Delixy Holdings Limited Signs Non-Binding Letter of Intent for Strategic Transaction Involving Up to 48% Interest in East Kazakhstan Sarybulak Oil Field

Delixy targets up to 48% of a Kazakh oil and gas operator, but only signs a non-binding LOI.

What the company is saying

Delixy Holdings Limited, listed on NASDAQ as DLXY, is announcing a non-binding letter of intent signed on September 15, 2026, with Caog S.a.r.l of Luxembourg to potentially acquire or merge up to 48% of Tarbagatay Munay (TBM), the operator of the Sarybulak Oil Field in East Kazakhstan. The company frames this as a strategic move to expand beyond oil trading and integrate upstream operations, emphasizing the project's established gas supply to China, new crude oil production, and significant resource base. Executive Chairman and CEO Mr. Dongjian Xie personally highlights the alignment between TBM's upstream assets and Delixy's marketing network in China, projecting enhanced commercialization and long-term value creation. The announcement stresses the project's operational history, resource scale, and infrastructure, but repeatedly uses conditional language about the deal's completion. The company details two possible transaction structures—equity acquisition or asset merger—but makes clear that all terms are subject to due diligence, definitive agreements, and multiple regulatory and shareholder approvals. The tone is optimistic and forward-looking, but the company is careful to state there is no assurance of completion.

What the data suggests

Delixy has signed only a non-binding LOI for a potential acquisition or merger of up to 48% of TBM, not a definitive agreement. TBM operates the Sarybulak Oil Field, located about 90 kilometers from the China-Kazakhstan border, and has supplied nearly 4.0 billion cubic meters of natural gas to China over more than thirteen years via its own cross-border pipeline. Commercial crude oil sales began in Q1 2026, and TBM holds approximately 100 million metric tons of approved original oil in place as recognized by the Kazakhstan Geological Committee. The project has recently identified additional oil-bearing formations and light oil structures, but no quantification or development timeline is provided for these. The crude produced is mainly heavy naphthenic oil, suitable for higher-value lubricant feedstock, and the project has full oil export rights. No financial figures such as revenue, profit, or cash flow are disclosed, and there is no evidence of committed funding or transaction pricing. All operational and resource data pertain to TBM, not Delixy, and Delixy's actual progress is limited to the early negotiation stage.

Analysis

The announcement is framed in highly positive terms, emphasizing strategic access, resource scale, and potential long-term value creation. However, the only realised milestone is the signing of a non-binding LOI; all transaction benefits are contingent on future due diligence, definitive agreements, and multiple regulatory approvals. While the project has a long operational history and recent crude sales, Delixy has not yet secured any ownership or operational rights. Most of the value claims (integration, diversification, supply chain benefits) are forward-looking and aspirational, with no immediate earnings impact or profitability data disclosed. The contemplated acquisition or merger is capital intensive, but there is no evidence of committed funding or near-term returns. The gap between narrative and evidence is moderate: operational facts about TBM are solid, but Delixy's actual progress is limited to early-stage negotiations.

Risk flags

• ●The transaction is at a very early stage, with only a non-binding LOI signed and no definitive agreement or binding commitments. This exposes Delixy to the risk that negotiations may fail, terms may change, or the deal may not proceed at all.
• ●Completion is subject to extensive regulatory and governmental approvals in Kazakhstan, including waivers of statutory priority or pre-emptive rights and the consent of other TBM shareholders. These processes can be lengthy and unpredictable, introducing significant execution risk.
• ●There is no disclosure of transaction price, funding sources, or expected financial impact, making it impossible to assess potential dilution, leverage, or return on investment. The absence of these details limits investor ability to evaluate the deal's attractiveness or risks.
• ●All operational and resource figures relate to TBM, not Delixy, and there is no evidence Delixy will secure operational control, profit rights, or integration benefits unless the transaction closes on favorable terms. The company’s narrative is heavily forward-looking and contingent.
• ●The announcement relies on the strategic value of infrastructure and resource scale, but provides no quantification of incremental reserves from recent exploration or any timeline for realizing production diversification or export expansion. This leaves the upside largely speculative.

Bottom line

Delixy Holdings Limited is seeking to acquire or merge up to 48% of Tarbagatay Munay, a Kazakh oil and gas operator with a long history of gas supply to China and a substantial oil resource base, but has only signed a non-binding LOI. The project’s operational track record and infrastructure are credible, with 4.0 billion cubic meters of gas delivered and 100 million metric tons of oil in place, but all value to Delixy remains hypothetical until a binding agreement is reached and regulatory hurdles are cleared. No financial terms, funding plans, or integration details are disclosed, and the path to closing is complex and uncertain. Investors should treat this as an early-stage, high-uncertainty signal with no immediate earnings impact or guaranteed upside. The most important next step is evidence of a definitive agreement with clear financial terms and regulatory progress; until then, the announcement is mainly aspirational.

Announcement summary

(NASDAQ:DLXY) Delixy Holdings Limited announced that on September 15, 2026, it entered into a non-binding letter of intent (LOI) with Caog S.a.r.l, a Luxembourg registered company, regarding the potential acquisition or merger of up to 48% of shares in Tarbagatay Munay (TBM), a Kazakhstan registered company and the subsoil user and operator of the Sarybulak Oil Field in East Kazakhstan. The LOI contemplates two possible transaction structures: (i) acquisition of part or all of the equity of the Project operating company to obtain operating, profit, and development rights; or (ii) an asset merger and restructuring involving the Project's operational assets, pipeline facilities, mineral right reserves, and production and operation business for integrated cooperative operation. The Sarybulak Oil Field Project is located approximately 90 kilometers from the China-Kazakhstan border, providing strategic access to a key energy transportation corridor. The Project has supplied natural gas to China for more than thirteen years via a self-owned cross-border pipeline, delivering an aggregate of close to 4.0 billion cubic meters by the end of April 2026. Commercial crude oil sales from the Project began in the first quarter of 2026. TBM currently has approximately 100 million metric tons of approved original oil in place (OOIP) recognized by the Kazakhstan Geological Committee. Ongoing geological exploration and resource evaluation have identified additional oil-bearing formations expected to further enhance the Project's resource scale and asset value. The Project's crude production mainly consists of heavy naphthenic crude oil, a desirable feedstock for producing special naphthenic base oil used in lubricants, which typically commands higher value than conventional fuel products. Recent exploration has also indicated several light oil-bearing structures, anticipated to facilitate the development of lighter crude oil and support production diversification. The Project possesses full oil export rights, enabling access to international markets. Mr. Dongjian Xie, Executive Chairman and Chief Executive Officer of Delixy, stated that the proposed transaction is a significant step in Delixy's strategy to expand beyond oil trading and strengthen participation across the energy value chain. He highlighted the Project's ability to deliver produced crude oil to China, Delixy's main crude market, leveraging Delixy's strong network of commercial relationships and influence over end users. Mr. Xie emphasized the Project's combination of strong local government relationships, established natural gas production, cross-border infrastructure, newly commenced crude oil production, and substantial resource potential in a strategically important region adjacent to China. He believes the opportunity could enhance supply chain integration, diversify revenue streams, and create additional long-term value for shareholders. Completion of the transaction is subject to due diligence, negotiation of a definitive agreement, satisfaction of negotiated conditions, and approval by Delixy's board. Any definitive transaction will also require all necessary Kazakhstan governmental, regulatory, and subsoil-authority approvals, including any waiver of the State's statutory priority or pre-emptive right, and the consent or waiver of any pre-emptive, right-of-first-refusal, tag-along, or similar rights held by other TBM shareholders. There is no assurance that a definitive agreement will be entered into or that the proposed transaction will be consummated. TBM is currently owned by Caog S.a.r.l and a China public listed company in Shanghai Stock Exchange, has operated in the region for more than fifteen years, and has established relationships with the Kazakhstan government.

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