Tamboran Resources Corp

Tamboran Resources Corporation is an early stage, growth-driven independent natural gas exploration and production company focused on the commercial development of natural gas resources in the Beetaloo Basin, located within the Northern Territory of Australia. The Beetaloo Basin is an area of approximately seven million acres (10,800 square miles) and is believed to contain significant quantities of unconventional natural gas resources. The company holds approximately 2.8 million net prospective acres and is the largest acreage holder in the Beetaloo Basin. The Australian Federal Government's current policy targets net zero carbon emissions economy-wide by 2050, and the Safeguard Mechanism requires shale gas facilities to have a zero baseline, meaning they must have Net Zero Scope 1 emissions by law. The company has set a target to exceed these requirements by reaching net zero equity Scope 1 and 2 GHG emissions upon commencement of commercial production.

The oil and natural gas industry is intensely competitive, and Tamboran competes globally with companies that have greater resources, including companies that carry on midstream and refining operations and market petroleum products on a regional, national, or worldwide basis. The company believes its application of U.S. drilling and completion technology provides a competitive advantage to achieve natural gas production in compliance with Australian GHG regulations. Tamboran has brought in strategic partnerships with Helmerich & Payne, Liberty Energy, and Baker Hughes to accelerate incorporation of lessons from the U.S. shale industry. The company's operations team has been involved in the Beetaloo Basin for over a decade, operating nine horizontal wells across the basin, the most by any operator. Tamboran has contracted Helmerich & Payne for one H&P FlexRig with a 10-year option to contract for up to four additional rigs, and has a two-year preferred arrangement with Liberty Energy for dedicated frac fleets and personnel.

Tamboran's business model is an integrated approach to the commercial development of natural gas resources in the Beetaloo Basin, with a three-phase business plan addressing structural supply shortages in three markets. The first phase focuses on transitioning from exploration to commercialization by delivering the Shenandoah South Pilot Project, supplying initial gas sales into the local Northern Territory gas market. The second phase involves constructing a new high capacity pipeline to access the Australian East Coast domestic gas market and ullage in existing East Coast LNG export facilities in Gladstone. The third phase aims to supply natural gas for export through existing LNG plants in the Middle Arm Precinct near Darwin and the company's proposed Northern Territory LNG export facility to South and East Asian markets. The company plans to market natural gas under long-term agreements, with revenue expected to be generated from gas sales agreements, including a binding take or pay Gas Sales Agreement with the NT Government for 40 TJ/d (approximately 41 MMcf/d) gross.

The Shenandoah South Pilot Project is the company's first phase of development, with five wells drilled and completed, and mechanical completion of the Sturt Plateau Compression Facility achieved in July 2026. The project aims to supply 40 TJ/d (approximately 41 MMcf/d) gross to the Northern Territory Government under a Gas Sales Agreement signed on April 23, 2024, with an initial term expiring at the end of 2034 and an option to extend for a further 6.5 years through to mid-2041. During fiscal year 2026, the company drilled SS2-1H, -3H and -5H with ~10,000-foot horizontal sections, completed record Beetaloo Basin IP30, IP60 and IP90 flow rate tests on SS2-2H ST1, and achieved record IP20 flow rates from the SS2-1H well. The company plans to drill and tie-in three additional Shenandoah South wells (SS1-2H, SS1-4H and SS1-6H) during fiscal year 2027, with gas sales expected to ramp to the full 40 TJ/d plateau rates.

The second development phase involves APA Group evaluating the opportunity to construct an approximately 1,000-mile pipeline connecting the Beetaloo to the East Coast gas grid network. Australia's East Coast gas market currently has ~5 Bcf/d of demand, including ~1.3 Bcf/d domestic and ~3.6 Bcf/d LNG export capacity, with a gas shortfall forecast in the late-2020s. Tamboran has secured non-binding letters of intent from six of Australia's largest energy retailers for the purchase of natural gas with an aggregate volume of 875 MMcf/d for a period of up to 10 to 15 years. The third phase includes the proposed NTLNG project, with pre-FEED completed in mid-2025 with Bechtel, assessing a potential first phase of two 6 million tons of LNG per annum trains, each consuming approximately 1 Bcf/d of gas. The company has secured non-binding MOUs with bp and Shell for 20-year LNG purchase contracts, and the NT Government has awarded exclusive use of an approximately 420-acre site for a term extending to December 31, 2027 with two one-year extension options.

During fiscal year 2026, Tamboran completed several significant operational developments. The company took final investment decision on the Shenandoah South Pilot Project, executed a binding take or pay Gas Sales Agreement with the NT Government, and received Native Title Holder consent and Northern Territory Government approval to sell gas under the Beneficial Use of Gas legislation. On May 28, 2026, Tamboran acquired approximately 98.1% of the issued and outstanding equity interests of Falcon Australia, and on July 23, 2026, completed the acquisition of FOGA minority stock in exchange for 60,259 shares of Tamboran common stock. APA Group completed construction of the 12-inch diameter Sturt Plateau Pipeline, a 23-mile pipeline, achieving practical completion in July 2026 and commencing receiving sales gas in September 2026. The company also entered into a Deed of Addendum to the Asset Sale Agreement on March 20, 2026, and executed the Stage 1 and Stage 2 Checkerboard Sale and Purchase Deeds on March 23 and March 25, 2026, respectively.

Tamboran is an early stage development company with no material revenue during the reporting period, with first gas sales commencing in September 2026. The company has a limited operating history and has incurred recurring operational losses, negative cash flows, and substantial cumulative net losses, raising substantial doubt about its ability to continue as a going concern. The company does not expect positive cash flow until at least 2028 and does not expect to pay dividends in the foreseeable future. As of June 30, 2026, the company employed 45 people full-time and two part-time people. The company's functional currency is the Australian dollar, with the average exchange rate for fiscal year 2026 being A$1.00 to $0.68, compared to A$1.00 to $0.65 in fiscal year 2025.

Tamboran's business plan requires substantial additional capital, and the company does not currently have any commitments for future external funding. The company estimates gross expenses of approximately $25 million to drill and complete each of the three wells it is currently drilling. The company does not expect to generate positive cash flow until at least 2028. The company plans to progress development activities in the Shenandoah South Pilot Project during fiscal year 2027, including drilling and tie-in of three additional wells (SS1-2H, SS1-4H and SS1-6H), completing construction activities, commissioning and practical completion of the SPCF, with gas sales expected to ramp to the full 40 TJ/d (approximately 41 MMcf/d) gross plateau rates in accordance with the Northern Territory Government's nominations.

The first major growth vector is the expansion of the Shenandoah South Pilot Project, with the Beetaloo Joint Venture evaluating options for a potential expansion of the SPCF to up to 100 TJ/d, with an investment decision planned for mid-2027. The second growth vector is the development of the BEC Pipeline Project, with APA Group evaluating the opportunity to construct an approximately 1,000-mile pipeline connecting the Beetaloo to the East Coast gas grid network, with early works expenditure of up to A$5 million under the BEC EDA. The third growth vector is the proposed NTLNG export facility, with pre-FEED completed in mid-2025 with Bechtel, assessing a potential first phase of two 6 million tons of LNG per annum trains, each consuming approximately 1 Bcf/d of gas, with the NT Government awarding exclusive use of an approximately 420-acre site for a term extending to December 31, 2027 with two one-year extension options.

Tamboran has secured non-binding letters of intent from six of Australia's largest energy retailers for the purchase of natural gas with an aggregate volume of 875 MMcf/d for a period of up to 10 to 15 years, addressing the forecast gas shortfall on the East Coast in the late-2020s. The company has also secured non-binding MOUs with bp and Shell for 20-year LNG purchase contracts for the export phase. The company is evaluating strategic partnerships for the financing and development of infrastructure projects, including the potential expansion of the SPCF and the BEC Pipeline Project. The company plans to deliver the proposed development plan with a continuous focus on reducing costs while increasing production efficiencies, including importing U.S. unconventional drilling and completion techniques, best-practices and technology, which is expected to reduce the incremental cost to drill and complete future wells.

The company's margin and cost outlook is focused on reducing costs while increasing production efficiencies. The strategy includes importing U.S. unconventional drilling and completion techniques, best-practices and technology, together with the right personnel, which is expected to reduce the incremental cost to drill and complete future wells. The company has contracted Helmerich & Payne for one H&P FlexRig with a 10-year option to contract for up to four additional rigs, with an operating rate of $39,500 per day and a mobilization fee of $15,000 per day plus all associated costs for shipping from Houston, Texas. The total import cost for rig 469 was $7.5 million. The company has also entered into a two-year preferred arrangement with Liberty Energy to provide dedicated frac fleets and personnel on market terms, with an MOU signed in September 2026 to extend the hydraulic fracture stimulation and wireline services agreement.

The company's operational outlook includes the drilling and tie-in of three additional Shenandoah South wells (SS1-2H, SS1-4H and SS1-6H) during fiscal year 2027, completing construction activities, commissioning and practical completion of the SPCF. The Beetaloo Joint Venture continues to evaluate options for a potential expansion of the SPCF to up to 100 TJ/d, with an investment decision planned for mid-2027. APA Group has commenced Early Works defined in the BEC EDA, including efforts to obtain access and approvals, along with developing revised project schedules and estimates. The company has committed approximately $6.0 million through March 2027 based on minimum work requirements for EP 161, and has approved a CY2026 budget including a two well program and hydraulic fracturing long lead items for a commitment of approximately A$26 million.

The company's capital allocation plans include substantial additional capital required for its business plan, with no commitments for future external funding. The company estimates gross expenses of approximately $25 million to drill and complete each of the three wells it is currently drilling. The company does not expect to pay dividends in the foreseeable future. The company has contracted Helmerich & Payne for one H&P FlexRig with a 10-year option to contract for up to four additional rigs, with an operating rate of $39,500 per day. The company has also entered into a two-year preferred arrangement with Liberty Energy for dedicated frac fleets and personnel, with an MOU signed in September 2026 to extend the agreement and contemplate priority access to a broader set of Liberty Energy capabilities as they are introduced to Australia.

The company faces significant headwinds and constraints, including the substantial doubt raised by recurring operational losses, negative cash flows, and cumulative net losses about its ability to continue as a going concern. The company's ability to deliver natural gas to target markets depends on the construction of additional pipeline capacity, which may not be secured. The company has no proved reserves at this time and areas that it decides to drill may not yield natural gas in commercial quantities or quality. The company faces challenges importing U.S. practices and technology to the Northern Territory, including limited local experience and the ability to attract and train a qualified workforce. The company's business plan contemplates developing a new LNG export terminal on the northern coast of Australia, which is dependent on securing a third-party partner and the necessary permits.

The company is subject to complex laws and regulations that could increase operating costs or expose it to significant liabilities, including the Safeguard Mechanism which requires Net Zero Scope 1 emissions by law, with an A$82.68 carbon offset price cap for fiscal year 2026 that increases by CPI plus 2% each year. The company faces risks related to native title and heritage issues, community opposition, and environmental regulations. The company's ability to achieve Net Zero Scope 1 emissions will depend on its ability to economically manage carbon emissions, which could be impacted by availability of future revenues, market pricing of carbon offsets, and technological developments. The company also faces risks related to the volatility of natural gas prices, which could adversely affect its financial condition and operations.

Tamboran faces material risks including the substantial doubt about its ability to continue as a going concern due to recurring operational losses, negative cash flows, and cumulative net losses, with no material revenue expected until after initial gas sales which commenced in September 2026 ¹. The company's business plan requires substantial additional capital, with estimated gross expenses of approximately $25 million to drill and complete each of the three wells currently being drilled ², and no commitments for future external funding. The company has no proved reserves at this time, and areas that it decides to drill may not yield natural gas in commercial quantities or quality, with only five wells currently tied into the SPCF ³. The company's ability to deliver natural gas to target markets depends on the construction of additional pipeline capacity, which may not be secured, and the company cannot assure that it will reach a mutually satisfactory agreement with APA Group for the BEC Pipeline Project. The company faces challenges importing U.S. practices and technology to the Northern Territory, including limited local experience and the ability to attract and train a qualified workforce, with the company employing 45 people full-time and two part-time people as of June 30, 2026 ⁴. The company is subject to the Safeguard Mechanism which requires Net Zero Scope 1 emissions by law, with an A$82.68 carbon offset price cap for fiscal year 2026 that increases by CPI plus 2% each year ⁵, which could increase production costs and may be difficult to meet.

Management's message emphasizes the company's transition from an exploration company to a producer, with first gas sales achieved in September 2026. The key strategic priorities for the period ahead include progressing the Shenandoah South Pilot Project to full 40 TJ/d (approximately 41 MMcf/d) gross plateau rates, evaluating the potential expansion of the SPCF to up to 100 TJ/d with an investment decision planned for mid-2027, and progressing the BEC Pipeline Project with APA Group. Management highlights the company's basin-scale acreage position as the largest Beetaloo Basin acreage holder with 2.8 million net prospective acres, the proven team with operational and commercialization experience, and the strategic partnerships with Helmerich & Payne, Liberty Energy, and Baker Hughes to accelerate incorporation of lessons from the U.S. shale industry. The company plans to deliver the proposed development plan with a continuous focus on reducing costs while increasing production efficiencies, and does not expect positive cash flow until at least 2028.