Highlights

  • Cue Energy shares rose 1.89% to AUD 0.14 on 28 April 2026 following the latest quarterly update.
  • $1.75 million returned to shareholders via a 0.25 cent per share Dividend.
  • Long-term Gas Sales Agreement signed to Supply up to 3.2 PJ through 2034.
  • H1 FY2026 Revenue reported at $25.7 million with EBITDAX of $13.5 million.
  • Quarterly cash receipts stood at $12.0 million with closing cash balance of $11.5 million.
  • Two development wells planned at Palm Valley to support future gas Supply

Cue Energy Resources Ltd (ASX:CUE) shares moved 1.89% higher to AUD 0.14 during the afternoon session on 28 April 2026, following the release of its quarterly activities report for the period ended 31 March 2026. The stock has also delivered a gain of approximately 35% over the past year, reflecting sustained investor interest.

The latest update highlights a combination of Shareholder returns, new long-term gas contracting arrangements, and ongoing development activity across its portfolio. While certain production segments recorded lower output during the quarter due to operational and external factors, the broader update includes elements that may be viewed as supportive for the company’s forward Revenue visibility and Cash Flow profile.

Company Overview

Cue Energy Resources Ltd is an oil and gas exploration and production company with operations spanning Australia, Indonesia, and New Zealand. The company holds interests in a diversified portfolio of producing Assets, development projects, and exploration opportunities.

Its Australian portfolio includes interests in the Mereenie, Palm Valley, and Dingo fields, while international exposure comes through Assets such as the Mahato and Sampang Production Sharing Contracts (PSCs) in Indonesia, and the Maari field in New Zealand. The company’s strategy focuses on maintaining production, generating Cash Flow, and selectively investing in development opportunities.

Gas Sales Agreement Extends Revenue Visibility

A key development highlighted in the update is the execution of a long-term Gas Sales Agreement (GSA) with the Northern Territory Government. Under this agreement, Cue is set to Supply up to 3.2 petajoules (PJ) of gas through to the end of 2034.

The contract includes take-or-pay provisions and a fixed pricing structure indexed to Inflation. This arrangement is expected to support a more predictable Revenue stream over the contract period.

To facilitate Supply under the agreement, the Palm Valley Joint Venture has taken a Final Investment Decision to drill two new development wells. These wells are planned to deliver up to 21 PJ of gas on a gross basis, with Cue’s share contributing to its contracted Supply obligations.

Drilling is scheduled to commence around mid-2026, with production anticipated to be brought online progressively in the second half of the calendar year.

Dividend Payout Reflects Capital Management Approach

During the quarter, Cue returned approximately $1.75 million to shareholders through a Dividend of 0.25 cents per share. This brings the total dividends distributed over the past two years to more than $33 million.

The Dividend aligns with the company’s stated Capital management approach, which includes returning surplus cash to shareholders while maintaining funding for operational and development activities.

Financial Performance and Cash Position

Cue reported quarterly cash receipts of $12.0 million, an increase from $9.9 million in the previous quarter. The company noted that recent increases in global oil prices were not fully reflected in these receipts due to the timing of oil sales, with the impact expected to be visible in the subsequent quarter.

The company ended the period with a cash balance of $11.5 million, compared to $11.2 million in the prior quarter.

For the half-year ended 31 December 2025, Cue reported Revenue of $25.7 million, profit of $5.1 million, and underlying EBITDAX of $13.5 million. These figures provide additional context for the company’s financial performance heading into the second half of the financial year.

Production Performance Mixed Across Regions

Production during the quarter showed variation across different operating regions.

In Australia, gas production was relatively stable, with 0.33 PJ recorded compared to 0.32 PJ in the prior quarter. Oil production increased to 2,016 barrels from 1,240 barrels.

In Indonesia, the Mahato PSC experienced lower oil production at 32,511 barrels compared to 59,481 barrels in the previous quarter. This decline was attributed to the temporary shutdown of the PB field due to regional safety measures following a pipeline incident in Central Sumatra, which was not directly related to the Mahato operations. Production returned to previous levels by the end of February.

The Sampang PSC recorded a decline in both gas and oil production, reflecting the mature stage of the fields. Gas output stood at 0.09 PJ, while oil production was 103 barrels.

In New Zealand, oil production from the Maari field decreased to 16,991 barrels from 25,147 barrels in the prior quarter. This was primarily due to a scheduled maintenance shutdown and a fault in the MN1 well following maintenance activities. A workover is currently underway to address the issue.

Total production for the quarter was reported at 119.5 thousand barrels of oil equivalent (kboe), compared to 154.6 kboe in the previous quarter.

Operational Developments and Future Plans

Cue continues to progress several operational initiatives across its portfolio.

In the Mahato PSC, the operator is preparing a Phase 3 development plan targeting additional production from the Telisa reservoir, with drilling expected during 2026. Planning is also ongoing for the GA-1 exploration well.

Within the Sampang PSC, efforts are ongoing to optimise output from existing wells. The installation of a compressor at the Grati gas processing plant, aimed at improving production efficiency, has been delayed and is now expected to be completed in the current quarter.

Cue has also indicated that it does not intend to participate in the Paus Biru development and does not plan to remain in the Sampang PSC beyond its current expiry in December 2027.

In New Zealand, remediation work is planned for certain infrastructure components at the Maari field, although these do not currently impact production.

Takeover Offer Under Review

During the quarter, Cue received an unsolicited, conditional, off-market Takeover offer from Horizon Oil Limited. The offer seeks to acquire all shares not already held or controlled by Horizon.

In response, Cue established an Independent Board Committee comprising independent directors to evaluate the proposal. The company has issued a Target’s Statement and a supplementary statement to provide shareholders with relevant information regarding the offer.

The offer is currently scheduled to close on 5 June 2026, unless extended or withdrawn.

What This Means for Investors?

Cue Energy’s latest update presents a combination of operational developments, financial metrics, and strategic initiatives.

The announcement of a long-term gas sales agreement provides visibility over future contracted revenues, while planned development drilling supports the company’s production outlook. At the same time, Dividend payments indicate ongoing Capital returns to shareholders.

However, the quarter also reflects lower production levels in certain Assets due to operational factors, which is an important consideration in assessing overall performance.

The modest share price movement on the day suggests that investors are weighing both the forward-looking elements of the update and the near-term production trends.