Alternative Energy Scenarios The Company monitors various energy outlooks and industry forecasts that include scenario-based projections. Under most scenarios, natural gas continues to play a significant role in supporting future energy systems. In both Australia and Indonesia, there is growing regulatory interest in capturing carbon emissions. If carbon capture and storage (CCS) becomes more cost-effective, Cue may consider emissions reduction through CCS; however, no current implementation plan exists. Cue also monitors ongoing advancements in CCS technologies, hydrogen development, and renewable energy integration to support long-term decarbonisation at its projects. While no investment or implementation decisions have been made to date, Cue remains engaged in exploring commercially and scientifically credible decarbonisation pathways. Risk Management Identify, Assess and Manage Climate Related Risks The Company follows a robust Risk Management System Framework. Climate-related risks are evaluated alongside broader business risks and recorded in a central risk register, which assesses controls, assigns ownership, and monitors treatment plans. These risks are reviewed regularly, incorporating operational considerations, industry developments, peer benchmarks, shareholder feedback, regulatory updates, and internal analysis by staff and contractors. Oversight of climate risk management is conducted through internal reviews by the Board’s Operational Risk and Sustainability Committee. The Chief Executive is accountable for climate risks, including those associated with individual assets and financial investments impacted by climate change. These risks have potential financial and operational implications, affecting overall profitability. However, climate-related financial, market, and socio-political risks also present opportunities, particularly in the increasing use of natural gas as a compliment to renewable energy and as a lower-emission alternative to coal. Calculating Climate risk In New Zealand, the Emissions Trading Scheme (ETS) sets a market-based carbon price. New Zealand Units (NZUs), representing one metric tonne of Carbon dioxide or its equivalent in other greenhouse gases, are purchased and surrendered by Cue for the Maari production asset. NZU prices and emissions forecasts are incorporated into sensitivity testing. In Australia, Cue is not currently subject to a mandatory carbon pricing scheme. However, project and investment assessments factor in a range of potential carbon pricing outcomes. Likewise, in Indonesia, the prevailing carbon pricing regulations do not currently apply to Cue’s operations. The Company monitors various emerging policies and regulatory frameworks that could impact asset value and operational performance. Given the evolving nature of carbon pricing mechanisms and rapidly changing policy environments across the countries in which Cue operates, or is evaluating projects, carbon price modelling is based on the best available information and estimates at the time. For physical climate risks across all asset interests, the Company maintains comprehensive insurance coverage and regularly participates in technical review meetings to assess engineering and infrastructure vulnerabilities. Risk Types and Controls To categorise risk, the Company uses the following time horizon definitions: – Short-term: 0-5 years – Medium-term: 5-10 years – Long-term: 10+ years Task Force on Climate–Related Financial Disclosure (TCFD) Statement continued 18 Cue Energy Resources Limited Annual Report 2025
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