Announcement PDF ABN 33 087 741 571 1 ASX ANNOUNCMENT 11 September 2026 PO VALLEY ENERGY LTD (ASX:PVE) INTERIM FINANCIAL REPORT FOR SIX MONTHS TO 30 JUNE 2026 Po Valley Energy Limited (ASX:PVE) encloses its interim financial report for the period ended 30 June 2026. This announcement was approved for release by the Board of Directors of Po Valley Energy Limited Enquiries to: Mr Kevin Bailey AM Po Valley Chairman +61 417 556 458 To ask questions directly to the Po Valley Energy view this report and access media content, visit our interactive investor website at: https://povalley.com/link/eW1DJP Registered Office Rome Office Level 5/191 St Georges Terrace Perth WA 6000 Australia info@povalley.com Via Isonzo 34, Rome, 00198 Italy TEL +39 06 4201 4968 FAX +39 06 4890 5824 Directors Mr. Kevin Bailey AM, Chairman and CEO Ms. Sara Edmonson, Non-executive Director Mr. Joseph Constable, Non-executive Director Ms. Katrina O’Leary, Non-executive Director Mr. Michael Gentile, Non-executive Director PO VALLEY ENERGY LIMITED A.B.N. 33 087 741 571 INTERIM FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2026 PO VALLEY ENERGY LIMITED INTERIM FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2026 CONTENTS 1 DIRECTORS’ REPORT ............................................................................................................................................ 2 AUDITOR’S INDEPENDENCE DECLARATION ......................................................................................................... 6 STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME ......................................................... 7 STATEMENT OF FINANCIAL POSITION ................................................................................................................. 8 STATEMENT OF CHANGES IN EQUITY .................................................................................................................. 9 STATEMENT OF CASH FLOWS ............................................................................................................................ 10 NOTES TO THE FINANCIAL STATEMENTS ........................................................................................................... 11 DIRECTORS’ DECLARATION ................................................................................................................................ 26 INDEPENDENT AUDITOR’S REVIEW REPORT ..................................................................................................... 27 PO VALLEY ENERGY LIMITED DIRECTORS’ REPORT 2 The Directors present their report together with the interim financial report for the half-year ended 30 June 2026 and the independent auditor’s review report thereon, of Po Valley Energy Limited (“the Company” or “Po Valley Energy” or “PVE”) and its subsidiary Po Valley Operations Pty Ltd (“PVO”) together referred to as “the Group”. Director details The following persons were Directors of the Company during or since the end of the financial half-year: • Kevin Bailey AM – Chairman and Chief Executive Officer • Sara Edmonson - Non-Executive Director • Joseph Constable – Non-Executive Director • Katrina O’Leary – Non-Executive Director • Michael Gentile – Non-Executive Director Company Secretary Lucia McLean was appointed Company Secretary on 27 March 2026 following the retirement of former Company Secretary Kevin Hart, who held the position from 9 October 2020 to 27 March 2026. Principal Activities The principal continuing activities of the Group in the course of the half-year were: • Production and sale of gas from the Podere Maiar 1 well • The exploration for gas and condensate in the Po Valley region of northern Italy • Appraisal and development of gas and oil fields in that footprint Review and results of operations Financial results for the period The profit attributable to members of the Company for the half-year was €1,261,791 (30 June 2025: €1,749,745). The Group’s cash reserves as at 30 June 2026 were €2,714,144 (31 December 2025: €2,462,580). A review of the operations and the results of those operations of the Group during the half-year is as follows: Summary of results table: 30 June 2026 30 June 2025 Mcm Mcm Production volume (net) 8,997 8,810 €’000 €’000 Gas Sales 4,119 3,908 EBITDA1 2,677 2,628 Depreciation and amortisation – production (273) (271) Depreciation (15) (14) Unwind of discount of restoration provision (19) (20) EBIT1 2,370 2,323 Net Finance income (costs) other than related to restoration provision 44 (7) Taxation (1,153) (566) Net profit / (loss) after tax attributable to shareholders 1,261 1,750 1EBITDA (earnings before interest, tax, depreciation and depletion) and EBIT (earnings before interest and tax) are non-IFRS measures that are presented to provide an understanding of the Group’s operations. The non-IFRS measures are unaudited, however, the numbers have been extracted from the financial statements that have been subject to review by the Company’s auditor. PO VALLEY ENERGY LIMITED DIRECTORS’ REPORT 3 Selva Malvezzi Production Concession (63% PVO) The Selva Malvezzi Production Concession (“Selva”) is an onshore gas asset located in the Po Valley, Italy. Awarded in July 2022, the Selva Malvezzi Production Concession covers 80.68km2 carved out from the former Podere Gallina Exploration Permit. The Group holds a 63% working interest and operates the asset through the Italian Branch operations of Po Valley Operations Pty Ltd (“PVO”). The concession includes: ● Producing asset: Podere Maiar-1 dir well (“PM-1”); and ● Additional discoveries and prospects: Casale Guida (North Selva), Ronchi (South Selva), Selva Malvezzi (East Selva), and Bagnarola (Riccardina). PM-1 gas production and well management Gas production at PVO’s 63%-owned Podere Maiar – 1 (PM-1) gas facility in the Selva Malvezzi Production Concession for the quarter is shown in the table below: PM1 Gas Production half year to 30 June 2026 Q1- 2026 Q2-2026 Total To 30 June 2026 Production scm scm scm PM-1 – 100% 7,261,834 7,018,568 14,280,402 PM-1 – 63% (PVE share) 4,574,955 4,421,698 8,996,653 Revenue €’000 €’000 €’000 PM-1 – 100% 3,145,087 3,393,248 6,538,335 PM-1 – 63% (PVE share) 1,981,405 2,137,746 4,119,151 Production has been consistent throughout the period averaging ~77,000-80,000 scm per day. The modest reduction in Q2 reflected planned maintenance activities, including a routine slickline intervention and replacement of the alumina in the dehydration regeneration columns. Field operations continued safely and efficiently throughout the period. Cumulative production since initial flow has reached 79.9million scm from the C2 level, exceeding the certified P1 reserves reported in the July 2022 CPR (PVE’s net share is 63%). Routine slickline operations performed confirmed the stable performance and pressure evolution of the well. To optimize operations during the scheduled well shutdown, the alumina in the dehydration regeneration columns was successfully replaced. Periodic inspections of the nitrogen generation system were successfully completed in the presence of the UNMIG representatives. The next regulatory inspection, which will include the calibration of the safety valves (PSV), is scheduled for June 2027, in accordance with the biennial maintenance program. Royalty expenses (on gas production sales) are accrued for the period of €412k. Royalties are payable in the second quarter of the year following the year end. For this period Royalites will be payable in Q2/2027. The Group paid €608k in Royalties in this period in respect of the production for the 2025 FY. PO VALLEY ENERGY LIMITED DIRECTORS’ REPORT 4 Casale Guida 1d, Ronchi 1d, Bagnarola 1d, Selva Malvezzi 1d wells The key area of focus for the Company with the next stages of development in the Selva Malvezzi Production Concession is at - Casale Guida 1d (Selva North discovery); - Ronchi 1d (South Selva discovery); - Selva Malvezzi 1d (East Selva prospect); and - Bagnarola 1d (Riccardina prospect). In June 2026, the Groups submitted a new Environmental Impact Assessment (EIA) with Italy's Ministry of Environment and Energy Security covering the drilling, development, commissioning, production and final decommissioning and environmental restoration of these four new production wells above. The EIA submission incorporates the wells engineering, gas plants and pipelines, technical studies, environmental assessments and mitigation measures developed following previous regulatory consultation. 3D-Geophysical survey over Selva Malvezzi Concession The Group completed 3D geophysical data acquisition over the whole Selva Malvezzi Concession area in 2025. The program covered approximately 140km2. The works were completed by Geotec for permitting and Geofyzika Torun (GT) for acquisition & data recording, with PVO technical team supervision. Data acquired and collected is being processed by Schlumberger Italy for interpretation by the PVO team. The final delivery will be a high-resolution three-dimensional subsurface model which is expected to enhance reservoir understanding, optimise future drilling locations and further de-risk development planning in the concession. Teodorico Offshore Gas field development (100% PVO) The Teodorico gas field is located in shallow waters (approximately 30m deep) off the east coast in the northern Adriatic Sea; the primary source of domestic gas production for much of Italy; and in close proximity to existing east coast offshore gas production facilities. Teodorico has the largest gas-in-place of all of Po Valley Energy’s gas fields and is at an advanced stage of assessment, ready for development. The Group holds a preliminary production concession for this area. The Group advanced preparations for a revised EIA submission for the Teodorico project. This includes addressing additional environmental requirements following the 2024 Regional Administrative Court ruling in relation to protected areas. In early July PVO appointed RINA to carry out updates on both the engineering project and revision of the Environmental Impact Assessment. Cadelbosco di Sopra and Grattasasso exploration licences (100% PVO) Cadelbosco di Sopra and Grattassao hold shallow gas opportunities with core capabilities and deep oil contingent resources already discovered. The Group has recommenced engagement with regulatory authorities to advance the Environmental Impact Assessment (EIA) for the proposed Canolo 1 Dir, Canolo 2 Dir and Zini 1 gas exploration wells. During the June quarter, the Company held a preliminary meeting with the Emilia-Romagna Region and with the Ministry. The EIA, originally submitted in 2013, was suspended following the restrictions introduced after the 2012 Emilia- Romagna earthquakes and the subsequent PiTESAI regulatory framework. With these restrictions now lifted, PO VALLEY ENERGY LIMITED DIRECTORS’ REPORT 5 the Group is preparing the required documentation to restart the EIA approval process, representing an important step towards progressing these shallow gas opportunities. Torre del Moro (100% PVO) Torre del Moro is a large deep gas/condensate prospect. A regional petroleum system study is in progress to further evaluate Torre del Moro prospectivity and guide future exploration strategy. Specifically at the moment a study aimed at the evaluation of source rock potential is ongoing and will be followed by a structural study aimed to define hydrocarbons migration and material accumulation. Significant events after balance date There were no events between the end of the financial period and the date of this report that, in the opinion of the Directors, affect significantly the operations of the Group, the results of those operations, or the state of affairs of the Group, in subsequent financial periods. Auditor’s independence declaration A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 6 and forms part of the Directors’ report for the half-year ended 30 June 2026. This report has been made in accordance with a resolution of Directors. Kevin Bailey AM Chairman and Chief Executive Officer 11 September 2026 AUDITOR’S INDEPENDENCE DECLARATION As lead auditor for the review of the consolidated financial report of Po Valley Energy Limited for the half-year ended 30 June 2026, I declare that to the best of my knowledge and belief, there have been no contraventions of: a) the auditor independence requirements of the Corporations Act 2001 in relation to the review; and b) any applicable code of professional conduct in relation to the review. Perth, Western Australia 11 September 2026 M R Ohm Partner PO VALLEY ENERGY LIMITED 7 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 JUNE 2026 NOTE 30 June 2026 € 30 June 2025 € Continuing Operations Revenue from contracts with customers 2 4,119,119 3,908,071 Cost of sales 3 (348,334) (386,398) Royalties (315,677) (376,631) Depreciation and amortisation expense - production 3 (272,686) (270,948) Gross profit 3,182,422 2,874,094 Other income 154,631 110,322 Employee benefits Depreciation expense Corporate overheads (559,779) (15,882) (372,684) (372,330) (14,145) (254,670) Profit from operating activities 4 2,388,708 2,343,271 Finance income Finance expense 51,972 (25,871) 198 (27,967) Net finance income / (expense) 5 26,101 (27,769) Profit before tax Income tax expense 6 2,414,809 (1,153,018) 2,315,502 (565,757) Profit for the period 1,261,791 1,749,745 Other comprehensive income - - Total comprehensive income for the period 1,261,791 1,749,745 Basic and diluted earnings per share from continuing operations 7 0.11 € cents 0.15 € cents The accompanying notes from part of these financial statements PO VALLEY ENERGY LIMITED 8 CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2026 NOTE 30 June 2026 € 31 December 2025 € Current Assets Cash and cash equivalents Financial assets Trade and other receivables 9 8 2,714,144 6,063,316 1,093,109 2,462,580 6,028,804 839,203 Total current assets 9,870,569 9,330,587 Non-Current Assets Inventory – non-current Other assets Property, plant & equipment Resource property costs 10 11 33,438 4,678 1,702,502 10,640,112 33,438 4,678 1,777,499 10,550,134 Total non-current assets 12,380,730 12,365,749 Total assets 22,251,299 21,696,336 Current Liabilities Trade and other payables Taxation payable Lease liabilities Provisions 12 13 841,558 320,173 27,888 3,855 1,137,759 868,440 27,888 3,852 Total current liabilities 1,193,474 2,037,939 Non-Current Liabilities Provisions Lease liabilities Deferred tax liabilities 13 12 6 969,377 38,063 430,765 950,585 51,874 - 1,438,205 1,002,459 Total Liabilities 2,631,679 3,040,398 Net Assets 19,619,620 18,655,938 Equity Issued capital Reserves Accumulated losses 14 15 56,847,751 1,192,269 (38,420,400) 56,847,751 1,192,269 (39,384,082) Total Equity 19,619,620 18,655,938 The accompanying notes from part of these financial statements PO VALLEY ENERGY LIMITED 9 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2026 Issued Capital € Foreign Currency Translation Reserve € Accumulated Losses € Total € Balance at 1 January 2025 56,847,751 1,192,269 (42,108,345) 15,931,675 Total comprehensive income for the period: Profit for the period - - 1,749,745 1,749,745 Other comprehensive income - - - - Total comprehensive income for the period - - 1,749,745 1,749,745 Balance at 30 June 2025 56,847,751 1,192,269 (40,358,600) 17,681,420 Balance at 1 January 2026 56,847,751 1,192,269 (39,384,082) 18,655,938 Total comprehensive income for the period: Profit for the period - - 1,261,791 1,261,791 Other comprehensive income - - - - Total comprehensive income for the period - - 1,261,791 1,261,791 Transactions with members Dividends paid - - (298,109) (298,109) Balance at 30 June 2026 56,847,751 1,192,269 (38,420,400) 19,619,620 The accompanying notes from part of these financial statements 10 CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30 JUNE 2026 NOTE 30 June 2026 € 30 June 2025 € Cash flows from operating activities Receipts from customers 3,868,442 4,075,191 Receipts from joint operations partners 74,326 102,296 Payment of royalties (608,266) (616,131) Payments to suppliers and employees (1,220,357) (941,719) Taxation paid (1,189,314) - Interest received 177 198 Interest paid (888) (227) Net cash from operating activities 924,120 2,619,608 Cash flows from investing activities Payments for property plant and equipment (15,593) (6,751) Payments for resource property costs (net of joint operation partner recoveries) (342,282) (146,017) Net cash used in investing activities (357,875) (152,768) Cash flows from financing activities Payment of dividends 14 (298,109) - Payments of lease liabilities 12 (13,811) (14,173) Net cash used in financing activities (311,920) (14,173) Net increase in cash and cash equivalents 254,325 2,452,667 Cash and cash equivalents at 1 January 2,462,580 4,993,913 Exchange difference on cash and cash equivalents (2,761) 28,710 Cash and cash equivalents at 30 June 2,714,144 7,475,290 The accompanying notes from part of these financial statements PO VALLEY ENERGY LIMITED NOTES TO THE INTERIM FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2026 11 NOTE 1: SUMMARY OF MATERIAL ACCOUNTING POLICIES 1.1 REPORTING ENTITY Po Valley Energy Limited (“the Company” or “Po Valley Energy” or “PVE”) is a company domiciled in Australia. The consolidated interim financial report for the six-month period ended 30 June 2026 comprises the Company and its interests in subsidiaries and jointly controlled entities and operations (together referred to as “the Group”). The Group is primarily involved in the exploration, appraisal, development of, and production from, gas properties in the Po Valley region in Italy and is a for profit entity. 1.2 BASIS OF PREPARATION (a) STATEMENT OF COMPLIANCE The interim financial report is a condensed general purpose financial report prepared in accordance with AASB 134 Interim Financial Reporting and the Corporations Act 2001. Selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in financial position and performance of the Group since the last annual consolidated financial statements as at and for the year ended 31 December 2025. They do not include all of the information required for a full annual financial report, and should be read in conjunction with the consolidated annual financial report of the Group as at and for the year ended 31 December 2025 and with any public announcements made by Po Valley Energy Limited during the half-year ended 30 June 2026. The accounting policies and methods of computation adopted are consistent with those of the previous financial year and corresponding half-year. These accounting policies are consistent with Australian Accounting Standards and with International Financial Reporting Standards. (b) BASIS OF MEASUREMENT These consolidated financial statements have been prepared on the basis of historical cost taking into account, where appropriate, any value adjustments except for certain items required to be recognised at fair value. (c) FUNCTIONAL AND PRESENTATION CURRENCY The consolidated financial statements are presented in Euro, which is the Company’s and each of the Group entities’ functional currency. PO VALLEY ENERGY LIMITED NOTES TO THE INTERIM FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2026 12 (d) USE OF ESTIMATES AND JUDGEMENTS The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected. The estimates and judgements that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below. Impairment of non-current assets The ultimate recoupment of the value of resource property costs and property plant and equipment is dependent on the successful development and commercial exploitation, or alternatively, sale, of the underlying properties. The Group undertakes at least on an annual basis, a comprehensive review for indicators of impairment of these assets. Should an impairment indicator exist, the area of interest or cash generating unit is tested for impairment. No such indicator was identified in the current period. Rehabilitation provision The value of the rehabilitation provision represents the discounted value of the present obligations to restore, dismantle and rehabilitate each well site under development or in production. Significant estimation is required in determining the provisions for rehabilitation and closure which are inherently uncertain and may change in response to amendments to legislation, regulatory requirements, operating plans, technology, costs levels and timing of rehabilitation activities that will affect ultimate costs necessary to rehabilitate the sites. The discounted value reflects a combination of management’s best estimate of the cost of performing the work required, the timing of the cash flows and the discount rate. A change in any, or a combination of, the key assumptions used to determine the provisions could have a material impact on the carrying value of the provisions. The provision recognised for each site is reviewed at each reporting date and updated based on the facts and circumstances available at that time. Changes to the estimated future costs for operating sites are recognised in the statement of financial position by adjusting both the restoration and rehabilitation asset and provisions. The Group reviewed the provision at reporting date for works completed during development and revised costs estimates for current prices and conditions to ensure the provision is appropriate at reporting date. There were no changes to estimated costs during the period. Reserve estimates Estimation of reported recoverable quantities of Proven and Probable reserves include estimates regarding commodity prices, exchange rates, discount rates, and production and transportation costs for future cash flows. It also requires interpretation of complex geological and geophysical models in order to make an assessment of the size, shape, depth and quality of reservoirs, and their anticipated PO VALLEY ENERGY LIMITED NOTES TO THE INTERIM FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2026 13 recoveries. The economic, geological and technical factors used to estimate reserves may change from period to period. A change in any, or a combination of, the key assumptions used to determine the reserve estimates could have a material impact on the carrying value of the project via depreciation rates or impairment assessments. The reserve estimates are reviewed at each reporting date and any changes to the estimated reserves are recognised prospectively to depreciation and amortisation. Any impact of the change in the reserves is considered on asset carrying values, and impairment losses, if any, are immediately recognised in the profit or loss. Deferred tax assets and liabilities Deferred tax assets and liabilities are recognised for temporary differences between the carrying amounts of assets and liabilities in the financial statements and their corresponding tax bases, using tax rates that have been enacted or substantively enacted at the reporting date and are expected to apply when the temporary differences reverse. Significant judgement is required in determining the tax bases of the Group’s assets and liabilities and the periods over which the associated temporary differences are expected to reverse. This is particularly relevant to production assets, including differences arising from depreciation and depletion rates, capitalised development expenditure and rehabilitation obligations. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only to the extent that it is probable that future taxable profits will be available against which those amounts can be utilised. This assessment requires management to estimate future taxable profits by jurisdiction, having regard to forecast production, commodity prices, operating costs, capital expenditure, the expected timing of temporary-difference reversals and applicable restrictions on the utilisation of tax losses. These estimates and assumptions are subject to risk and uncertainty. Changes in forecast operating performance, commodity prices, tax legislation or the expected timing of recovery of assets and settlement of liabilities may result in adjustments to the deferred tax assets and liabilities recognised in future reporting periods. Unrecognised deferred tax assets are reassessed at each reporting date. 1.3 MATERIAL ACCOUNTING POLICIES (a) New and revised Standards and Interpretations on issue not yet effective Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet effective have not been early adopted by the Group for the reporting period ended 30 June 2026. The Directors do not believe that these new and revised Standards and Interpretations will have a material effect on the Group. (b) New Standards and Interpretations applicable for the six-month period ended 30 June 2026 The Directors have reviewed all the new and revised Standards and Interpretations issued by the AASB that are relevant to the Group and effective for the current reporting period. As a result of this review, the Directors have determined that there is no material impact of the new and revised Standards and Interpretations on the Group and, therefore, no material change is necessary to the Group accounting policies. PO VALLEY ENERGY LIMITED NOTES TO THE INTERIM FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2026 14 NOTE 2: REVENUE 30 June 2026 € 30 June 2025 € Gas sales contract with customers 4,119,119 3,908,071 All gas sales are recorded as revenue at a point in time. NOTE 3: COST OF SALES Production operating costs 326,913 361,745 Capacity and transportation costs 21,421 24,653 Cash costs of production 348,334 386,398 Depreciation of plant and equipment 74,708 72,379 Depletion of resource property costs 197,978 198,569 Depreciation and amortisation expense 272,686 270,948 NOTE 4: PROFIT AND LOSS INFORMATION Profit for the half-year includes the following items: Professional fees (216,698) (131,551) Company administration and compliance (62,104) (83,134) Travel costs (25,180) (13,875) NOTE 5: FINANCE INCOME AND EXPENSE Recognised in profit and loss: Interest income 51,972 198 Finance income 51,972 198 Interest expense (888) (1,359) Unwind of discount on site restoration provision (18,792) (20,478) Foreign exchange (gains) / losses (net) (6,191) (6,130) Finance expense (25,871) (27,967) Net finance income / (expense) 26,101 (27,769) PO VALLEY ENERGY LIMITED NOTES TO THE INTERIM FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2026 15 NOTE 6: INCOME TAX 30 June 2026 € 30 June 2025 € Current tax Current year 722,253 450,081 Deferred tax Deferred tax expense 430,765 115,676 Total income tax expense 1,153,018 565,757 Numerical reconciliation between aggregate tax expense recognised in the statement of comprehensive income and tax expenses calculated per the statutory income tax rate: Profit for the year before tax from continuing operations 2,414,809 2,315,502 Income tax expensed using the Company’s domestic tax rate of 30 % (2024: 30%) 724,443 694,650 Effect of tax rates in foreign jurisdictions (164,691) (153,791) Permanent differences 71,662 57,333 Current year losses and temporary differences for which no deferred tax asset was recognised 49,273 16,562 Changes in temporary differences 339,809 (41,912) Tax losses utilised - (107,332) Foreign regional taxes payable 132,522 100,247 Income tax expense 1,153,018 565,757 PO VALLEY ENERGY LIMITED NOTES TO THE INTERIM FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2026 16 NOTE 6: INCOME TAX (continued) Recognised deferred tax assets and liabilities The Group has recognised a deferred tax liability in respect of taxable temporary differences arising from its Italian production assets. These temporary differences principally reflect differences between the carrying amounts of the assets in the financial statements and their corresponding tax bases, including differences in the timing and basis of accounting depreciation and depletion compared with deductions available for Italian income tax purposes. The movement in the net deferred tax liability during the half-year was as follows: CONSOLIDATED 30 June 2026 € 31 December 2025 € Production assets timing differences 430,765 - Recognised deferred tax liabilities 430,765 - Deferred tax assets are recognised in respect of tax losses and temporary differences based on management’s assessment that future taxable profit will be available against which the Group can utilise the benefits therefrom. Deferred tax assets are recognised in relation to the Italian subsidiary’s available tax losses and temporary differences, reduced by amounts utilised. At 30 June 2026 all available tax losses in Italy had been utilised in the prior period and therefore no deferred tax asset has been recognised for these tax losses (31 December 2025: $Nil). Unrecognised deferred tax assets Deferred tax assets have not been recognised in respect of the following items: 30 June 2026 € 31 December 2025 € Tax losses (Australia) 4,214,694 3,765,927 Tax losses (Italy) - - Deductible temporary differences (117) 14,75