Ann: Half Year Financial Report 31 December 2024, page-4

Bullet Point Summary of Melbana Energy Limited's Half-Year Financial Report (31 December 2024)

Positive Aspects:

• Continued Oil Exploration & Development: Progress in Cuba’s Block 9 with remedial acid-stimulation, Amistad-2 and Amistad-3 well drilling plans, and development of proprietary Reservoir Drilling Fluid (RDF).
• Australian Operations Advancements:
  • Progress in WA-488-P with potential future payments of USD 5 million and a royalty structure for oil production.
  • Grant of WA-552-P, allowing further exploration in the Northern Carnarvon Basin.
  • Exploration progress in AC/P70, with resource estimates completed.
• Strong Cash Position: Ended the half-year with $9.7 million in cash reserves.
• Strategic Planning & Cost Control: Exploration commitments met in key areas with studies to optimize costs and efficiency.
• Corporate Structuring & Governance: New Company Secretary (Uno Makotsvana) also serving as CFO.
• Auditor’s Confirmation: No material misstatements found in financial reporting.
• Foreign Exchange Gain: Recorded $1.2 million in foreign currency translation gains.

Negative Aspects:

• Significant Financial Loss: Half-year net loss of $1.99 million, a substantial increase from the previous year’s loss of $703,315.
• Declining Cash Reserves: Cash balance fell from $12.3 million to $9.7 million due to operational and exploration expenditures.
• Revenue Drop: Other income decreased significantly from $1.03 million to $66,555.
• Increased Operational Expenses: Higher expenses in consultant fees, employee benefits, and administrative costs.
• Capital Raising Required: Acknowledgment that current cash reserves may not be sufficient for upcoming commitments, requiring alternative funding (e.g., partnerships, capital raising, oil sales).
• Potential Risks to Exploration Projects: If external funding is not secured, some exploration permits may be surrendered or cancelled.
• Stock Performance & Small Shareholding Concerns: Implementation of Small Holding Share Sale Facility suggests concerns about shareholders with low-value holdings.
• Lapsed Performance Rights: 41 million Performance Rights lapsed, indicating potential challenges in meeting performance targets.

Overall Assessment:

• Financially strained but active in exploration & development.
• Strong technical advancements in Cuba and Australia but high capital expenditure & declining income present risks.
• Future success hinges on securing funding, successful oil production, and monetizing assets.