Empire Petroleum Reports Financial Results for Fourth Quarter and Full Year 2025 and Provides Operational Updates
Key Terms
boe/d technical
bbl/d technical
ngls technical
mmcfd technical
rights offering financial
convertible note financial
dd&a financial
FOURTH QUARTER AND FULL YEAR 2025 HIGHLIGHTS
-
Produced full year 2025 net production volumes of 2,242 barrels of oil equivalent per day (“Boe/d”) including 1,437 barrels of oil per day (“Bbl/d”);
-
Boe/d is comprised of
64% oil,18% natural gas liquids (“NGLs”), and18% natural gas;
-
Boe/d is comprised of
-
During Q4-2025, Empire initiated a program to re-activate and work over what was originally planned as 10-12 wells in 2026, and as the Company advanced its multi-phase
Texas gas development program, the 2026 outlook now includes 12-30 wells designed to unlock incremental production, enhance system reliability, and position the field for scalable long-term growth;-
The Company’s three phase development program consists of the following steps:
- Reactivating multiple wells to restore baseline production and re‑establish stable field deliverability, with operations currently active on 10 wells;
-
Executing targeted recompletions and well-deepening operations to bring additional pay zones online across the
Glen Rose ,Rodessa , James Lime, Travis Peak, and theHaynesville -Bossier formations; -
Evaluating deeper gas potential, including a planned 17,000-21,000 foot cleanout and technical evaluation to determine the viability of deeper targets and to refine opportunities within both established and emerging zones in the consolidated
Cotton Valley -Bossier andWestern Haynesville intervals supported by existing seismic coverage;
- Initial wells from this program have now begun flowing during cleanup, marking the start of early production response across the area;
- Empire currently has one active workover rig in the field, with ongoing progress across workovers, recompletions, and facility optimization efforts as the staged reactivation program advances;
- The Company is executing a broad field program, including ongoing flowline construction and repair work, new location and pad development, and tie-in preparation activities to support sustained deliverability and system readiness for upcoming development phases;
-
Compression capacity at Empire’s Texas Midstream plant doubled from its 2025 capacity of 1.5 million cubic feet per day (“MMcfd”) to 3.0 MMcfd in Q1-2026 and is expected to increase over
600% to 9.5 MMcfd in Q2-2026, with preparation underway for an additional two bays of compression activity; -
In Q2-2026, Empire plans to progress its
Texas development program with a dedicated drilling rig to deepen wells from 3,500 to 7,000 feet in depth, increasing the Company’s 2026 development plan to 12-30 new wells;
-
The Company’s three phase development program consists of the following steps:
-
During Q4-2025, Empire continued to advance the conceptual and technical redesign of its hydrocarbon vaporization technology, with a focus on improving thermal efficiency, enhancing heat utilization, and strengthening long-term operating stability to support enhanced oil recovery (“EOR”) operations in the Starbuck Drilling Program (“Starbuck”);
-
The Company experienced steam unit closures during Q4-2025 and Q1-2026 due to extreme cold weather, with the shut-ins cutting production by over
25% ; - Empire is currently working on upgrades to the thermal insulation on its steam units, focusing on improved protection and performance within the combustion chamber and coil assemblies to enhance heat-transfer efficiency and injection-system reliability;
- Through Q4-2025 and into early 2026, Empire continued well completion and artificial lift optimization, including targeted upgrades to existing sucker-rod pumping systems across the Starbuck field and other Rockies region assets to improve operational performance and production consistency;
- The Company also advanced technical evaluations to improve injected-water quality, including refining chemical treatment formulations to mitigate scale formation and related operational impacts;
-
The Company experienced steam unit closures during Q4-2025 and Q1-2026 due to extreme cold weather, with the shut-ins cutting production by over
-
Prior to year end, the Company entered into a third amendment to its Revolver Loan Agreement with Equity Bank, extending the maturity date of its existing revolving credit facility;
-
The amendment maintains the current maximum revolver commitment amount of
$20.0 million
-
The amendment maintains the current maximum revolver commitment amount of
-
In Q1-2026, Empire launched a subscription rights offering (“Rights Offering”) that was initially sized at
$6.0 million $10.0 million - As stated in previous filings, Energy Evolution Master Fund, Ltd., the Company’s largest shareholder, has indicated its intent to participate in the Rights Offering and fully subscribe to the shares of Common Stock corresponding to its subscription rights, as well as its intent to fully exercise its over-subscription rights to purchase its pro rata share of the underlying securities related to the Rights Offering that remain unsubscribed at the expiration date;
- Phil E. Mulacek, Chairman of the Board of Empire, also has indicated his intent to participate;
- The Rights Offering is expected to expire at 5:00p.m., Eastern Time, on March 18, 2026, subject to extension or earlier termination;
-
During Q1-2026, the Company entered into and settled the
$3.0 million -
Approximately
$5.0 million $3.0 million
-
Approximately
-
In early 2026, Empire strengthened forward cash-flow visibility by locking in crude oil swap contracts by hedging roughly
90% of estimated oil production for the remaining three quarters of 2026 at a blended price in excess of$72 $54
-
Reported full year 2025 total product revenue of
$34.2 million $72.1 million $2.12 -
Adjusted EBITDA of
( for full year 2025 compared to$5.4) million $0.7 million -
Loss is primarily related to lower average oil and NGLs realized pricing, lower than expected oil production, primarily due to redrilling efforts in
North Dakota , and impairment loss of$51.3 million
-
Adjusted EBITDA of
2026 OUTLOOK
“The natural gas market is entering a period of renewed strength, and Empire is positioning itself to benefit from that shift with a disciplined, multi-step plan in Texas,” said Phil Mulacek, Chairman of the Board of Empire. “The work we’ve initiated has positioned the Company for meaningful improvement as oil prices have strengthened through early March 2026. Following the global conflicts that pushed prices higher, we began implementing a disciplined hedging strategy, securing volumes from the high
We are expanding our infrastructure, strengthening our commercial foundation, and advancing deeper-gas evaluation in a way that supports scalable growth as demand continues to rise. The groundwork being laid today provides meaningful leverage to an improving gas environment, and we believe the Company is well aligned to capture that opportunity for our shareholders. While our 2025 results reflected vastly lower realized pricing and reduced oil volumes due to natural decline, shut-ins for EOR instability, and redrilling activity, the year also delivered critical operational learnings that strengthened our strategic direction. The performance trends, subsurface data, and field work completed last year validated the importance of accelerating our gas development initiatives in
Mike Morrisett, President & CEO, continued, “Our operational progress in early 2026 reflects deliberate execution across our
-
In 2026, Empire expects to scale its
Texas gas development program by transitioning from early reactivation and recompletion work into broader field optimization and targeted production growth initiatives, which shifts the initial target of 10-12 wells in 2026 to a 12-30 well target by year-end 2026; - The Company is advancing well activity, key infrastructure and commercial improvements, which includes expansion of central and booster compression to support higher production volumes and improve pressure management, installation of a high-pressure sales point to increase takeaway capacity and reduce system constraints;
- Advancement of engineering work for deep gas and liquids development has progressed beyond the concept phase and will move into well activity during the second quarter of 2026, including completion and testing across multiple lower formations and continued evaluation of potential horizontal pilot opportunities;
- Additional recompletions and reactivation candidates are expected to be sequenced throughout the year, supported by ongoing subsurface evaluation and lessons learned from early-2026 results;
- Empire plans to progress deep-gas assessment activities, including diagnostic work and preparatory steps required for potential deeper-zone testing later in the year;
-
In
Louisiana , the Company is in final due diligence for a three-well participation opportunity that would expand Empire’s economic footprint in developing oil and gas properties; -
Collectively, these initiatives across
Texas andLouisiana are expected to increase production optionality, enhance field reliability, and strengthen Empire’s overall asset base while positioning the Company for sustained, gas-focused growth through 2026 and beyond.
-
Empire is evaluating enhanced water purification and filtration solutions for feedwater supplying steam units, aimed at improving water quality control, mitigating scaling risk, and extending equipment life;
- A technical issue on one steam unit has temporarily reduced injection capacity, but mitigation steps, including unit diagnostics, component replacement, and installation of upgraded insulation, are in progress to support a timely return-to-normal operations;
- The Company is working on improvements and adaptations to surface facilities at central tank batteries, including upgrades to treaters and enhancements to oil and produced-water storage tank infrastructure, supporting safer operations, improved handling capacity, and overall facility reliability;
-
Looking ahead, Empire continues to evaluate opportunities to replicate and enhance its proprietary steam injection EOR model across additional assets, including the South of Starbuck, Wayne, and
Landa oil fields, supporting long-term development inNorth Dakota .
-
On September 12, 2025, the New Mexico Conservation Commission (“Commission”) issued Order No. R-24004 (the “Order”) regarding the Company’s rights to the Residual Oil Zone (“ROZ”) in the Eunice Monument South Unit’s (“EMSU”) Unitized Interval. The Commission unanimously affirmed the existence of a ROZ in the Grayburg and San Andres formations within the EMSU and confirmed Empire’s exclusive rights to produce the ROZ under the 1984 Commission Order;
-
Based on these findings, the Commission:
- Denied Goodnight Midnight Permian, LLC’s (“Goodnight”) applications to drill five new saltwater disposal (“SWD”) wells within the boundaries of the EMSU;
- Denied Goodnight’s application to increase injection volumes in an existing SWD well;
- Suspended Goodnight’s four SWD wells located within the EMSU boundaries to provide Empire the opportunity to establish the CO2 EOR pilot project;
- On December 17, 2025, the Commission issued its “Amended Order Denying Goodnight’s Applications & Partially Granting/Partially Denying Empire’s Applications” (“Order R-24004-A”) reiterating and clarifying matters from its Order, but leaving implementation of the Order’s suspension to the discretion of the Oil Conservation Division (“OCD”);
- On January 15, 2026, the OCD issued a letter with “Implementation of OCC Orders 24004 and 24004-A” providing deadlines for Empire’s CO2 EOR pilot project and the suspension of Goodnight’s four SWD wells located within the EMSU boundaries;
- Both Empire and Goodnight have appealed the Order and Order R-24004-A;
- Empire plans to proceed with motions to revoke the existing permits granted to the remaining three SWD Companies disposing wastewater in the EMSU and Arrowhead Grayburg Unit Unitized Interval, while concurrently advancing litigation for trespass and damages;
-
Based on these findings, the Commission:
-
The Company expects final resolution of this matter to result in a meaningful reduction in operating expenses and contribute to improved financial performance in
New Mexico going forward.
FOURTH QUARTER AND FULL YEAR 2025 FINANCIAL AND OPERATIONAL RESULTS
Q4-25 |
Q3-25 |
% Change2
|
Q4-24 |
% Change2
|
|
|
|
|
|
|
|
| Net equivalent sales (Boe/d) | 2,161 |
2,398 |
- |
2,356 |
- |
| Net oil sales (Bbls/d) | 1,359 |
1,566 |
- |
1,581 |
- |
| Realized price ($/Boe) |
|
|
- |
|
- |
| Product Revenue ($M) |
|
|
- |
|
- |
| Net Loss ($M) |
( |
( |
NM |
( |
NM |
| Adjusted Net Loss ($M)1 |
( |
( |
- |
( |
- |
| Adjusted EBITDA ($M)1 |
( |
|
NM |
( |
NM |
1 Adjusted net loss and adjusted EBITDA are non-GAAP financial measures. See “Non-GAAP Information” section later in this release for more information, including reconciliations to the most comparable GAAP measure.
2 NM: A percentage calculation is not meaningful due to change in signs, a zero-value denominator, or a percentage change greater than 200.
Net sales volumes for Q4-2025 were 2,161 Boe/d, including 1,359 barrels of oil per day; 410 barrels of NGLs per day, and 2,347 thousand cubic feet per day (“Mcf/d”) or 391 Boe/d of natural gas. Oil sales volumes for 2025 decreased compared to prior year by approximately
Empire reported 2025 total product revenue of
Lease operating expenses in 2025 decreased to
Production and ad valorem taxes for 2025 were
Depreciation, Depletion, and Amortization (“DD&A”) and Accretion for 2025 was
Impairment loss for 2025 was
General and administrative expenses, excluding share-based compensation expense, was
Interest expense for 2025 compared to 2024 resulted in a slight increase due to a higher outstanding balance under the Company’s credit facility offset by lower average interest rate.
Empire recorded a net loss of
Adjusted EBITDA was
YEAR-END 2025 PROVED RESERVES
The Company’s year-end 2025 SEC proved reserves were 7.6 MMBoe compared to 9.2 MMBoe at year-end 2024. The Company recorded (0.7) MMBoe for revisions and (0.9) MMBoe for divestitures/production.
Year-end 2025 SEC proved reserves were comprised of approximately
| Oil (MBbls) | Gas (MMcf) | NGLs (MBbls) | MBoe | |||||||||
| Balance, December 31, 2023 | 6,924 |
|
6,104 |
|
1,171 |
|
9,112 |
|
||||
| Acquisition of Reserves | 198 |
|
240 |
|
35 |
|
274 |
|
||||
| Revisions | (90 |
) |
637 |
|
159 |
|
175 |
|
||||
| Extensions | 550 |
|
— |
|
— |
|
550 |
|
||||
| Production | (581 |
) |
(917 |
) |
(150 |
) |
(884 |
) |
||||
| Balance, December 31, 2024 | 7,001 |
|
6,064 |
|
1,215 |
|
9,227 |
|
||||
| Acquisition of Reserves | — |
|
— |
|
— |
|
— |
|
||||
| Revisions | (556 |
) |
(847 |
) |
(30 |
) |
(727 |
) |
||||
| Extensions | — |
|
— |
|
— |
|
— |
|
||||
| Divestitures | (42 |
) |
(55 |
) |
(5 |
) |
(56 |
) |
||||
| Production | (525 |
) |
(862 |
) |
(150 |
) |
(818 |
) |
||||
| Balance, December 31, 2025 | 5,878 |
|
4,300 |
|
1,030 |
|
7,625 |
|
||||
The acquisition of reserves for 2024 primarily relate to additional working interests in certain of the Company’s
The standardized measure of the Company’s reported SEC proved reserves, discounted at
| As of December 31, | ||||||||
2025 |
2024 |
|||||||
| (in thousands) | ||||||||
| Future cash inflows | $ | 391,089 |
|
$ | 537,303 |
|
||
| Future production costs | (277,342 |
) |
(324,215 |
) |
||||
| Future development costs | (30,006 |
) |
(38,681 |
) |
||||
| Future income tax expense | (1,867 |
) |
(18,020 |
) |
||||
| Future net cash flows | 81,874 |
|
156,387 |
|
||||
(23,265 |
) |
(58,022 |
) |
|||||
| Standardized measure | $ | 58,609 |
|
$ | 98,365 |
|
||
The 12-month average prices were adjusted to reflect applicable transportation and quality differentials on a well-by-well basis to arrive at realized sales prices used to estimate the properties' reserves. The prices for the properties’ reserves were as follows:
2025 |
2024 |
|||||
| Oil (Bbl) | $ | 61.55 |
$ | 71.66 |
||
| Natural gas (MMBtu) | $ | 1.76 |
$ | 0.95 |
||
| NGLs (Bbl) | $ | 21.07 |
$ | 24.54 |
||
Changes in the Standardized Measure of Discounted Future Net Cash Flows at
| As of December 31, | ||||||||
2025 |
2024 |
|||||||
| (in thousands) | ||||||||
| Beginning of year | $ | 98,365 |
|
$ | 83,017 |
|
||
| Net change in prices and production costs | (56,825 |
) |
(5,843 |
) |
||||
| Net change in future development costs | 534 |
|
221 |
|
||||
| Oil and gas net revenue | (3,294 |
) |
(9,381 |
) |
||||
| Extensions | — |
|
11,255 |
|
||||
| Acquisition of reserves | — |
|
1,891 |
|
||||
| Divestiture of reserves | (800 |
) |
— |
|
||||
| Revisions of previous quantity estimates | (1,454 |
) |
6,676 |
|
||||
| Net change in taxes | 8,760 |
|
4,274 |
|
||||
| Accretion of discount | 10,853 |
|
9,746 |
|
||||
| Changes in timing and other | 2,470 |
|
(3,491 |
) |
||||
| End of year | $ | 58,609 |
|
$ | 98,365 |
|
||
CAPITAL SPENDING, BALANCE SHEET & LIQUIDITY
For 2025, Empire invested approximately
As of December 31, 2025, Empire had approximately
Empire successfully completed a Rights Offering in August 2025, which raised approximately
In Q1-2026, Empire entered into oil derivative contracts for approximately
UPDATED PRESENTATION
An updated Company presentation will be posted to the Company’s website under the Investor Relations section.
ABOUT EMPIRE PETROLEUM
Empire Petroleum Corporation is a publicly traded,
SAFE HARBOR STATEMENT
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements involve a wide variety of risks and uncertainties, and include, without limitations, statements with respect to the Company’s estimates, strategy, and prospects. Such statements are subject to certain risks and uncertainties which are disclosed in the Company’s reports filed with the SEC, including its Form 10-K for the fiscal year ended December 31, 2025, and its other filings with the SEC. Readers and investors are cautioned that the Company’s actual results may differ materially from those described in the forward-looking statements due to a number of factors, including, but not limited to, future commodity prices, the Company’s ability to acquire productive oil and/or gas properties or to successfully drill and complete oil and/or gas wells on such properties, general economic conditions both domestically and abroad, including inflation, tariffs and interest rates, uncertainties associated with legal and regulatory matters, successful completion of the Rights Offering, and other risks and uncertainties related to the conduct of business by the Company. Other than as required by applicable securities laws, the Company does not assume a duty to update these forward-looking statements, whether as a result of new information, subsequent events or circumstances, changes in expectations, or otherwise.
| EMPIRE PETROLEUM CORPORATION | ||||||||||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||||||||||
| (in thousands, except share data) | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| For the Three Months Ended | For the Years Ended | |||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | |||||||||||||||||
2025 |
2025 |
2024 |
2025 |
2024 |
||||||||||||||||
| Revenue: | ||||||||||||||||||||
| Oil Sales | $ |
6,804 |
|
$ |
8,790 |
|
$ |
9,445 |
|
$ |
31,648 |
|
$ |
41,515 |
|
|||||
| Gas Sales |
|
(67 |
) |
|
196 |
|
|
74 |
|
|
898 |
|
|
344 |
|
|||||
| Natural Gas Liquids Sales |
|
312 |
|
|
388 |
|
|
558 |
|
|
1,616 |
|
|
2,133 |
|
|||||
| Total Product Revenues |
|
7,049 |
|
|
9,374 |
|
|
10,077 |
|
|
34,162 |
|
|
43,992 |
|
|||||
| Other |
|
10 |
|
|
14 |
|
|
11 |
|
|
41 |
|
|
47 |
|
|||||
| Loss on Derivatives |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(389 |
) |
|||||
| Total Revenue |
|
7,059 |
|
|
9,388 |
|
|
10,088 |
|
|
34,203 |
|
|
43,650 |
|
|||||
| Costs and Expenses: | ||||||||||||||||||||
| Lease Operating Expense |
|
7,335 |
|
|
5,735 |
|
|
5,881 |
|
|
25,223 |
|
|
27,545 |
|
|||||
| Production and Ad Valorem Taxes |
|
619 |
|
|
755 |
|
|
887 |
|
|
2,854 |
|
|
3,770 |
|
|||||
| Depreciation, Depletion & Amortization |
|
2,999 |
|
|
2,794 |
|
|
2,493 |
|
|
10,595 |
|
|
9,256 |
|
|||||
| Impairment |
|
51,289 |
|
|
- |
|
|
- |
|
|
51,289 |
|
|
- |
|
|||||
| Accretion of Asset Retirement Obligation |
|
545 |
|
|
534 |
|
|
520 |
|
|
2,139 |
|
|
2,007 |
|
|||||
| General and Administrative: | ||||||||||||||||||||
| General and Administrative |
|
3,011 |
|
|
2,881 |
|
|
3,713 |
|
|
11,995 |
|
|
12,582 |
|
|||||
| Stock-Based Compensation |
|
168 |
|
|
238 |
|
|
519 |
|
|
1,423 |
|
|
2,156 |
|
|||||
| Total General and Administrative |
|
3,179 |
|
|
3,119 |
|
|
4,232 |
|
|
13,418 |
|
|
14,738 |
|
|||||
| Total Cost and Expenses |
|
65,966 |
|
|
12,937 |
|
|
14,013 |
|
|
105,518 |
|
|
57,316 |
|
|||||
| Operating Loss |
|
(58,907 |
) |
|
(3,549 |
) |
|
(3,925 |
) |
|
(71,315 |
) |
|
(13,666 |
) |
|||||
| Other Income and (Expense): | ||||||||||||||||||||
| Interest Expense |
|
(529 |
) |
|
(388 |
) |
|
(269 |
) |
|
(1,547 |
) |
|
(1,515 |
) |
|||||
| Other Income (Expense) |
|
483 |
|
|
93 |
|
|
1 |
|
|
788 |
|
|
(1,017 |
) |
|||||
| Loss Before Taxes |
|
(58,953 |
) |
|
(3,844 |
) |
|
(4,193 |
) |
|
(72,074 |
) |
|
(16,198 |
) |
|||||
| Income Tax Benefit (Provision) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|||||
| Net Loss | $ |
(58,953 |
) |
$ |
(3,844 |
) |
$ |
(4,193 |
) |
$ |
(72,074 |
) |
$ |
(16,198 |
) |
|||||
| Net Loss per Common Share: | ||||||||||||||||||||
| Basic | $ |
(1.71 |
) |
$ |
(0.11 |
) |
$ |
(0.13 |
) |
$ |
(2.12 |
) |
$ |
(0.54 |
) |
|||||
| Diluted | $ |
(1.71 |
) |
$ |
(0.11 |
) |
$ |
(0.13 |
) |
$ |
(2.12 |
) |
$ |
(0.54 |
) |
|||||
| Weighted-Average Number of Common Shares Outstanding: | ||||||||||||||||||||
| Basic |
|
34,501,251 |
|
|
34,043,173 |
|
|
33,034,333 |
|
|
34,056,054 |
|
|
30,064,856 |
|
|||||
| Diluted |
|
34,501,251 |
|
|
34,043,173 |
|
|
33,034,333 |
|
|
34,056,054 |
|
|
30,064,856 |
|
|||||
| EMPIRE PETROLEUM CORPORATION | |||||||||||||||
| Condensed Operating Data | |||||||||||||||
| (Unaudited) | |||||||||||||||
| For the Three Months Ended | For the Years Ended | ||||||||||||||
| December 31, | September 30, | December 31, | December 31, | ||||||||||||
2025 |
2025 |
2024 |
2025 |
2024 |
|||||||||||
| Net Sales Volumes: | |||||||||||||||
| Oil (Bbl) |
|
125,059 |
|
144,098 |
|
145,442 |
|
524,646 |
|
581,159 |
|||||
| Natural gas (Mcf) |
|
215,921 |
|
207,677 |
|
208,698 |
|
860,599 |
|
916,955 |
|||||
| Natural gas liquids (Bbl) |
|
37,743 |
|
41,938 |
|
36,556 |
|
150,224 |
|
150,091 |
|||||
| Total (Boe) |
|
198,788 |
|
220,648 |
|
216,781 |
|
818,303 |
|
884,076 |
|||||
| Average daily equivalent sales (Boe/d) |
|
2,161 |
|
2,398 |
|
2,356 |
|
2,242 |
|
2,416 |
|||||
| Average Price per Unit: | |||||||||||||||
| Oil ($/Bbl) | $ |
54.41 |
$ |
61.00 |
$ |
64.94 |
$ |
60.32 |
$ |
71.44 |
|||||
| Natural gas ($/Mcf) | $ |
(0.31) |
$ |
0.94 |
$ |
0.35 |
$ |
1.04 |
$ |
0.37 |
|||||
| Natural gas liquids ($/Bbl) | $ |
8.27 |
$ |
9.25 |
$ |
15.26 |
$ |
10.76 |
$ |
14.21 |
|||||
| Total ($/Boe) | $ |
35.46 |
$ |
42.48 |
$ |
46.48 |
$ |
41.75 |
$ |
49.76 |
|||||
| Operating Costs and Expenses per Boe: | |||||||||||||||
| Lease operating expense | $ |
36.90 |
$ |
25.99 |
$ |
27.13 |
$ |
30.83 |
$ |
31.16 |
|||||
| Production and ad valorem taxes | $ |
3.11 |
$ |
3.42 |
$ |
4.09 |
$ |
3.49 |
$ |
4.26 |
|||||
| Depreciation, depletion, amortization and accretion | $ |
17.83 |
$ |
15.08 |
$ |
13.90 |
$ |
15.56 |
$ |
12.74 |
|||||
| General and administrative expense: | |||||||||||||||
| General and administrative expense (excluding stock-based compensation) | $ |
15.15 |
$ |
13.06 |
$ |
17.13 |
$ |
14.66 |
$ |
14.23 |
|||||
| Stock-based compensation | $ |
0.85 |
$ |
1.08 |
$ |
2.39 |
$ |
1.74 |
$ |
2.44 |
|||||
| Total general and administrative expense | $ |
16.00 |
$ |
14.14 |
$ |
19.52 |
$ |
16.40 |
$ |
16.67 |
|||||
| EMPIRE PETROLEUM CORPORATION | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| (in thousands, except share data) | ||||||||
| (Unaudited) | ||||||||
| December 31, | December 31, | |||||||
2025 |
2024 |
|||||||
| ASSETS | ||||||||
| Cash | $ |
1,189 |
|
$ |
2,251 |
|
||
| Accounts Receivable |
|
5,122 |
|
|
8,155 |
|
||
| Inventory |
|
1,262 |
|
|
1,305 |
|
||
| Prepaids |
|
607 |
|
|
640 |
|
||
| Total Current Assets |
|
8,180 |
|
|
12,351 |
|
||
| Property and Equipment: | ||||||||
| Oil and Natural Gas Properties, Successful Efforts |
|
148,238 |
|
|
140,675 |
|
||
| Less: Accumulated Depletion, Amortization and Impairment |
|
(93,425 |
) |
|
(31,974 |
) |
||
| Total Oil and Gas Properties, Net |
|
54,813 |
|
|
108,701 |
|
||
| Other Property and Equipment, Net |
|
1,486 |
|
|
1,391 |
|
||
| Total Property and Equipment, Net |
|
56,299 |
|
|
110,092 |
|
||
| Other Noncurrent Assets |
|
1,394 |
|
|
1,425 |
|
||
| Total Assets | $ |
65,873 |
|
$ |
123,868 |
|
||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Accounts Payable |
|
10,799 |
|
$ |
10,452 |
|
||
| Accrued Expenses |
|
12,616 |
|
|
10,348 |
|
||
| Current Portion of Lease Liability |
|
286 |
|
|
400 |
|
||
| Current Portion of Long-Term Debt |
|
641 |
|
|
70 |
|
||
| Total Current Liabilities |
|
24,342 |
|
|
21,270 |
|
||
| Long-Term Debt |
|
14,415 |
|
|
11,266 |
|
||
| Long-Term Note Payable - Related Party, net |
|
1,023 |
|
|
- |
|
||
| Long-Term Lease Liability |
|
12 |
|
|
144 |
|
||
| Derivative Instruments |
|
281 |
|
|
- |
|
||
| Asset Retirement Obligations |
|
30,406 |
|
|
28,423 |
|
||
| Total Liabilities |
|
70,479 |
|
|
61,103 |
|
||
| Stockholders’ Equity: | ||||||||
| Series A Preferred Stock - |
|
- |
|
|
- |
|
||
| Common Stock - |
|
94 |
|
|
93 |
|
||
| Additional Paid-in-Capital |
|
148,191 |
|
|
143,489 |
|
||
| Accumulated Deficit |
|
(152,891 |
) |
|
(80,817 |
) |
||
| Total Stockholders’ Equity (Deficit) |
|
(4,606 |
) |
|
62,765 |
|
||
| Total Liabilities and Stockholders’ Equity | $ |
65,873 |
|
$ |
123,868 |
|
||
| EMPIRE PETROLEUM CORPORATION | ||||||||||||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| For the Three Months Ended | For the Years Ended | |||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | |||||||||||||||||
2025 |
2025 |
2024 |
2025 |
2024 |
||||||||||||||||
| Cash Flows From Operating Activities: | ||||||||||||||||||||
| Net Loss | $ |
(58,953 |
) |
$ |
(3,844 |
) |
$ |
(4,193 |
) |
$ |
(72,074 |
) |
$ |
(16,198 |
) |
|||||
| Adjustments to Reconcile Net Loss to Net Cash | ||||||||||||||||||||
| (Used In) Provided By Operating Activities: | ||||||||||||||||||||
| Stock-Based Compensation |
|
168 |
|
|
238 |
|
|
519 |
|
|
1,423 |
|
|
2,156 |
|
|||||
| Amortization of Right-of-Use Assets |
|
111 |
|
|
117 |
|
|
133 |
|
|
469 |
|
|
540 |
|
|||||
| Depreciation, Depletion & Amortization |
|
2,999 |
|
|
2,794 |
|
|
2,493 |
|
|
10,595 |
|
|
9,256 |
|
|||||
| Accretion of Asset Retirement Obligations |
|
545 |
|
|
534 |
|
|
520 |
|
|
2,139 |
|
|
2,007 |
|
|||||
| Impairment of Oil and Natural Gas Properties |
|
51,289 |
|
|
- |
|
|
- |
|
|
51,289 |
|
|
- |
|
|||||
| Loss on Commodity Derivatives |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
389 |
|
|||||
| Net Settlements on Derivative Instruments |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
18 |
|
|||||
| Loss (Gain) on Financial Derivatives |
|
(484 |
) |
|
(97 |
) |
|
- |
|
|
(581 |
) |
|
998 |
|
|||||
| Amortization of Debt Discount on Convertible Notes |
|
29 |
|
|
- |
|
|
- |
|
|
29 |
|
|
500 |
|
|||||
| Amortization of Debt Issuance Costs |
|
113 |
|
|
- |
|
|
- |
|
|
113 |
|
|
- |
|
|||||
| Loss on Extinguishment of Debt |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
10 |
|
|||||
| Loss (Gain) on Sale of Oil and Natural Gas Properties |
|
- |
|
|
7 |
|
|
- |
|
|
(168 |
) |
|
- |
|
|||||
| Loss (Gain) on Sale of Other Fixed Assets |
|
2 |
|
|
- |
|
|
- |
|
|
(30 |
) |
|
- |
|
|||||
| Change in Operating Assets and Liabilities: | ||||||||||||||||||||
| Accounts Receivable |
|
546 |
|
|
1,835 |
|
|
(2,005 |
) |
|
369 |
|
|
(357 |
) |
|||||
| Inventory, Oil in Tanks |
|
(44 |
) |
|
86 |
|
|
195 |
|
|
43 |
|
|
129 |
|
|||||
| Prepaids, Current |
|
(71 |
) |
|
220 |
|
|
(64 |
) |
|
574 |
|
|
608 |
|
|||||
| Accounts Payable |
|
1,012 |
|
|
(1,792 |
) |
|
(7,254 |
) |
|
541 |
|
|
5,020 |
|
|||||
| Accrued Expenses |
|
(192 |
) |
|
601 |
|
|
1,073 |
|
|
1,463 |
|
|
2,144 |
|
|||||
| Other Long-Term Assets and Liabilities |
|
179 |
|
|
(369 |
) |
|
(177 |
) |
|
(140 |
) |
|
(1,063 |
) |
|||||
| Net Cash (Used In) Provided By Operating Activities |
|
(2,751 |
) |
|
330 |
|
|
(8,760 |
) |
|
(3,946 |
) |
|
6,157 |
|
|||||
| Cash Flows From Investing Activities: | ||||||||||||||||||||
| Disposal of Oil and Natural Gas Properties |
|
- |
|
|
400 |
|
|
- |
|
|
575 |
|
|
- |
|
|||||
| Capital Expenditures - Oil and Natural Gas Properties |
|
(1,130 |
) |
|
(453 |
) |
|
(4,460 |
) |
|
(4,754 |
) |
|
(53,219 |
) |
|||||
| Disposal of Other Fixed Assets |
|
2 |
|
|
- |
|
|
- |
|
|
51 |
|
|
- |
|
|||||
| Purchase of Other Fixed Assets |
|
(1 |
) |
|
(12 |
) |
|
(12 |
) |
|
(54 |
) |
|
(152 |
) |
|||||
| Cash Paid for Right-of-Use Assets |
|
(100 |
) |
|
(107 |
) |
|
(123 |
) |
|
(431 |
) |
|
(499 |
) |
|||||
| Net Cash Used In Investing Activities |
|
(1,229 |
) |
|
(172 |
) |
|
(4,595 |
) |
|
(4,613 |
) |
|
(53,870 |
) |
|||||
| Cash Flows From Financing Activities: | ||||||||||||||||||||
| Borrowings on Credit Facility |
|
- |
|
|
- |
|
|
2,700 |
|
|
3,000 |
|
|
6,650 |
|
|||||
| Proceeds from Promissory Notes - Related Party |
|
- |
|
|
2,000 |
|
|
- |
|
|
4,000 |
|
|
5,000 |
|
|||||
| Payments on Promissory Note - Related Party |
|
- |
|
|
(2,000 |
) |
|
- |
|
|
(2,000 |
) |
|
- |
|
|||||
| Principal Payments of Debt |
|
(210 |
) |
|
(208 |
) |
|
(215 |
) |
|
(639 |
) |
|
(592 |
) |
|||||
| Proceeds from Rights Offering, net of transaction costs |
|
- |
|
|
2,358 |
|
|
9,973 |
|
|
2,358 |
|
|
30,484 |
|
|||||
| Proceeds from Stock Issuance and Warrant Exercises |
|
778 |
|
|
- |
|
|
(2 |
) |
|
778 |
|
|
629 |
|
|||||
| Net Cash Provided By Financing Activities |
|
568 |
|
|
2,150 |
|
|
12,456 |
|
|
7,497 |
|
|
42,171 |
|
|||||
| Net Change in Cash |
|
(3,412 |
) |
|
2,308 |
|
|
(899 |
) |
|
(1,062 |
) |
|
(5,542 |
) |
|||||
| Cash - Beginning of Period |
|
4,601 |
|
|
2,293 |
|
|
3,150 |
|
|
2,251 |
|
|
7,793 |
|
|||||
| Cash - End of Period | $ |
1,189 |
|
$ |
4,601 |
|
$ |
2,251 |
|
$ |
1,189 |
|
$ |
2,251 |
|
|||||
Empire Petroleum Corporation
Non-GAAP Information
Certain financial information included in Empire’s financial results are not measures of financial performance recognized by accounting principles generally accepted in
| For the Three Months Ended | For the Years Ended | |||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | |||||||||||||||||
2025 |
2025 |
2024 |
2025 |
2024 |
||||||||||||||||
| (in thousands, except share and per share data) | ||||||||||||||||||||
| Net Loss | $ |
(58,953 |
) |
$ |
(3,844 |
) |
$ |
(4,193 |
) |
$ |
(72,074 |
) |
$ |
(16,198 |
) |
|||||
| Adjusted for: | ||||||||||||||||||||
| Loss (gain) on commodity derivatives |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
389 |
|
|||||
| Loss (gain) on financial derivatives |
|
(484 |
) |
|
(97 |
) |
|
- |
|
|
(581 |
) |
|
998 |
|
|||||
| Loss (gain) on sale of oil and natural gas properties |
|
- |
|
|
7 |
|
|
- |
|
|
(168 |
) |
|
- |
|
|||||
| Loss (gain) on sale of other fixed assets |
|
2 |
|
|
- |
|
|
- |
|
|
(30 |
) |
|
- |
|
|||||
| Net Settlements on Derivative Instruments |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
18 |
|
|||||
| Impairment |
|
51,289 |
|
|
- |
|
|
- |
|
|
51,289 |
|
|
- |
|
|||||
| Adjusted Net Loss | $ |
(8,146 |
) |
$ |
(3,934 |
) |
$ |
(4,193 |
) |
$ |
(21,564 |
) |
$ |
(14,793 |
) |
|||||
| Diluted Weighted-Average Number of Common Shares Outstanding |
|
34,501,251 |
|
|
34,043,173 |
|
|
33,034,333 |
|
|
34,056,054 |
|
|
30,064,856 |
|
|||||
| Adjusted Net Loss Per Common Share | $ |
(0.24 |
) |
$ |
(0.12 |
) |
$ |
(0.13 |
) |
$ |
(0.63 |
) |
$ |
(0.49 |
) |
|||||
The Company defines adjusted EBITDA as net loss plus net interest expense, DD&A, accretion, amortization of right of use assets, income tax provision (benefit), and other adjustments. Company management believes this presentation is relevant and useful because it helps investors understand Empire’s operating performance and makes it easier to compare its results with those of other companies that have different financing, capital and tax structures. Adjusted EBITDA should not be considered in isolation from or as a substitute for net income (loss), as an indication of operating performance or cash flows from operating activities or as a measure of liquidity. In addition, adjusted EBITDA does not represent funds available for discretionary use.
| For the Three Months Ended | For the Years Ended | |||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | |||||||||||||||||
2025 |
2025 |
2024 |
2025 |
2024 |
||||||||||||||||
| (in thousands) | ||||||||||||||||||||
| Net Loss | $ |
(58,953 |
) |
$ |
(3,844 |
) |
$ |
(4,193 |
) |
$ |
(72,074 |
) |
$ |
(16,198 |
) |
|||||
| Add Back: | ||||||||||||||||||||
| Interest expense |
|
529 |
|
|
388 |
|
|
269 |
|
|
1,547 |
|
|
1,515 |
|
|||||
| Depreciation, Depletion & Amortization |
|
2,999 |
|
|
2,794 |
|
|
2,493 |
|
|
10,595 |
|
|
9,256 |
|
|||||
| Impairment |
|
51,289 |
|
|
- |
|
|
- |
|
|
51,289 |
|
|
- |
|
|||||
| Accretion |
|
545 |
|
|
534 |
|
|
520 |
|
|
2,139 |
|
|
2,007 |
|
|||||
| Amortization of right-of-use assets |
|
111 |
|
|
117 |
|
|
133 |
|
|
469 |
|
|
540 |
|
|||||
| EBITDA | $ |
(3,480 |
) |
$ |
(11 |
) |
$ |
(778 |
) |
$ |
(6,035 |
) |
$ |
(2,880 |
) |
|||||
| Adjustments: | ||||||||||||||||||||
| Stock-based compensation |
|
168 |
|
|
238 |
|
|
519 |
|
|
1,423 |
|
|
2,156 |
|
|||||
| Net Settlements on Derivative Instruments |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
18 |
|
|||||
| Loss (gain) on commodity derivatives |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
389 |
|
|||||
| Loss (gain) on financial derivatives |
|
(484 |
) |
|
(97 |
) |
|
- |
|
|
(581 |
) |
|
998 |
|
|||||
| Loss (gain) on sale of oil and natural gas properties |
|
- |
|
|
7 |
|
|
- |
|
|
(168 |
) |
|
- |
|
|||||
| Loss (gain) on sale of other fixed assets |
|
2 |
|
|
- |
|
|
- |
|
|
(30 |
) |
|
- |
|
|||||
| Adjusted EBITDA | $ |
(3,794 |
) |
$ |
137 |
|
$ |
(259 |
) |
$ |
(5,391 |
) |
$ |
681 |
|
|||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20260316822472/en/
Empire Petroleum Corporation
Mike Morrisett
President & CEO
539-444-8002
Info@empirepetrocorp.com
Kali Carter
Communications & Investor Relations Manager
918-995-5046
IR@empirepetrocorp.com
Source: Empire Petroleum Corporation
