Civil construction was completed for the contingent Amistad-3 well. However, following the result of Amistad-2, it was decided to drill Amistad-11 instead of Amistad-3. Amistad-11 is a planned twin well to Alameda-2, which had originally produced at a stabilised 1,2351 BOPD prior to being damaged whilst shut-in post the original completion. The Amistad-11 well plan is to drill up-dip of Alameda-2, kicking off at a shallower depth to achieve the desired separation at optimum reservoir depth then to drill on to a total depth of 1,000 m.MD in the lower section of Unit 1B (See Figure 3). The well is planned to have an open hole completion, but with the capability of running a slotted production liner, if required. The reservoir drilling fluid Melbana has developed in response to its experience managing this formation previously will once again be used, given the good drilling rate of penetration and high productivity completion observed at Amistad-2. Drainage interference from the selected well position and trajectory is also estimated to be minimal, given the small volume produced to date relative to likely total recoverable volume estimated from prior testing and location outside the communication area of Alameda-2. Partner approval and all permits to drill Amistad-11 were acquired and the rig mobilised to location completed on 22 November 2025. The Amistad-11 well spud was awaiting receipt of outstanding payment amounts due from Sonangol. Sonangol advised they would not be able to remit further monies in the 2025 calendar year and requested the drilling of Amistad-11 be deferred till 2026. As such, the Company issued instructions to demobilise the contractor personnel and equipment and issued a Notice of Default to Sonangol, pursuant to the Joint Operating Agreement that governs the parties’ relationship in Block 9 for nonpayment of cash calls. Failure to cure the default in the sixty days provided may result in the defaulting party being required to assign its interest in Block 9 to the non-defaulting party. Sonangol did not cure the default within the sixty-day period and, accordingly, its entire participating interest in Block 9 was deemed to be transferred to Melbana. During the period, Melbana acquired 18 km of low-cost 2D seismic data using a highly mobile hydraulic weight-drop system and associated geophone receivers. The Company conducted the acquisition of these data, primarily along existing roads to tie existing and proposed well locations and aid in the identification of potential shallow drilling hazards. Preliminary processing indicates good data quality and the potential for the acquired data to supplement, and potentially replace, the vintage seismic data which has been utilised to date for shallow well targeting (See Figure 4). Given the success of the low-cost 2D survey, plans are being advanced to conduct a small-scale 3D seismic survey along the Alameda-2 anticline trend to tie the existing wells and support future shallow well development planning. During the period, a total of 13,824 barrels of crude was produced from Alameda-2 and delivered to storage, bringing the closing inventory to 36,687 barrels. Alameda-2 was shut-in on 2 November, with the aim of drilling a twin (Amistad-11) immediately adjacent to avoid the formation damage issues, which had demonstrably impacted Alameda-2 production performance. In 2024, McDaniel assessed a gross (100%) 2C Contingent Resource of 46 MMbbl with a Sub-Categorisation of Development Pending (80% Chance of Development) for Amistad Unit 1B in the Eastern part of the structure. McDaniel also assessed a gross (P50) best estimate Prospective Resource of 90MMbbl (with a Chance of Discovery of 70% if an appraisal well is drilled) for Amistad Unit 1B in the western part of the structure. McDaniel also assessed a gross (100%) P50 –Best Estimate-prospective Resource of 32 MMbbl for Amistad Unit 1A (with a Chance of Discovery of 70%) that could be similarly derisked by drilling an additional appraisal well and testing on pump in that area. The Company has retained the resource estimates for the Amistad structure as independently assessed by McDaniel in 2024. While regulatory uncertainty remains, management considers this to be a temporary factor affecting project timing rather than the resource base itself. Management continues to consider the underlying geological model sound. Trial seismic data and the resulting structural reinterpretation have highlighted the need for additional seismic coverage of comparable quality to reassess the Amistad structure. Based on the currently available information, management considers the existing estimates to remain the Company’s best estimates of recoverable volumes, subject to revision following that reassessment. Australian Operations WA-488-P (Melbana contingent cash and royalty interest) The Company sold its 100% interest in permit area WA-488-P to the Australian subsidiary of a US oil major in November 20212. The purchaser became the Operator and made a country entry to drill the giant Beehive Prospect located within the WA-488-P exploration permit (See Figure 5). Directors’ Report continued 1 See ASX announcement dated 28 August 2023. 2 See ASX announcement dated 23 April 2021. 14 Melbana Energy Limited Annual Report 2026
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