Highlights

Highlights

• Elixir Energy and Beach Energy executed definitive farmout agreements on 22 October 2026 covering a transaction valued at roughly $205 million.

• Beach Energy will pay $25 million in cash and fund $180 million of gross carried appraisal spending over four years.

• Beach Energy gains operatorship and a 50 per cent interest in two permits where Elixir previously held the full working interest.

• Completion remains subject to conditions including ministerial and competition regulator approvals, targeted for the second half of financial year 2027.

Elixir Energy Limited (ASX:EXR) has moved its long-running courtship of Beach Energy into definitive documentation, confirming on 23 October 2026 that the two companies have executed definitive agreements for a farmout of Taroom Trough gas permits in Queensland worth roughly $205 million, a deal that hands Beach a bigger foothold and day-to-day control of key acreage.

A Gas Portfolio Built Over Years

Elixir Energy (ASX:EXR) has spent several years assembling and appraising the Taroom Trough gas portfolio in Queensland's Surat and Bowen basins, an area the company believes holds substantial unconventional gas potential, while periodically bringing in partners to help fund the appraisal work needed to prove it up.

The Terms of the Farmout

Under the agreements executed on 22 October 2026, Elixir Energy (ASX:EXR) and Beach Energy will pay Elixir $25 million in cash and fund $180 million of gross carried appraisal expenditure, including operating costs, over four years, with Elixir's own share of that carry amounting to roughly $90 million.

In exchange, Beach picks up operatorship and a 50 per cent interest in the ATP2044 and ATP2077-A/B permits, where Elixir previously held the entire working interest, and increases its stake in the ATP2056 and ATP2057 permits from 25 per cent to 50 per cent, with Elixir's interest there falling from 50 per cent to 25 per cent.

The arrangement excludes the Diona joint venture sub-block within ATP2077.

Notably, the structure requires no Elixir Shareholder approval and involves no issue of new shares, meaning the funding Beach is providing flows directly into appraisal work rather than diluting existing holders, a contrast with some of the Equity raisings smaller explorers in the sector rely on to fund similar programmes.

Conditions Still to Clear

Completion is not immediate.

The agreements remain subject to Queensland ministerial approval, Australian Competition and Consumer Commission approval or a waiver, completion of Elixir's own farm-in to the ATP2056 permit, and a Waiver of pre-emption rights held by other joint venture parties.

Elixir and Beach have guided to completion in the second half of the 2027 financial year, meaning the window running from January to June 2027.

What It Means and What to Watch

The next milestones include for confirmation that the various conditions precedent have been satisfied, further detail on the appraisal work programme Beach intends to run once it takes over as operator, and any update on the Lorelle-4H horizontal appraisal well flagged in the company's October investor materials.

Key Insights

The executed farm-out creates a defined pathway for partner-funded appraisal, but regulatory approvals and other conditions must be met before completion. The retained Diona interest remains outside the transaction.