How Central Petroleum’s Multi-Basin Deal Could Transform Its Growth Trajectory

Strategic Expansion into Key Australian Basins

Central Petroleum Limited (ASX – CTP) has announced a significant strategic expansion by entering binding Sale and Purchase Agreements with ADX Energy. This deal secures Central a foothold in two prolific Australian basins, the Cooper Basin in South Australia and the Otway Basin in Victoria. The acquisition includes a 20% stake in the PEP169 permit in the Otway Basin and a 49% interest in the PEL677 permits in the Cooper Basin, marking a pivotal move from Central’s traditional Northern Territory focus to a multi-basin growth strategy.

The transaction, valued at approximately $13.1 million plus royalties, is contingent on regulatory and financier approvals expected by mid-January 2026. This capital deployment underscores Central’s ambition to diversify its portfolio and tap into established, infrastructure-rich regions with proven hydrocarbon potential.

Near-Term Drilling and Production Prospects

Central plans to accelerate exploration with multiple wells scheduled for drilling from mid-2026 through 2027. In the Otway Basin’s PEP169 permit, the Enterprise North gas prospect stands out, supported by extensive seismic data and proximity to existing gas processing facilities. The Enterprise North field, discovered in 2020, is already producing gas into the Victorian market, and Central’s stake offers near-term production upside with relatively low upfront development costs.

Meanwhile, in the Cooper Basin, the PEL677 permits cover retention leases with a history of conventional oil and gas production. Central and its partners have identified several drill-ready prospects, with plans to prioritise two to three wells by early 2027. The basin’s mature infrastructure and access to export facilities provide a pathway for rapid commercialisation of discoveries.

Market Access and Strategic Partnerships

One of the key benefits of this acquisition is Central’s enhanced access to the high-value east coast gas market, a critical energy hub in Australia. The proximity of these permits to existing pipelines and processing plants reduces the time and cost to bring new production online. Central’s Managing Director and CEO, Leon Devaney, highlighted the partnership with ADX Energy as a strong technical and operational fit, combining nimble exploration expertise with Central’s production capabilities.

This move also complements Central’s recent strategic initiatives, including binding gas supply agreements and exploration activities in the Northern Territory. Together, these efforts position Central as a more diversified and dynamic player in Australia’s evolving energy landscape.

Balancing Opportunity with Risk

While the acquisition opens exciting growth avenues, it carries the usual exploration risks, including drilling success and commodity price volatility. The transaction’s completion depends on regulatory and financing conditions, and the forward-looking production targets remain subject to operational execution. Nonetheless, the relatively low acquisition cost per barrel of oil equivalent and the existing infrastructure footprint provide a strong foundation for value creation.

Looking ahead, Central’s multi-basin strategy could reshape its production profile and cash flow dynamics, potentially delivering a step-change in shareholder value if exploration and development milestones are met.