and appointed a new Executive Chairman.

Managing Director Kane Marshall said the quarter delivered progress towards establishing a producing oil and gas hub in the Surat Basin. The company also received about A$1.4 million in cash during the period and ended it with A$1.415 million of cash on hand.

Emu Apple Oil Field Intervention Results

The Emu Apple-1 intervention comprised a condensate backwash followed by an acid wash treatment to remove paraffin build-up. After the acid wash the well was shut in for treatment optimisation and then brought back online progressively. Pump strokes returned to pre-intervention rates, and the company reports clear communication between the well and the reservoir.

Post-intervention, the well produced 10 to 20 barrels of oil per day at its earlier pump rate. Output was in a 15 to 20 barrel range in August and 10 to 20 barrels in September while clean-up continued. After the quarter ended and clean-up was finished, the well continued at about 14 barrels per day with no water cut. Fluid levels stayed more than 100 metres above the pump intake.

Field surveys have been completed on Emu Apple-2 and -3 to scope similar interventions and plan hydraulic pumping units.

Gas Sales, Riverslea Restart, New Ventures and California

At the Major Gas Field in PL 512, the company concentrated on returning production through the existing Major-4 well. On-ground work to deliver gas to the Silver Springs Gas Plant advanced alongside negotiation of a gas sales agreement. Executing that agreement and completing resource reporting is expected to allow reserves to be booked. Updated geological mapping of the P10 case in the Showgrounds Formation identified potential infill targets up-dip of Major-4 and a possible oil leg that requires further data.

At the Riverslea Oil Field in PL 30, additional assays of Riverslea-3 crude samples were completed at Intertek in Adelaide and are being incorporated into a lifting agreement with IOR. Plans advanced for Riverslea-1 hydraulic pump reactivation and for Riverslea-3 to target free-flow production, using spare load out pumps and flowlines identified at Emu Apple. Civil earthworks and further equipment procurement are expected to finish next quarter ahead of first oil.

AOK is in discussions with a number of counterparties about increasing its Surat Basin acreage, targeting assets with low entry costs, infrastructure and existing paths to commercialisation. It is also negotiating directly with regulators in two jurisdictions over international exploration concessions, with a focus on higher-risk, larger-resource gas plays.

In California, CityGate gas prices exceeded US$3 per MMBTU during the quarter, producing breakeven and, in select periods, positive cash flow. After maintenance at the Rec Board wells, production reached about 350 mcf/day, with potential to approach 500 mcf/day by adding compression. The company is reviewing its California acreage, which it expects to remain profitable at current gas prices.

Corporate Changes and Cash Position

Thomas Streitberg became Executive Chairman from 24 September 2026 for a three-year term. He has agreed to take all of his compensation as share-based compensation and invested A$300,000 on the same terms as the 24 April 2026 raising.

Tranche 2 of that raising, approved at the 24 July 2026 general meeting, issued 380,834,367 shares at A$0.0029 each for A$1,104,420 before costs, along with 350,000,000 placement options and 110,000,000 Lead Manager options exercisable at A$0.006 by 30 June 2028. The company also sold 47,015,822 shares through its unmarketable parcel facility for A$105,785.

The Appendix 5B shows receipts from customers of A$89,000 and net operating cash outflow of A$409,000. Investing outflow was A$116,000, financing inflow was A$1.311 million, and cash rose from A$624,000 to A$1.415 million. The estimated funding available is 2.70 quarters, and related party payments were A$59,000.

Summing Up the Quarter

AOK reports a producing Emu Apple-1, a gas sales agreement still under negotiation, Riverslea works scheduled to finish next quarter, and a cash balance of A$1.415 million. Its December 2026 quarter objectives include stable Emu Apple-1 output, executing the gas and lifting agreements, and securing approval for the Riverslea restart.

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