Financial Data and Key Metrics Changes - For Q1 2025, production averaged just under 15,000 barrels of oil equivalent per day, a 16% increase from Q4 2024 [9] - EBITDA for the quarter was $39.9 million, adjusted net income was $8 million, and GAAP net income was $2.7 million [14] - Total debt at the end of Q1 was $117 million, with a net debt to adjusted annualized EBITDA ratio of 0.7 times [14] - The company revised its 2025 production guidance to a range of 15,000 to 17,000 barrels per day, with an anticipated oil cut of 64% to 68% [14] Business Line Data and Key Metrics Changes - The acquisition of Lucero has expanded the development pipeline, which now includes 25 net wells, with 9.5 net wells either drilling or completing [9] - The company has deferred the completion of 1.9 net wells due to recent commodity price volatility [10] - Approximately 61% of oil production is hedged at a weighted average price of $70.75 per barrel [11] Market Data and Key Metrics Changes - The company has chosen not to close on $20 million of acquisitions due to market conditions [10] - The overall pipeline of development wells is higher than ever, primarily due to the Lucero acquisition [9] Company Strategy and Development Direction - The company aims to invest capital at the highest rates of return possible, allowing for capital returns to shareholders through all cycles [7] - The board reaffirmed the annual dividend at a rate of $2.25 per share, reflecting confidence in the business model [8] - The company is actively looking for acquisition opportunities that meet their return hurdles, especially in a volatile market [21][45] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to maintain dividends despite current pricing environments [32] - The company is prepared to adapt its capital expenditures based on market conditions to protect long-term shareholder returns [15] - There is an ongoing assessment of operator behavior and AFE quality, with no significant changes noted [40] Other Important Information - G&A expenses increased due to the Lucero acquisition, with a projected run rate of about $4 per BOE [54] - Litigation costs are expected to continue into the second quarter due to an upcoming trial [56] Q&A Session Summary Question: What drives the guidance range? - Management indicated that the timing of well completions and potential acquisitions are key factors influencing the guidance range [18][19] Question: How does the company view buybacks in the current environment? - The focus remains on maintaining the fixed dividend, with buybacks considered in the context of capital investment and cash flow [23][25][27] Question: How is the Lucero acquisition performing? - The integration of Lucero assets is proceeding as expected, with performance aligning with initial underwriting [34] Question: What is the outlook for capital expenditures? - The company has a wide CapEx range to allow flexibility for attractive acquisitions, with $10 million currently underwritten for base case acquisitions [48][51] Question: Are there any early signs from operators regarding AFE quality? - Management noted no significant changes in AFE quality, with a trend towards longer laterals being observed [40] Question: Is the company looking at other basins for acquisitions? - The company is receiving inquiries from stressed private companies and is actively looking at other basins for potential acquisitions [44][45]

Company Overview - Vitesse's assets are comprised of over 80% undeveloped locations, indicating a long-term growth potential[8, 27] - Vitesse estimates having over 200 net remaining undeveloped locations across its asset[15, 18] - Vitesse has interests in 7,397 productive wells (221 net wells) with an average working interest of 3.6% per working interest well[18] Financial Performance & Strategy - Vitesse estimates 2025 net production to be 15.0 – 17.0 MBoe/d with 64-68% oil weighting[15] - Vitesse offers an 11% fixed dividend yield[8] - Vitesse has a returns-based capital allocation framework, including a $0.5625 per share quarterly cash dividend and a $60 million share repurchase program[10] - Vitesse targets a net debt to adjusted EBITDA ratio of less than 1.0x[10, 27] Asset Valuation - Vitesse's 1P PV-10 is $806 million, and PDP PV-10 is $609 million[15] - Vitesse has nearly 200 acquisitions and divestitures totaling $757 million[27]

For the quarter ended March 2025, Vitesse Energy (VTS) reported revenue of $66.17 million, up 8.1% over the same period last year. EPS came in at $0.23, compared to $0.34 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $65.06 million, representing a surprise of +1.71%. The company delivered an EPS surprise of +155.56%, with the consensus EPS estimate being $0.09.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and ho ...

Vitesse Energy (VTS) came out with quarterly earnings of $0.23 per share, beating the Zacks Consensus Estimate of $0.09 per share. This compares to earnings of $0.34 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 155.56%. A quarter ago, it was expected that this energy company would post earnings of $0.26 per share when it actually produced earnings of $0.18, delivering a surprise of -30.77%. Over the last four quarters, the ...

PART I FINANCIAL INFORMATION [Condensed Consolidated Financial Statements (Unaudited)](index=10&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) Q1 2025 unaudited financials reflect total assets of $975.2 million, net income of $2.7 million, and reduced operating cash flow [Condensed Consolidated Balance Sheets](index=11&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance sheets show total assets at $975.2 million and equity at $667.7 million, primarily from the Lucero acquisition | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$975,236** | **$810,893** | | Total current assets | $70,448 | $50,911 | | Total oil and gas properties | $895,244 | $751,976 | | **Total Liabilities** | **$307,546** | **$310,559** | | Revolving credit facility | $117,000 | $117,000 | | **Total Equity** | **$667,690** | **$500,334** | - Total assets increased by approximately **$164.3 million**, primarily driven by a **$143.3 million** increase in oil and gas properties, largely due to the Lucero acquisition[22](index=22&type=chunk) - Total equity increased by **$167.4 million**, reflecting the issuance of common stock for the Lucero acquisition and net income for the period, partially offset by dividends[22](index=22&type=chunk)[26](index=26&type=chunk) [Condensed Consolidated Statements of Operations](index=13&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Statements of operations show a return to profitability with $2.7 million net income and an 8.1% increase in total revenue | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Total Revenue (in thousands)** | **$66,171** | **$61,193** | | Operating Income (in thousands) | $5,380 | $13,079 | | Commodity derivative (loss), net (in thousands) | ($172) | ($13,824) | | **Net Income (Loss) (in thousands)** | **$2,668** | **($2,186)** | | Net income (loss) per share – basic | $0.08 | ($0.07) | | Net income (loss) per share – diluted | $0.08 | ($0.07) | - The company returned to profitability with a net income of **$2.7 million** in Q1 2025, compared to a net loss of **$2.2 million** in Q1 2024, primarily due to a significant reduction in net commodity derivative losses from **$13.8 million** to just **$0.2 million**[24](index=24&type=chunk) - Total revenue increased by **8.1%** year-over-year, driven by higher natural gas revenue and overall production volumes[24](index=24&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=15&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash flow statements indicate a 55.6% decrease in operating cash flow to $17.5 million, offset by financing activities | Cash Flow Category | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash from Operating Activities (in thousands) | $17,489 | $39,419 | | Net cash from Investing Activities (in thousands) | ($30,374) | ($32,213) | | Net cash from Financing Activities (in thousands) | $14,413 | ($6,381) | | **Net Increase in Cash (in thousands)** | **$1,528** | **$825** | - Net cash from operating activities decreased by **55.6%** year-over-year, falling to **$17.5 million** from **$39.4 million**[28](index=28&type=chunk) - Financing activities provided a net cash inflow of **$14.4 million**, primarily due to **$49.8 million** in cash acquired from the Lucero Acquisition, which offset **$26.0 million** in dividend payments[28](index=28&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=16&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the company's oil and gas focus, Lucero acquisition, credit facility, and dividend declaration - The company's business is focused on acquiring and developing oil and gas properties, primarily non-operated working and royalty interests in the Williston Basin (Bakken and Three Forks formations)[30](index=30&type=chunk) - On March 7, 2025, Vitesse acquired Lucero Energy Corp. in an all-stock transaction, issuing **8,169,839** shares of common stock, accounted for as a business combination with assets and liabilities recorded at fair values[58](index=58&type=chunk) Preliminary Purchase Price Allocation for Lucero Acquisition (in thousands) | Category | Amount | | :--- | :--- | | Arrangement consideration | $194,279 | | **Assets Acquired** | | | Cash and cash equivalents | $49,846 | | Proved oil and gas properties | $150,395 | | Total assets acquired | $206,594 | | **Liabilities Assumed** | | | Total liabilities assumed | $12,315 | | **Net Assets Acquired** | **$194,279** | - The Revolving Credit Facility's borrowing base was increased to **$315 million** and elected commitments rose to **$250 million** in conjunction with the Lucero Acquisition, with **$117.0 million** outstanding as of March 31, 2025[72](index=72&type=chunk) - On May 1, 2025, the Board declared a quarterly cash dividend of **$0.5625 per share**, payable on June 30, 2025[116](index=116&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion highlights the Lucero acquisition, Q1 2025 production and revenue growth, $2.7 million net income, and liquidity [Executive Overview](index=33&type=section&id=Executive%20Overview) Executive overview outlines the company's strategy, key Q1 2025 financial and operational highlights, and the Lucero acquisition - The company's strategy focuses on creating stockholder value through acquiring, developing, and producing oil and gas assets, maintaining a strong balance sheet, and paying a meaningful dividend[118](index=118&type=chunk) Q1 2025 Financial and Operating Highlights | Metric | Value | | :--- | :--- | | Quarterly Dividend | $0.5625 per share | | Production | 14,971 Boe/d (68% oil) | | Total Revenue | $66.2 million | | Net Income | $2.7 million | | Cash Flow from Operations | $17.5 million | | Capital Investment | $30.4 million | | Total Debt (as of March 31, 2025) | $117.0 million | - A key event in the quarter was the closing of the all-stock acquisition of Lucero Energy Corp. for a total consideration of **$194.3 million**[121](index=121&type=chunk) [Results of Operations](index=36&type=section&id=Results%20of%20Operations) Results of operations show 8% revenue growth from production, higher G&A from acquisition costs, and reduced derivative losses Comparison of Operating Results (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | **Total Revenue ($ thousands)** | **$66,171** | **$61,193** | **8%** | | Daily Production (Boe/d) | 14,971 | 12,557 | 19% | | Avg. Realized Price/Boe (pre-hedging) | $49.11 | $53.55 | (8%) | | Lease Operating Expense/Boe | $10.28 | $10.32 | 0% | | G&A Expense/Boe | $9.00 | $4.70 | 91% | | DD&A/Boe | $19.72 | $20.61 | (4%) | - The **8%** increase in total revenue was driven by an **18%** rise in production volumes, partially offset by an **8%** decrease in average realized prices per Boe[142](index=142&type=chunk) - General and administrative expenses increased by **126%** to **$12.1 million**, primarily due to **$4.6 million** in transaction costs related to the Lucero Acquisition[148](index=148&type=chunk) - The net commodity derivative loss was significantly reduced to **$0.2 million** from **$13.8 million** in the prior-year quarter, mainly due to relatively flat oil prices in Q1 2025 compared to rising prices in Q1 2024[153](index=153&type=chunk)[154](index=154&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity and capital resources detail $4.5 million cash, $133 million available credit, and decreased operating cash flow - As of March 31, 2025, the company had **$4.5 million** in cash and **$133.0 million** available under its Revolving Credit Facility[161](index=161&type=chunk) - The working capital deficit narrowed to **$26.2 million** from **$49.4 million** at year-end 2024, due to an increase in revenue receivables and a decrease in accrued capital expenditures[163](index=163&type=chunk) - Cash flow from operations decreased **56%** to **$17.5 million** in Q1 2025 from **$39.4 million** in Q1 2024[164](index=164&type=chunk) - Total capital expenditures for Q1 2025 were **$30.4 million**, including development and acquisition activities[175](index=175&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages commodity price and interest rate risks through hedging programs and monitors the impact of market fluctuations - The company's primary market risk exposure is from the volatility of oil and natural gas prices, which it manages through a derivative hedging program[185](index=185&type=chunk)[186](index=186&type=chunk) - A hypothetical **$1** increase or decrease in the NYMEX WTI strip price would change the fair value of the company's open oil commodity derivative positions by approximately **$2.6 million** as of March 31, 2025[189](index=189&type=chunk) - The company is exposed to interest rate risk through its floating-rate Revolving Credit Facility, where a **1%** change in the average interest rate would result in an approximate **$0.3 million** change in quarterly interest expense[190](index=190&type=chunk) [Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls were effective as of March 31, 2025, with Lucero excluded from internal control over financial reporting assessment - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[191](index=191&type=chunk) - The assessment of internal controls over financial reporting as of March 31, 2025, excluded Lucero, which was acquired on March 7, 2025, permissible under SEC guidance for up to 12 months post-acquisition[192](index=192&type=chunk)[193](index=193&type=chunk) - Other than incorporating Lucero's controls, there were no changes in internal control over financial reporting during the first quarter of 2025 that have materially affected, or are reasonably likely to materially affect, internal controls[194](index=194&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=45&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in ordinary legal proceedings, including a lawsuit over revenue deductions, with no material adverse effect expected - The company is the plaintiff in a lawsuit against an operator in North Dakota regarding improper post-production cost deductions from revenue payments, with the trial scheduled for June 2025[196](index=196&type=chunk) - Management believes that current legal proceedings, in aggregate, will not materially and adversely affect the company's business, financial condition, or results of operations[195](index=195&type=chunk) [Risk Factors](index=45&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors, except for a new risk concerning potential adverse effects from new trade policies and tariffs - A new risk factor has been added regarding potential new trade policies and tariffs, such as the announced **10%** baseline tariff on imports, which could increase operating costs and adversely affect the business[199](index=199&type=chunk) - Other than the newly added risk factor, there have been no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[198](index=198&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No common stock repurchases occurred in Q1 2025, with $59.8 million remaining available under the stock repurchase program - The company did not repurchase any shares of its common stock during the three months ended March 31, 2025[201](index=201&type=chunk)[202](index=202&type=chunk) - As of March 31, 2025, approximately **$59.8 million** remained available for repurchases under the company's approved Stock Repurchase Program[202](index=202&type=chunk) [Other Information](index=46&type=section&id=Item%205.%20Other%20Information) No director or officer adopted, modified, or terminated any Rule 10b5-1 trading arrangement during Q1 2025 - No director or officer adopted, modified, or terminated any Rule 10b5-1 trading arrangement during the three months ended March 31, 2025[205](index=205&type=chunk)

VITESSE ENERGY ANNOUNCES FIRST QUARTER 2025 RESULTS AND REVISED 2025 GUIDANCE GREENWOOD VILLAGE, Colo. – May 5, 2025 – Vitesse Energy, Inc. (NYSE: VTS) ("we," "our," "Vitesse," or the "Company") today reported the Company's first quarter 2025 financial and operating results and revised 2025 guidance. FIRST QUARTER 2025 HIGHLIGHTS Non-GAAP financial measure; see reconciliation schedules at the end of this release (1) MANAGEMENT COMMENTS "In the first quarter, we delivered a 7% dividend increase and successfu ...

Vitesse Energy (VTS) shares soared 7.1% in the last trading session to close at $24.51. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 13% loss over the past four weeks.VTS's recent share jump can be attributed to oil market stability despite geopolitical tensions. While President Trump’s new tariffs on Venezuelan oil buyers create uncertainty, the potential for tighter supply from U.S. sanctions on Venezuela and Iran supports b ...

Core Viewpoint - Economic uncertainty and tariff wars are causing stock market volatility, but dividend-paying stocks can provide stability for investors [1] Group 1: Vitesse Energy (VTS) - Vitesse Energy is an energy company that primarily holds financial interests in oil and gas wells operated by leading U.S. operators [3] - The company recently acquired Lucero Energy, which is expected to enhance dividends and provide liquidity for further acquisitions [3][6] - Vitesse announced a quarterly dividend of $0.5625 per share for Q4, marking a 7% increase from the previous quarter, with a dividend yield of 9.3% [4] - Jefferies analyst Lloyd Byrne reiterated a buy rating on VTS with a price target of $33, noting that Q4 EBITDA slightly missed consensus estimates due to lower production and acquisition costs [5] - The Lucero acquisition is seen positively as it adds to Vitesse's production and inventory, providing about 10 years of operational life [7] Group 2: Viper Energy (VNOM) - Viper Energy, a subsidiary of Diamondback Energy, focuses on owning and acquiring mineral and royalty interests in oil-weighted basins, particularly the Permian Basin [9] - The company announced a total capital return of 65 cents per share for Q4 2024, representing 75% of the cash available for distribution [10] - JPMorgan analyst Arun Jayaram maintained a buy rating on VNOM but lowered the price target to $51, citing factors like natural gas demand and potential oil price declines [11] - Viper's policy of returning about 75% of distributable cash flow to shareholders through dividends and buybacks is highlighted as a unique aspect of the company [13] Group 3: ConocoPhillips (COP) - ConocoPhillips announced a dividend of 78 cents per share for Q1 2025, with a dividend yield of 3.1% [15] - Analyst Jayaram reaffirmed a buy rating on COP but reduced the price target to $115, reflecting concerns over potential oil price declines [15] - The company has executed multiple counter-cyclical transactions since its 2016 strategy reset, enhancing its cost structure and inventory durability [16] - ConocoPhillips is expected to be one of the few companies in JPMorgan's coverage that could increase cash returns in 2025, including $6 billion in stock buybacks [18]

Vitesse Energy (NYSE: VTS ) recently announced the acquisition of Lucero Energy which is adding an operating component to its strategy, doing so in an all stock transaction that settles down leverage but also allows for a reasonableThey lead the investing group The Value Lab where they offer members a portfolio with real time updates, chat to answer questions 24/7, regular global market news reports, feedback on member stock ideas, new trades monthly, quarterly earnings write-ups, and daily macro opinions.T ...

Production and Reserves - As of December 31, 2024, the company had an average daily production of 13,003 Boe, with proved reserves of 40,283 MBoe, of which 68% is oil[36]. - Estimated proved reserves in the Williston Basin were 38,469 MBoe, contributing to an average production of 12,341 Boe per day for the year ended December 31, 2024[43]. - As of December 31, 2024, estimated total proved reserves amounted to 40,283 MBoe, a slight decrease from 40,595 MBoe in 2023[48]. - The percentage of proved developed reserves decreased to 67.6% in 2024 from 70.1% in 2023[48]. - Estimated net proved undeveloped reserves increased to 13,038 MBoe in 2024, up from 12,121 MBoe in 2023, primarily due to extensions and discoveries adding 5,543 MBoe[51]. - The PV-10 value of total proved reserves was approximately $586,590,000, with 66% of this value supported by producing wells[50]. - Acquisitions in 2024 added 809 MBoe of proved undeveloped reserves in the Williston Basin and Central Rockies[55]. - Development costs of approximately $63 million were incurred for the conversion of 3,409 MBoe of proved undeveloped reserves to proved developed reserves[55]. - Revisions in 2024 resulted in a net decrease of 2,026 MBoe in proved undeveloped reserves, primarily due to reclassification based on updated drilling plans[55]. - The company expects to convert remaining proved undeveloped reserves to proved developed producing reserves within five years[52]. - Approximately 32% of the estimated net proved reserves volumes were classified as proved undeveloped as of December 31, 2024[165]. Financial Performance and Dividends - The company distributed cash to stockholders totaling $63.6 million, $58.0 million, and $36.0 million for the years ended December 31, 2024, 2023, and 2022, respectively[38]. - The company’s ability to pay dividends may be limited by its indebtedness and requirements under its Revolving Credit Facility[121]. - The company’s ability to pay dividends is restricted by requirements under its Revolving Credit Facility, which may limit future distributions[205]. - The company may face challenges in paying dividends due to its indebtedness and the discretion of its Board of Directors[128]. - The company may not generate enough cash flow to meet its debt obligations or pay dividends due to the cyclical nature of its industry[202]. Acquisitions and Strategy - The company has closed approximately 170 discrete acquisitions totaling over $570 million since its inception in 2014, focusing on smaller non-operated lease and wellbore positions[40]. - The company’s business strategy includes a focus on long-term stockholder value through the acquisition, development, and production of oil and natural gas assets[38]. - The company’s management team has established a systematic approach to evaluating acquisition and development opportunities, enhancing its competitive strengths[40]. - The company’s acquisition strategy involves risks associated with evaluating properties with limited information, which could impact financial results[116]. - The company’s acquisition strategy includes risks associated with evaluating properties with limited information, such as the Lucero Acquisition[166]. Production Costs and Pricing - Average sales price for oil decreased to $69.94 per Bbl in 2024, down 5.4% from $73.59 per Bbl in 2023[63]. - Average sales price for natural gas fell to $1.34 per Mcf in 2024, a decline of 28.7% from $1.88 per Mcf in 2023[63]. - Lease operating expense per Boe increased to $10.00 in 2024, up 9.8% from $9.11 in 2023[63]. - The company hedged approximately 2.3 million barrels of oil in 2025 at an average price of $71.16 per Bbl and 0.9 million barrels in 2026 at an average price of $66.95 per Bbl[40]. Regulatory and Environmental Risks - The company is subject to extensive and changing federal, state, and local laws and regulations related to environmental protection, which may increase operating costs and impact financial condition[92]. - The recent final rules under the Clean Air Act (CAA) impose stricter methane emission controls, requiring a reduction of emissions by 95% through capture and control systems[95]. - The company is in substantial compliance with current environmental laws and regulations, with no known material commitments for capital expenditures to comply with existing requirements[92]. - The company may face increased costs and operational impacts due to potential changes in the definition of Waters of the United States (WOTUS) under the Clean Water Act (CWA)[97]. - The company must develop and maintain facility response plans for oil spills, which imposes certain duties and liabilities under the Oil Pollution Act (OPA)[98]. - The company’s hydraulic fracturing operations may face increased regulatory scrutiny and potential costs if federal permitting is required in the future[100]. - Environmental regulations and compliance requirements could increase operational costs and impact the company's ability to conduct business effectively[144]. - Increased regulatory scrutiny on emissions has led to heightened litigation risks for fossil fuel companies, which could affect the company's financial condition[235]. Operational Challenges - The company acknowledges the cyclical nature of the oil and natural gas industry, which affects capital expenditures and production levels[71]. - The company faces risks related to volatile oil and natural gas prices, which have historically affected its financial position and results of operations[116]. - The company’s operations are concentrated in the Williston Basin, making it vulnerable to regional events affecting oil and natural gas prices[175]. - The company’s drilling activities are subject to high risks, including the potential for uneconomical operations and external geopolitical factors[141]. - The company may face challenges in acquiring or developing additional reserves, which are crucial for future production and success[152]. - Seasonal weather conditions can limit drilling and completion activities, particularly in the Williston Basin during winter months[157]. - The ongoing litigation regarding the Dakota Access Pipeline (DAPL) poses a risk to its continued operation, which could adversely affect the company's business[156]. Human Resources and Corporate Structure - The company had 33 full-time employees as of December 31, 2024, with plans to hire additional personnel as needed[109]. - The company is focused on attracting and retaining top talent, providing a welcoming and inclusive environment, and offering excellent training and career development opportunities[109]. - The company’s principal executive offices are located in Greenwood Village, CO, occupying approximately 22,000 square feet of leased space, which is deemed sufficient for current and future growth[111]. Financial Risks and Debt - The company is exposed to interest rate risk due to variable rate indebtedness, which could significantly increase debt service obligations[121]. - The company’s Revolving Credit Facility is collateralized by perfected liens and security interests on substantially all of its assets, exposing it to foreclosure risks in case of default[201]. - A significant reduction in the borrowing base under the Revolving Credit Facility could negatively impact liquidity and financial results[198]. - The Revolving Credit Facility contains restrictive covenants that may limit the company's business and financing activities[199]. - The company’s future cash flows may be insufficient to meet debt obligations due to various economic and competitive factors beyond its control[202]. Market and Competitive Environment - The company faces intense competition in acquiring assets and accessing capital, which could adversely affect its operations[179]. - The company anticipates fluctuations in its business and financial condition due to competition in the oil and natural gas industry and the success or failure of its business strategies[125]. - Geopolitical tensions, including conflicts in Ukraine and the Middle East, have led to significant volatility in oil and natural gas prices[182]. - Negative investor sentiment towards the oil and natural gas industry may lead to reduced capital funding for development projects[191]. Miscellaneous - The company is classified as an "emerging growth company" and may take advantage of certain exemptions from reporting requirements, which could lead to a less active trading market for its common stock[124]. - The company has experienced net losses in the past due to fluctuations in oil and gas prices, which may recur in the future[147]. - The present value of future net cash flows from proved reserves is not necessarily the same as the current market value, influenced by various factors including pricing and operating costs[154]. - The company relies on third-party transportation and processing facilities, and any lack of capacity could lead to increased costs and production delays[155]. - The integration of acquired assets may not yield anticipated benefits, and the company may face unknown liabilities from such acquisitions[172].