Highlights

  • Binding conditional 10-year Gas Sales Agreement signed with Alcoa for approximately 50 TJ/day.
  • Pre-FEED evaluation estimated a project NPV10 of US$867 million and IRR of 31%.
  • Alcoa approved Stage Two – Project Partnering, releasing US$1.5 million in funding.
  • Grant Davey appointed Non-Executive Chairman and Michael Barnes as a director.

Gas developer Equus Energy Limited (ASX:EQU) made a commercial breakthrough at its offshore Western Australian gas project during the September 2026 quarter. A conditional long-term sales agreement with Alcoa established a foundation domestic customer, while early engineering work outlined the project’s potential economics and infrastructure options.

A Long-Term Customer for Domestic Gas

Equus executed a binding conditional 10-year Gas Sales Agreement with Alcoa of Australia, establishing Alcoa as the project’s foundation domestic gas customer. The contract provides for approximately 50 TJ/day of domestic gas following project start-up, equivalent to approximately 182 PJ over the term, and satisfies the project’s commitment under Western Australia’s Domestic Gas Reservation Policy.

The agreement forms part of a broader Gas Sales and Funding Agreement providing access to as much as US$30 million to support Pre-FEED, FEED and progress toward a Final Investment Decision, conditional on stage conditions and Alcoa approvals. In September, Alcoa accepted the Stage One Pre-FEED deliverables and approved Stage Two – Project Partnering, releasing US$1.5 million to support efforts to secure operating, LNG offtake, infrastructure and financing partners.

Engineering and Project Economics

The preferred development plan involves a phased tie-back using a leased floating production, storage and offloading vessel, a third-party export pipeline and existing processing facilities under tolling arrangements, with pathways assessed via Woodside’s Pluto facilities or Santos’ Varanus Island infrastructure. It targets approximately 2 Mtpa of LNG, 50 TJ/day of domestic gas and peak condensate production of approximately 12,000 barrels per day over a modelled 15-year life.

The Pre-FEED evaluation estimated a project NPV10 of US$867 million and a nominal IRR of 31%, with capital payback approximately two years after first production. Phase 1 capital expenditure was estimated at approximately US$1.25 billion in 2026 dollars, such as a 20% contingency. The modelled LNG breakeven price was approximately US$6.60/MMBtu, compared with an assumed price of US$9.50/MMBtu.

Leadership and Available Cash

On 6 July 2026, Equus appointed Grant Davey as Non-Executive Chairman and Michael Barnes, a former Western Australian Under Treasurer, as an Independent Non-Executive Director. Brendan Jesser retired as Chairman and Chris Bath retired as Executive Director, continuing as CFO and Company Secretary.

Equus held $11.7 million in cash at 30 September 2026, after spending $1.38 million on exploration and evaluation, mainly Pre-FEED work. After the quarter, it received approximately $865,000 from Alcoa for Stage Two funding costs. The company’s AGM is set to be held on 26 November 2026, where shareholders will vote on additional performance rights for its executives.

The Remaining Commercial Steps