Cue Energy Resources Limited Notes to the financial statements 30 June 2025 Note 3. Critical accounting estimates and judgements (continued) 36 (vi) Capitalised exploration and evaluation costs Exploration and evaluation costs have been capitalised on the basis that the consolidated entity expects to commence commercial production in the future, from which time the costs will be amortised in proportion to the depletion of the mineral resources. Key judgements are applied in considering costs to be capitalised which includes determining expenditures directly related to these activities and allocating overheads between those that are expensed and capitalised. In addition, costs are only capitalised that are expected to be recovered either through successful development or sale of the relevant mining interest. Factors that could impact the future commercial production at the mine include the level of reserves and resources, future technology changes, which could impact the cost of mining, future legal changes and changes in commodity prices. To the extent that capitalised costs are determined not to be recoverable in the future, they will be written off in the period in which this determination is made. (vii) Development assets Development costs have been capitalised on the basis that the Consolidated Entity expects to commence commercial production in the future, from which time the costs will be amortised in proportion to the depletion of reserves. Key judgements are applied in considering costs to be capitalised that are expected to be recovered either through successful development or sale of the relevant assets. The primary assumption made in respect of development assets is that these assets will be able to be realised through the successful development of the relevant tenement or through its sale. To the extent that capitalised costs are determined not to be recoverable in the future, they will be written off in the period in which this determination is made. Note 4. Financial reporting by segments Segment Information AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed and used by the Board of Directors (who are identified as the Chief Operating Decision Makers (“CODM”)) in assessing performance and in determining the allocation of resources. The CODM assesses the performance of the operating segments based upon EBITDAX, adjusted to exclude business development costs, exploration and evaluation expenses, share based payments and one-off expenses, which allows peer comparison when assessing performance. The accounting policies adopted for internal reporting to the CODM are consistent with those adopted in the Group's financial statements. The Consolidated Entity operates in four principal segments: Onshore Australia, Maari in New Zealand and Sampang and Mahato in Indonesia. The Consolidated Entity has a distinct corporate function which has been presented separately in order to reconcile to the statutory results. Australia The Consolidated Entity, through wholly owned subsidiaries, Cue Mereenie Pty Ltd, Cue Palm Valley Pty Ltd and Cue Dingo Pty Ltd, holds 3 permits for Onshore Australia activities in the Amadeus Basin in the Northern Territory. For details of interests in joint operations refer to note 21. New Zealand The Group, through its wholly owned subsidiary, Cue Taranaki Pty Ltd, holds a 5% interest in petroleum production property, PMP38160 (Maari) in New Zealand. Indonesia The Group, through its wholly owned subsidiary, Cue Sampang Pty Ltd, holds a 15% interest in the Sampang PSC gas production property and through Cue Mahato Pty Ltd, holds a 11.25% interest in the Mahato PSC oil production property. Information regarding the Group’s reportable segments is presented below: 48 Cue Energy Resources Limited Annual Report 2025
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