Highlights

  • Carnarvon contracted the Transocean Equinox drilling rig for a 2027 Bedout exploration campaign.
  • Ara carries gross unrisked mean prospective resources of 191 million barrels of oil equivalent.
  • Dorado remains ready to enter FEED, with a development concept targeting a 60,000-barrel daily plateau.
  • The company ended September with AUD 97 million in cash, no Debt and a Dorado development carry.

A contracted offshore drilling rig and a new exploration schedule have placed Carnarvon Energy Limited (ASX:CVN) on a defined pathway towards its next Bedout Basin campaign. The company is preparing to test large prospects offshore Western Australia in 2027 while maintaining its interests in the Dorado and Pavo discoveries. Its September quarter also ended with substantial cash reserves and no debt.

Ara Emerges as the Lead Well

Carnarvon’s September quarterly activities report confirmed that Transocean Equinox had been contracted for the proposed Bedout programme. Drilling is expected to commence from April 2027, subject to environmental approvals and joint-venture planning. The campaign provides for one firm exploration well and one contingent well within Carnarvon’s permits. Ara is identified as the most likely firm target. Located approximately 80 kilometres north of Dorado, Ara carries estimated gross unrisked mean prospective resources of 191 million barrels of oil equivalent and an estimated 37% geological chance of success. Those volumes relate to an undrilled accumulation and cannot be treated as reserves.

Dorado Remains a Separate Development Opportunity

Dorado is an appraised oil and gas discovery with a staged development concept. The first phase envisages liquids production through a wellhead platform linked to a floating production, storage and offloading vessel. Earlier engineering indicated the potential for production at a plateau of around 60,000 barrels of oil per day, subject to project sanction and development. Carnarvon described the project as ready for front-end engineering and design. It has not announced a final Investment decision or an operating start date. The company holds a 10% interest, with Santos operating the project.

Balance Sheet Supports Exploration Planning

At 30 September 2026, Carnarvon reported approximately AUD 97 million in cash, no debt and a US$90 million development cost carry associated with Dorado. It also held a 19.9% strategic interest in Strike Energy, adding exposure to the Perth Basin. Management indicated that drilling both a firm and contingent well could cost Carnarvon approximately AUD 20 million. This estimate is a planning assumption, with actual expenditure dependent on final well selection and operations. The company is also considering the timing of renewed Dorado work with its operator and project partners.

Approvals and Budget Decisions Are the Next Gate

Work during the September quarter included progressing environmental plans for multi-well, multi-year drilling. Joint-venture budgeting is expected to determine whether the contingent well becomes a committed part of the campaign. Ara’s prospective resource size explains its prominence in the exploration portfolio, but the well is intended to test whether Hydrocarbons are present in commercially meaningful quantities. The programme is therefore an exploration catalyst rather than a forecast of proven discoveries.

Outlook: The Next Milestones

Upcoming milestones include environmental approvals, final well selection, joint-venture budgets and preparation for the expected April 2027 Bedout drilling start.

Carnarvon Energy shares traded at AUD 0.103 on 6 November 2026, up 2.50%; intraday high AUD 0.103, low AUD 0.100, Volume 1,438,215 shares and Market Capitalisation approximately AUD 182.9 million.