Conrad Asia Energy Ltd (ASX:CRD) released an ASX announcement on 9 September 2026 confirming the completion of the farm-down of its 75% non-operated Participating Interest in the Duyung Production Sharing Contract (PSC) to PT Nations Natuna Barat (Nations/NNB), following MEMR approval on 27 August 2026. Completion triggered the payment of the second cash Tranche of US$4 million from NNB, bringing total cash received to US$9 million of the US$16 million total cash consideration. Conrad now retains a 22.875% operated Participating Interest in the Duyung PSC via its interests in WNEL Holdings. The Mako Gas Development Project is fully funded for its US$320 million development, with first gas targeted for Q4 2027 to Supply Batam — Indonesia's rapidly growing data centre hub.

Transaction Completion and Cash Consideration

Following MEMR approval on 27 August 2026, all remaining conditions for the NNB PI Transfer were met and the second cash tranche of US$4 million was paid by NNB. The first tranche of US$5 million was received in March 2026. The third and final tranche of US$7 million is payable upon commencement of commercial production. The remainder of the Acquisition consideration will be paid through production revenues until 75% of past costs have been recovered. As part of the overall transaction, Conrad previously acquired the 15% PI from Coro Energy and the 8.5% PI from Empyrean Energy. Upon completion of final steps under the Empyrean Settlement Agreement — including issuance of an 8.5% Equity interest in WNEL Holdings — Conrad will hold a 22.875% operated PI in Duyung via WNEL.

Mako Development and Market Context

The Mako Gas Development Project is fully funded for a US$320 million development, with the funding package containing substantial contingencies. FID was taken earlier in 2026 and development activities are well underway. First gas is expected in Q4 2027, delivering gas for power generation to Batam — described as becoming a major data centre hub in the region. Executive Chairman Peter Botten noted that Conrad can also now evaluate additional potential within the Duyung PSC, particularly in large structures identified on a 3D seismic survey acquired by Conrad in the immediate area adjoining the Mako gas field.

About the Company

Conrad Asia Energy Limited is a Singapore-headquartered Asia-focused Natural Gas exploration and development company. The Mako Gas Development Project within the Duyung PSC is Conrad's primary asset, with the company retaining operatorship and a 22.875% economic interest following completion of the NNB transaction. A reserves and resources restatement will be issued upon completion of all remaining transaction steps.

Risks

The US$7 million third cash tranche is contingent on commencement of commercial production from Mako. Any delay to first gas in Q4 2027 would also delay this payment.

Conrad retains a 22.875% operated interest in a US$320 million development. While the project is fully funded, as operator Conrad carries governance and technical execution responsibilities.

The Empyrean Settlement Agreement final steps — including WNEL Holdings equity issuance — have not yet been completed, and the reserves/resources restatement is pending.

Batam data centre growth as the primary gas market is an emerging Demand source. The pace of data centre build-out and power demand increase affects Mako's commercial strength.

Indonesia's PSC regulatory and fiscal framework involves ongoing interaction with MEMR and other authorities.

What to Watch Ahead

Completion of the Empyrean Settlement Agreement final steps and the subsequent reserves/resources restatement.

Receipt of the US$7 million third cash tranche upon commencement of commercial production from Mako.

Development progress updates on Mako — FID has been taken and the project is fully funded, so operational execution toward Q4 2027 first gas is the key focus.

First gas announcement from the Mako Gas Development Project in Q4 2027, triggering production revenues and the cost recovery mechanism.

Any exploration evaluation announcement for structures adjacent to Mako within the Duyung PSC, where 3D seismic has identified several large structures.