Horizon Oil Limited (ASX:HZN) announced on 9 September 2026 that the Nam Phong Booster Gas Compressor (BGC) Project in Thailand has been successfully commissioned and brought into service. The project marks the completion of a key field development initiative designed to reduce system backpressure, improve well deliverability and enhance gas recovery from the mature Nam Phong gas field.

Following start-up on 4 September 2026, initial operating results showed total field sales of approximately 10.3 terajoules per day (TJ/d) gross, representing an increase of 84% compared with average sales before compressor commissioning.

The development provides Horizon Oil with additional production capacity from an existing asset while supporting higher gas sales under a long-term oil-linked gas contract.

Nam Phong Booster Gas Compressor Commissioned to Improve Field Performance

The Nam Phong Booster Gas Compressor project was designed to address declining deliverability from the mature Nam Phong gas field by reducing system backpressure and improving gas flow performance.

The project was sanctioned in January 2026 following Horizon Oil’s Acquisition of the Nam Phong asset in August 2025. It involved installation of a leased gas engine-driven booster compressor to unlock additional reserves and improve recovery from the field.

The compressor entered service on 4 September 2026, completing a targeted development program focused on improving production efficiency from existing infrastructure.

Horizon Oil reported that the initial production response following start-up has been encouraging, with field sales increasing to approximately 10.3 TJ/d gross.

Increased Production Supports Horizon Oil’s Thailand Contribution

Horizon Oil has an effective 60% interest in the Nam Phong gas field through MH Energy Thailand.

The company stated that the increase in production following compressor start-up is expected to increase Thailand’s contribution to group production from approximately 2,000 barrels of oil equivalent per day (boepd) to approximately 2,500 boepd.

The Nam Phong field operates under a long-term oil-linked gas sales contract, meaning gas sales pricing is linked to oil prices. Horizon noted that the increased production volumes are expected to support higher Revenue and Cash Flow generation for the joint venture, particularly in the context of recent oil price conditions.

The production increase demonstrates the company’s approach of enhancing value from recently acquired Assets through targeted development projects.

Acquisition Strategy Followed by Low-Cost Development Opportunity

The Nam Phong Booster Gas Compressor project forms part of Horizon Oil’s broader strategy of acquiring and improving existing production assets.

The company acquired the Nam Phong asset in August 2025 and subsequently progressed the compressor project to improve field performance. Horizon highlighted that the project was delivered safely, on schedule and below budget, with support from its MH Energy Thailand partners, Matahio.

The Block E5 (Nam Phong) joint venture consists of MH Energy Thailand as operator with an 80% participating interest and PTTEP with a 20% participating interest. MH Energy Thailand is 75% owned by Horizon Oil, with Matahio Energy holding the remaining 25% interest.

The successful commissioning provides an example of how infrastructure upgrades can extend production capability from mature fields.

Technical Execution Supports Future Field Recovery Potential

The compressor installation was focused on improving the operating performance of the existing Nam Phong field rather than developing a new production area.

By reducing pressure constraints within the gas system, the BGC is expected to improve well performance and support additional gas recovery from the field.

Horizon Oil highlighted the importance of technical evaluation and execution following the acquisition of the asset, with the compressor project representing a key milestone in the company’s efforts to generate additional value from the field.

The company acknowledged the contribution of Matahio Energy, PTTEP and Thailand’s Department of Mineral Fuels in supporting approvals, construction and commissioning activities.

Risks and Uncertainty Factors

While the Nam Phong Booster Gas Compressor has delivered an initial increase in field sales, future production levels remain subject to ongoing operational performance and reservoir behaviour.

Gas production from mature fields can be influenced by factors including reservoir pressure, well performance, maintenance requirements and future operating conditions.

The project’s contribution to revenue and cash flow also remains linked to gas pricing arrangements, including the long-term oil-linked gas sales contract.

Future performance will depend on maintaining reliable operations and achieving sustained production improvements from the field.

What to Watch Ahead

Investors may continue monitoring the ongoing performance of the Nam Phong gas field following compressor commissioning.

Key areas of focus include:

  • Sustainability of increased gas sales following the BGC start-up.
  • Contribution of Thailand production to Horizon Oil’s overall output.
  • Ongoing performance of the Nam Phong joint venture.
  • Future opportunities to enhance recovery from existing assets.
  • Updates on Horizon Oil’s broader production and development strategy.

Horizon Oil’s latest update marks an important operational milestone following the acquisition of the Nam Phong asset. The successful commissioning of the Booster Gas Compressor has increased field sales and supports the company’s strategy of improving production from existing assets through targeted development initiatives.