Production and Reserves - EON Resources Inc. has 956 million barrels of Original Oil in Place (OOIP) and expects to triple proven reserves in the next 3-4 years[5]. - Production is projected to increase by 1,000 barrels per day (bbl/day) over the next 24 months[5]. - EON has identified an additional 34 million barrels of oil in unperforated legacy zones, with plans for infield drilling to optimize recovery[15]. - The Grayburg-Jackson oil field has 550 existing wells that can be utilized to recover proven reserves without significant new capital expenditures[17]. - The company plans to develop an additional 158 waterflood patterns, which includes 95 producing patterns and 63 planned for development (PDNP + PUD)[29]. - The total Original Oil in Place (OOIP) for the 158 patterns is estimated at 50 million barrels of oil (MMBO)[29]. - The company expects full waterflood development to raise gross plateau oil rates to approximately 3,700 BOPD[43]. - The EON field has proven reserves of approximately 20 million barrels of crude oil and 5 billion cubic feet of natural gas[41]. - The company operates 550 producing wells and has 95 active patterns, tapping into 40% of the reserves[41]. Financial Performance - The company reported revenues of $15,708,239 year-to-date, with Q3 revenues reaching $7,364,346, marking a significant increase from previous quarters[47]. - The financial results were impacted by non-cash expenses, with net income for Q3 reported at $(3,841,171)[47]. - Total revenues for the year-to-date (YTD) reached $15,708,239, with Q3 revenues at $7,364,346[56]. - Net loss for the year-to-date (YTD) was $9,172,468, with Q3 net loss at $3,841,171[56]. - Total expenses for YTD were $16,316,136, with Q3 expenses at $5,379,540[56]. - General and administrative expenses for YTD totaled $6,868,748, with Q3 at $2,235,263[56]. - The company reported a one-time gain of $1.7 million from extinguishment of liabilities in Q2[56]. Operational Strategy - The company aims to reduce workover costs per well from $250,000 to approximately $150,000 through scientific and analytical approaches[16]. - EON's operational strategy includes responsible hedging and leveraging existing wells to minimize capital expenditures[5]. - The company has implemented a chemical acid treatment program to clean wells and recover production, which had previously stabilized and dropped[14]. - The company is rolling out an AI application for operators to improve efficiencies and increase production[15]. Capital Structure - The company has a Reserve Based Loan (RBL) balance of $25.1 million with a 15% interest rate and a five-year amortization schedule[59]. - There are 14.9 million warrants outstanding convertible to 11.2 million Class A shares at an exercise price of $11.50[58]. - The company has $15 million of preferred units at a subsidiary level, which will convert to common stock after two years[58]. Market Context - The Permian Basin contributes 62% of the total oil output in the U.S. and is expected to remain resource-rich until approximately 2040[22]. - EON's first acquisition was a waterflood property in the Permian Basin, with ongoing exploration for further expansion opportunities[18].
HNR Acquisition p(HNRA) - 2024 Q3 - Quarterly Results