Core Viewpoint - U.S. Energy Corporation is advancing its transformation into an integrated industrial gas company, focusing on the development of its Kevin Dome asset, which has significant potential for helium and CO₂ resources [2][3][5]. Financial and Operational Results - For the second quarter of 2025, U.S. Energy reported total hydrocarbon production of approximately 48,816 BOE, with oil production accounting for 69% [14]. - Total oil and gas sales for the quarter were approximately $2.0 million, a decrease from $6.1 million in the same quarter of 2024, primarily due to divestitures and declining oil prices [14]. - The company reported a net loss of $6.1 million, or a loss of $0.19 per diluted share, compared to a net loss of $1.97 million in the same quarter of 2024 [17][25]. Resource Report - An industrial gas resource report confirmed U.S. Energy controls 1.28 billion cubic feet (BCF) of net helium resources and 443.8 BCF of net CO₂ resources at the Kevin Dome [3][4]. Upstream Development - The company successfully drilled two additional industrial gas wells, bringing the total to three, with a combined peak production rate of 12.2 MMcf/d [6][7]. - The wells have a premium gas composition of 0.47% helium and 85.2% CO₂, indicating strong marketability and revenue potential [6]. Infrastructure and Carbon Management - The design and planning of the initial processing facility are advancing, with construction expected to start soon, projected to generate first revenues in the first half of 2026 [2][12]. - The company achieved sustained injection of 17.0 MMcf/d across two wells, equating to an annual sequestration capacity of approximately 240,000 metric tons of CO₂ [12]. Balance Sheet and Liquidity - U.S. Energy remained entirely debt-free as of June 30, 2025, with approximately $26.7 million in available liquidity [10][11]. - The company’s cash balance decreased from $7.7 million at the end of 2024 to $6.7 million by mid-2025 [11][23]. Future Outlook - The company is targeting high-margin recovery of CO₂, helium, and natural gas from existing production, with capital deployment expected to begin in Q3 2025 [12]. - The next phase of upstream growth is planned for 2026, focusing on monetization opportunities and infrastructure build-out [12].

Core Points - U.S. Energy Corporation will release its second quarter 2025 financial results on August 12, 2025, before market opens [1] - A conference call to discuss the financial results and recent events will take place on the same day at 9:00 a.m. ET [2] - The company focuses on developing and operating high-quality energy and industrial gas assets while aiming to reduce its carbon footprint [3] Company Overview - U.S. Energy Corporation is a growth-focused company engaged in the development and operation of energy and industrial gas assets in the U.S. [3] - The company emphasizes low-risk development and maintaining attractive shareholder returns [3] - More information about the company can be found on its website [3]

Core Viewpoint - U.S. Energy Corp. is advancing its development of an industrial gas processing plant with a finalized capacity of 17 MMCF, expected to be operational soon [1]. Company Summary - The industrial gas processing plant being constructed by U.S. Energy Corp. is a significant step in its development strategy [1]. - The finalized capacity of the plant is 17 million cubic feet per day (MMCF) [1]. Industry Context - The construction of gas processing facilities is crucial for enhancing the efficiency and output of energy production in the sector [1].

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was approximately $2.2 million, down from $5.4 million in the same quarter last year, reflecting the impact of divestitures in the second half of 2024 [20] - Lease operating expense for the quarter was $1.6 million or $34.23 per BOE, compared to $3.2 million or $29.2 per BOE in the same quarter last year, indicating a decrease due to divestitures [21] - Cash position stood at over $10.5 million as of March 31, 2025, reflecting net cash proceeds of $10.3 million from a successful equity offering [22] Business Line Data and Key Metrics Changes - The company is focusing on the development of its Montana industrial gas project, which includes workovers, flow testing, and drilling new development wells [7][8] - The processing plant at Ki Bin Dome is expected to process approximately 17 million cubic feet of raw gas per day, with an estimated cost of $15 million [11] - The company anticipates sequestering approximately 250,000 metric tons of CO2 annually once the processing plant is operational [13] Market Data and Key Metrics Changes - The helium market remains steady, with current pricing around $400 per Mcf, down from previous peaks [34] - The largest growth forecast for helium demand is in the semiconductor industry, which is expected to drive future growth [33] Company Strategy and Development Direction - The company aims to build a full cycle platform from production and processing to long-term carbon storage while maintaining disciplined capital allocation [15] - The strategy includes monetizing legacy hydrocarbon assets while investing in the core Montana project [16] - The company positions itself as a first mover in the industrial gas sector with a unique non-hydrocarbon gas stream, providing a competitive advantage [14] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, highlighting the transformational opportunity presented by the Montana project [14] - The company has de-risked its project year to date and is on track to launch and grow its initiatives within the next twelve months [41] Other Important Information - The company has repurchased approximately 832,000 shares, representing roughly 2.5% of its outstanding float, reflecting management's confidence in the stock's value [17] - The company is in talks to renew and extend its credit agreement, expected to be completed in Q2 2025 [22] Q&A Session Summary Question: Was the cost of the processing plant higher than expectations? - Management clarified that the cost was in line with expectations, considering the complexity of the infrastructure and production requirements [27][29] Question: Could the completion of the processing plant bleed into Q2 2026? - Management indicated that completion could be at the end of Q1 or the beginning of Q2 2026, depending on weather conditions [31] Question: Can you provide an update on the helium markets? - Management noted that the helium market remains steady, with pricing around $400 per Mcf, and highlighted the semiconductor industry as a key growth area [34][36]

Financial Data and Key Metrics Changes - Revenue for the first quarter of 2025 was approximately $2.2 million, down from $5.4 million in the same quarter last year, reflecting the impact of divestitures in the second half of 2024 [18] - Lease operating expense for the quarter was $1.6 million or $34.23 per BOE, compared to $3.2 million or $29.2 per BOE in the same quarter last year, indicating a decrease due to divestitures [19] - Cash position stood at over $10.5 million, reflecting net cash proceeds of $10.3 million from a successful equity offering during the first quarter [20] Business Line Data and Key Metrics Changes - The company’s primary focus is on the development of the Montana industrial gas project, which includes workovers, flow testing, and drilling new development wells [6][7] - The company acquired 24,000 net acres in the Cuban Dome structure, targeting helium and CO2-rich formations [8] - The processing plant at Ki Bin Dome is expected to process approximately 17 million cubic feet of raw gas per day, with an estimated cost of $15 million [9][10] Market Data and Key Metrics Changes - The helium market remains steady, with current pricing around $400 per Mcf, down from previous peaks [30][34] - The largest growth forecast for helium demand is in the semiconductor industry, which is expected to drive future growth [30] Company Strategy and Development Direction - The company aims to build a full cycle platform from production and processing to long-term carbon storage while maintaining disciplined capital allocation [14] - The strategy includes monetizing legacy hydrocarbon assets while focusing on the core Montana project [15] - The company is positioned as a first mover in the industrial gas sector, leveraging its unique non-hydrocarbon gas stream for competitive advantage [13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, highlighting the transformational opportunity presented by the Montana project [13] - The company is focused on de-risking its projects and expects to reach scale within the next twelve months [38] Other Important Information - The company has repurchased approximately 832,000 shares, representing roughly 2.5% of its outstanding float, reflecting management's confidence in the stock's value [16] - The company controls one of the largest known CO2 deposits in the U.S., which is crucial for its carbon management initiatives [11] Q&A Session Summary Question: Was the cost of the processing plant higher than expected? - Management clarified that the cost was in line with expectations, considering the complexity of the infrastructure and production requirements [25][26] Question: Could the completion of the processing plant bleed into the second quarter of 2026? - Management indicated that weather could affect the timeline, but they are currently targeting a completion date around the end of the first quarter or early second quarter of 2026 [28] Question: Can you provide an update on the helium markets? - Management noted that the helium market remains stable, with significant demand from the semiconductor industry and current pricing around $400 per Mcf [30][34]

Core Insights - U.S. Energy Corp will participate in the D. Boral Capital Inaugural Global Conference in New York City on May 14, 2025, with CEO Ryan Smith hosting one-on-one meetings with institutional investors [1] Company Overview - U.S. Energy Corp is focused on consolidating high-quality producing assets in the United States, aiming to optimize production and generate free cash flow through low-risk development while providing attractive shareholder returns [3] - The company is committed to reducing its carbon footprint in its operational areas [3]

Financial Performance - Total revenue for Q1 2025 was $2,193,000, a decrease of 59.3% compared to $5,391,000 in Q1 2024[19] - Operating loss for Q1 2025 was $3,088,000, improved from an operating loss of $8,022,000 in Q1 2024[19] - Net loss for Q1 2025 was $3,111,000, compared to a net loss of $9,537,000 in Q1 2024, representing a 67.4% reduction[19] - Basic and diluted loss per share improved to $0.10 in Q1 2025 from $0.38 in Q1 2024[19] - The net loss attributable to common shareholders for the three months ended March 31, 2025, was $3,111,000, compared to a net loss of $9,537,000 for the same period in 2024, representing a 67.4% improvement[78] - Basic and diluted net loss per share for the three months ended March 31, 2025, was $(0.10), compared to $(0.38) for the same period in 2024[78] Cash and Liquidity - Cash and equivalents increased to $10,502,000 as of March 31, 2025, up from $7,723,000 at the end of 2024[23] - Cash used in operating activities was $4.544 million for the three months ended March 31, 2025, compared to $603 thousand in 2024, mainly due to a net loss of $3.1 million[137] - Cash used in investing activities was $2.422 million, significantly higher than $179 thousand in the comparable period of 2024, primarily due to the Synergy acquisition[138] - Cash provided by financing activities was $9.745 million, a substantial increase from cash used of $563 thousand in 2024, driven by an equity offering that raised $11.9 million[139] - As of March 31, 2025, the Company had no outstanding amounts under the Credit Agreement after repaying the remaining balance of $2.0 million on September 10, 2024[52] Assets and Liabilities - Total assets rose to $55,835,000 as of March 31, 2025, compared to $49,667,000 at the end of 2024, reflecting a 12.4% increase[18] - Total liabilities decreased to $22,277,000 as of March 31, 2025, down from $25,846,000 at the end of 2024, a reduction of 13.1%[18] - Shareholders' equity increased to $33,558,000 as of March 31, 2025, compared to $23,821,000 at the end of 2024, marking a 40.9% increase[18] Revenue Breakdown - In the Rockies region, oil revenue decreased to $1.357 million from $1.721 million, while natural gas and liquids revenue increased to $69,000 from $41,000[41] - Oil revenue fell by 63% to $1.77 million, while natural gas and liquids revenue decreased by 36% to $423,000 for the same period[119] - Production quantities dropped by 57%, with 47,008 barrels of oil equivalent (BOE) produced in Q1 2025, down from 109,800 BOE in Q1 2024[119] - The average sales price for oil decreased by 14% to $59.01 per barrel, while the average sales price for natural gas and liquids increased by 54% to $4.14 per Mcfe[119] Acquisitions and Investments - The company acquired industrial gas properties for $2,128,000 during Q1 2025[23] - The Company acquired 24,000 net operated acres in Montana for a total consideration of $4.7 million, which includes $2.0 million in cash and 1,400,000 shares of common stock[39] - The company plans to use proceeds from the stock offering for the development of its recent acquisition in Montana and general corporate purposes[58] Shareholder Activities - The company issued 4,871,400 shares in an underwritten offering, netting $11,877,000[21] - The ongoing share repurchase program has been extended until June 30, 2026, with $5.0 million authorized for repurchases[110] - During the first quarter of 2025, the company repurchased a total of 125,600 shares at an average price of $1.87 per share, with a remaining authorization of approximately $3,596,161 under the share repurchase program[152] Operational Costs - For the three months ended March 31, 2025, total oil and natural gas production costs decreased to $1.773 million, a reduction of $1.820 million or 51% compared to $3.593 million in 2024[120] - Lease operating expenses were $1.609 million, down $1.577 million or 49% from $3.186 million in the prior year, while lease operating expense per BOE increased by 18% to $34.23[120] - Gathering, transportation, and treating costs fell to $16 thousand, a decrease of $48 thousand or 75% compared to the same period in 2024[121] - Production taxes decreased to $148 thousand, down $195 thousand or 57% from $343 thousand in 2024, remaining between 6% and 7% of revenue[122] - General and administrative expenses increased to $2.389 million, an increase of $183 thousand or 8% compared to $2.206 million in 2024, primarily due to higher professional fees and stock-based compensation[125] Financial Reporting and Controls - The Company is currently assessing the impact of new accounting standards on its financial disclosures, including ASU 2023-09 and ASU 2024-03[34][36] - As of March 31, 2025, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls were not effective due to a material weakness in internal control over financial reporting as of December 31, 2024[143] - A material weakness was identified related to the accounting system, which lacked certain functionalities such as system-based account reconciliations and independent evaluation of third-party IT controls[144] - The company began outsourcing day-to-day accounting to a third-party provider in January 2025, aiming to remediate the material weakness by year-end 2025[146] - There were no changes in internal control over financial reporting during the three months ended March 31, 2025, that materially affected the company's internal controls[147] Risk Factors and Future Outlook - Significant credit risk exists, with Purchaser A accounting for 46% of total oil and natural gas revenue for the three months ended March 31, 2025, compared to 28% in 2024[42] - The company expects to record a write-down of oil and natural gas properties in the second quarter of 2025, estimated between $7.0 million and $8.0 million, due to lower commodity prices[92] - The company anticipates capital expenditures for industrial gas development to range between $3.5 million and $4.5 million in 2025[130] - The company is not currently involved in any legal proceedings that could materially affect its business or financial condition[149] - There have been no material changes to the risk factors previously disclosed in the Annual Report for the year ended December 31, 2024[151]

Production and Sales - U.S. Energy reported total hydrocarbon production of approximately 47,008 BOE in Q1 2025, with oil production accounting for 64% of total output[13] - Total oil and gas sales for Q1 2025 were approximately $2.2 million, a decrease from $5.4 million in Q1 2024, primarily due to divestitures and declining oil prices[13] - Total revenue for Q1 2025 was $2,193,000, a decrease of 59.3% compared to $5,391,000 in Q1 2024[26] Reserves and Assets - The company's proved developed producing (PDP) reserves as of March 31, 2025, were approximately 2.0 million BOE, with a present value discounted at 10% of approximately $28.7 million[12] - Total current assets increased to $12,091,000 in Q1 2025 from $9,724,000 in Q4 2024, reflecting a 24.5% growth[24] - Total assets rose to $55,835,000 in Q1 2025, up from $49,667,000 in Q4 2024, indicating a 12.5% increase[24] - Total liabilities decreased to $22,277,000 in Q1 2025 from $25,846,000 in Q4 2024, a reduction of 13.5%[24] Financial Performance - The company reported a net loss of $3.1 million, or a loss of $0.10 per diluted share, in Q1 2025, compared to adjusted EBITDA of ($1.5) million[16] - Net loss for Q1 2025 was $3,111,000, compared to a net loss of $9,537,000 in Q1 2024, representing a 67.4% improvement[26] - Adjusted EBITDA for Q1 2025 was $(1,498,000), a decline from $237,000 in Q1 2024[31] - Cash general and administrative expenses for Q1 2025 were approximately $1.9 million, reflecting an 18% decrease from $2.0 million in Q1 2024[15] - Operating expenses for Q1 2025 totaled $5,281,000, down 60.7% from $13,413,000 in Q1 2024[26] - The company incurred no impairment of oil and natural gas properties in Q1 2025, compared to $5,419,000 in Q1 2024[26] Liquidity and Capital Management - U.S. Energy ended Q1 2025 with approximately $30.5 million in total liquidity, remaining entirely debt-free[10] - Cash and equivalents at the end of Q1 2025 were $10,502,000, up from $7,723,000 at the end of Q4 2024, marking a 36.5% increase[28] Future Projects - U.S. Energy achieved a sustained gas injection rate of 17.0 MMcf/d, projected to sequester approximately 240,000 metric tons of CO₂ annually[7] - The company has budgeted $1.3 million for each of two new industrial gas wells targeting the Duperow formation, with completion expected by early June 2025[8] - Construction of the initial gas processing plant, capable of processing 17.0 MMcf/d, is scheduled to begin in July 2025 at a capital cost of approximately $15 million[8] Shareholder Actions - U.S. Energy repurchased approximately 832,000 shares year-to-date, representing 2.5% of outstanding shares, reflecting strong alignment with shareholders[17]

Core Insights - U.S. Energy Corporation is focused on becoming a leading provider of non-hydrocarbon industrial gases, with significant progress in its Montana development project [2][3] - The company has a disciplined capital allocation strategy, having divested legacy oil and gas assets, eliminated debt, and returned capital to shareholders through share repurchases [2][8] Financial Performance - For Q1 2025, U.S. Energy reported total hydrocarbon production of approximately 47,008 barrels of oil equivalent (BOE), with oil production accounting for 64% [11] - Total oil and gas sales for Q1 2025 were approximately $2.2 million, a decrease from $5.4 million in Q1 2024, primarily due to divestitures and declining oil prices [11] - The company reported a net loss of $3.1 million, or a loss of $0.10 per diluted share, compared to a net loss of $9.5 million in the same quarter of 2024 [14][24] Operational Developments - U.S. Energy has acquired 24,000 net acres in the Kevin Dome, with the Kiefer Farms well demonstrating helium concentrations of approximately 0.6% and flow rates exceeding 3.2 million cubic feet per day (MMcf/d) [6][10] - The company is set to begin construction of its gas processing plant in July 2025, which will have a processing capacity of 17.0 MMcf/d at a capital cost of approximately $15 million [6][10] Carbon Management Initiatives - The company is projected to permanently sequester approximately 240,000 metric tons of CO₂ annually through its gas injection activities [13] - U.S. Energy has submitted an application for a new Class II injection well, with approval expected in June 2025 [13] Balance Sheet and Liquidity - As of March 31, 2025, U.S. Energy remained entirely debt-free, with approximately $30.5 million in available liquidity [8][9] - The company ended Q1 2025 with a cash balance of $10.5 million, an increase from $7.7 million at the end of 2024 [9][21] Shareholder Returns - U.S. Energy has repurchased approximately 832,000 shares year-to-date, representing about 2.5% of its outstanding shares, reflecting strong alignment with shareholders [15]

Core Viewpoint - U.S. Energy Corporation is set to release its first quarter 2025 financial results on May 12, 2025, before market opening, indicating a focus on transparency and communication with investors [1]. Group 1: Financial Results Announcement - The company will announce its first quarter 2025 results before the market opens on May 12, 2025 [1]. - A conference call is scheduled for the same day at 9:00 a.m. ET to discuss the financial results and recent events [2]. Group 2: Investor Relations - A webcast of the conference call will be available on the company's Investor Relations website, emphasizing the company's commitment to keeping investors informed [2]. - Replay options for the teleconference will be available until May 26, 2025, providing additional access for stakeholders [3]. Group 3: Company Overview - U.S. Energy Corporation focuses on the development and operation of high-quality energy and industrial gas assets in the U.S., aiming for low-risk development and attractive shareholder returns [3]. - The company is committed to reducing its carbon footprint in its operational areas, aligning with broader industry trends towards sustainability [3].