Regulations Cue operates across multiple jurisdictions, each with its own regulatory framework, which helps mitigate the risks of regulatory changes on its business. The Company continually assesses risks related to climate change, carbon pricing, and the physical impacts of environmental change. Strategic planning and adaptation remain key to ensuring both compliance and operational resilience. New Zealand has a well-established Emissions Trading Scheme (ETS). Under this scheme, Cue is required to report annual greenhouse gas emissions and to purchase and surrender one New Zealand Unit (NZU) to the government for each tonne of carbon dioxide equivalent emissions. Cue incorporates modelled NZU prices in performance forecasts and sensitivity analyses for the Maari asset. At present, Cue is not subject to participation in, or reporting under, any mandatory carbon pricing scheme in Australia. However, mandatory climate-related financial disclosure requirements have been introduced by the Australian Government and based on Cue’s current assessment of the applicable thresholds, mandatory climate-related financial reporting is expected to apply for its annual reporting period beginning on or after 1 July 2027. Emissions from Cue’s onshore operations are reported annually by the field operator under the National Greenhouse and Energy Reporting (NGER) scheme. These emissions currently remain below the threshold required for coverage under the Safeguard Mechanism. Indonesia has implemented a sector-based carbon pricing regulation, although it does not currently apply to Cue’s operations. Cue continues to monitor the evolving policy landscape in Indonesia, including the potential economic impacts of future climate-related regulations and environmental conditions. Climate-related risks and opportunities Risk Type Description Time Horizon Potential Financial Impacts PHYSICAL RISKS Acute Climate change increases the severity, duration and frequency of extreme weather events offshore Taranaki (Maari). The Mahato and Amadeus fields, located onshore in Indonesia and Central Australia can experience periods of extreme heat, drought, flooding and fire. S, M, L Declining revenue due to disruptions to operations and supply chains, reduced labour productivity, increased costs to repair or replace equipment damaged by severe weather events, unable to meet operational budgets and KPIs leading to a decline in expected shareholder returns. PHYSICAL RISKS Chronic Increasing average temperatures and long term sea level rise. L Reduced productivity and increased costs to manage operations in higher temperatures. Increased capital for facility adaptation measures to maintain performance and reliability. TRANSITION RISKS Policy & Legal Changes in legislation and regulation relating to climate and sustainability matters, including emissions reporting, financial disclosure requirements, carbon pricing and sector specific environmental obligations. S, M, L Increased compliance costs, insurance premiums, taxes, carbon pricing, changes in demand and pricing, and potential litigation arising from non-compliance. Onerous operating conditions for late-life assets, reducing revenue and profitability, leading to early retirement of existing assets. TRANSITION RISKS Policy and Legal (decommissioning) Changes in environmental and decommissioning regulations associated with climate, environmental and energy transition policies. M, L Increased financial assurance requirements, earlier retirement of assets and higher rehabilitation or decommissioning costs. TRANSITION RISK Technology Continued development and adoption of alternative energy technologies could reduce demand for petroleum products. L The development of alternative energy systems could ultimately reduce demand for petroleum products (greater impact on liquid fuels than gas is anticipated) that are produced by Cue’s assets, leading to reduced revenue. Task Force on Climate–Related Financial Disclosure (TCFD) Statement continued 19 Cue Energy Resources Limited Annual Report 2026
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