Lion Energy Limited (ASX: LIO) has announced significant progress across its core oil and gas exploration activities and a strategic pivot away from its green hydrogen ventures. Lion Energy Limited is an ASX-listed oil and gas exploration and production company, primarily operating the East Seram Production Sharing Contract (PSC) in Indonesia, where it focuses on attractive shallow oil and world-class oil and gas fold-belt prospects. The company confirmed the completion of its Bula Karang farm-out, securing vital funding and advancing site works for the upcoming Bula Karang-1 exploration well.
A key milestone achieved during the second quarter of 2026 was the final government approval from the Indonesian Ministry of Energy and Mineral Resources (MEMR) for the East Seram PSC farm-out. This approval facilitates the transfer of a 15% participating interest from Lion’s subsidiary, Balam Energy, to OPIC East Seram Corporation, thereby unlocking crucial partner funding for the Bula Karang-1 well. Balam Energy retains a 45% interest and operatorship, with OPIC committing to fund 88% of the drilling costs up to US$5.6 million. Additionally, Lion has secured a drilling contract with Australian contractor Silver City Drilling for the SCD-20 rig, with the spud date for the Bula Karang-1 exploration well now targeted for September 2026, prudently allowing for logistical and formal completion. The Bula Karang prospect boasts a prospective (P50) resource of 12 million barrels of oil and an estimated geological chance of success of 38%.
In a strategic move to focus on its high-potential upstream oil and gas portfolio, Lion Energy has resolved to discontinue its green hydrogen business division. This decision follows a comprehensive review and reflects the company’s commitment to disciplined capital allocation. Lion has ceased its lease obligations at the Port of Brisbane Hydrogen Project and completed the sale of its hydrogen production and refuelling equipment for gross proceeds of A$400,000, commencing an orderly wind-down of related activities. Executive Chairman Mr Tom Soulsby commented on the “significant ramp-up of the drilling planning and execution activities for the exciting Bula Karang-1 well,” noting it as a “potential game changer for Lion.”
