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Empire Petroleum Reports Results for Fourth Quarter and Full Year 2024 and Provides Operational Updates

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TULSA, Okla.--(BUSINESS WIRE)-- Empire Petroleum (NYSE American: EP) (“Empire� or the “Company�), an oil and gas company with producing assets in New Mexico, North Dakota, Montana, Texas, and Louisiana, today reported operational and financial results for the fourth quarter and full year 2024, including year-end 2024 proved reserves.

FOURTH QUARTER AND FULL YEAR 2024 HIGHLIGHTS

  • Produced Q4-2024 net production volumes of 2,356 barrels of oil equivalent per day (“Boe/dâ€�) including 1,581 barrels of oil per day (“Bbl/dâ€�);
    • 22% increase of BBl/d comparing Q4-2024 vs. Q4-2023;
    • Boe/d is comprised of 67% oil, 17% natural gas liquids (“NGLsâ€�), and 16% natural gas;
  • Since initiating phase one of Enhanced Oil Recovery (“EORâ€�) efforts in the Starbuck Drilling Program (“Starbuckâ€�) in North Dakota, Empire remains committed to leveraging advanced recovery technologies to optimize production and convert additional wells into injectors;
    • In Q4-2024, Empire secured approval from the North Dakota Industrial Commission (“NDICâ€�) to convert two more oil wells into injectors, further advancing its EOR strategy;
    • Converting three wells lowered the Company’s short-term production, while better positioning Empire for long-term production growth;
  • In Q4-2024, Empire officially filed a provisional patent application with the United States Patent and Trademark Office in connection with a technology it developed in relation to hydrocarbon vaporization;
    • The Company continues to advance the final design of the patent in preparation for field deployment;
    • Initial results from the 30-day peak period showed more than a 700% increase in Starbuck production, achieved using only temporary solutions at that time;
    • Final fabrication was 30% complete to the target design and Empire expects the intellectual property (“IPâ€�) to be developed over the next 90-120 days;
  • As Empire continues to expand its technical focus into its Texas region, the Company successfully completed initial infrastructure to begin a new drilling program in Texas, which is expected to begin in 2025;
  • Year-end 2024 proved reserves were approximately 9.2 million barrels of oil equivalent (“MMBoeâ€�), and the standardized measure of SEC proved reserves discounted at 10% was $98.4 million;
    • At year-end 2024, future net cash flows without the 10% discount applied was approximately $156.4 million;
  • Empire successfully completed two rights offerings in 2024, both anchored by its largest shareholders and bolstered by additional shareholder participation, reflecting optimism in Empire’s long-term growth strategy;
    • In Q1-2024, Empire launched a $20.7 million rights offering (“April Rights Offeringâ€�) at $5.00 per share, and due to strong demand, the offering was ultimately oversubscribed upon its conclusion in Q2-2024;
    • Following this success, the Company completed a second rights offering (“November Rights Offeringâ€�) in Q4-2024, raising an additional $10.0 million at $5.05 per share, which was also oversubscribed, underscoring shareholder confidence in the Company’s operational and financial outlook;
  • In Q4-2024, Empire increased its revolving credit facility with Equity Bank from $10.0 million to $20.0 million, with the expansion immediately providing over $11.0 million in additional capacity, which highlights the strong relationship with Equity Bank and the financial institution’s continued confidence in the Company’s performance and growth trajectory; and
  • Reported full year 2024 total product revenue of $44.0 million, a net loss of $16.2 million, or ($0.54) per diluted share;
    • Adjusted EBITDA of $0.7 million for full year 2024 compared to ($2.4) million in 2023;
    • Loss is primarily related to operational challenges on the initial production optimization associated with the EOR in North Dakota. Empire anticipates resolving these non-recurring production issues in Q2-2025.

2025 OUTLOOK

“As an emerging, agile company, Empire Petroleum has a unique ability to pivot quickly as we receive new data and insights. This flexibility is a tremendous advantage in the dynamic energy sector, allowing us to efficiently allocate capital and resources to the most promising opportunities where they will have the greatest impact,� said Phil Mulacek, Chairman of the Board of Empire. “Each new set of data and developments strengthens our confidence in our forward plan, ensuring the best results for our shareholders.�

Mike Morrisett, President and CEO, added “with assets spanning multiple regions, Empire has the ability to shift our focus based on the latest geological, operational, and technical information. We continue to build on our progress in Starbuck and drive responsible energy development. At the same time, we are actively integrating new information to refine our approach ensuring that we adapt to evolving conditions while optimizing our performance. We are confident this level of adaptability positions us well for long-term success.�

North Dakota � Williston Basin:

  • Empire anticipates completing the final equipment portion of the first EOR phase, which should allow the Company to increase production to its original levels, and as the technology is implemented, Empire anticipates production growth; and
  • In February 2025, Empire secured NDIC approval for five new drilling permits for horizontal wells, as the Company continues to advance its growth strategy.

New Mexico � Permian Basin:

  • From Q4-2024 to Q1-2025, Empire completed 19 workovers in the region, underscoring the Company’s commitment to maximizing well productivity, extending asset life, and optimizing operational output;
    • The work completed during this period ensures continued production and mitigates a potential decline; and
  • Empire continues the legal and regulatory actions against a third-party trespassing on the New Mexico water floods.

Texas � East Texas Basin:

  • Empire will continue to use new technology, including the technical IP developed in other areas, which will allow the Company to expand its capacity for potential new joint ventures benefiting Empire and the companies it partners with.
Ìý

FOURTH QUARTER AND FULL YEAR 2024 FINANCIAL AND OPERATIONAL RESULTS

Q4-24

Q3-24

% Change

Q4-24 vs. Q3-24

Q4-23

% Change

Q4-24 vs. Q4-23

Ìý

Ìý

Ìý

Ìý

Ìý

Net equivalent sales (Boe/d)

2,356

2,460

-4%

2,011

17%

Net oil sales (Bbls/d)

1,581

1,573

1%

1,294

22%

AGÕæÈ˹ٷ½ized price ($/Boe)

$46.48

$48.12

-3%

$53.50

-13%

Product Revenue ($M)

$10,076

$10,892

-7%

$9,898

2%

Net Loss ($M)

($4,193)

($3,640)

-15%

($4,797)

13%

Adjusted Net Loss ($M)1

($4,193)

($3,829)

-10%

($5,753)

27%

Adjusted EBITDA ($M)1

($260)

($56)

-362%

($2,917)

91%

__________________________________

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.

Net sales volumes for Q4-2024 were 2,356 Boe/d, including 1,581 barrels of oil per day; 397 barrels of NGLs per day, and 2,268 thousand cubic feet per day (“Mcf/d�) or 378 Boe/d of natural gas. Oil sales volumes for 2024 increased compared to prior year by approximately 93,000 barrels or 19% primarily due to new wells completed in North Dakota during Q3-2024 as well as the acquisition of additional working interest in New Mexico.

Empire reported 2024 total product revenue of $44.0 million versus $40.1 million in 2023. Contributing to the increase were higher oil sales volumes in North Dakota due to the Company’s Starbuck Drilling Program offset by a slight decline in commodity prices.

Lease operating expenses in 2024 decreased to $27.5 million versus $28.6 million for 2023, primarily due to lower workover activities of $5.9 million in 2024 compared to $12.0 million for 2023, partially offset by higher expenses related to an increase in production. Higher workover expense in 2023 was primarily related to work performed on wells in New Mexico to workover wells in the region to enhance and maintain production. These costs are part of the damages Empire seeks to recover under litigation.

Production and ad valorem taxes for 2024 were $3.8 million versus $3.0 million in 2023, as a result of higher product revenues.

Depreciation, Depletion, and Amortization (“DD&A�) and Accretion for 2024 was $11.3 million versus $4.9 million for 2023. The increase in DD&A reflects higher production, the acquisition of additional working interest in New Mexico and the impact of the capitalized costs associated with new drilling activity in North Dakota. Accretion increased slightly due to new drilling activity related to the Starbuck Drilling Program.

General and administrative expenses, excluding share-based compensation expense, was $12.6 million, or $14.23 per Boe in 2024 versus $12.0 million, or $15.71 per Boe in 2023. The slight increase in expenses was primarily due to an increase in salaries and benefits associated with an increase in employee headcount.

Interest expense for 2024 was $1.5 million compared to $1.0 million for 2023, a slight increase due to a higher outstanding balance under the Company’s credit facility offset by lower interest rates.

Empire recorded a net loss of $16.2 million in 2024, or ($0.54) per diluted share, versus a 2023 net loss of $12.5 million, or ($0.55) per diluted share.

Adjusted EBITDA was $0.7 million for 2024 compared to Adjusted EBITDA of ($2.4) million in 2023.

YEAR-END 2024 PROVED RESERVES

The Company’s year-end 2024 SEC proved reserves were 9.2 MMBoe compared to 9.1 MMBoe at year-end 2023. The Company recorded 0.4 MMBoe for acquisitions/revisions and (0.3) MMBoe for extensions/production.

Year-end 2024 SEC proved reserves were comprised of approximately 76% crude oil, 13% NGLs, and 11% natural gas.

Oil (MMBbls)

Gas (MMcf)

NGLs

MBOE

Balance, December 31, 2022

8,826

Ìý

12,937

Ìý

2,262

Ìý

13,244

Ìý

Acquisition of Reserves

36

Ìý

19

Ìý

5

Ìý

44

Ìý

Revisions

(1,625

)

(5,998

)

(960

)

(3,585

)

Extensions

175

Ìý

-

Ìý

-

Ìý

175

Ìý

Production

(488

)

(854

)

(136

)

(766

)

Balance, December 31, 2023

6,924

Ìý

6,104

Ìý

1,171

Ìý

9,112

Ìý

Acquisition of Reserves

198

Ìý

240

Ìý

35

Ìý

274

Ìý

Revisions

(90

)

637

Ìý

159

Ìý

175

Ìý

Extensions

550

Ìý

-

Ìý

-

Ìý

550

Ìý

Production

(581

)

(917

)

(150

)

(884

)

Balance, December 31, 2024

7,001

Ìý

6,064

Ìý

1,215

Ìý

9,227

Ìý

The acquisition of reserves for 2024 and 2023 primarily relate to additional working interests in certain of the Company’s New Mexico properties. The revisions for 2024 and 2023 primarily relate to changes in pricing and the extensions relate to increased volumes from our Starbuck Drilling Program.

The standardized measure of the Company’s reported SEC proved reserves, discounted at 10%, at year-end 2024 was $98.4 million. As of December 31 for each year:

Ìý

2024

Ìý

Ìý

2023

Ìý

Future cash inflows

$

537,303,424

Ìý

$

543,067,776

Ìý

Future production costs

Ìý

(324,214,760

)

Ìý

(350,439,800

)

Future development costs

Ìý

(38,681,208

)

Ìý

(42,475,160

)

Future income tax expense

Ìý

(18,019,644

)

Ìý

(25,201,886

)

Future net cash flows

Ìý

156,387,812

Ìý

Ìý

124,950,930

Ìý

10% annual discount for estimated timing of cash flows

Ìý

(58,022,633

)

Ìý

(41,934,370

)

Standardized measure

$

98,365,179

Ìý

$

83,016,560

Ìý

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:

2024

2023

Oil (Bbl)

$71.66

$75.45

Natural gas (MMBtu)

$0.95

$1.51

NGLs (Bbl)

$24.54

$9.82

Ìý

Changes in the Standardized Measure of Discounted Future Net Cash Flows at 10% per annum are as follows as of December 31 for each year:

Ìý

2024

Ìý

Ìý

2023

Ìý

Beginning of year

$

83,016,560

Ìý

$

147,667,413

Ìý

Net change in prices and production costs

Ìý

(5,842,745

)

Ìý

(71,619,375

)

Net change in future development costs

Ìý

220,549

Ìý

Ìý

3,314,220

Ìý

Oil and gas net revenue

Ìý

(9,381,470

)

Ìý

(6,256,366

)

Extensions

Ìý

11,255,319

Ìý

Ìý

4,684,473

Ìý

Acquisition of reserves

Ìý

1,890,863

Ìý

Ìý

526,848

Ìý

Revisions of previous quantity estimates

Ìý

6,675,903

Ìý

Ìý

(55,329,684

)

Net change in taxes

Ìý

4,274,178

Ìý

Ìý

33,317,731

Ìý

Accretion of discount

Ìý

9,746,049

Ìý

Ìý

19,542,907

Ìý

Changes in timing and other

Ìý

(3,490,026

)

Ìý

7,168,393

Ìý

End of year

$

98,365,179

Ìý

$

83,016,560

Ìý

Ìý

CAPITAL SPENDING, BALANCE SHEET & LIQUIDITY

For 2024, Empire invested approximately $42.2 million in capital expenditures, primarily related to the continued drilling and completions activity in North Dakota.

As of December 31, 2024, Empire had approximately $2.3 million in cash on hand and approximately $8.7 million available on its credit facility.

Successful completion of the November Rights Offering in November 2024 with Empire receiving gross proceeds of $10.0 million at $5.05 per share.

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, Tulsa-based oil and gas company with current producing assets in New Mexico, North Dakota, Montana, Texas, and Louisiana. Management is focused on organic growth and targeted acquisitions of proved developed assets with synergies with their existing portfolio of wells. More information about Empire can be found at .

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, 2024, 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, 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, uncertainties associated with legal and regulatory matters, 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.

Ìý
Ìý

EMPIRE PETROLEUM CORPORATION

Condensed Consolidated Statements of Operations

(Unaudited)

Ìý

Three Months Ended

Ìý

Year Ended

December 31,

Ìý

September 30,

Ìý

December 31,

Ìý

December 31,

2024

Ìý

2024

Ìý

2023

Ìý

2024

Ìý

2023

Revenue:
Oil Sales

$

9,445,145

$

10,341,280

$

9,106,041

$

41,515,661

$

36,684,494

Gas Sales

Ìý

73,659

Ìý

8,547

Ìý

410,816

Ìý

343,503

Ìý

1,726,754

Natural Gas Liquids ("NGLs") Sales

Ìý

557,671

Ìý

541,755

Ìý

381,497

Ìý

2,132,666

Ìý

1,660,256

Total Product Revenues

Ìý

10,076,475

Ìý

10,891,582

Ìý

9,898,354

Ìý

43,991,830

Ìý

40,071,504

Other

Ìý

10,766

Ìý

15,269

Ìý

15,705

Ìý

47,348

Ìý

70,480

Gain (Loss) on Derivatives

Ìý

-

Ìý

470,717

Ìý

1,253,708

Ìý

(388,886)

Ìý

(65,693)

Total Revenue

Ìý

10,087,241

Ìý

11,377,568

Ìý

11,167,767

Ìý

43,650,292

Ìý

40,076,291

Ìý
Costs and Expenses:
Lease Operating Expense

Ìý

5,881,309

Ìý

6,733,611

Ìý

7,956,264

Ìý

27,545,028

Ìý

28,625,481

Production and Ad Valorem Taxes

Ìý

886,838

Ìý

984,075

Ìý

772,781

Ìý

3,770,078

Ìý

3,044,411

Depletion, Depreciation & Amortization

Ìý

2,492,783

Ìý

2,596,360

Ìý

1,035,059

Ìý

9,256,254

Ìý

3,096,533

Accretion of Asset Retirement Obligation

Ìý

519,827

Ìý

509,131

Ìý

478,881

Ìý

2,006,756

Ìý

1,756,022

General and Administrative Expense:
General and Administrative

Ìý

3,712,825

Ìý

3,635,917

Ìý

4,536,237

Ìý

12,581,859

Ìý

12,034,184

Stock-Based Compensation

Ìý

519,060

Ìý

335,077

Ìý

855,514

Ìý

2,155,774

Ìý

3,144,751

Total General and Administrative Expense

Ìý

4,231,885

Ìý

3,970,994

Ìý

5,391,751

Ìý

14,737,633

Ìý

15,178,935

Ìý
Total Cost and Expenses

Ìý

14,012,642

Ìý

14,794,171

Ìý

15,634,736

Ìý

57,315,749

Ìý

51,701,382

Ìý
Operating Loss

Ìý

(3,925,401)

Ìý

(3,416,603)

Ìý

(4,466,969)

Ìý

(13,665,457)

Ìý

(11,625,091)

Ìý
Other Income and (Expense):
Interest Expense

Ìý

(268,694)

Ìý

(196,306)

Ìý

(328,445)

Ìý

(1,515,269)

Ìý

(1,000,427)

Other Income (Expense)

Ìý

687

Ìý

(26,705)

Ìý

465

Ìý

(1,017,263)

Ìý

23,721

Loss before Taxes

Ìý

(4,193,408)

Ìý

(3,639,614)

Ìý

(4,794,949)

Ìý

(16,197,989)

Ìý

(12,601,797)

Ìý
Income Tax (Provision) Benefit

Ìý

-

Ìý

-

Ìý

(2,528)

Ìý

-

Ìý

132,192

Ìý
Net Loss

$

(4,193,408)

$

(3,639,614)

$

(4,797,477)

$

(16,197,989)

$

(12,469,605)

Ìý
Net Loss per Common Share:
Basic

$

(0.13)

$

(0.12)

$

(0.20)

$

(0.54)

$

(0.55)

Diluted

$

(0.13)

$

(0.12)

$

(0.20)

$

(0.54)

$

(0.55)

Weighted Average Number of Common Shares Outstanding:
Basic

Ìý

33,034,333

Ìý

31,619,333

Ìý

23,912,271

Ìý

30,064,856

Ìý

22,718,890

Diluted

Ìý

33,034,333

Ìý

31,619,333

Ìý

23,912,271

Ìý

30,064,856

Ìý

22,718,890

Ìý
Ìý

EMPIRE PETROLEUM CORPORATION

Condensed Operating Data

(Unaudited)

Ìý

Three Months Ended

Ìý

Year Ended

December 31,

Ìý

September 30,

Ìý

December 31,

Ìý

December 31,

2024

Ìý

2023

Ìý

2023

Ìý

2024

Ìý

2023

Ìý
Net Sales Volumes:
Oil (Bbl)

Ìý

145,442

Ìý

144,674

Ìý

119,022

Ìý

581,159

Ìý

487,869

Natural gas (Mcf)

Ìý

208,698

Ìý

255,195

Ìý

215,855

Ìý

916,955

Ìý

854,274

Natural gas liquids (Bbl)

Ìý

36,556

Ìý

39,137

Ìý

30,011

Ìý

150,091

Ìý

136,013

Total (Boe)

Ìý

216,781

Ìý

226,344

Ìý

185,009

Ìý

884,076

Ìý

766,261

Ìý
Average daily equivalent sales (Boe/d)

Ìý

2,356

Ìý

2,460

Ìý

2,011

Ìý

2,416

Ìý

2,099

Ìý
Average Price per Unit:
Oil ($/Bbl)

$

64.94

$

71.48

$

76.51

$

71.44

$

75.19

Natural gas ($/Mcf)

$

0.35

$

0.03

$

1.90

$

0.37

$

2.02

Natural gas liquids ($/Bbl)

$

15.26

$

13.84

$

12.71

$

14.21

$

12.21

Total ($/Boe)

$

46.48

$

48.12

$

53.50

$

49.76

$

52.29

Ìý
Operating Costs and Expenses per Boe:
Lease operating expense

$

27.13

$

29.75

$

43.00

$

31.16

$

37.36

Production and ad valorem taxes

$

4.09

$

4.35

$

4.18

$

4.26

$

3.97

Depreciation, depletion, amortization and accretion

$

13.90

$

13.72

$

8.18

$

12.74

$

6.33

General & administrative expense:
General & administrative expense (excluding stock-based compensation)

$

17.13

$

16.06

$

24.52

$

14.23

$

15.71

Stock-based compensation

$

2.39

$

1.48

$

4.62

$

2.44

$

4.10

Total general & administrative expense

$

19.52

$

17.54

$

29.14

$

16.67

$

19.81

Ìý
Ìý

EMPIRE PETROLEUM CORPORATION

Condensed Consolidated Balance Sheets

December 31,

Ìý

December 31,

Ìý

2024

Ìý

Ìý

Ìý

2023

Ìý

Ìý
ASSETS
Current Assets:
Cash

$

2,251,464

Ìý

$

7,792,508

Ìý

Accounts Receivable

Ìý

8,154,433

Ìý

Ìý

8,354,636

Ìý

Derivative Instruments

Ìý

-

Ìý

Ìý

406,806

Ìý

Inventory

Ìý

1,304,699

Ìý

Ìý

1,433,454

Ìý

Prepaids

Ìý

640,349

Ìý

Ìý

757,500

Ìý

Total Current Assets

Ìý

12,350,945

Ìý

Ìý

18,744,904

Ìý

Ìý
Property and Equipment:
Oil and Natural Gas Properties, Successful Efforts

Ìý

140,675,399

Ìý

Ìý

93,509,803

Ìý

Less: Accumulated Depreciation, Depletion and Impairment

Ìý

(31,974,184

)

Ìý

(22,996,805

)

Total Oil and Gas Properties, Net

Ìý

108,701,215

Ìý

Ìý

70,512,998

Ìý

Other Property and Equipment, Net

Ìý

1,391,113

Ìý

Ìý

1,883,211

Ìý

Total Property and Equipment, Net

Ìý

110,092,328

Ìý

Ìý

72,396,209

Ìý

Ìý
Other Noncurrent Assets

Ìý

1,425,198

Ìý

Ìý

1,474,503

Ìý

Ìý
TOTAL ASSETS

$

123,868,471

Ìý

$

92,615,616

Ìý

Ìý
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable

$

10,452,237

Ìý

$

16,437,219

Ìý

Accrued Expenses

Ìý

10,347,990

Ìý

Ìý

7,075,302

Ìý

Current Portion of Lease Liability

Ìý

400,692

Ìý

Ìý

432,822

Ìý

Current Portion of Note Payable - Related Party

Ìý

-

Ìý

Ìý

1,060,004

Ìý

Current Portion of Long-Term Debt

Ìý

69,552

Ìý

Ìý

44,225

Ìý

Total Current Liabilities

Ìý

21,270,471

Ìý

Ìý

25,049,572

Ìý

Ìý
Long-Term Debt

Ìý

11,266,127

Ìý

Ìý

4,596,775

Ìý

Term Note Payable - Related Party

Ìý

-

Ìý

Ìý

-

Ìý

Long-Term Lease Liability

Ìý

143,689

Ìý

Ìý

544,382

Ìý

Asset Retirement Obligations

Ìý

28,423,000

Ìý

Ìý

27,468,427

Ìý

Total Liabilities

Ìý

61,103,287

Ìý

Ìý

57,659,156

Ìý

Ìý
Stockholders' Equity:
Series A Preferred Stock - $.001 Par Value, 10,000,000 Shares Authorized, 6 and 6 Shares Issued and Outstanding, Respectively

Ìý

-

Ìý

Ìý

-

Ìý

Common Stock - $.001 Par Value, 190,000,000 Shares Authorized, 33,667,132 and 25,503,530 Shares Issued and Outstanding, Respectively

Ìý

93,188

Ìý

Ìý

85,025

Ìý

Additional Paid-in-Capital

Ìý

143,488,803

Ìý

Ìý

99,490,253

Ìý

Accumulated Deficit

Ìý

(80,816,807

)

Ìý

(64,618,818

)

Total Stockholders' Equity

Ìý

62,765,184

Ìý

Ìý

34,956,460

Ìý

Ìý
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

123,868,471

Ìý

$

92,615,616

Ìý

Ìý
Ìý

EMPIRE PETROLEUM CORPORATION

Condensed Consolidated Statements of Cash Flows

(Unaudited)

Ìý

Three Months Ended

Ìý

Year Ended

December 31,

Ìý

September 30,

Ìý

December 31,

Ìý

December 31,

Ìý

December 31,

Ìý

2024

Ìý

Ìý

Ìý

2024

Ìý

Ìý

Ìý

2023

Ìý

Ìý

Ìý

2024

Ìý

Ìý

Ìý

2023

Ìý

Ìý
Cash Flows From Operating Activities:
Net Loss

$

(4,193,408

)

$

(3,639,614

)

$

(4,797,477

)

$

(16,197,989

)

$

(12,469,605

)

Ìý
Adjustments to Reconcile Net Loss to Net Cash Provided By (Used In) Operating Activities:
Stock-Based Compensation

Ìý

519,060

Ìý

Ìý

335,077

Ìý

Ìý

855,513

Ìý

Ìý

2,155,774

Ìý

Ìý

3,144,750

Ìý

Amortization of Right of Use Assets

Ìý

133,199

Ìý

Ìý

135,735

Ìý

Ìý

135,733

Ìý

Ìý

540,401

Ìý

Ìý

423,689

Ìý

Depreciation, Depletion and Amortization

Ìý

2,492,783

Ìý

Ìý

2,596,360

Ìý

Ìý

1,035,059

Ìý

Ìý

9,256,254

Ìý

Ìý

3,096,533

Ìý

Accretion of Asset Retirement Obligation

Ìý

519,827

Ìý

Ìý

509,131

Ìý

Ìý

478,881

Ìý

Ìý

2,006,756

Ìý

Ìý

1,756,022

Ìý

(Gain) Loss on Derivatives

Ìý

-

Ìý

Ìý

(470,717

)

Ìý

(1,253,708

)

Ìý

388,886

Ìý

Ìý

65,693

Ìý

Settlement on or Purchases of Derivative Instruments

Ìý

-

Ìý

Ìý

281,530

Ìý

Ìý

(266,653

)

Ìý

18,200

Ìý

Ìý

(353,695

)

Loss on Financial Derivatives

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

998,000

Ìý

Ìý

-

Ìý

Amortization of Debt Discount on Convertible Notes

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

500,382

Ìý

Ìý

-

Ìý

(Gain) Loss on Extinguishment of Debt

Ìý

-

Ìý

Ìý

26,705

Ìý

Ìý

-

Ìý

Ìý

10,094

Ìý

Ìý

-

Ìý

Change in Operating Assets and Liabilities:
Accounts Receivable

Ìý

(2,004,722

)

Ìý

2,277,310

Ìý

Ìý

(1,128,490

)

Ìý

(357,473

)

Ìý

(2,700,528

)

Inventory, Oil in Tanks

Ìý

194,507

Ìý

Ìý

(48,011

)

Ìý

131,230

Ìý

Ìý

128,755

Ìý

Ìý

(160,827

)

Prepaids, Current

Ìý

(64,009

)

Ìý

211,733

Ìý

Ìý

(165,768

)

Ìý

607,925

Ìý

Ìý

745,648

Ìý

Accounts Payable

Ìý

(7,254,138

)

Ìý

10,419,209

Ìý

Ìý

556,917

Ìý

Ìý

5,019,857

Ìý

Ìý

751,355

Ìý

Accrued Expenses

Ìý

1,073,329

Ìý

Ìý

41,175

Ìý

Ìý

649,185

Ìý

Ìý

2,144,204

Ìý

Ìý

(3,082,928

)

Other Long Term Assets and Liabilities

Ìý

(176,799

)

Ìý

135,172

Ìý

Ìý

(160,691

)

Ìý

(1,063,023

)

Ìý

(1,103,607

)

Net Cash Provided By (Used In) Operating Activities

Ìý

(8,760,371

)

Ìý

12,810,795

Ìý

Ìý

(3,930,269

)

Ìý

6,157,003

Ìý

Ìý

(9,887,500

)

Ìý
Cash Flows from Investing Activities:
Acquisition of Oil and Natural Gas Properties

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

(2,094,419

)

Additions to Oil and Natural Gas Properties

Ìý

(4,460,338

)

Ìý

(18,615,643

)

Ìý

(8,950,338

)

Ìý

(53,219,169

)

Ìý

(14,546,873

)

Purchase of Other Fixed Assets

Ìý

(12,157

)

Ìý

(19,590

)

Ìý

(173,337

)

Ìý

(151,638

)

Ìý

(352,851

)

Cash Paid for Right of Use Assets

Ìý

(122,943

)

Ìý

(125,236

)

Ìý

(124,485

)

Ìý

(498,654

)

Ìý

(552,196

)

Sinking Fund Deposit

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

2,779,000

Ìý

Net Cash Used In Investing Activities

Ìý

(4,595,438

)

Ìý

(18,760,469

)

Ìý

(9,248,160

)

Ìý

(53,869,461

)

Ìý

(14,767,339

)

Ìý
Cash Flows from Financing Activities:
Borrowings on Credit Facility

Ìý

2,700,000

Ìý

Ìý

-

Ìý

Ìý

4,492,484

Ìý

Ìý

6,650,000

Ìý

Ìý

4,492,484

Ìý

Proceeds from Promissory Note - Related Party

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

5,000,000

Ìý

Ìý

-

Ìý

Proceeds from Rights Offerings, net of transaction costs

Ìý

9,972,959

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

30,484,488

Ìý

Ìý

-

Ìý

Proceeds from Bridge Loans from Related Parties

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

10,000,000

Ìý

Principal Payments of Debt

Ìý

(215,400

)

Ìý

(158,383

)

Ìý

(4,517,576

)

Ìý

(591,975

)

Ìý

(6,450,774

)

Proceeds from Stock Issuance and Warrant Exercises

Ìý

(2

)

Ìý

-

Ìý

Ìý

9,961,195

Ìý

Ìý

628,901

Ìý

Ìý

12,461,195

Ìý

Net Cash Provided By Financing Activities

Ìý

12,457,557

Ìý

Ìý

(158,383

)

Ìý

9,936,103

Ìý

Ìý

42,171,414

Ìý

Ìý

20,502,905

Ìý

Ìý
Net Change in Cash

Ìý

(898,252

)

Ìý

(6,108,057

)

Ìý

(3,242,326

)

Ìý

(5,541,044

)

Ìý

(4,151,934

)

Ìý
Cash - Beginning of Period

Ìý

3,149,716

Ìý

Ìý

9,257,773

Ìý

Ìý

11,034,834

Ìý

Ìý

7,792,508

Ìý

Ìý

11,944,442

Ìý

Ìý
Cash - End of Period

$

2,251,464

Ìý

$

3,149,716

Ìý

$

7,792,508

Ìý

$

2,251,464

Ìý

$

7,792,508

Ìý

Ìý
Supplemental Cash Flow Information:
Cash Paid for Interest

$

894,282

Ìý

$

650,637

Ìý

Ìý
Ìý
Ìý
Ìý

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 the United States, or GAAP. These non-GAAP financial measures include “Adjusted Net Loss�, “EBITDA� and “Adjusted EBITDA�. These disclosures may not be viewed as a substitute for results determined in accordance with GAAP and are not necessarily comparable to non-GAAP performance measures which may be reported by other companies. Adjusted net loss is presented because the timing and amount of these items cannot be reasonably estimated and affect the comparability of operating results from period to period, and current periods to prior periods.

Three Months Ended

Ìý

Year Ended

December 31,

Ìý

September 30,

Ìý

December 31,

Ìý

December 31,

Ìý

December 31,

Ìý

2024

Ìý

Ìý

Ìý

2024

Ìý

Ìý

Ìý

2023

Ìý

Ìý

Ìý

2024

Ìý

Ìý

Ìý

2023

Ìý

Ìý
Net Loss

$

(4,193,408

)

$

(3,639,614

)

$

(4,797,477

)

$

(16,197,989

)

$

(12,469,605

)

Ìý
Adjusted for:
(Gain) loss on derivatives

Ìý

-

Ìý

Ìý

(470,717

)

Ìý

(1,253,708

)

Ìý

388,886

Ìý

Ìý

65,693

Ìý

Settlement on or purchases of derivative instruments

Ìý

-

Ìý

Ìý

281,530

Ìý

Ìý

(266,653

)

Ìý

18,200

Ìý

Ìý

(353,695

)

(Gain) loss on financial derivatives

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

998,000

Ìý

Ìý

-

Ìý

CEO severance (including employer taxes)

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

374,820

Ìý

COO severance (including employer taxes)

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

145,319

Ìý

Professional fees for potential financing transactions

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

564,588

Ìý

Ìý

-

Ìý

Ìý

564,588

Ìý

Ìý
Adjusted Net Loss

$

(4,193,408

)

$

(3,828,801

)

$

(5,753,250

)

$

(14,792,903

)

$

(11,672,880

)

Ìý
Diluted Weighted Average Shares Outstanding

Ìý

33,034,333

Ìý

Ìý

31,619,333

Ìý

Ìý

23,912,271

Ìý

Ìý

30,064,856

Ìý

Ìý

22,718,890

Ìý

Ìý
Adjusted Net Loss Per Share

$

(0.13

)

$

(0.12

)

$

(0.24

)

$

(0.49

)

$

(0.51

)

Ìý
Ìý
Ìý

The Company defines adjusted EBITDA as net loss plus net interest expense, depreciation, depletion, and amortization (“DD&A�) and 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.

Three Months Ended

Ìý

Year Ended

December 31,

Ìý

September 30,

Ìý

December 31,

Ìý

December 31,

Ìý

December 31,

Ìý

2024

Ìý

Ìý

Ìý

2024

Ìý

Ìý

Ìý

2023

Ìý

Ìý

Ìý

2024

Ìý

Ìý

Ìý

2023

Ìý

Ìý
Net Loss

$

(4,193,408

)

$

(3,639,614

)

$

(4,797,477

)

$

(16,197,989

)

$

(12,469,605

)

Ìý
Add Back:
Interest expense

Ìý

268,694

Ìý

Ìý

196,306

Ìý

Ìý

328,445

Ìý

Ìý

1,515,269

Ìý

Ìý

1,000,427

Ìý

DD&A

Ìý

2,492,783

Ìý

Ìý

2,596,360

Ìý

Ìý

1,035,059

Ìý

Ìý

9,256,254

Ìý

Ìý

3,096,533

Ìý

Accretion

Ìý

519,827

Ìý

Ìý

509,131

Ìý

Ìý

478,881

Ìý

Ìý

2,006,756

Ìý

Ìý

1,756,022

Ìý

Amortization of right of use assets

Ìý

133,199

Ìý

Ìý

135,735

Ìý

Ìý

135,733

Ìý

Ìý

540,401

Ìý

Ìý

423,689

Ìý

Income taxes

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

2,528

Ìý

Ìý

-

Ìý

Ìý

(132,192

)

EBITDA

$

(778,905

)

$

(202,082

)

$

(2,816,831

)

$

(2,879,309

)

$

(6,325,126

)

Ìý
Adjustments:
Stock based Compensation

Ìý

519,060

Ìý

Ìý

335,077

Ìý

Ìý

855,514

Ìý

Ìý

2,155,774

Ìý

Ìý

3,144,751

Ìý

(Gain) loss on derivatives

Ìý

-

Ìý

Ìý

(470,717

)

Ìý

(1,253,708

)

Ìý

388,886

Ìý

Ìý

65,693

Ìý

Settlement on or purchases of derivative instruments

Ìý

-

Ìý

Ìý

281,530

Ìý

Ìý

(266,653

)

Ìý

18,200

Ìý

Ìý

(353,695

)

(Gain) Loss on financial derivatives

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

998,000

Ìý

Ìý

-

Ìý

CEO severance (including employer taxes)

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

374,820

Ìý

COO severance (including employer taxes)

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

145,319

Ìý

Professional fees for potential financing transactions

Ìý

-

Ìý

Ìý

-

Ìý

Ìý

564,588

Ìý

Ìý

-

Ìý

Ìý

564,588

Ìý

Ìý
Adjusted EBITDA

$

(259,845

)

$

(56,192

)

$

(2,917,090

)

$

681,551

Ìý

$

(2,383,650

)

Ìý
Ìý

Ìý

Mike Morrisett

President & CEO

539-444-8002

[email protected]

Kali Carter

Communications & Investor Relations Manager

918-995-5046

[email protected]

Source: Empire Petroleum

Empire Petroleum

NYSE:EP

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EP Stock Data

187.82M
14.35M
56.99%
10.24%
3.85%
Oil & Gas E&P
Crude Petroleum & Natural Gas
United States
TULSA