Australis Oil & Gas (ATS) Investor Update summary

Company background and asset history

• Founded by former Aurora Oil & Gas team, leveraging experience from Eagle Ford development and sale for $1.8 billion in 2014.

• Sought high-quality, low-cost oil assets, leading to acquisition of Tuscaloosa Marine Shale (TMS) core acreage between 2016 and 2018.

• Drilled six TMS wells in 2018-2019, confirming productivity and subsurface models.

TMS play context and industry trends

• TMS shares geological similarities with Eagle Ford but is deeper and hotter, initially leading to mixed results and high costs.

• Encana delineated the TMS Core by 2014, showing improved and consistent well results.

• Oil price collapse in 2014 halted full-field development plans; industry shifted from growth to maintenance, focusing on established basins.

• Well productivity in established plays improved until 2021, then declined due to inventory depletion and lower quality drilling locations.

• TMS Core wells have demonstrated productivity comparable to major US basins, with further upside expected from modern technology application.

Strategic transactions and partnerships

• Two major transactions announced: a development partnership for undeveloped acreage and a sale of 90% wellbore-only interests in producing wells for $16.9 million, with closing scheduled for December 2025.

• The development partner will invest up to $46 million, carrying a 20% interest and enabling a new drilling and leasing program within an Area of Mutual Interest (AMI).

• ATS will retain a 20% interest in existing and future acreage, with the right to participate in additional leasing and expansion beyond the current 11,000 net acres.

• Proceeds from the wellbore sale will repay all Macquarie debt, strengthen the balance sheet, and fund operating and leasing costs during the carry period.

• EQV will assume operatorship of the PDP wells, with ATS retaining a 10% interest and rights to data and workover proposals.