Highlights

  • Q4 2025 production declined 8% from prior quarter due to Baúna well downtime and reservoir decline.
  • Full-year 2025 production reached 10.3 MMboe, slightly below 2024 record levels.
  • Preliminary 2026 guidance expects 8.1–9.2 MMboe with Baúna efficiency improvements in H2 2026.

Karoon Energy Ltd (ASX:KAR) reported Q4 2025 production on a Net Revenue Interest (NRI) basis of 2.37 MMboe, down from 2.59 MMboe in Q3 2025. The decline reflects extended downtime on the SPS-92 and PRA-2 wells at the Baúna field and natural reservoir decline. Full-year 2025 production totaled 10.3 MMboe, within the upper range of guidance (9.8–10.4 MMboe) and marginally below 2024’s 10.4 MMboe.

Baúna FPSO efficiency improved to 98.8% in Q4, up from 92.7% in the previous quarter, driven by maintenance enhancements and increased equipment redundancy. Full-year FPSO efficiency rose to 95.1%, compared to 84.5% in 2024. Who Dat production in the U.S. Gulf of Mexico increased 10% to 0.65 MMboe NRI, aided by the E6ST well sidetrack, although full-year output fell 10% from 2024 levels.

Sales and Revenue
Q4 2025 sales volumes totaled 2.65 MMboe, 5% higher than Q3 2025, largely due to shipment timing. Baúna oil sales averaged USD 61.53/bbl, down 10% from the prior quarter, while Who Dat liquids averaged USD 57.06/bbl, an 8% decline reflecting lower global oil prices. Total Q4 revenue decreased 5% from Q3, reaching USD 156.1 million, with full-year 2025 revenue of USD 628.5 million, down 19% from 2024.

Operational Developments
At Baúna, preparations are underway for the SPS-92 ESP replacement and PRA-2 subsea umbilical repair, targeting mid-2026 reinstatement. Annual maintenance and a flotel-supported revitalisation campaign are scheduled for 1Q26.

In the U.S., technical studies for the Who Dat A1 sidetrack continue, with a second sidetrack expected in 2Q26, contingent on JV approvals.

Capital Expenditure and Cash Flow
Q4 2025 capex totaled USD 44.0 million, largely for the E6ST sidetrack and Santos Basin signature bonuses. Full-year 2025 capex, excluding the Baúna FPSO acquisition, is estimated at USD 96–101 million. Net debt at 31 December 2025 stood at USD 143.9 million, with total liquidity of USD 546.1 million. Karoon completed a US$9.8 million on-market share buyback during the quarter.

Preliminary 2026 capex is forecast at USD 110–135 million, including Baúna well restoration, Who Dat A1 sidetrack, and Santos Basin exploration, excluding contingent decisions for Who Dat East.

2026 Guidance
Total 2026 production is expected to range between 8.1–9.2 MMboe, with Baúna FPSO efficiency projected at 90–95% excluding planned shutdowns. Unit production costs are forecast at USD 12–15/boe, while exploration and appraisal expenditure is guided at USD 9–11 million.

Share Performance
KAR traded at 1.60 AUD at time of writing on 27 Jan, Down 1,53% today.