NuEnergy Gas Secures $88 Million Field Service Contract to Propel Tanjung Enim Coal Bed Methane Project

US$88 Million Fully Funded Contract Secures Development Financing for Tanjung Enim

The US$88 million field service contract with PT Beijing Energy Linking, executed on 30 June 2026, represents a pivotal advancement in NuEnergy Gas’ development strategy at Tanjung Enim. Covering the full scope of drilling, construction, testing, and completion of coal bed methane wells alongside dewatering activities for Phase 2, this fully funded contract removes traditional financing risks by establishing repayment through future gas sales revenue collected in cash. This structure ensures clear funding availability for the extensive development program.

The contract spans from 30 June 2026 to 3 August 2039, coinciding with the expiration of the Tanjung Enim Production Sharing Contract (PSC). PT Beijing Energy Linking will execute the contracted works in Area A of Tanjung Enim POD 1 to achieve targeted gas production and ramp-up to a sustainable plateau of 24 million standard cubic feet per day. The repayment mechanism, based on future revenue, reflects strong confidence in the project’s commercial viability. This contract is the first definitive implementation agreement following the Collaboration Agreement announced in January 2026, bringing NuEnergy closer to full-field development approval.

Two-Phase Production Strategy Aims for 25 Million Standard Cubic Feet Per Day Capacity

NuEnergy Gas’ development plan for Tanjung Enim involves a two-phase approach to optimize capital efficiency and manage risk. Phase one, the Early Gas Sales Initiative, targets 1 million standard cubic feet per day, while Phase two, covered by the field service contract, aims for 24 million standard cubic feet per day, totaling 25 million standard cubic feet per day under the approved Plan of Development 1. This phased rollout allows early commercial production and revenue generation while scaling operations to full capacity.

This strategy aligns with industry best practices for coal bed methane projects by prioritizing early production to establish economics and operational capabilities. NuEnergy holds a 45% participating interest in the Tanjung Enim PSC in South Sumatra, with Dart Energy (Tanjung Enim) Pte Ltd, a NuEnergy subsidiary, acting as operator. This provides NuEnergy with direct control over development and execution, facilitating rapid progress aligned with capital and commercial goals.

Progress on Early Gas Sales Initiative Targeting Q1 2027 First Production

The Early Gas Sales Initiative aims to deliver first commercial gas production of 1 million standard cubic feet per day by Q1 2027, contingent on infrastructure completion and regulatory approvals. While weather and permitting delays related to PT Perusahaan Gas Negara Tbk’s compressed natural gas Mother Station impacted schedules, civil works and site preparations began in July 2026, signaling progress toward infrastructure authorization.

Construction of Early Production Facilities is set to start in August 2026, a critical milestone providing processing infrastructure for gas treatment and delivery under the EGSI. Well optimization and commissioning efforts continue across four EGSI production wells, including successful well interventions at TE-B06-003 and TE-B01-003 during the quarter. Ongoing gas flaring and optimization programs aim to assess reservoir performance and enhance production stability ahead of initial gas sales.

Dynamic Subsurface Simulation Study Reveals Capital-Efficient Development Approach

NuEnergy completed an updated dynamic subsurface simulation study for Tanjung Enim POD 1 this quarter, identifying a more capital-efficient field development concept. The refined plan achieves production targets with a reduced surface footprint, lower land access requirements, improved well placement, and enhanced reservoir optimization. This advancement improves project economics and reduces development intensity compared to earlier concepts.

These findings support NuEnergy’s goal to maximize project value while minimizing capital expenditure. The company will advance development planning, including stakeholder coordination on land access for Phase 2. The surface facility contract, covering in-field pipelines for POD 1, will be finalized after completing the Front-End Engineering Design study based on this optimized development concept, enhancing commercial terms and operational efficiency.

NuEnergy’s 45% Interest and Operator Role in South Sumatra’s Tanjung Enim PSC

NuEnergy Gas holds a 45% participating interest in the Tanjung Enim PSC in South Sumatra, with operational control through its subsidiary Dart Energy (Tanjung Enim) Pte Ltd. This structure grants NuEnergy significant influence over development strategy, operations, and capital deployment. The PSC represents the company’s flagship asset, progressing from exploration and appraisal to full commercial development.

As operator, NuEnergy oversees subsurface simulation studies, well optimization, and infrastructure development critical to meeting production milestones. The PSC area contains a substantial coal bed methane resource, with NuEnergy’s stake providing exposure to revenue potential as early gas sales commence. PT Beijing Energy Linking’s funding commitment for Phase 2 development under the field service contract underscores third-party confidence in the project’s resource base and economics, validating NuEnergy’s valuation and strategy.

Well Optimization Programs Enhance Production Readiness and Commissioning

NuEnergy’s operational readiness program targets optimization of four wells designated for Early Gas Sales Initiative production. During the quarter, well intervention programs at TE-B06-003 and TE-B01-003 improved well performance as part of production readiness. Gas flaring and optimization continue across all four wells to evaluate reservoir behavior and improve production stability ahead of initial gas sales.

Dewatering activities support understanding of formation water and production logistics. Flaring at wells TE-B06-001, TE-B06-002, TE-B06-003, and TE-B01-003 provided essential data for finalizing production system design and operations. These efforts underpin commissioning and infrastructure configuration for Early Production Facilities construction starting August 2026, directly informing design and operational procedures.

Muralim PSC Extension Application Pending Regulatory Approval

Besides Tanjung Enim, NuEnergy holds 100% interest in the Muralim PSC, also in South Sumatra, operated via Dart Energy (Muralim) Pte Ltd. The company has applied for a 12-month extension to finalize a plan of development for Muralim PSC and is awaiting approval from Indonesia’s Ministry of Energy and Mineral Resources. This extension demonstrates NuEnergy’s commitment to advancing exploration and development planning for this secondary asset while prioritizing Tanjung Enim’s commercial production.

The extension request aligns with standard industry practices for managing multiple PSC timelines in Indonesia. Approval will provide additional time for geological and engineering studies essential for future development authorizations. NuEnergy’s full ownership of Muralim allows strategic control over timing and capital allocation, complementing cash flow generated from Tanjung Enim.

Collaboration Agreement Framework Enables Full-Field Development Strategy

The Collaboration Agreement announced in January 2026 laid the foundation for the US$88 million field service contract with PT Beijing Energy Linking. This framework facilitates development financing and operational execution by combining external funding and resources with NuEnergy’s retained economic interest and asset control. The field service contract is the first binding implementation agreement under this collaboration, confirming the commercial model’s success.

The surface facilities contract, including in-field pipelines for Tanjung Enim POD 1, will be finalized after the Front-End Engineering Design study, marking the next major milestone. This phased contract execution allows for detailed engineering and cost optimization before major capital commitments. The successful field service contract execution reflects market confidence in the project’s viability and NuEnergy’s development approach, positioning the company to advance infrastructure and achieve first gas sales within the targeted timeframe.

Infrastructure Development and Permitting Progress Supports Q1 2027 Gas Sales Target

NuEnergy’s pathway to first gas sales depends on completing interconnected infrastructure and regulatory requirements. Civil works and site preparation for PT Perusahaan Gas Negara Tbk’s compressed natural gas Mother Station began in July 2026, addressing critical permitting delays. Despite weather and permitting challenges, the company is collaborating closely with PGN and regulators to finalize infrastructure and approvals. Early Production Facilities construction starting in August 2026 will provide essential gas processing capabilities for the EGSI.

NuEnergy’s balanced approach manages technical, regulatory, and operational challenges inherent in Indonesian coal bed methane development. The targeted Q1 2027 first gas sales milestone remains achievable given recent infrastructure progress and scheduled Early Production Facilities construction. Completing these initiatives will enable initial gas production and revenue generation ahead of full-field Phase 2 development under the field service contract.