Australis Oil and Gas (ASX: ATS) has executed two major transactions that advance development of its undeveloped onshore Tuscaloosa Marine Shale (TMS) area, while also bolstering the company’s balance sheet.
The company expects to eliminate roughly A$7.5 million (US$4.9m) of indebtedness at closing, and hold a pro-forma cash balance of around A$18.4m (US$12m) at 1 January 2026.
The transactions’ combination of retained economic interests, carried development funding, and strengthened liquidity positions Australis to pursue its longer-term development goals.
Development Partnering Agreement
Australis finalised a partnership with a US-listed independent oil and gas company to advance drilling and development across its undeveloped TMS position.
The partner will deploy up to approximately A$70.4m (US$46m) under a Carry Program, funding Australis for a 20% working interest to earn an 80% interest in undeveloped operated acreage and part of the company’s non-operated holding.
The Carry Program includes funding an Initial Lease Program and drilling an Initial Test Well by 30 October 2026, with an option for the partner to extend to 2027.
Once the test well is on production, the partner will have up to six months to elect to proceed with the broader program, which requires drilling at least one well every twelve months through to completion.
Australis will retain operatorship of the leasing and development program during the carry phase, although the partner may assume operatorship at any time.
Managing director Mr Ian Lusted said the agreement “validates the play and the opportunity it presents” and enables Australis to work closely with a partner with the “financial and technical capacity to move the play forwards.”
EQV Financing Transaction
Australis has also executed a sale agreement with an affiliate of EQV Group to sell 90% of its working interest in existing TMS producing wells for roughly A$25.9m (US$16.9).
The transaction will allow Australis to retire all outstanding debt and provide the company with additional liquidity while preserving its undeveloped acreage for the new partnering arrangement.
Under the agreement, EQV will assume operatorship of the producing wellbores following closing, with Australis retaining a 10% interest and participation rights under existing operating agreements.
Mr Lusted said the company’s shareholders now have “a clear and funded way forward” to advance the TMS, supported by aligned partners focused on value creation.
