As a result of drilling Alameda-1, net pay areas totalling approximately 300 mMD were defined across gross reservoir intervals totalling circa 2,155mMD. In August 2022, on the back of the Alameda discovery, the Company’s Independent Experts, McDaniel and Associates, released updated estimates for Oil in Place and Prospective Resources for the three reservoirs intersected by the Alameda-1 well. The Alameda-1 exploration well (2022) discovered three geologically separate and vertically stacked oilbearing formations accompanied by high formation pressure that each flowed oil to surface. This resulted in independently certified oil in place and prospective resources, of over 5 billion barrels of oil in place and a gross unrisked best estimate prospective resource of 267 million barrels as per table below. In Australia we often talk about the energy trilemma: Sustainability (low carbon), Affordability and Security of supply. We also routinely focus on Sustainability and there is a huge push away from fossil fuels to alternative sources of energy. Unfortunately for less affluent nations, the de-emphasis of affordability and security of supply comes at a huge cost to society. It has been said that these two key limbs of the energy trilemma are essentially the lowest rungs on Maslow’s hierarchy of needs. Without these, societies will labour to rise up the ladder: with self-actualisation a somewhat distant goal. It has also been said that we all want to breathe clear clean air, just not in the pitch black of a power cut. Our technical people were drawn to Cuba as it was underexplored, underdeveloped and overlooked by the wider oil and gas industry. We had the thesis that there were untapped billions of barrels of oil in the onshore geological formations, with a significant proportion of that potential in the deeper unexplored rocks. Cuba - Block 9 (Melbana 30%) Melbana were awarded the Block 9 PSC (100%) in 2015 for 25 years on internationally attractive terms. This is a large onshore block (2,344km2), prolific hydrocarbon zone: close to a multibillion-barrel field, with welldeveloped oil field infrastructure, service providers and international airports. Melbana then set about integrating all the gravity, magnetic seismic, well production data we could find to build a complete model of the genesis of the structures that the Cuban industry had been producing from before we got there. Our team identified nineteen leads and two drillable prospects and set about a farmout campaign to try and attract co-investment. Melbana were successful in attracting Sonangol (National Oil Company of Angola – Africa’s largest oil producer) in 2021 to fund 85% of the cost of drilling two exploration wells for a 70% working interest (completed 2022) but crucially Melbana retained Operatorship. In 2021, Melbana spudded the Alameda-1 well to test 4 separate target zones. The well intersected oil starting at 454 metres and continued to intersect reservoirs through to total depth of 3,916 metres when drilling stopped due to a highly pressured influx of oil and gas into the well bore. The Company then elected to shut in the well and designed a 2 well appraisal program. Gross (100%) Unrisked Prospective Resources1 (MMbbl) Zone Low (1U) Best (2U) Mean High (3U) Amistad 30 88 119 240 Alameda 34 109 148 297 Marti 21 70 95 197 Total 85 267 362 734 Table 1 – Independently estimated Prospective Resources following completion of Alameda-1 1 This estimate should be read with reference to the footnote “Notes regarding Contingent and Prospective resource estimates” on page 34 9 Melbana Energy Limited Annual Report 2023
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