One of the themes that has been emerging as the war with Iran drags on, is the increasing needs for energy security in Australia.
This has led to both the federal and some state governments promising support for more oil and gas exploration on and offshore, including in Queensland, where Omega Oil and Gas Ltd (ASX: OMA) is active.
Image source: Getty Images
Major drilling program to start
Omega's upcoming drilling program is well timed, with the company recently announcing that it had secured a drilling rig for a drilling program of at least three and up to six more wells at its tenements in the Taroom Trough.
As the company said:
Subject to permitting, Omega plans to, and is fully funded to, drill at least four wells in our expanded 2026/27 program – a minimum of two wells on our existing PCA areas, and two wells on the recently awarded ATP 2081 (formerly PLR2025-1-9), realising the cost and efficiency benefits of a continuous campaign. Omega also maintains options to drill further horizontal and vertical wells. Omega's program is scheduled to commence in May 2026 following completion of preceding wells by other operators. The program aims to delineate reservoir and resource distribution over a broad area, identify "sweet spots", and mature Omega's resource and reserve base.
Omega said it had a "commanding" acreage position in the Taroom Trough both through its own tenements and via its 19.43% ownership stake in Elixir Energy Ltd (ASX: EXR).
Taken together, this gave Omega an interest in 5041 sq km.
Omega Managing Director Trevor Brown said:
With basin-wide drilling in the Taroom Trough during 2026, and our multi-well campaign fast approaching, Omega is entering an exciting growth phase. We believe that our upcoming program, scheduled to commence in May 2026, will further de-risk this exciting play and demonstrate the vast scale of the Taroom Trough's oil and gas resources.
Shares looking cheap
The analyst team at Canaccord Genuity said a recent visit to the Taroom Trough by Queensland Premier David Crisafulli "and subsequent press releases calling for the acceleration of permitting represents, in our view, a key turning point in the political narrative regarding oil and gas development''.
They added:
We upgrade our price target to $1.30 (from $0.85) and retain our speculative buy after increasing our risking. In our view regulatory tail risk is fast evaporating and that could lead to higher corporate activity in a play which is proximal to existing infrastructure and underutilised LNG facilities.
Omega shares were changing hands for 84.5 cents early on Thursday. The company was valued at $390.9 million.
