ADX Energy raising up to $5.2m to support Austrian oil and gas production

• ADX launches two-for-five renounceable rights issue at 1.2c to raise up to $5.2m
• Funding priorities cover Vienna Basin production enhancement work, HOCH-1 gas discovery testing and GOLD-1 shallow gas drilling
• All directors intend to participate, with rights trading scheduled to start on November 4

Special Report: ADX Energy is raising up to $5.2 million before costs to lift Austrian oil and gas production and advance its shallow gas program.

The company will offer eligible shareholders two new shares for every five held at 1.2 cents each in a renounceable rights issue.

ADX Energy (ASX:ADX) executive chair Ian Tchacos said the funding would support an increase in oil and gas production from ADX’s existing fields as well as provide funding toward low-risk gas projects in Austria within an exceptional pricing environment.

“A successful well work, testing and drilling program has the potential to deliver multiples of production growth in a short time frame,” he said.

“The rights issue finance structure is intended to reward our shareholders for their continued support and position the company for its next stage of development with increased cash flow and a stronger balance sheet.”

Mahe Capital is lead manager and underwriter, partially underwriting the offer to $1m. All directors intend to participate.

Subscribers will also receive one free attaching option for every two new shares, exercisable at 2.5c until December 31, 2028. 

Three priorities for fresh capital

ADX plans to direct proceeds from the placement primarily towards:

• Vienna Basin production enhancement;
• Phase 2 production testing at the HOCH-1 gas discovery; and 
• Drilling, testing and completion of the GOLD-1 shallow gas well.

The Vienna Basin program builds on earlier work that helped lift ADX’s average net Austrian production 23% to 242 barrels of oil equivalent per day in the September quarter.

ADX expects two behind pipe reservoir perforation jobs and an equipment repair to add about 100 barrels of oil equivalent per day from its Vienna basin fields.

At HOCH-1, where ADX holds a 50% economic interest, four zones delivered a combined average test flow of 3.15 million cubic feet of gas per day over 12 hours (equivalent to 550 barrels per day).

Phase 2 will test the deeper Zone 6 reservoir. ADX expects the next results in mid-December, with further testing needed to establish commerciality and support a potential connection to production infrastructure.

GOLD-1 offers another opportunity very close to infrastructure, with the prospect about 300m from a pipeline tie-in point.

Empyrean Energy signed a binding heads of agreement to earn 10% of the GOLD Cluster Area by funding 20% of GOLD-1 drilling and testing costs. The transaction has now been finalised with the signing of an Energy Investment Agreement.

Supply security supports Austrian opportunity

Oil supplies transport fuels and industrial feedstocks while gas supports heating, power generation and industry. Disrupted supply has kept prices elevated even as consumers reduce consumption.

The International Energy Agency’s October outlook forecasts global oil demand falling 2.6 million barrels per day in 2026, against a larger 5.8 million-barrel daily supply decline. It expects the market to remain in deficit through year-end.

The US Energy Information Administration’s October forecast puts fourth-quarter Brent at US$105 a barrel, easing to US$74 in the final quarter of 2027 as production recovers and inventories rebuild. 

That outlook assumes most Middle Eastern production returns to pre-conflict levels by the end of June 2027.

European gas regulator ACER reports that disrupted liquefied natural gas flows, low storage and slower refilling pushed EU hub prices towards €90/MWh in mid-October. Current EU hub pricing is approximately €100/MWh – that is equivalent to US$97/barrel.

The European Commission nevertheless says expanded import capacity and diversified supplies leave the EU system flexible enough to meet winter demand, highlighting the role of temperatures and available LNG cargoes.

For ADX, the immediate milestones remain immediately increasing production, HOCH-1 testing and GOLD-1 preparations, alongside completing the capital raising and further farm-in work.

This article was developed in collaboration with ADX Energy, a Stockhead advertiser at the time of publishing. 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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