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ADX Energy goes continental as advisors take stock of cash boost for low-risk gas wells

• Target price of 19 cents per share after $4.4m placement to help build gas production base in Austria
• Proceeds from raise to help fund one shallow exploration well on track to spud next month
• Additional cash available to cover site preparation and materials for two more low-risk gas wells and purchase additional seismic data for its Sicily Channel Permit

Special Report: Equipped with fresh cash from a placement, ADX Energy gets a share revaluation from Auctus Advisors that reflects the capital injection, accelerated activity and heightened energy demand in Europe as war threatens gas and supply lines.

Three shallow gas wells, HOCH-1, GOLD-1, SCHOE-1, have been targeted by the Austria-focused company as it eyes a large increase in production from low-risk prospects.

ADX Energy (ASX:ADX) last week raised A$4.4 million at 2.7c per share in a strongly supported placement to new and existing investors including institutional investors.

Investors will also receive one option for every two new shares, with an exercise price of 4.05c per share.

With Europe crying out for secure energy sources, preferably local, the new cash will fund evaluation of testing results from the Welchau-1 well and drilling at HOCH-1 shallow gas exploration well in Upper Austria that is expected to spud in April 2026.

“We have revised our target price to A$0.19 per share to reflect the new equity issuance,” Auctus Advisors said in a research note. 

Down from the previous target of 22c, the new rating implies a total return of 400% as the exploration and production company builds its production base in Austria.

It is a significant premium to the current price of around 2.6c.

“We are seeking to build our production base in Austria with a program of low-risk, immediate, shallow gas exploration drilling this year commencing with HOCH-1 well in April,” ADX executive chairman Ian Tchacos said. 

HOCH-1 is a 5.2 to 8 billion cubic feet (P50 – Pmean) prospect with (2.6 to 4 bcf net to ADX) with an upside case of 17.3bcf (8.7bcf net) with an estimated at 62% chance of success, Auctus Advisors said. 

Analyst Stephane Foucaud said success would have a positive read‑across for the SCHOE prospect, which holds 5.3 to 6.4bcf (P50–Pmean) of gross prospective resources (2.7 to 3.2bcf net) and an upside case of 12.2bcf (6.1 Bcf net). SCHOE carries a 51% chance of success.

Further, the strengthened cash position enables well‑site preparation and materials for two additional Austrian wells, one of them GOLD. 

Auctus Advisors said the GOLD cluster carried a 77% chance of success and was estimated to hold 12.1 to 13.3 bcf (P50-Pmean) where ADX has a 100% interest. 

“More support out of Europe for European assets will translate into improved value development for our Australian investors. Europe needs much more reliable energy and ADX is well placed to deliver it from our Austrian and Italian asset portfolio,” Tchacos said. 

But wait there’s more

The to-do list also includes a dual listing on Oslo Børs’ Euronext Growth market, further drilling data purchases for the Sicily Channel permit, and maturation of attractive near-field oil targets close to the company’s 3,000 barrels per day processing facility at Anshof.

“Our ReNAV of A$0.19 per share for the company reflects producing assets, shallow gas targets, Welchau-1, and the Italian permit, based on anticipated farm-out terms,” Foucaud said.

Source: Stockhead