Why Is Metgasco (ASX:MEL) Stock Down 11% Today?

Sonal Goyal

22 October 2026 05:52 PM AEDT

Why Is Metgasco (ASX:MEL) Stock Down 11% Today?

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Key Highlights

Metgasco shares were down 11.11% at $0.016 during the Trading session on 22 October 2026
FY26 loss narrowed to $1,281,149 from $3,267,814, while Revenue fell to $1,354,057
Production from the Southern Flank gas fields was 0.12 PJe, down 38% on FY25

Shares in Metgasco Ltd (ASX:MEL) were down 11.11% at $0.016 during the trading session on 22 October 2026, at the time of the data. The S&P/ASX 200 stood at 8,792.20, down 0.44%, while the All Ordinaries stood at 8,916.20, down 0.45%. Metgasco is an oil and gas company with interests in the Cooper Eromanga Basin, and its financial report for the year ended 30 June 2026, dated 30 September 2026, showed a loss of $1,281,149 and reduced gas production.

About the Company

Metgasco Ltd is an Australian company incorporated on 22 June 1999 and listed on the Australian Securities Exchange on 23 December 2004 under the code MEL. Its registered office and principal place of Business is Level 4, 88 William Street, Perth, Western Australia. Ken Aitken is Managing Director and Michael Glennon is Non-Executive Chairman.

Business Overview

The group's principal activities are oil and gas exploration, appraisal, development, production and commercialisation in the Cooper Eromanga Basin, and it is also seeking additional Investment opportunities. It holds a 25% interest in the Odin and Vali gas fields, known as the Southern Flank gas fields, alongside Vintage Energy Ltd, which holds 50% and operates, and Bridgeport (Cooper Basin) Pty Ltd, which holds 25%.

Vali supplies AGL Energy under an agreement extending to December 2026, while Odin supplies Pelican Point Power under a contract to December 2026. The company also funds rehabilitation of the Cervantes-1 site in the Perth Basin, expected to be complete in 2028.

FY26 Production and Financial Results

In its financial report dated 30 September 2026, Metgasco reported appraisal production from the Southern Flank gas fields of 0.12 PJe, down 38% from 0.195 PJe in FY25. Odin accounted for 81% of output.

Revenue was $1,354,057 against $2,158,081 a year earlier. The loss after tax was $1,281,149 compared with $3,267,814, and the result included finance costs of $2,990,209, an Impairment of oil and gas properties of $1,561,853 and a $4,262,866 gain on modification of a convertible loan. Cash was $1,616,525, including $1,250,000 of restricted cash.

Field Operations and Grants

The company reported that its production uplift program removed scale at Odin, though gas rate improvements were modest, and that uplift work on the Vali wells was unsuccessful. Further dewatering of Vali-2 and Vali-3 could not begin because rain left roads waterlogged.

Two $2.5 million South Australian Government grants, totalling $5 million, were received on 24 June to part-fund drilling of the Odin-3 and Vali-4 appraisal wells. Metgasco's $1.25 million share is held as restricted cash, and drilling timing is subject to joint venture approvals and rig availability.

Disposal Agreement and Funding

Metgasco agreed in December 2025 to dispose of its 25% interests in Odin and Vali to Vintage for $5.9 million, and shareholders approved the transaction on 14 January 2026. Vintage terminated the agreement on 1 April 2026 because its pre-conditions had not been met by 31 March 2026. The company said it remains in active discussions on farm-in or Acquisition opportunities.

The group reported a net Liability position of $3,854,016 and a Working Capital Deficit of $2,551,110. Glennon Small Companies, owed $7 million, confirmed it would not call on some or all of the Debt while the company maintains sufficient working capital, and repayment dates were extended to 30 December 2026.

Related Sector Context

Onshore gas producers in the Cooper Basin Supply the eastern Australian domestic market and typically work in joint ventures, where decisions on capital spending depend on all partners. Production can be affected by well conditions, infrastructure and weather, and small listed producers often have limited trading liquidity.

During the 22 October 2026 session, the S&P/ASX 200 was down 0.44% and the All Ordinaries down 0.45%, while Metgasco shares were down 11.11% at the time of the data.

Risks to Weigh In

The auditor's report included a material uncertainty related to going concern, and the company stated that if its funding measures are not achieved there may be significant doubt about its ability to continue. It may need to raise additional capital, with no assurance of terms or timing.

Other uncertainties disclosed include declining production, changes to regulation and restoration obligations, and alignment with joint venture partners.

Catalysts on Watch

Items the company referenced include possible Vali well workovers in FY27, drilling of Odin-3 and Vali-4 subject to approvals and rig availability, the end of the Odin and Vali gas supply contracts in December 2026 and the Loan repayment dates of 30 December 2026. Discussions on new Assets continue.

Putting It Together

Metgasco shares were down 11.11% at $0.016 during the 22 October 2026 session, against declines of less than half a percent in the main ASX benchmarks. The report dated 30 September 2026 showed a narrower loss of $1,281,149, lower revenue and production, and a funding position that carries a Going Concern uncertainty.

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