Key Takeaways:
Karoon Energy lowered its 2026 production forecast by 11% after a technical issue at its Who Dat project in the U.S. Gulf of Mexico pushed output restoration to 2027, sending its shares down as much as 15%.
"Reduced production is expected to translate into lower revenue until full production resumes in late 2027," said Cliff Man, chief executive officer at ETF Shares.
The Australian oil and gas producer now expects total 2026 production of 7.2 million to 8.2 million barrels of oil equivalent, down from a prior range of 8.1 million to 9.2 million. Who Dat output was trimmed to 1.2 million to 1.5 million MMboe on a net revenue interest basis from 2.1 million to 2.5 million previously. The E manifold, a system used to connect and direct flows from wells, will not be restored this year as previously anticipated. Operator LLOG Exploration Company told the joint venture that additional technical analysis showed the failed riser cannot be reinstated in 2026, with removal planned for the third quarter and production now expected to resume in the second half of 2027.
The delay will weigh on Karoon's revenue through at least late 2027 and highlights the operational risks of mature deepwater assets. Who Dat is currently producing about 3,000 barrels of oil equivalent per day on a net basis. Development activity continues, with the A-1 sidetrack well expected to begin production by mid-year and the G-1 sidetrack well scheduled for the fourth quarter of 2026. Karoon said it is reviewing and optimizing its 2026 capital expenditure commitments across the Who Dat and Bauna assets in response to the latest developments. Production guidance for its Brazilian operations remains unchanged.
Karoon's shares fell as much as 15.1% to A$1.58 in Sydney trading, the lowest level since late February, before recovering some losses to trade around A$1.72. The stock has declined more than 30% this year.
This article is for informational purposes only and does not constitute investment advice.
