88 Energy Limited ("88 Energy" or "Company") advises that a copy of the Company's Annual Report for the year ended 31 December 2025 (the "Annual Report") has been lodged on the ASX along with the Company's 2025 year-end Corporate Governance Statement and Appendix 4G.
The Annual Report, which was sent to shareholders today, is available on the Company's website at www.88energy.com along with copies of each of these other documents.
Set out below is the Chairman's Statement as included in the Annual Report.
Also, set out below is a summary of the Company's audited financial information for the year ended 31 December 2025 as extracted from the Annual Report, being:
锟� Consolidated Statement of Comprehensive Income;
锟� Consolidated Statement of Financial Position;
锟� Consolidated Statement of Changes in Equity; and
锟� Consolidated Statement of Cash Flows.
CHAIRMAN'S STATEMENT
Dear Shareholders,
It is my pleasure to present 88 Energy's Annual Report for the year ended 31 December 2025. The year reflected a continued sharpening of our strategic focus and the disciplined expansion and advancement of a portfolio centred on Alaskan exploration and appraisal opportunities proximate to proven producers.
Without a doubt, the Alaskan North Slope is experiencing renewed oil and gas exploration and development momentum, supported by favourable policy settings, recent exploration success, and expanding infrastructure investment. Federal and State agencies continue to streamline permitting processes and actively encourage new domestic energy investment. During the year, notable exploration success was reported by APA Corporation, Armstrong Oil and Gas, and Santos Limited. Infrastructure development also progressed, with Santos' Pikka Phase 1 project nearing completion and first oil expected in 2026, while proposed gas pipeline and LNG initiatives further serve to highlight the long-term strategic relevance of the basin. In addition, the Fall 2025 North Slope Bid Round saw 271 leases awarded to nine companies, including 88 Energy, representing approximately 466,764 acres and total investment of around US$17 million.
Collectively, these developments underscore the growing strategic importance of the Alaskan North Slope and reinforce the commercial potential of our assets. The oil and gas sector remains integral to a well-functioning global economy amid volatile markets and evolving energy security priorities. Against this backdrop, the Board has remained focused on disciplined capital allocation, advancing a data-led approach to the progression of select assets with credible and clearly defined pathways towards future production.
During the year, 88 Energy meaningfully enhanced and evolved its Alaskan portfolio. At Project Leonis, recently renamed South Prudhoe, the Company reported a maiden internal Prospective Resource estimate for the Canning Prospect which was also recently updated in February 2026 with prospective resource estimates covering the Ivashak, Kuparuk and also revised Canning and USB reservoirs (Schrarder Schrader Bluff). This work confirmed significant prospectivity across the expanded South Prudhoe acreage with multiple drill ready prospects identified.
The expanded South Prudhoe acreage position includes fourteen new leases covering approximately 34,560 acres that were secured across two focus areas or, as we see it, strategic development hubs. These acquisitions reflect our infrastructure-led and data-driven strategy in action, with the new tenure supported by modern seismic interpretation and located in close proximity near to established North Slope infrastructure. The expanded acreage provides deliberate us with exposure to lower-risk, near-infrastructure exploration and development opportunities, while maintaining a disciplined approach to capital deployment.
At Project Phoenix, 88 Energy achieved a significant milestone with the execution of binding terms for a farm-out participation arrangement with Burgundy Xploration LLC (Burgundy). Under the agreed structure, Burgundy intends is to fund up to US$39 million of the future gross work programme, providing a full carry through the planned horizontal well and extended production test. Burgundy progressed its funding strategy through the confidential submission of a draft Form S-1 registration statement with the United States Securities and Exchange Commission and in parallel, advanced operational readiness with the appointment of Fairweather LLC, the progression of Franklin Bluffs 3D seismic planning, and the strengthening of in-state capability. Together, these activities strongly position the joint venture to support the Franklin Bluffs drilling and production test programme currently scheduled for H1 CY2026.
Turning to Namibia, the Company secured a 12-month extension to the First Renewal Exploration Period at PEL 93 through to 2 October 2026. This was accompanied by approval of a refreshed Stage 1A work programme designed to support pre-drill de-risking. The programme includes a high-resolution airborne gravity, magnetic, and radiometric survey, preparation of a certified prospective resource report, and development of an Authority for Expenditure for a potential exploration well. Stage 1A is to be jointly funded on a 50:50 basis, subject to a US$1 million cost cap.
Decisive steps were taken to simplify the portfolio and reduce future cost exposure. In August 2025, 88 Energy executed a binding agreement to sell its 75% non-operated interest in the producing Project Longhorn assets in the Permian Basin for US$3.25 million. This removed exposure to a capital-intensive multi-well development programme, while allowing capital to be redeployed into the Company's core exploration focus. In December 2025, 88 Energy relinquished its historical Peregrine and Umiat leases as part of its ongoing portfolio optimisation strategy. This decision reduces future lease holdings and reflects a disciplined approach to capital allocation. Together with the sale of Project Longhorn, the relinquishment of the Peregrine and Umiat assets has contributed to a significant impairment charge in the current reporting period. However, these actions strategically position the Company to direct capital and technical resources toward assets with superior subsurface characteristics, greater proximity to infrastructure and stronger near-term value potential.
On 22 August 2025, Mr Philip Byrne retired as Non-Executive Chairman and from the Board, with my appointment as Non-Executive Chair effective the same day. I would like to again acknowledge Phil's contribution and thank him for his leadership and support during his tenure, particularly during a period of strategic transition.
On behalf of the Board, I thank our shareholders for your continued support. As we look to 2026, the Company is positioned around a clear focus, with a portfolio concentrated on sensible, high-impact opportunities, and an ongoing commitment to strategic and financial discipline.