Cue Energy Resources Limited Directors' report 30 June 2025 13 Exploration and development activities may be affected by a range of factors including geological conditions, limitations on activities due to seasonal weather patterns or adverse weather conditions, unanticipated operational and technical difficulties, difficulties in commissioning and operating plant and equipment, mechanical failure or plant breakdown, unanticipated reservoir problems which may affect production volumes and/or costs, industrial disputes, unexpected shortages and increases in the costs of plant and equipment, native title processes, changing government regulations and many other factors beyond the Consolidated Entity’s control. Production The Consolidated Entity’s oil and gas production is exposed to interruptions which may result from mechanical or technical failure, pipeline and other infrastructure access, project delays or other unforeseeable events. Restrictions on the movement and supply of personnel and products due to external influences such as geopolitical unrest or conflict may also cause interruption to production. A significant interruption to production could result in loss of revenue and additional costs to repair or replace equipment. Regulatory risk The Consolidated Entity currently operates in Australia, Indonesia and New Zealand and is subject to changes in government policy or statutory changes that may affect our business operations and financial position. A change in government regime may significantly result in changes to fiscal, monetary, property rights and other issues which may result in a material adverse impact on Consolidated Entity’s business and its operations. Profitability may be affected by changes in government taxation and royalty policies or the interpretation and application of policies in our operating jurisdictions. The Consolidated Entity monitors changes in relevant regulations and engages with regulators and governments to ensure policy and law changes are appropriately understood. Any failure to comply with or changes to applicable laws, regulations or permits, even if non-compliance is inadvertent, could result in material fines, penalties, changes in the cost of operations, additional investment or other liabilities. In extreme cases, non-compliance with or amendments applicable laws, regulations or permits could result in suspension of activities or forfeiture of one or more of the Consolidated Entity’s projects. Access to infrastructure Our oil and gas sales can be dependent on access to third party owned infrastructure. Infrastructure failure, such as pipelines and processing facilities, increased tariffs or restrictions on access to third party infrastructure may have a material effect on financial performance. The Consolidated Entity works with its project partners, customers and infrastructure suppliers to understand and mitigate the risk of delays or failure. Permit Risk All petroleum licences held by the Consolidated Entity are subject to the granting and approval of relevant government bodies and ongoing compliance with licence terms and conditions, including periodic requirements for renewal or extension. The Consolidated Entity monitors project operators’ tenure management processes and standard operating procedures to minimise the risk of losing tenure. Litigation The Consolidated Entity is not currently involved in any litigation. However, in the ordinary course of business we may become involved in litigation and disputes, for example with our partners, contractors or employees, over a broad range of matters. Any such litigation or dispute could involve significant economic costs and damage to relationships with partners or other stakeholders. Outcomes of any litigation may have an adverse impact on the Consolidated Entity’s business, market reputation and financial condition and financial performance. 25 Cue Energy Resources Limited Annual Report 2025
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