Key Highlights

  • Karoon Energy (ASX:KAR) closed at $1.69, up 1.20%, on 26 October 2026.
  • Third-quarter 2026 production was 2.27 MMboe, up 110% on the second quarter, with sales Revenue of US$191.6 million.
  • CY26 production guidance was revised to 6.6 to 7.2 MMboe after an electrical fault at the SPS-92 well.

Karoon Energy Ltd (ASX:KAR) closed at $1.69, up 1.20%, in the Trading session on 26 October 2026, while the S&P/ASX 200 closed at 8,809.9, up 0.17%, and the S&P/ASX 200 Energy index gained 0.92%. Karoon is a Melbourne-based oil and gas company that produces from the Baúna project offshore Brazil and the Who Dat field in the US Gulf of Mexico.

SPS-92 Fault and Guidance Update Dated 28 September 2026

Karoon reported a fault on the monitoring system of the SPS-92 well at Baúna on 21 September and shut the well down in a controlled manner on 22 September. Testing confirmed a fault in one of the three electrical phases of the newly installed power cable for the downhole electrical submersible pump, and the pump is operating on two phases. The company expects a rig-based well intervention to replace the cable, has an option over a suitable rig and estimated that about 3,500 barrels per day would be deferred until it is replaced, without an expected effect on Baúna reserves.

Karoon cut its 2026 Baúna production guidance from 6.0 to 6.7 MMbbl to 5.4 to 5.7 MMbbl, leaving total CY26 production at 6.6 to 7.2 MMboe and unit production cost guidance at US$15 to 16 per boe. Its insurance program may partially offset lost revenue and reimburse substantially all intervention costs, subject to terms and insurer confirmation.

Third Quarter Report Dated 22 October 2026

Third-quarter production was 2.27 MMboe, up 110% on the second quarter, and sales revenue rose 64% to US$191.6 million. Baúna operating efficiency was 96% and Who Dat Facility efficiency was 100%. Total Baúna production stood at 16,400 barrels per day, with SPS-92 producing at about 55% of pre-fault levels.

Cash was US$80.8 million at 30 September, with Operating Cash Flow funding capital expenditure, Shareholder returns of 13.3 million shares bought back and a US$6.0 million interim dividend. The Who Dat East joint venture sanctioned development on 12 August, with first production expected in the second half of 2028, and Karoon reported progress on the proposed Neon development, including a memorandum with TechnipFMC. One lost time incident was the first in more than 600 days.

Karoon also reported that waterflood resumption is providing reservoir pressure support and that Who Dat A1 sidetrack performance was a contributor to the quarter. Planning is under way for the Who Dat G1 sidetrack, expected online in 2Q27, with E field remediation plans on track for execution in 2H27. The company noted that increased global shipping rates linked to the Middle East war affected realised prices late in the quarter.

About Karoon Energy

Karoon Energy Ltd (ASX:KAR) produces oil from Brazil and Gulf of Mexico assets. The company noted a Brazilian windfall export tax extended to 7 November 2026.

The Who Dat East development targets an initial net production rate of about 6,000 boepd on a net revenue interest basis, with first production expected in the second half of 2028. On Neon, discussions on a potential option over a topside host facility are reaching maturity, according to the report.

Risks and Catalysts on Watch

Timing of the SPS-92 repair depends on permit approvals and services, and insurance recovery is subject to final confirmation. Scheduled items include the Who Dat G1 sidetrack, expected online in 2Q27, and the Brazilian export tax expiry date of 7 November 2026.

Wrapping Up

Karoon's reports combine a production rebound in the third quarter with a reduced full-year outlook after the SPS-92 fault. The shares closed up 1.20% on 26 October.