ADX Energy (ASX: ADX): Busy 1H26
• 3Q25 WI sales averaged 251 boe/d, in line with expectations. The company held ~A$4 mm in cash at the end of September, also in line with forecasts.• A busy operational period is anticipated in 1H26. Flow testing at Welchau is scheduled to recommence in January, starting with fluid sampling and pressure measurements in the already perforated Reifling formation—the shallowest reservoir. The well is expected to be acid-stimulated to mitigate formation damage and enhance productivity, with estimated costs of ~EUR0.5 mm. Our unrisked NAV for the Reifling formation is ~A$0.34 per share.
• ADX’s shallow gas drilling programme in Austria is expected to begin in February. Land has been secured for three prospects, with drilling and environmental permits anticipated by YE25. The HOCH-1 and GOLD-1 wells are planned first, followed by the optional SCHOE-1 well, contingent on HOCH-1 success. ADX holds a 50% WI in HOCH-1 and SCHOE-1, and a 100% WI in GOLD-1. The company intends to farm out an interest in GOLD-1 prior to drilling.
• An appraisal oil well at Anshof is planned for 3Q26. ADX has secured the drill site for the SGB-1 well (100% WI), which could be tied into the Anshof permanent processing facility. The well targets proven Eocene sandstone reservoirs, with secondary potential in deeper Cretaceous formations already validated by nearby wells. Our unrisked NAV for SGB-1 is ~A$0.01 per share.
• We re-iterate our target price of A$0.30 per share.
Valuation
Our total unrisked valuation for the company based on its 2P reserves and the shallow gas play is ~A$0.10 per share assuming that ADX keeps 50% WI of the shallow gas play. Our ReNAV of A$0.28 per share for the company reflects: (1) producing assets, (2) shallow gas targets (near-term focus), (3) Welchau-1, and (4) the Italian permit, based on anticipated farm-out terms.
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
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