BARNWELL INDUSTRIES INC 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of Barnwell Industries, Inc. Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Barnwell Industries, Inc. and subsidiaries (collectively, the Company) as of September 30, 2025 and 2024, and the related consolidated statements of operations, comprehensive loss, equity, and cash flows for each of the two years in the period ended September 30, 2025, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of September 30, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended September 30, 2025, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the entity’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters 51 does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates. Estimation of proved reserves impacting the recognition and valuation of depletion expense and impairment of oil and gas properties Critical Accounting Matter Description As described in Note 1 to the financial statements, the Company accounts for its oil and gas properties using the full cost method of accounting which requires management to make estimates of proved reserve volumes and future revenues and expenses to calculate depletion expense and measure its oil and gas properties for potential impairment. To estimate the volume of proved reserves and future revenues, management makes significant estimates and assumptions, including forecasting the production decline rate of producing properties. In addition, the estimation of proved reserves is also impacted by management’s judgments and estimates regarding the financial performance of wells associated with proved reserves to determine if wells are expected, with reasonable certainty, to be economical under the appropriate pricing assumptions required in the estimation of depletion expense and potential impairment measurements. We identified the estimation of proved reserves of oil and gas properties, due to its impact on depletion expense and impairment evaluation, as a critical audit matter. The principal consideration for our determination that the estimation of proved reserves is a critical audit matter is that changes in certain inputs and assumptions, which require a high degree of subjectivity necessary to estimate the volume and future revenues of the Company’s proved reserves could have a significant impact on the measurement of depletion expense or the impairment assessment. In turn, auditing those inputs and assumptions required subjective and complex auditor judgement. How the Critical Audit Matter was Addressed in the Audit We obtained an understanding of the design and implementation of management’s controls and our audit procedures related to the estimation of proved reserves included the following, among others. • We evaluated the level of knowledge, skill, and ability of the Company’s reservoir engineering specialists and their relationship to the Company, made inquiries of those reservoir engineers regarding the process followed and judgments made to estimate the Company’s proved reserve volumes, and read the reserve report prepared by the Company’s specialists. • To the extent key, sensitive inputs and assumptions used to determine proved reserve volumes and other cash flow inputs and assumptions are derived from Company’s accounting records, such as commodity pricing, historical pricing differentials, operating costs, and working and net revenue interests, we tested management’s process for determining the assumptions, including examining the underlying support, on a sample basis. Specifically, our audit procedures involved testing management’s assumptions, to the extent key, as follows: • Compared the estimated pricing differentials used in the reserve report to realized prices related to revenue transactions recorded in the current year and examined contractual support for the pricing differentials; • Evaluated the forecasted operating costs at year-end compared to historical operating costs; • Evaluated the working and net revenue interests used in the reserve report by inspecting a sample of ownership interests; 52 • Applied analytical procedures to the reserve report by comparing to historical actual results and to the prior year reserve report. /s/ WEAVER AND TIDWELL, L.L.P. We have served as the Company’s auditor since 2020. Dallas, Texas December 22, 2025 53 BARNWELL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS September 30, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 2,886,000 $ 4,285,000 Accounts and other receivables, net of allowance for credit losses of: $ 49,000 at September 30, 2025; $ 141,000 at September 30, 2024 1,621,000 2,190,000 Note receivable 300,000 — Other current assets 423,000 873,000 Current assets of discontinued operations — 1,535,000 Total current assets 5,230,000 8,883,000 Asset for retirement benefits 5,928,000 4,899,000 Operating lease right-of-use assets 145,000 39,000 Other non-current assets 347,000 — Property and equipment: Proved oil and natural gas properties, net (full cost method) 9,153,000 16,554,000 Other property and equipment, net 9,000 12,000 Total property and equipment, net 9,162,000 16,566,000 Non-current assets of discontinued operations — 282,000 Total assets $ 20,812,000 $ 30,669,000 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 2,182,000 $ 1,785,000 Accrued capital expenditures 185,000 2,407,000 Accrued compensation 264,000 526,000 Accrued operating and other expenses 1,022,000 1,465,000 Current portion of asset retirement obligation 613,000 798,000 Other current liabilities 460,000 301,000 Current liabilities of discontinued operations — 530,000 Total current liabilities 4,726,000 7,812,000 Operating lease liabilities 93,000 7,000 Liability for retirement benefits 1,791,000 1,898,000 Asset retirement obligation 7,162,000 7,790,000 Deferred income tax liabilities 18,000 100,000 Total liabilities 13,790,000 17,607,000 Commitments and contingencies (Note 18) Equity: Common stock, par value $ 0.50 per share; authorized, 40,000,000 shares: 10,241,434 issued at September 30, 2025; 10,195,990 issued at September 30, 2024 5,121,000 5,098,000 Additional paid-in capital 8,039,000 7,690,000 (Accumulated deficit) retained earnings ( 6,508,000 ) 595,000 Accumulated other comprehensive income, net 2,642,000 1,943,000 Treasury stock, at cost: 167,900 shares at September 30, 2025 and 2024 ( 2,286,000 ) ( 2,286,000 ) Total stockholders’ equity 7,008,000 13,040,000 Non-controlling interests 14,000 22,000 Total equity 7,022,000 13,062,000 Total liabilities and equity $ 20,812,000 $ 30,669,000 See Notes to Consolidated Financial Statements 54 BARNWELL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Year ended September 30, 2025 2024 Revenues: Oil and natural gas $ 13,563,000 $ 17,396,000 Sale of interest in leasehold land — 500,000 Gas processing and other 134,000 179,000 13,697,000 18,075,000 Costs and expenses: Oil and natural gas operating 8,966,000 9,849,000 General and administrative 6,937,000 5,130,000 Depletion, depreciation, and amortization 3,146,000 4,950,000 Impairment of assets 865,000 2,885,000 Foreign currency loss (gain) 192,000 ( 10,000 ) Interest expense 7,000 — Loss on sale of assets 636,000 — 20,749,000 22,804,000 Loss from continuing operations before equity in income of affiliates and income taxes ( 7,052,000 ) ( 4,729,000 ) Equity in income of affiliates — 1,071,000 Loss from continuing operations before income taxes ( 7,052,000 ) ( 3,658,000 ) Income tax provision 71,000 213,000 Net loss from continuing operations ( 7,123,000 ) ( 3,871,000 ) Net earnings (loss) from discontinued operations 12,000 ( 1,460,000 ) Net loss ( 7,111,000 ) ( 5,331,000 ) Less: Net (loss) earnings attributable to non-controlling interests ( 8,000 ) 234,000 Net loss attributable to Barnwell Industries, Inc. stockholders $ ( 7,103,000 ) $ ( 5,565,000 ) Basic and diluted loss per common share attributable to Barnwell Industries, Inc. stockholders: Net loss from continuing operations attributable to Barnwell Industries, Inc. $ ( 0.71 ) $ ( 0.41 ) Net loss from discontinued operations — ( 0.15 ) Net loss attributable to Barnwell Industries, Inc. $ ( 0.71 ) $ ( 0.56 ) Weighted-average number of common shares outstanding: Basic and diluted 10,056,479 10,017,997 See Notes to Consolidated Financial Statements 55 BARNWELL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS Year ended September 30, 2025 2024 Net loss $ ( 7,111,000 ) $ ( 5,331,000 ) Other comprehensive income (loss): Foreign currency translation adjustments, net of taxes of $ 0 75,000 — Retirement plans: Amortization of accumulated other comprehensive gain into net periodic benefit cost, net of taxes of $ 0 — ( 85,000 ) Net actuarial gain (loss) arising during the period, net of taxes of $ 0 624,000 ( 76,000 ) Total other comprehensive income (loss) 699,000 ( 161,000 ) Total comprehensive loss ( 6,412,000 ) ( 5,492,000 ) Less: Comprehensive loss (income) attributable to non-controlling interests 8,000 ( 234,000 ) Comprehensive loss attributable to Barnwell Industries, Inc. $ ( 6,404,000 ) $ ( 5,726,000 ) See Notes to Consolidated Financial Statements 56 BARNWELL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EQUITY Years ended September 30, 2025 and 2024 Shares Outstanding Common Stock Additional Paid-In Capital Retained Earnings (Accumulated Deficit) Accumulated Other Comprehensive Income Treasury Stock Non-controlling Interests Total Equity Balance at September 30, 2023 9,990,778 $ 5,079,000 $ 7,687,000 $ 6,160,000 $ 2,104,000 $ ( 2,286,000 ) $ 13,000 $ 18,757,000 Net (loss) earnings — — — ( 5,565,000 ) — — 234,000 ( 5,331,000 ) Distributions to non-controlling interests — — — — — — ( 226,000 ) ( 226,000 ) Acquisition of non-controlling interest — — ( 186,000 ) — — — 1,000 ( 185,000 ) Share-based compensation — — 208,000 — — — — 208,000 Issuance of common stock for restricted stock units vested 37,312 19,000 ( 19,000 ) — — — — — Retirement plans: Amortization of accumulated other comprehensive gain into net periodic benefit cost, net of taxes of $ 0 — — — — ( 85,000 ) — — ( 85,000 ) Net actuarial gain arising during the period, net of taxes of $ 0 — — — — ( 76,000 ) — — ( 76,000 ) Balance at September 30, 2024 10,028,090 5,098,000 7,690,000 595,000 1,943,000 ( 2,286,000 ) 22,000 13,062,000 Net loss — — — ( 7,103,000 ) — — ( 8,000 ) ( 7,111,000 ) Foreign currency translation adjustments, net of taxes of $ 0 — — — — 75,000 — — 75,000 Share-based compensation — — 372,000 — — — — 372,000 Issuance of common stock for restricted stock units vested 45,444 23,000 ( 23,000 ) — — — — — Retirement plans: Net actuarial loss arising during the period, net of taxes of $ 0 — — — — 624,000 — — 624,000 Balance at September 30, 2025 10,073,534 $ 5,121,000 $ 8,039,000 $ ( 6,508,000 ) $ 2,642,000 $ ( 2,286,000 ) $ 14,000 $ 7,022,000 See Notes to Consolidated Financial Statements 57 BARNWELL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Year ended September 30, 2025 2024 Cash flows from operating activities of continuing operations: Net loss $ ( 7,111,000 ) $ ( 5,331,000 ) Net earnings (loss) from discontinued operations 12,000 ( 1,460,000 ) Net loss from continuing operations ( 7,123,000 ) ( 3,871,000 ) Adjustments to reconcile net loss from continuing operations to net cash (used in) provided by operating activities: Depletion, depreciation, and amortization 3,146,000 4,950,000 Impairment of assets 865,000 2,885,000 Loss on sale of oil and natural gas properties 636,000 — Sale of interest in leasehold land, net of fees paid — ( 439,000 ) Distributions of income from equity investees — 1,071,000 Equity in income of affiliates — ( 1,071,000 ) Retirement benefits income ( 315,000 ) ( 345,000 ) Accretion of asset retirement obligation 808,000 900,000 Deferred income tax (benefit) expense ( 82,000 ) 42,000 Asset retirement obligation payments ( 483,000 ) ( 1,139,000 ) Share-based compensation expense 372,000 208,000 Non-cash rent income ( 8,000 ) ( 28,000 ) Retirement plan contributions and payments ( 3,000 ) ( 4,000 ) Credit loss (reversal) expense ( 2,000 ) 85,000 Foreign currency loss (gain) 192,000 ( 10,000 ) Increase from changes in current assets and liabilities 224,000 2,100,000 Net cash (used in) provided by operating activities from continuing operations ( 1,773,000 ) 5,334,000 Cash flows from investing activities of continuing operations: Acquisition of non-controlling interest — ( 185,000 ) Proceeds from sale of interest in leasehold land, net of fees paid — 439,000 Proceeds from the sale of oil and natural gas assets 2,722,000 441,000 Capital expenditures - oil and natural gas ( 3,074,000 ) ( 3,514,000 ) Net cash used in investing activities from continuing operations ( 352,000 ) ( 2,819,000 ) Cash flows from financing activities of continuing operations: Repayments for insurance premium financing ( 168,000 ) — Distributions to non-controlling interests — ( 226,000 ) Net cash used in financing activities from continuing operations ( 168,000 ) ( 226,000 ) Cash flows from discontinued operations: Net cash used in operating activities ( 95,000 ) ( 624,000 ) Net cash provided by (used in) investing activities 1,125,000 ( 13,000 ) Net cash used in financing activities ( 250,000 ) — Net cash provided by (used in) discontinued operations 780,000 ( 637,000 ) Effect of exchange rate changes on cash and cash equivalents ( 106,000 ) 23,000 Net (decrease) increase in cash and cash equivalents ( 1,619,000 ) 1,675,000 Cash and cash equivalents at beginning of year 4,505,000 2,830,000 Less: Cash and cash equivalents of discontinued operations at end of year — ( 220,000 ) Cash and cash equivalents of continuing operations at end of year $ 2,886,000 $ 4,285,000 See Notes to Consolidated Financial Statements 58 BARNWELL INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2025 AND 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business Barnwell’s continuing operations is engaged in the following lines of business: 1) acquiring, developing, producing and selling oil and natural gas in Canada and the U.S. and 2) leasehold land interests in Hawaii. Principles of Consolidation The consolidated financial statements include the accounts of Barnwell Industries, Inc. and all majority-owned subsidiaries (collectively referred to herein as “Barnwell,” “we,” “our,” “us,” or the “Company”), including a 77.6 %-owned land investment general partnership (Kaupulehu Developments) and a 75 %-owned land investment partnership (KD Kona). All significant intercompany accounts and transactions have been eliminated. Undivided interests in oil and natural gas exploration and production joint ventures are consolidated on a proportionate basis. Barnwell’s investments in both unconsolidated entities in which a significant, but less than controlling, interest is held and in VIEs in which the Company is not deemed to be the primary beneficiary are accounted for by the equity method. Use of Estimates in the Preparation of Consolidated Financial Statements The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management of Barnwell to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Actual results could differ significantly from those estimates. Significant assumptions are required in the valuation of deferred tax assets, asset retirement obligations, and proved oil and natural gas reserves, and such assumptions may impact the amount at which such items are recorded. Discontinued Operations On March 14, 2025, the Company entered into and completed the sale of its wholly-owned subsidiary, Water Resources International, Inc. (“Water Resources”). Water Resources drills water wells and installs and repairs water pumping systems in Hawaii and represented our contract drilling segment. As a result of the sale, the Company has classified the related assets and liabilities and the results of its contract drilling business as discontinued operations in the consolidated financial statements for all periods presented. Prior to the sale, the Company did not have any assurances that a sale of Water Resources was likely to occur. See Note 3 “Discontinued Operations” for further discussion and additional disclosures related to discontinued operations. Unless otherwise noted, the discussions in the Notes to Consolidated Financial Statements refers to the Company’s continuing operations. 59 Revenue Recognition Barnwell operates in and derives revenue from the following two principal business segments: • Oil and Natural Gas Segment - Barnwell engages in oil and natural gas development, production, acquisitions and sales in Canada and the U.S. • Land Investment Segment - Barnwell owns land interests in Hawaii. Oil and Natural Gas - Barnwell’s investments in oil and natural gas properties are located in Alberta, Canada. These property interests are principally held under governmental leases or licenses. Barnwell sells the large majority of its oil, natural gas and natural gas liquids production under short-term contracts between itself and marketers based on prices indexed to market prices and recognizes revenue at a point in time when the oil, natural gas and natural gas liquids are delivered, as this is where Barnwell’s performance obligation is satisfied and title has passed to the customer. Barnwell’s investments in oil and natural gas properties in Oklahoma and Texas were sold on August 8, 2025. Land Investment - Barnwell is entitled to receive contingent residual payments from the entities that previously purchased Barnwell’s land investment interests under contracts entered into in prior years. The residual payments under those contracts become due when the entities sell lots and/or residential units in the areas that were previously sold under the aforementioned contracts or when a preferred payment threshold is achieved. The residual payments received by Barnwell are recognized as revenue when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Cash and Cash Equivalents Cash and cash equivalents include cash on hand and short-term investments with original maturities of three months or less. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents. We maintain bank account balances with high quality financial institutions which often exceed insured limits. We have not experienced any losses with these accounts and believe that we are not exposed to any significant credit risk on cash. Accounts and Other Receivables Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for credit losses is Barnwell’s best estimate of the amount of current expected credit losses in Barnwell’s existing accounts receivable and is based on the aging of the receivable balances, analysis of historical credit loss rates, and current and future economic conditions affecting collectability. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Barnwell does not have any off-balance sheet credit exposure related to its customers. 60 Insurance Recoveries The Company maintains directors and officers liability insurance coverage. Receipts from insurance claim reimbursements under the liability coverage, up to the amount of costs recognized are considered recoveries. These recoveries are accounted for when they are probable of receipt. Insurance recoveries are not recognized prior to the recognition of the related costs incurred. Any insurance receivable for recoveries is recorded separately from the corresponding liability, and only if recovery is determined to be probable and reasonably estimable. Investments in Real Estate Barnwell accounts for sales of Increment I and Increment II leasehold land interests under the full accrual method. Gains from such sales were recognized when the buyer’s investments were adequate to demonstrate a commitment to pay for the property, risks and rewards of ownership transferred to the buyer, and Barnwell did not have a substantial continuing involvement with the property sold. With regard to payments Kaupulehu Developments is entitled to receive from KD I and KD II, the percentage of sales payments from KD I and KD II and percentage of distributions from KD II are contingent future profits which will be recognized when they are realized. All costs of the sales of Increment I and Increment II leasehold land interests were recognized at the time of sale and were not deferred to future periods when any contingent profits will be recognized. Variable Interest Entities The consolidation of VIEs is required when an enterprise has a controlling financial interest and is therefore the VIE’s primary beneficiary. A controlling financial interest will have both of the following characteristics: (a) the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The determination of whether an entity is a VIE and, if so, whether the Company is the primary beneficiary, may require significant judgment. Barnwell analyzes its entities in which it has a variable interest to determine whether the entities are VIEs and, if so, whether the Company is the primary beneficiary. This analysis includes a qualitative review based on an evaluation of the design of the entity, its organizational structure, including decision making ability and financial agreements, as well as a quantitative review. Our unconsolidated affiliates that have been determined to be VIEs are accounted under the equity method because we do not have a controlling financial interest and are therefore not the VIE’s primary beneficiary (see Note 6). Equity Method Investments Affiliated companies, which are limited partnerships or similar entities, in which Barnwell holds more than a 3 % to 5 % ownership interest and does not control, are accounted for as equity method investments. Equity method investment adjustments include Barnwell’s proportionate share of investee income or loss, adjustments to recognize certain differences between Barnwell’s carrying value and Barnwell’s equity in net assets of the investee at the date of investment, impairments and other adjustments required by the equity method. Gains or losses are realized when such investments are sold. Barnwell classifies distributions received from equity method investments using the cumulative earnings approach in the Consolidated Statements of Cash Flows. Under the cumulative earnings approach, distributions received up to the amount of cumulative equity in earnings recognized are treated as returns 61 on investment and are classified within operating cash flows and those in excess of that amount are treated as returns of investment and are classified within investing cash flows. Investments in equity method investees are evaluated for impairment as events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. If the carrying amounts of the assets exceed their respective fair values, additional impairment tests are performed to measure the amounts of the impairment losses, if any. When an impairment test demonstrates that the fair value of an investment is less than its carrying value, management will determine whether the impairment is either temporary or other-than-temporary. Examples of factors which may be indicative of an other-than-temporary impairment include (a) the length of time and extent to which fair value has been less than carrying value, (b) the financial condition and near-term prospects of the investee, and (c) the intent and ability to retain the investment in the investee for a period of time sufficient to allow for any anticipated recovery in fair value. If the decline in fair value is determined by management to be other-than-temporary, the carrying value of the investment is written down to its estimated fair value as of the balance sheet date of the reporting period in which the assessment is made. Oil and Natural Gas Properties Barnwell uses the full cost method of accounting under which all costs incurred in the acquisition, exploration and development of oil and natural gas reserves, including costs related to unsuccessful wells and estimated future site restoration and abandonment, are capitalized. We capitalize internal costs that can be directly identified with our acquisition, exploration and development activities and do not include any costs related to production, general corporate overhead or similar activities. The capitalized costs of oil and gas properties, excluding unevaluated and unproved properties, are amortized as depreciation, depletion and amortization expense using the units-of-production method based on estimated proved recoverable oil and gas reserves. Costs associated with unevaluated and unproved properties, initially excluded from the amortization base, relate to unproved leasehold acreage, wells and production facilities in progress and wells pending determination of the existence of proved reserves. Unproved leasehold costs are transferred to the amortization base with the costs of drilling the related well once a determination of the existence of proved reserves has been made or upon impairment of a lease. Costs associated with wells in progress and completed wells that have yet to be evaluated are transferred to the amortization base once a determination is made whether or not proved reserves can be assigned to the property. Costs of dry wells are transferred to the amortization base immediately upon determination that the well is unsuccessful. All items classified as unevaluated and unproved properties are assessed on a quarterly basis for possible impairment or reduction in value. Properties are assessed on an individual basis or as a group if properties are individually insignificant. The assessment includes consideration of various factors, including, but not limited to, the following: intent to drill; remaining lease term; geological and geophysical evaluations; drilling results and activity; assignment of proved reserves; and economic viability of development if proved reserves are assigned. During any period in which these factors indicate an impairment, the cumulative drilling costs incurred to date for such property and all or a portion of the associated leasehold costs are transferred to the full cost pool and become subject to amortization. Under the full cost method of accounting, we review the carrying value of our oil and natural gas properties, on a country-by-country basis, each quarter in what is commonly referred to as the ceiling test. Under the ceiling test, capitalized costs, net of accumulated depletion and oil and natural gas related 62 deferred income taxes, may not exceed an amount equal to the sum of 1) the discounted present value (at 10 %), using average first-day-of-the-month prices during the 12-month period ending as of the balance sheet date held constant over the life of the reserves (except where prices are defined by contractual arrangements), of Barnwell’s estimated future net cash flows from estimated production of proved oil and natural gas reserves as determined by independent petroleum reserve engineers, less estimated future expenditures to be incurred in developing and producing the proved reserves but excluding future cash outflows associated with settling asset retirement obligations with the exception of those associated with proved undeveloped reserves from wells that are to be drilled in the future; plus 2) the cost of major development projects and unproven properties not subject to depletion, if any; plus 3) the lower of cost or estimated fair value of unproven properties included in costs subject to depletion; less 4) related income tax effects. If net capitalized costs exceed this limit, the excess is expensed. Depletion is computed using the units-of-production method whereby capitalized costs, net of estimated salvage values, plus estimated future costs to develop proved reserves and satisfy asset retirement obligations, are amortized over the total estimated proved reserves on a country-by-country basis. Investments in major development projects are not depleted until either proved reserves are associated with the projects or impairment has been determined. Proceeds from the disposition of oil and natural gas properties are credited to the full cost pool, with no gain or loss recognized, unless such a sale would significantly alter the relationship between capitalized costs and the proved reserves in a particular country. Given the volatility of oil and gas prices, it is reasonably possible that the estimate of discounted future net cash flows from proved oil and gas reserves could change in the near term. If oil and gas prices decline in the future, even if only for a short period of time, it is possible that impairments of oil and gas properties could occur. In addition, it is reasonably possible that impairments could occur if costs are incurred in excess of any increases in the present value of future net cash flows from proved oil and gas reserves, or if properties are sold for proceeds less than the discounted present value of the related proved oil and gas reserves. Barnwell’s sales reflect its working interest share after royalties. Barnwell’s production is generally delivered and sold at the plant gate. Barnwell does not have transportation volume commitments with pipelines and does not have natural gas imbalances related to natural gas balancing arrangements with its partners. Long-lived Assets Long-lived assets to be held and used, other than oil and natural gas properties, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. Recoverability is measured by comparing the carrying amount of the asset to the future net cash flows expected to result from use of the asset (undiscounted and without interest charges). If it is determined that the asset may not be recoverable, impairment loss is measured as the amount by which the carrying amount of the asset exceeds the fair value of the asset. Long-lived assets to be disposed of by sale are classified as held for sale and are reported at the lower of the asset carrying value or fair value, less cost to sell. Other property and equipment is depreciated using the straight-line method based on estimated useful lives. 63 Share-based Compensation Share-based compensation cost for Barnwell’s equity-classified stock options, restricted stock units, and common stock issued for services is measured at fair value and is recognized as an expense over the requisite service period. For stock options, Barnwell utilizes a closed-form valuation model to determine the fair value of each option award. Expected volatilities are based on the historical volatility of Barnwell’s stock over a period consistent with that of the expected terms of the options. The expected terms of the options represent expectations of future employee exercise and are estimated based on factors such as vesting periods, contractual expiration dates, historical trends in Barnwell’s stock price, and historical exercise behavior. If the Company does not have sufficient historical data regarding employee exercise behavior, the “simplified method” as permitted by the SEC’s Staff Accounting Bulletin No. 110, Share-Based Payment is utilized to estimate the expected terms of the options. The risk-free rates for periods within the contractual life of the options are based on the yields of U.S. Treasury instruments with terms comparable to the estimated option terms. Expected dividends are based on historical dividend payments. For restricted stock units, Barnwell utilizes the closing market price of the Company’s common stock on the grant date reduced by the present value of the dividends expected to be paid on the underlying shares of common stock during the requisite service period (as these awards are not entitled to receive dividends until vested) to determine the fair value of each restricted stock unit award. For common stock issued for services, Barnwell utilizes the closing market price of the Company’s common stock on the grant date to determine the fair value of the common stock issued for services. The Company's policy is to recognize forfeitures as they occur. Retirement Plans Barnwell accounts for its defined benefit pension plan and Supplemental Executive Retirement Plan by recognizing the over-funded or under-funded status as an asset or liability in its Consolidated Balance Sheets and recognizes changes in that funded status in the year in which the changes occur through comprehensive income. See further discussion at Note 9. The estimation of Barnwell’s retirement plan obligations, costs and liabilities requires management to estimate the amount and timing of cash outflows for projected future payments and cash inflows for maturities and expected returns on plan assets. These assumptions may have an effect on the amount and timing of future contributions. At the end of each year, Barnwell determines the discount rate to be used to calculate the present value of plan liabilities and the net periodic benefit cost. The discount rate is an estimate of the current interest rate at which the retirement plan liabilities could be effectively settled at the end of the year. In estimating this rate, Barnwell performs a cash-flow matching discount rate analysis developed using high-quality corporate bonds yield. The discount rate used to value the future benefit obligation as of each year-end is the rate used to determine the periodic benefit cost in the following year. The expected long-term return on assets assumption for the pension plans represents the average rate of return to be earned on plan assets over the period the benefits included in the benefit obligation are to be paid. The actual fair value of plan assets and estimated rate of return is used to determine the expected investment return during the year. The estimated rate of return on plan assets is based on an estimate of future experience for plan asset returns, the mix of plan assets, current market conditions, and expectations for future market conditions. A decrease (increase) of 50 basis points in the expected return on assets assumption would increase (decrease) pension expense by approximately $ 69,000 based on the assets of the plan at September 30, 2025. 64 The effects of changing assumptions are included in unamortized net gains and losses, which directly affect accumulated other comprehensive income. These unamortized gains and losses in excess of certain thresholds are amortized and reclassified to (loss) income over the average remaining service life of active employees. Asset Retirement Obligation Barnwell accounts for asset retirement obligations by recognizing the fair value of a liability for an asset retirement obligation in the period in which it is incurred if a reasonable estimate of fair value can be made. Barnwell estimates the fair value of asset retirement obligations based on the projected discounted future cash outflows required to settle abandonment and restoration liabilities. Such an estimate requires assumptions and judgments regarding the existence of liabilities, the amount and timing of cash outflows required to settle the liability, what constitutes adequate restoration, inflation factors, credit adjusted discount rates, and consideration of changes in legal, regulatory, environmental and political environments. Abandonment and restoration cost estimates are determined in conjunction with Barnwell’s reserve engineers based on historical information regarding costs incurred to abandon and restore similar well sites, information regarding current market conditions and costs, and knowledge of subject well sites and properties. These assumptions represent Level 3 inputs. Barnwell’s estimated site restoration and abandonment costs of its oil and natural gas properties are capitalized as part of the carrying amount of oil and natural gas properties and depleted over the life of the related reserves. When the assumptions used to estimate a recorded asset retirement obligation change, a revision is recorded to both the asset retirement obligation and the capitalized cost of asset retirements. The liability is accreted at the end of each period through charges to oil and natural gas operating expense. Income Taxes Income taxes are determined using the asset and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax impacts of differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided when it is more likely than not that some portion or all of the deferred tax asset will not be realized. Management evaluates its potential exposures from tax positions taken that have been or could be challenged by taxing authorities. These potential exposures result because taxing authorities may take positions that differ from those taken by management in the interpretation and application of statutes, regulations and rules. Management considers the possibility of alternative outcomes based upon past experience, previous actions by taxing authorities (e.g., actions taken in other jurisdictions) and advice from tax experts. Recognized tax positions are initially and subsequently measured as the largest amount of tax benefit that is more likely than not of being realized upon ultimate settlement with a taxing authority on a jurisdiction-by-jurisdiction basis. Liabilities for unrecognized tax benefits related to such tax positions are included in long-term liabilities unless the tax position is expected to be settled within the upcoming year, in which case the liabilities are included in current liabilities. Interest and penalties related to uncertain tax positions are included in income tax expense. 65 Our operations in Texas are subject to a franchise tax assessed by the state of Texas which is presented as income tax expense. Environmental Barnwell is subject to extensive environmental laws and regulations. These laws, which are constantly changing, regulate the discharge of materials into the environment and maintenance of surface conditions and may require Barnwell to remove or mitigate the environmental effects of the disposal or release of petroleum or chemical substances at various sites. Environmental expenditures are expensed or capitalized depending on their future economic benefit. Expenditures that relate to an existing condition caused by past operations and that have no future economic benefit are expensed. Liabilities for expenditures of a noncapital nature are recorded when environmental assessment and/or remediation is probable, and the costs can be reasonably estimated. Barnwell recognizes an insurance receivable related to environmental expenditures when collection of the receivable is deemed probable. Any recognition of an insurance receivable is recorded by crediting and offsetting the original charge. Any differential arising between insurance recoveries and insurance receivables is expensed or capitalized, consistent with the original treatment. Derivative Instruments Barnwell may utilize physical forward commodity contracts to mitigate market price risk on its oil and natural gas output when deemed appropriate. Purchase and sale contracts with a fixed price determined at inception are recorded on the Consolidated Balance Sheets as derivative financial instruments if such contracts are readily convertible to cash - unless the contracts are eligible for and elected as the normal purchases and normal sales exception (“NPNS”); in which case, the contracts are recorded on an accrual basis and the Company recognizes the amounts relating to such transactions during the period when the commodities are physically delivered. The Company generally applies the NPNS exception to eligible oil and natural gas contracts to purchase or sell quantities it expects to use or sell in the normal course of business. The Company has not traded in any derivative contracts other than where the NPNS exception is applied, and it does not apply hedge accounting. Foreign Currency Translations and Transactions Assets and liabilities of foreign subsidiaries are translated at the year-end exchange rate. Operating results of foreign subsidiaries are translated at average exchange rates during the period. Translation adjustments have no effect on net income and are included in “Accumulated other comprehensive income, net” in the accompanying Consolidated Balance Sheets. Foreign currency gains or losses on intercompany loans and advances that are not considered long-term investments in nature because management intends to settle these intercompany balances in the future are included in our statements of operations. 66 Fair Value Measurements Fair value is defined as the amount that would be received from the sale of an asset or paid for the transfer of a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are classified and disclosed in one of the following categories: • Level 1: Unadjusted quoted prices in active markets for identical assets and liabilities in active markets and have the highest priority. • Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. • Level 3: Unobservable inputs for the financial asset or liability and have the lowest priority. Recently Adopted Accounting Pronouncements In November 2023, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,” which expands reportable segment disclosure requirements on an annual and interim basis, primarily through enhanced disclosures about significant segment expenses. The Company adopted the provisions of this ASU in the annual reporting period for fiscal year ended September 30, 2025. The adoption of this update did not have an impact on Barnwell’s consolidated financial statements. 2. GOING CONCERN The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business for the twelve-month period following the date of issuance of these consolidated financial statements. Our ability to sustain our business in the future will depend on sufficient oil and natural gas operating cash flows which are dependent on oil and natural gas prices, which can and in the past have fluctuated significantly, and on oil and natural gas operating expenses which are both variable and fixed. A sufficient level of oil and natural gas operating cash flows are necessary to fund discretionary oil and natural gas capital expenditures which must be economically successful to provide sufficient returns to grow reserves and production or at a minimum replace declining production from aging wells. Such a level of oil and natural gas capital expenditures will require funding from external debt and/or equity sources that are not currently in place, but those sources may not be feasible or sufficient. In addition, we will need sufficient cash flows to fund our non-discretionary outflows such as oil and natural gas asset retirement obligations, ongoing oil and natural gas operating expenses and general and administrative expenses, both those related to our oil and natural gas operations and those related to our being a public company. In the quarters ended March 31, 2025 and June 30, 2025, continuing uncertainties regarding the sufficiency of our cash balances and future cash inflows due largely to a reduction in oil and natural gas prices and recent shareholder consent solicitation and proxy contest costs incurred, raised substantial doubt about our ability to meet our estimated cash outflows or continue as a going concern. However, due to the gross proceeds of $ 2,443,000 raised in the private placement offering in November 2025, 67 management has determined that there is no longer substantial doubt regarding the Company's ability to continue as a going concern for one year from the filing of this Annual Report on Form 10-K. 3. DISCONTINUED OPERATIONS Sale of Water Resources On March 14, 2025, the Company entered into a Stock Purchase Agreement with three unrelated individuals (collectively, the “Buyer”) whereby the Buyer acquired all of the shares of capital stock of Water Resources (the “Shares”) owned by the Company (the “Purchase Agreement”). The sale and purchase of the Shares closed (the “Closing”) simultaneously with the execution and delivery of the Purchase Agreement by each of the parties thereto on March 14, 2025. The aggregate purchase price for the Shares was $ 1,050,000 , which was paid at Closing by the Buyer as follows: an initial aggregate cash payment of $ 250,000 and the delivery of a non-interest bearing promissory note with a principal amount of $ 800,000 (the “Promissory Note”). The principal payments on the Promissory Note were to be paid in installments on the following schedule: $ 200,000 on May 15, 2025; and $ 150,000 on June 16, 2025, July 15, 2025, August 15, 2025, and September 15, 2025. The Promissory Note is secured by certain specified assets of Water Resources and personal guarantees of the purchasers. In August 2025, the Promissory Note was amended to the following schedule: $ 100,000 on December 15, 2025; $ 50,000 on February 15, 2026; and $ 150,000 on March 15, 2026 and to increase the annual interest rate on the Promissory Note from zero to 12 % beginning August 15, 2025 and to 18 % beginning December 15, 2025. As of September 30, 2025, the balance of the Promissory Note was $ 300,000 and is presented as “Note receivable” on the Consolidated Balance Sheets. Water Resources drills water wells and installs and repairs water pumping systems in Hawaii and represented our contract drilling segment. As a result of the sale, the Company has classified the related assets and liabilities and the results of its contract drilling business as discontinued operations in the consolidated financial statements for all periods presented. Prior to the sale, the Company did not have any assurances that a sale of Water Resources was likely to occur. The Company recorded a loss of $ 193,000 on the sale of Water Resources, which was included in the results from discontinued operations for the year ended September 30, 2025. There was no impact from the sale of Water Resources on the provision for income taxes. 68 The following table presents the financial results from discontinued operations presented in the Consolidated Statements of Operations. Year ended September 30, 2025 2024 Revenues: Contract drilling $ 1,156,000 $ 3,612,000 Other — 37,000 1,156,000 3,649,000 Costs and expenses: Contract drilling operating 1,239,000 4,483,000 General and administrative 209,000 468,000 Depletion, depreciation, and amortization 40,000 156,000 Interest expense 1,000 2,000 Gain on sale of assets (1) ( 538,000 ) — 951,000 5,109,000 Earnings (loss) from discontinued operations before income taxes 205,000 ( 1,460,000 ) Loss on sale of discontinued operations ( 193,000 ) — Income tax provision — — Net earnings (loss) from discontinued operations $ 12,000 $ ( 1,460,000 ) ________________________ (1) In February 2025, the Company completed the sale of a contract drilling segment drilling rig and related ancillary equipment to an independent third party for proceeds of $ 538,000 , net of related costs. The drilling rig and related ancillary equipment were fully depreciated and had a net book value of zero and as a result of the sale, the Company recognized a $ 538,000 gain during the the year ended September 30, 2025 which was recorded in discontinued operations. 69 The following table presents the carrying amounts of the assets and liabilities of discontinued operations on the Consolidated Balance Sheets. September 30, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ — $ 220,000 Accounts and other receivables, net of allowance for credit losses of: $ 0 at September 30, 2025; $ 234,000 at September 30, 2024 — 580,000 Assets held for sale — 69,000 Other current assets — 666,000 Total current assets of discontinued operations $ — $ 1,535,000 Non-current assets: Property and equipment: Drilling rigs and other property and equipment — 3,170,000 Accumulated depreciation, impairment, and amortization — ( 2,888,000 ) Total non-current assets of discontinued operations $ — $ 282,000 LIABILITIES Current liabilities: Accounts payable $ — $ 37,000 Accrued compensation — 124,000 Accrued operating and other expenses — 369,000 Total current liabilities of discontinued operations $ — $ 530,000 4. LOSS PER COMMON SHARE Basic loss per share is computed using the weighted-average number of common shares outstanding for the period. Diluted loss per share is calculated using the treasury stock method to reflect the assumed issuance of common shares for all potentially dilutive securities, which consist of outstanding stock options and nonvested restricted stock units. Potentially dilutive shares are excluded from the computation of diluted loss per share if their effect is anti-dilutive. Options to purchase 454,452 shares of common stock and 218,300 restricted stock units were excluded from the computation of diluted shares for the year ended September 30, 2025, as their inclusion would have been anti-dilutive. Options to purchase 465,000 shares of common stock and 98,795 restricted stock units were excluded from the computation of diluted shares for the year ended September 30, 2024, as their inclusion would have been anti-dilutive. 70 Reconciliations between net loss attributable to Barnwell stockholders and common shares outstanding of the basic and diluted net loss per share computations are detailed in the following tables: Year ended September 30, 2025 2024 Numerator: Net loss from continuing operations $ ( 7,123,000 ) $ ( 3,871,000 ) Less: Net (loss) earnings attributable to non-controlling interests of continuing operations ( 8,000 ) 234,000 Net loss from continuing operations attributable to Barnwell Industries, Inc. ( 7,115,000 ) ( 4,105,000 ) Net earnings (loss) from discontinued operations 12,000 ( 1,460,000 ) Net loss attributable to Barnwell Industries, Inc. $ ( 7,103,000 ) $ ( 5,565,000 ) Denominator: Basic weighted-average number of common shares outstanding 10,056,479 10,017,997 Effect of dilutive securities - common stock options and restricted stock units — — Diluted weighted-average number of common shares outstanding 10,056,479 10,017,997 Basic and diluted loss per common share: Net loss per common share from continuing operations attributable to Barnwell Industries, Inc. stockholders $ ( 0.71 ) $ ( 0.41 ) Net loss per common share from discontinued operations — ( 0.15 ) Net loss per common share attributable to Barnwell Industries, Inc. stockholders $ ( 0.71 ) $ ( 0.56 ) 5. ACCOUNTS AND OTHER RECEIVABLES AND ALLOWANCE FOR CREDIT LOSSES Insurance Recovery Receivable In the quarter ended June 30, 2025, the Company filed an insurance claim for $ 348,000 with our insurance carrier for the reimbursement of certain legal fees incurred that are covered under our directors and officers’ liability insurance policies. Accordingly, the Company determined that an insurance recovery from our insurance carrier was probable and reasonably estimable and therefore recorded an estimated accrued insurance recovery receivable of $ 348,000 at June 30, 2025 and no subsequent revision to the accrual has been recorded as of September 30, 2025. The insurance recovery receivable is included in "Accounts and other receivables, net of allowance for credit losses," in the accompanying Consolidated Balance Sheet and the related legal expense recovery was recorded in “General and administrative” expenses in the accompanying Consolidated Statements of Operations. The estimated accrued insurance recovery receivable amount is management's best estimate of the probable recoverable amount under the insurance policies. While the insurer has confirmed that certain costs incurred by the Company are eligible for claim under the Company's insurance policies, the amount ultimately recoverable through insurance is dependent upon the insurer's completion of their review of eligible legal costs incurred and the recoverable amount may differ from management's estimate. 71 Allowance for Credit Losses The following table summarizes the activity in the balance of allowance for credit losses related to accounts and other receivables: Year ended September 30, 2025 2024 Allowance for credit losses at beginning of period $ 141,000 $ 50,000 (Reversal of) provision for expected losses ( 2,000 ) 85,000 Write-offs charged against the allowance ( 84,000 ) ( 10,000 ) Recoveries of amounts previously written off — 16,000 Foreign currency translation adjustment ( 6,000 ) — Allowance for credit losses at end of period $ 49,000 $ 141,000 6. INVESTMENTS Investment in Kukio Resort Land Development Partnerships On November 27, 2013, Barnwell, through a wholly-owned subsidiary, entered into two limited liability limited partnerships, KD Kona and KKM, and indirectly acquired a 19.6 % non-controlling ownership interest in each of KD Kukio Resorts, KD Maniniowali, and KDK for $ 5,140,000 . The Kukio Resort Land Development Partnerships own certain real estate and development rights interests in the Kukio, Maniniowali and Kaupulehu portions of Kukio Resort, a private residential community on the Kona coast of the island of Hawaii, as well as Kukio Resort’s real estate sales office operations. KDK holds interests in KD I and KD II. KD I is the developer of Increment I and KD II is the developer of Increment II. Barnwell's ownership interests in the Kukio Resort Land Development Partnerships is accounted for using the equity method of accounting. In March 2019, KD II admitted a new development partner, Replay, a party unrelated to Barnwell, in an effort to move forward with development of the remainder of Increment II at Kaupulehu. KDK and Replay hold ownership interests of 55 % and 45 %, respectively, of KD II and Barnwell has a 10.8 % indirect non-controlling ownership interest in KD II through KDK, which is accounted for using the equity method of accounting. Barnwell continues to have an indirect 19.6 % non-controlling ownership interest in KD Kukio Resorts, KD Maniniowali, and KD I. The partnerships derive income from the sale of residential parcels in Increment I, which is now completely sold, as well as from commissions on real estate resales by the real estate sales office and revenues resulting from the sale of a few remaining private club memberships. The last two remaining single-family lots of the 80 lots developed within Increment I were sold in the quarter ended March 31, 2024. Increment II is not yet under development, and there is no assurance that development of such acreage will in fact occur. No definitive development plans have been made by KD II, the developer of Increment II, as of the date of this report. In November 2025, Kaupulehu Developments entered into an agreement with Mr. David Johnston, the son of Mr. Terry Johnston, a partner in Kaupulehu Developments, to surrender any and all remaining rights for Increment II for $ 2,000,000 of which $ 70,000 was received. Additionally, the purchaser has the right to extend the closing by up to two years by making a $ 70,000 payment in each of the next two years, 72 with those payments applied against the $ 2,000,000 purchase price. The closing of this transaction is entirely dependent on the purchaser and therefore may not happen. Subsequent to fiscal 2025, pursuant to a unit purchase agreement KDK, of which Barnwell holds a 19.6 % interest, agreed to sell KDK’s interests in Increment II to Mr. David Johnston for $ 2,109,000 . The unit purchase agreement is subject to due diligence, and there is no certainty that the transaction will close. Furthermore, there is also no assurance on the timing or amounts that the general partner of KDK would distribute upon a closing. Barnwell has the right to receive distributions from the Kukio Resort Land Development Partnerships via its non-controlling interests in KD Kona and KKM, based on its respective partnership sharing ratios of 75 % and 34.45 %, respectively. No cash distributions were received during the year ended September 30, 2025. During the year ended September 30, 2024, Barnwell received cash distributions of $ 1,071,000 (resulting in a net amount of $ 953,000 , after distributing $ 118,000 to non-controlling interests) from the Kukio Resort Land Development Partnerships. Equity in income of affiliates was nil for the year ended September 30, 2025, as compared to equity in income of affiliates of $ 1,071,000 for the year ended September 30, 2024. Summarized financial information for the Kukio Resort Land Development Partnerships is as follows: Year ended September 30, 2025 2024 Revenue $ 7,236,000 $ 13,555,000 Gross profit $ 3,234,000 $ 8,651,000 Net earnings $ 1,208,000 $ 6,437,000 In the quarter ended June 30, 2021, the Company received cumulative distributions from the Kukio Resort Land Development Partnerships in excess of our investment balance and in accordance with applicable accounting guidance, the Company suspended its equity method earnings recognition and the Kukio Resort Land Development Partnerships’ investment balance was reduced to zero with the distributions received in excess of our investment balance recorded as equity in income of affiliates because the distributions are not refundable by agreement or by law and the Company is not liable for the obligations of or otherwise committed to provide financial support to the Kukio Resort Land Development Partnerships. The Company will record future equity method earnings only after our share of the Kukio Resort Land Development Partnerships’ cumulative earnings in excess of distributions during the suspended period exceeds our share of the Kukio Resort Land Development Partnerships’ income recognized for the excess distributions, and during this suspended period any distributions received will be recorded as equity in income of affiliates. Accordingly, no equity in income of affiliates was recognized in the year ended September 30, 2025. Cumulative distributions received from the Kukio Resort Land Development Partnerships in excess of our investment balance was $ 106,000 at September 30, 2025 and $ 373,000 at September 30, 2024. 73 Sale of Interest in Leasehold Land Kaupulehu Developments holds rights to receive payments from KD I and KD II resulting from the sale of lots and/or residential units within Increment I, which is now fully sold, and within Increment II, which is not yet developed (see Note 20). With respect to Increment I, Kaupulehu Developments was entitled to receive payments from KD I based on 10 % of the gross receipts from KD I’s sales of single-family residential lots in Increment I. The last two single-family lots of the 80 lots developed within Increment I were sold in the quarter ended March 31, 2024. Under the terms of the Increment II agreement with KD II, Kaupulehu Developments is entitled to 15 % of the distributions of KD II, the cost of which is to be solely borne by KDK out of its 55 % ownership interest in KD II, plus a priority payout of 10 % of KDK’s cumulative net profits derived from Increment II sales subsequent to Phase 2A, up to a maximum of $ 3,000,000 as to the priority payout. Such interests are limited to distributions or net profits interests and Barnwell does not have any partnership interests in KD II or KDK through its interest in Kaupulehu Developments. The arrangement also gives Barnwell rights to three single-family residential lots in Phase 2A of Increment II, and four single-family residential lots in phases subsequent to Phase 2A when such lots are developed by KD II, all at no cost to Barnwell. Barnwell is committed to commence construction of improvements within 90 days of the transfer of the four lots in the phases subsequent to Phase 2A as a condition of the transfer of such lots. Also, in addition to Barnwell’s existing obligations to pay professional fees to certain parties based on percentages of its gross receipts, Kaupulehu Developments is obligated to pay an amount equal to 0.72 % and 0.20 % of the cumulative net profits of KD II to KD Development and a pool of various individuals, respectively, all of whom are partners of KKM and are unrelated to Barnwell, in compensation for the agreement of these parties to admit the new development partner for Increment II. Such compensation will be reflected as the obligation becomes probable and the amount of the obligation can be reasonably estimated. The following table summarizes the Increment I revenues from KD I and the amount of fees directly related to such revenues (see Note 18 “Commitments and Contingencies - Other Matters”): Year ended September 30, 2025 2024 Sale of interest in leasehold land: Revenues - sale of interest in leasehold land $ — $ 500,000 Fees - included in general and administrative expenses — ( 61,000 ) Sale of interest in leasehold land, net of fees paid $ — $ 439,000 There is no assurance with regards to the amounts of future payments from Increment II to be received or that the remaining acreage within Increment II will be developed. No definitive development plans have been made by KD II, the developer of Increment II, as of the date of this report. 74 Investment in Leasehold Land Interest – Lot 4C Kaupulehu Developments holds an interest in an area of approximately 1,000 acres of vacant leasehold land zoned conservation located adjacent to Lot 4A, which currently has no development potential without both a development agreement with the lessor and zoning reclassification. The lease terminates in December 2025. 7. OIL AND NATURAL GAS PROPERTIES Fiscal 2025 Oil and Natural Gas Property Dispositions On August 8, 2025, Barnwell entered into an agreement with an independent third party to sell all of its working interests in its U.S. oil and natural gas assets for a sales price of $ 2,300,000 . The sales price per the agreement was adjusted for customary purchase price adjustments to reflect the economic activity from the effective date of July 1, 2025 to the closing date August 8, 2025. The Company recognized a loss on the sale of $ 636,000 before related income taxes in the year ended September 30, 2025. The U.S. oil and natural gas assets were located in the states of Texas and Oklahoma and were owned by wholly-owned subsidiaries of Barnwell. As a result of the sale, the Company no longer owns any oil and natural gas assets in the U.S., however, the Company will continue to explore for oil and natural gas opportunities in the U.S. On August 28, 2025, Barnwell entered into and completed a purchase and sale agreement with an independent third party and sold its interests in certain oil and natural gas properties located in the Medicine River area of Alberta, Canada. The sales price per the agreement was adjusted for customary purchase price adjustments to $ 288,000 in order to, among other things, reflect an economic closing date of September 30, 2025. The final determination of the customary adjustments to the purchase price has not yet been made; however, it is not expected to result in a material adjustment. The proceeds were credited to the full cost pool, with no gain or loss recognized, as the sale did not result in a significant alteration of the relationship between capitalized costs and proved reserves. Fiscal 2024 Oil and Natural Gas Property Dispositions In April 2024, Barnwell entered into and completed a purchase and sale agreement with an independent third party and sold its interests in certain oil and natural gas properties located in the Kaybob area of Alberta, Canada. The sales price per the agreement was adjusted for customary purchase price adjustments to $ 441,000 in order to, among other things, reflect an economic effective date of May 1, 2024. The proceeds were credited to the full cost pool, with no gain or loss recognized, as the sale did not result in a significant alteration of the relationship between capitalized costs and proved reserves. In July 2024, Barnwell entered into and completed an agreement with an independent third party to convey interests in certain oil and natural gas properties located in the Bonanza and Balsam areas of Alberta, Canada. In consideration for the sale of the working interests in these properties, Barnwell retained a 4 % overriding royalty on these properties and the buyer assumed the asset retirement obligations associated with these properties. There were no cash proceeds from the sale and no gain or loss was recognized on this conveyance as this did not result in a significant alteration of the relationship between capitalized costs and proved reserves. With the disposition of the working interest, Barnwell reduced the full cost pool and abandonment liabilities associated with the working interests conveyed by approximately $ 153,000 . 75 In September 2024, Barnwell entered into and completed a purchase and sale agreement with an independent third party and sold its interests in certain oil and natural gas properties located in the Wood River area of Alberta, Canada. The sales price per the agreement was adjusted for customary purchase price adjustments to $ 292,000 in order to, among other things, reflect an economic effective closing date of September 30, 2024. From the sales proceeds, $ 38,000 was remitted directly to the Canada Revenue Agency by the buyers for potential amounts due for Barnwell’s Canadian income taxes related to the sale. The proceeds from the sale was credited to our cash in October 2024 and is reflected in the Statement of Cash Flows for the year ended September 30, 2025. No gain or loss was recognized on this disposition as the sale proceeds were credited to the full cost pool and did not result in a significant alteration of the relationship between capitalized costs and proved reserves. Impairment of Oil and Natural Gas Properties Under the full cost method of accounting, the Company performs quarterly oil and natural gas ceiling test calculations. Changes in the 12-month rolling average first-day-of-the-month prices for oil, natural gas and natural gas liquids prices (except where prices are defined by contractual arrangements), the value of reserve additions as compared to the amount of capital expenditures to obtain them, and changes in production rates and estimated levels of reserves, future development costs and the market value of unproved properties, impact the determination of the maximum carrying value of oil and natural gas properties. During the year ended September 30, 2025, the Company incurred a non-cash ceiling test impairment for our U.S. oil and natural gas properties of $ 865,000 . During the year ended September 30, 2024, the Company incurred a non-cash ceiling test impairment of $ 2,885,000 , which included impairments for our U.S. and Canadian oil and natural gas properties of $ 721,000 and $ 2,164,000 , respectively. As discussed above, the ceiling test uses a 12-month historical rolling average first-day-of-the-month prices. As such, declines in the 12-month historical rolling average first-day-of-the-month prices used in our ceiling test calculation in future periods could result in impairment write-downs in future periods in the absence of any offsetting factors that are not currently known or projected. Based on the oil and gas prices for October 1, November 1 and December 1 of 2025, the oil prices used in the 12-month historical rolling first-day-of-the-month average for the ceiling test at December 31, 2025 are likely to be lower than at September 30, 2025. As such, we may incur a further impairment charge in the first quarter of fiscal 2026 ending December 31, 2025. The Company is currently unable to estimate a range of the amount of any potential future impairment write-downs as variables that impact the ceiling limitation are dependent upon actual results of activity through the end of December 2025. 76 8. PROPERTY AND EQUIPMENT AND ASSET RETIREMENT OBLIGATION Barnwell’s property and equipment is detailed as follows: Estimated Useful Lives Gross Property and Equipment Accumulated Depletion, Depreciation, Amortization, and Impairment Net Property and Equipment At September 30, 2025: Proved oil and natural gas properties (full cost method) $ 74,511,000 $ ( 65,358,000 ) $ 9,153,000 Other property and equipment 3 – 10 years 500,000 ( 491,000 ) 9,000 Total $ 75,011,000 $ ( 65,849,000 ) $ 9,162,000 Estimated Useful Lives Gross Property and Equipment Accumulated Depletion, Depreciation, Amortization, and Impairment Net Property and Equipment At September 30, 2024: Proved oil and natural gas properties (full cost method) $ 83,557,000 $ ( 67,003,000 ) $ 16,554,000 Other property and equipment 3 – 10 years 509,000 ( 497,000 ) 12,000 Total $ 84,066,000 $ ( 67,500,000 ) $ 16,566,000 See Note 7 for discussion of acquisitions and divestitures of oil and natural gas properties in fiscal 2025 and 2024. 77 Asset Retirement Obligation Barnwell recognizes the fair value of a liability for an asset retirement obligation in the period in which it is incurred if a reasonable estimate of fair value can be made. The following is a reconciliation of the asset retirement obligation: Year ended September 30, 2025 2024 Asset retirement obligation as of beginning of year $ 8,588,000 $ 9,833,000 Obligations incurred on new wells drilled or acquired — 37,000 Liabilities associated with properties sold ( 209,000 ) ( 442,000 ) Revision of estimated obligation ( 694,000 ) ( 614,000 ) Accretion expense 808,000 900,000 Payments ( 483,000 ) ( 1,139,000 ) Foreign currency translation adjustment ( 235,000 ) 13,000 Asset retirement obligation as of end of year 7,775,000 8,588,000 Less current portion ( 613,000 ) ( 798,000 ) Asset retirement obligation, long-term $ 7,162,000 $ 7,790,000 Asset retirement obligations were reduced by $ 209,000 and $ 442,000 in fiscal 2025 and 2024, respectively, for those obligations that were assumed by purchasers of Barnwell's oil and natural gas properties (see Note 7 for additional details on dispositions). Asset retirement obligations were also reduced by $ 694,000 and $ 614,000 in fiscal 2025 and 2024, respectively, primarily due to revisions related to the estimated timing of future abandonments. Asset retirement obligations also increased by nil and $ 37,000 in fiscal 2025 and 2024, respectively, due primarily to our wells drilled and acquisitions. The asset retirement obligation reflects the estimated present value of the amount of dismantlement, removal, site reclamation, and similar activities associated with Barnwell's oil and natural gas properties. Barnwell estimates the ultimate productive life of the properties, a credit-adjusted risk-free rate, and an inflation factor in order to determine the current present value of this obligation. The credit-adjusted risk-free rate for the entire asset retirement obligation is a blended rate which ranges from 6 % to 13.5 %. In September 2019, the AER issued an abandonment/closure order for all wells and facilities in the Manyberries area which had been largely operated by LGX, an operating company that went into receivership in 2016. The estimated asset retirement obligation for the Company's interest in the wells and facilities in the Manyberries area is included in “Asset retirement obligation” in the Consolidated Balance Sheets. After the abandonment/closure order was issued for Manyberries, the OWA created a WIP program for specific areas where there are a significant number of orphaned wells to abandon. The OWA has the ability and expertise to abandon wells using its internal resources and network of service providers resulting in efficiencies that companies such as Barnwell would not be able to obtain on its own. Under the WIP program, the Company would be required to provide payment for only Barnwell’s working interest share, however, all WIP’s would have to participate in the program for the OWA to begin its work. In March 2021, the Company was notified by the OWA that Barnwell’s Manyberries wells were confirmed to be in the WIP program. Under the agreement with the OWA, the Company was required to pay the abandonment and reclamation costs in advance through a cash deposit. Barnwell has provided $ 975,000 in cumulative cash deposits to the OWA since the program began in the fall of 2021, and any amount remaining after 78 completion of the abandonments was to be refunded to the Company, and then upon commencement of the reclamation program a new deposit was to be made for those estimated costs. To date, the excess deposits that relate to abandonment work have not yet been refunded but have been used to fund the reclamation part of the program and the Company now estimates that a portion of the unused deposit will instead be applied to future reclamation work over the next several years. The estimated current portion of the unused deposit was $ 173,000 and $ 527,000 as of September 30, 2025 and 2024, respectively, and is included in “Other current assets” on the Company’s Consolidated Balance Sheets. The non-current portion of the unused deposit of $ 222,000 along with $ 61,000 of non-current receivables at September 30, 2025, is included in “Other non-current assets” on the Company’s Consolidated Balance Sheet at September 30, 2025. 9. RETIREMENT PLANS Barnwell sponsors a noncontributory defined benefit pension plan (“Pension Plan”) covering substantially all of its U.S. employees, with benefits based on years of service and the employee’s highest consecutive 5 years average earnings. Barnwell’s funding policy is intended to provide for both benefits attributed to service to date and for those expected to be earned in the future. In addition, Barnwell sponsors a Supplemental Executive Retirement Plan (“SERP”), a noncontributory supplemental retirement benefit plan which covers certain current and former employees of Barnwell for amounts exceeding the limits allowed under the Pension Plan. Effective December 31, 2019, the accrual of benefits for all participants in the Pension Plan and SERP was frozen and the plans were closed to new participants from that point forward. The following tables detail the changes in benefit obligations, fair values of plan assets and reconciliations of the funded status of the retirement plans: Pension Plan SERP September 30, 2025 2024 2025 2024 Change in Projected Benefit Obligation: Benefit obligation at beginning of year $ 8,195,000 $ 7,511,000 $ 1,974,000 $ 1,734,000 Interest cost 390,000 411,000 95,000 95,000 Actuarial (gain) loss ( 90,000 ) 520,000 ( 5,000 ) 149,000 Benefits paid ( 394,000 ) ( 247,000 ) ( 3,000 ) ( 4,000 ) Benefit obligation at end of year 8,101,000 8,195,000 2,061,000 1,974,000 Change in Plan Assets: Fair value of plan assets at beginning of year 13,094,000 11,982,000 — — Actual return on plan assets 1,329,000 1,359,000 — — Benefits paid ( 394,000 ) ( 247,000 ) — — Fair value of plan assets at end of year 14,029,000 13,094,000 — — Funded status $ 5,928,000 $ 4,899,000 $ ( 2,061,000 ) $ ( 1,974,000 ) 79 Pension Plan SERP September 30, 2025 2024 2025 2024 Amounts recognized in the Consolidated Balance Sheets: Noncurrent assets $ 5,928,000 $ 4,899,000 $ — $ — Current liabilities — — ( 270,000 ) ( 76,000 ) Noncurrent liabilities — — ( 1,791,000 ) ( 1,898,000 ) Net amount $ 5,928,000 $ 4,899,000 $ ( 2,061,000 ) $ ( 1,974,000 ) Amounts recognized in accumulated other comprehensive income before income taxes: Net actuarial gain $ ( 1,871,000 ) $ ( 1,251,000 ) $ ( 100,000 ) $ ( 96,000 ) Accumulated other comprehensive income $ ( 1,871,000 ) $ ( 1,251,000 ) $ ( 100,000 ) $ ( 96,000 ) The accumulated benefit obligation for the Pension Plan was $ 8,101,000 and $ 8,195,000 at September 30, 2025 and 2024, respectively. The accumulated benefit obligation for the SERP was $ 2,061,000 and $ 1,974,000 at September 30, 2025 and 2024, respectively. The accumulated benefit obligations are the same as the projected benefit obligations due to the Pension Plan and SERP being frozen as of December 31, 2019. Currently, no contributions are planned to be made to the Pension Plan during fiscal 2026. The SERP plan is unfunded and Barnwell funds benefits when payments are made. Expected payments under the SERP for fiscal 2026 are expected to be $ 270,000 . Fluctuations in actual market returns as well as changes in general interest rates will result in changes in the market value of plan assets and may result in increased or decreased retirement benefits costs and contributions in future periods. The Pension Plan actuarial gains in fiscal 2025 were primarily due to an increase in the discount rate and actual investment returns that were greater than the assumed rate of return. The SERP actuarial gains in fiscal 2025 were primarily due to an increase in the discount rate. The Pension Plan actuarial losses in fiscal 2024 were primarily due to a decrease in the discount rate, partially offset by an actuarial gain resulting from actual investment returns that were greater than the assumed rate of return. The SERP actuarial losses in fiscal 2024 were primarily due to a decrease in the discount rate. 80 The following table presents the weighted-average assumptions used to determine benefit obligations and net benefit (income) costs: Pension Plan SERP Year ended September 30, 2025 2024 2025 2024 Assumptions used to determine fiscal year-end benefit obligations: Discount rate 5.16 % 4.88 % 5.16 % 4.88 % Rate of compensation increase N/A N/A N/A N/A Assumptions used to determine net benefit costs (years ended): Discount rate 4.88 % 5.62 % 4.88 % 5.62 % Expected return on plan assets 6.20 % 6.50 % N/A N/A Rate of compensation increase N/A N/A N/A N/A We select a discount rate by reference to yields from the Willis Towers Watson RATE:Link 10-90 yield curve at our consolidated balance sheet date. The expected return on plan assets is based on an actuarial model which takes into consideration our investment mix and market conditions. The components of net periodic benefit (income) cost are as follows: Pension Plan SERP Year ended September 30, 2025 2024 2025 2024 Net periodic benefit (income) cost for the year: Interest cost $ 390,000 $ 411,000 $ 95,000 $ 95,000 Expected return on plan assets ( 800,000 ) ( 766,000 ) — — Amortization of net actuarial gain — — — ( 85,000 ) Net periodic benefit (income) cost $ ( 410,000 ) $ ( 355,000 ) $ 95,000 $ 10,000 The benefits expected to be paid under the retirement plans as of September 30, 2025 are as follows: Pension Plan SERP Expected Benefit Payments: Fiscal year ending September 30, 2026 $ 424,000 $ 270,000 Fiscal year ending September 30, 2027 $ 592,000 $ 167,000 Fiscal year ending September 30, 2028 $ 630,000 $ 172,000 Fiscal year ending September 30, 2029 $ 666,000 $ 176,000 Fiscal year ending September 30, 2030 $ 656,000 $ 174,000 Fiscal years ending September 30, 2031 through 2035 $ 3,224,000 $ 827,000 Plan Assets The trustees of the Pension Plan communicate periodically with the Pension Plan’s professional investment advisors to establish investment policies, direct investments and select investment options. The overall investment objective of the Pension Plan is to attain a diversified combination of investments that provides long-term growth in the assets of the plan to fund future benefit obligations while managing risk 81 in order to meet current benefit obligations. Generally, interest and dividends received provide cash flows to fund current benefit obligations. Longer-term obligations are generally estimated to be provided for by growth in equity securities. The Pension Plan’s investment policy permits investments in a diversified mix of U.S. and international equities, fixed income securities, other investments, and cash equivalents. The Pension Plan’s investments in fixed income securities include preferred securities and corporate bonds. The Pension Plan’s investments in equity securities primarily include domestic companies and is comprised of companies with market capitalization categorized as follows: 61 % micro-cap; 22 % small-cap; 8 % mid-cap; and 9 % large-cap. The Pension Plan’s other investment is a note receivable from an unrelated private company. A portion of the Pension Plan’s investments is in publicly traded stocks, one of which is Barnwell’s common stock. As of September 30, 2025 and 2024, the Pension Plan held 666,077 and 413,148 shares, respectively, of Barnwell common stock (see Note 20 for additional details). The Company’s year-end target allocation, by asset category, and the actual asset allocations were as follows: Target September 30, Asset Category Allocation 2025 2024 Cash and cash equivalents 0 % - 25 % 1 % 4 % Fixed income securities 15 % - 40 % 15 % 19 % Equity securities 45 % - 75 % 80 % 73 % Other investment 0 % - 10 % 4 % 4 % Actual investment allocations may vary from our target allocations from time to time due to prevailing market conditions. The trustees periodically review our actual investment allocations and rebalance our investments to our target allocations as dictated by current and anticipated market conditions and required cash flows. We categorize plan assets into three levels based upon the assumptions used to price the assets. Level 1 provides the most reliable measure of fair value, whereas Level 3 requires significant management judgment in determining the fair value. Equity securities and exchange-traded funds are valued by obtaining quoted prices on recognized and highly liquid exchanges. Fixed income securities are valued based upon the closing price reported in the active market in which the security is traded. All of our plan assets, except for the note receivable from a private company, are categorized as Level 1 assets, and as such, the actual market value is used to determine the fair value of assets. The fair value of the note receivable from an unrelated private company is valued based upon the terms of the note receivable’s agreement and unobservable inputs such as management’s consideration of the counterparty’s credit risk and as such, is categorized as a Level 3 asset. 82 The following tables set forth by level, within the fair value hierarchy, pension plan assets at their fair value: Fair Value Measurements Using: September 30, 2025 Carrying Amount Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial Assets: Cash $ 179,000 $ 179,000 $ — $ — Preferred securities 2,154,000 2,154,000 — — Equities 11,201,000 11,201,000 — — Note receivable from an unrelated private company 495,000 — — 495,000 Total $ 14,029,000 $ 13,534,000 $ — $ 495,000 Fair Value Measurements Using: September 30, 2024 Carrying Amount Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial Assets: Cash $ 531,000 $ 531,000 $ — $ — U.S. treasury and government securities 516,000 516,000 — — Fixed income exchange-traded funds 1,872,000 1,872,000 — — Preferred securities 88,000 88,000 — — Equities 9,516,000 9,516,000 — — Note receivable from an unrelated private company 571,000 — — 571,000 Total $ 13,094,000 $ 12,523,000 $ — $ 571,000 The following sets forth a summary of changes in the fair value of the pension Level 3 note receivable asset: Year ended September 30, 2025 2024 Balance at beginning of year $ 571,000 $ — Issuance of note receivable from an unrelated private company — 571,000 Interest income 129,000 — Payments received ( 205,000 ) — Balance at end of year $ 495,000 $ 571,000 83 10. INCOME TAXES The components of loss from continuing operations before income taxes, after adjusting the loss for non-controlling interests, are as follows: Year ended September 30, 2025 2024 United States $ ( 5,980,000 ) $ ( 1,360,000 ) Canada ( 1,064,000 ) ( 2,532,000 ) $ ( 7,044,000 ) $ ( 3,892,000 ) The components of the income tax provision related to the above losses are as follows: Year ended September 30, 2025 2024 Current provision: United States – State Before operating loss carryforwards $ 82,000 $ 23,000 Benefit of operating loss carryforwards — — After operating loss carryforwards 82,000 23,000 Canadian Before operating loss carryforwards 71,000 148,000 Benefit of operating loss carryforwards — — After operating loss carryforwards 71,000 148,000 Total current 153,000 171,000 Deferred (benefit) provision: United States – State ( 82,000 ) 42,000 Total deferred ( 82,000 ) 42,000 $ 71,000 $ 213,000 Consolidated taxes do not bear a customary relationship to pretax results due primarily to the fact that the Company is taxed separately in Canada based on Canadian source operations and in the U.S. based on consolidated operations, and essentially all deferred tax assets, net of relevant offsetting deferred tax liabilities, are not estimated to have a future benefit as tax credits or deductions. The Company operates two subsidiaries in Canada, one of which is a U.S. corporation operating as a branch in Canada that is treated as a non-resident for Canadian tax purposes and thus has operating results that cannot be offset against or combined with the other Canadian subsidiary that files as a resident for Canadian tax purposes. Income from our non-controlling interest in the Kukio Resort Land Development Partnerships is treated as non-unitary for state of Hawaii unitary filing purposes, thus unitary Hawaii losses provide limited sheltering of such non-unitary income. Income from our investment in the Oklahoma oil venture is 100% allocable to Oklahoma. As such, Barnwell receives no benefit from consolidated or unitary losses and, therefore, is subject to Oklahoma state taxes. Our operations in Texas are subject to a franchise tax assessed by the state of Texas, however no significant amounts have been incurred to date. On July 4, 2025, the President of the United States signed into law the One Big Beautiful Bill Act ("OBBBA"). The legislation, among other things, makes permanent, extends or modifies certain provisions under the 2017 Tax Cuts and Jobs Act, including a permanent extension of 100% bonus depreciation for certain capital expenditures. The Company has determined that there are no tax law changes in the OBBBA that significantly impact the Company’s current and deferred income taxes. 84 A reconciliation between the reported income tax expense and the amount computed by multiplying the loss attributable to Barnwell before income taxes by the U.S. federal tax rate of 21 % is as follows: Year ended September 30, 2025 2024 Tax benefit computed by applying statutory rate $ ( 1,477,000 ) $ ( 1,124,000 ) Increase in the valuation allowance 1,426,000 1,383,000 Additional effect of the foreign tax provision on the total tax provision ( 28,000 ) ( 129,000 ) U.S. state income tax provision (benefit), net of federal effect ( 16,000 ) 70,000 U.S. state provision to tax return adjustments ( 2,000 ) ( 12,000 ) Other 168,000 25,000 $ 71,000 $ 213,000 The change in the valuation allowance shown in the table above excludes the impact of changes in the valuation allowance of items that are incorporated within the respective reconciliation line items elsewhere in the table. The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows: 85 September 30, 2025 2024 Deferred income tax assets: Foreign tax credit carryover under U.S. tax law $ — $ 916,000 U.S. federal net operating loss carryover 9,463,000 10,382,000 U.S. state unitary net operating loss carryovers 484,000 1,334,000 Canadian net operating loss carryovers 1,490,000 1,331,000 Tax basis of investment in land in excess of book basis under U.S. tax law 11,000 11,000 Tax basis of investment in subsidiary in excess of book basis under U.S. tax law 376,000 — Property and equipment accumulated book depreciation and depletion in excess of tax under Canadian tax law 123,000 — Property and equipment accumulated book depreciation and depletion in excess of tax under U.S. tax law 661,000 548,000 Asset retirement obligation accrued for books but not for tax under U.S. tax law 835,000 907,000 Asset retirement obligation accrued for books but not for tax under Canadian tax law 1,941,000 2,141,000 Other liabilities accrued for books but not for tax under U.S. tax law 523,000 669,000 Foreign currency loss under U.S. tax law 76,000 68,000 Foreign currency loss under Canadian tax law 36,000 79,000 Other 195,000 168,000 Total gross deferred income tax assets 16,214,000 18,554,000 Less valuation allowance ( 12,391,000 ) ( 13,896,000 ) Net deferred income tax assets 3,823,000 4,658,000 Deferred income tax liabilities: Property and equipment accumulated tax depreciation and depletion in excess of book under Canadian tax law — ( 117,000 ) Book basis of investment in land development partnerships in excess of tax basis under U.S. tax law ( 64,000 ) ( 282,000 ) Book basis of investment in land development partnerships in excess of tax basis under U.S. state non-unitary tax law ( 19,000 ) ( 86,000 ) U.S. oil and gas property and equipment accumulated tax depreciation and depletion in excess of book under U.S. tax law — ( 698,000 ) U.S. oil and gas property and equipment accumulated tax depreciation and depletion in excess of book under U.S. state tax law — ( 16,000 ) U.S. tax law impact of foreign branch deferred tax asset under Canadian tax law ( 2,374,000 ) ( 2,215,000 ) Asset for retirement benefits ( 1,245,000 ) ( 1,029,000 ) Other ( 139,000 ) ( 315,000 ) Total deferred income tax liabilities ( 3,841,000 ) ( 4,758,000 ) Net deferred income tax liability $ ( 18,000 ) $ ( 100,000 ) Reported as: Deferred income tax assets $ — $ — Deferred income tax liabilities ( 18,000 ) ( 100,000 ) Net deferred income tax liability $ ( 18,000 ) $ ( 100,000 ) 86 The total valuation allowance decreased $ 1,505,000 for the year ended September 30, 2025. The decrease was due to current fiscal year operational activity that resulted in changes in deferred tax asset and liability balances, and there were no changes in judgment about the realizability of related deferred tax assets in future years. Of the total net decrease in the valuation allowance for fiscal 2025, $ 1,354,000 was recognized as an income tax benefit and $ 151,000 was credited to accumulated other comprehensive income. Net deferred tax assets at September 30, 2025 of $ 3,823,000 consists of the portion of deferred tax assets that are estimated to be partially realized through corresponding concurrent reversals of deferred tax liabilities related to the Kukio Resort Land Development Partnerships' excess of book income over taxable income, foreign branch deferred taxes, asset for retirement benefits accrued for books but not for tax under U.S. tax law, and certain other minor deferred tax liabilities. At September 30, 2025, Barnwell had U.S. federal net operating loss carryovers, U.S. state net operating loss carryovers and Canadian net operating loss carryovers totaling $ 45,063,000 , $ 7,565,000 and $ 5,551,000 , respectively. The U.S. federal net operating loss carryovers generated through September 30, 2018 expire in fiscal years 2032-2038, the U.S. state unitary net operating loss carryovers generated through September 30, 2017 expire in fiscal years 2033-2037, and the Canadian net operating loss carryovers expire in fiscal years 2039-2045. The U.S. federal net operating loss carryovers generated in fiscal years 2019-2025 and the U.S. state net operating loss carryovers generated in fiscal years 2018-2025 have no expiry, however utilization of the U.S. state and U.S. federal net operating loss carryovers generated in these and future years are limited to 80% of taxable income. FASB ASC Topic 740, Income Taxes, prescribes a threshold for recognizing the financial statement effects of a tax position when it is more likely than not, based on the technical merits, that the position will be sustained upon examination by a taxing authority. Barnwell files U.S. federal income tax returns, income tax returns in various U.S. states, and Canadian federal and provincial tax returns. A number of years may elapse before an uncertain tax position, for which we have unrecognized tax benefits, is audited and finally resolved. We believe that our unrecognized tax benefits are reflected on a more likely than not basis. We evaluate uncertain tax positions based on ongoing facts and circumstances. Any change in judgment related to the expected resolution of uncertain tax positions is recognized in earnings in the period in which such change occurs. Interest and penalties, if any, related to unrecognized tax benefits are recorded as a component of income tax expense. Settlement of any particular position could require the use of cash. Favorable or unfavorable resolution for an amount less than or greater than the amount estimated by Barnwell will result in a decrease or increase to income tax expense in the period of resolution. 87 There were no changes in unrecognized tax benefits during the years ended September 30, 2025 or 2024. Year ended September 30, 2025 2024 Balance at beginning of year $ 62,000 $ 62,000 Effect of tax positions taken in prior years — — Accrued interest related to tax positions taken — — Balance at end of year $ 62,000 $ 62,000 Uncertain tax positions at September 30, 2025 are related to the potential assessment of penalties and interest for the failure to file a certain foreign information form with each of our U.S. federal income tax returns for fiscal years 2019, 2020 and 2021. The Company filed amended U.S. federal income tax returns which included the missing form and statement of reasonable cause for these years in September and October 2023 and requested abatement of any potential penalties and interest which could subsequently be assessed. The Company is awaiting a response from the IRS and the probability of success of the abatement request remains uncertain. Included below is a summary of the tax years, by jurisdiction, that remain subject to examination by taxing authorities at September 30, 2025: Jurisdiction Fiscal Years Open U.S. federal 2019 – 2024 Various U.S. states 2022 – 2024 Canada federal 2017 – 2024 Various Canadian provinces 2017 – 2024 11. SEGMENT AND GEOGRAPHIC INFORMATION As disclosed in Note 3 “Discontinued Operations,” on March 14, 2025, the Company completed the sale of Water Resources, which represented the Company’s contract drilling segment. The financial results of the Company’s contract drilling business has been presented as discontinued operations and therefore is excluded from segment reporting. Accordingly, Barnwell’s continuing operations include the following two principal business segments: Oil and Natural Gas Segment - Barnwell engages in oil and natural gas development, production, acquisitions and sales in Canada and in the U.S. Land Investment Segment - Barnwell owns leasehold land interests in Hawaii. The Company’s Chief Operating Decision Maker is the Chief Executive Officer, who utilizes segment revenues and expenses and segment operating profit or loss to assess performance and allocate resources to each segment. General and administrative expenses are reviewed on a consolidated basis. 88 The following table presents certain financial information related to Barnwell’s reporting segments. All revenues reported are from external customers with no intersegment sales or transfers. Year ended September 30, 2025 2024 Revenues: Oil and natural gas $ 13,563,000 $ 17,396,000 Land investment — 500,000 Other 80,000 91,000 Total before interest income 13,643,000 17,987,000 Interest income 54,000 88,000 Total revenues $ 13,697,000 $ 18,075,000 Cost and expenses: Oil and natural gas $ 8,966,000 $ 9,849,000 Depletion, depreciation, and amortization: Oil and natural gas $ 3,144,000 $ 4,947,000 Other 2,000 3,000 Total depletion, depreciation, and amortization $ 3,146,000 $ 4,950,000 Impairment: Oil and natural gas $ 865,000 $ 2,885,000 Operating profit (loss) (before general and administrative expenses): Oil and natural gas $ 588,000 $ ( 285,000 ) Land investment — 500,000 Other 78,000 88,000 Loss on sale of assets ( 636,000 ) — Total operating profit 30,000 303,000 Equity in income of affiliates: Land investment — 1,071,000 General and administrative expenses ( 6,937,000 ) ( 5,130,000 ) Foreign currency (loss) gain ( 192,000 ) 10,000 Interest expense ( 7,000 ) — Interest income 54,000 88,000 Loss from continuing operations before income taxes $ ( 7,052,000 ) $ ( 3,658,000 ) Capital Expenditures: Year ended September 30, 2025 2024 Oil and natural gas $ 254,000 $ 4,228,000 Other — — Total $ 254,000 $ 4,228,000 Oil and natural gas capital expenditures include acquisitions as well as changes to capitalized asset retirement obligations, including revisions of asset retirement obligations (see Note 8 for additional details). 89 Assets By Segment: September 30, 2025 2024 Oil and natural gas (1) Canada $ 11,118,000 $ 15,218,000 United States — 4,190,000 Other: Cash and cash equivalents 2,886,000 4,285,000 Asset for retirement benefits 5,928,000 4,899,000 Corporate and other 880,000 260,000 Total $ 20,812,000 $ 28,852,000 ______________ (1) Primarily located in the province of Alberta, Canada . Long-Lived Assets By Geographic Area: September 30, 2025 2024 United States $ 5,965,000 $ 8,932,000 Canada 9,617,000 12,572,000 Total $ 15,582,000 $ 21,504,000 Revenue By Geographic Area: Year ended September 30, 2025 2024 United States $ 1,172,000 $ 2,803,000 Canada 12,471,000 15,184,000 Total (before interest income) $ 13,643,000 $ 17,987,000 90 12. REVENUE FROM CONTRACTS WITH CUSTOMERS Disaggregation of Revenue The following tables provide information about disaggregated revenue by revenue streams, reportable segments, geographical region, and timing of revenue recognition based upon continuing operations for the years ended September 30, 2025 and 2024. Year ended September 30, 2025 Oil and natural gas Land investment Other Total Revenue streams: Oil $ 10,476,000 $ — $ — $ 10,476,000 Natural gas 1,499,000 — — 1,499,000 Natural gas liquids 1,588,000 — — 1,588,000 Other — — 80,000 80,000 Total revenues before interest income $ 13,563,000 $ — $ 80,000 $ 13,643,000 Geographical regions: United States $ 1,171,000 $ — $ 1,000 $ 1,172,000 Canada 12,392,000 — 79,000 12,471,000 Total revenues before interest income $ 13,563,000 $ — $ 80,000 $ 13,643,000 Timing of revenue recognition: Goods transferred at a point in time $ 13,563,000 $ — $ 80,000 $ 13,643,000 Year ended September 30, 2024 Oil and natural gas Land investment Other Total Revenue streams: Oil $ 13,509,000 $ — $ — $ 13,509,000 Natural gas 2,007,000 — — 2,007,000 Natural gas liquids 1,880,000 — — 1,880,000 Contingent residual payments — 500,000 — 500,000 Other — — 91,000 91,000 Total revenues before interest income $ 17,396,000 $ 500,000 $ 91,000 $ 17,987,000 Geographical regions: United States $ 2,303,000 $ 500,000 $ — $ 2,803,000 Canada 15,093,000 — 91,000 15,184,000 Total revenues before interest income $ 17,396,000 $ 500,000 $ 91,000 $ 17,987,000 Timing of revenue recognition: Goods transferred at a point in time $ 17,396,000 $ 500,000 $ 91,000 $ 17,987,000 Contract Balances The following table provides the balances of our receivables from contracts with customers which is included in "Accounts and other receivables, net of allowance for credit losses," in the accompanying Consolidated Balance Sheets. 91 September 30, 2025 2024 2023 Accounts receivables from contracts with customers $ 913,000 $ 1,472,000 $ 2,344,000 13. ACCUMULATED OTHER COMPREHENSIVE INCOME Components of accumulated other comprehensive income, net of taxes, are as follows: Year ended September 30, 2025 2024 Foreign currency translation: Beginning accumulated foreign currency translation $ 220,000 $ 220,000 Change in cumulative translation adjustment before reclassifications 75,000 — Income taxes — — Net current period other comprehensive income 75,000 — Ending accumulated foreign currency translation 295,000 220,000 Retirement plans: Beginning accumulated retirement plans benefit income 1,723,000 1,884,000 Amortization of net actuarial gain — ( 85,000 ) Net actuarial gain (loss) arising during the period 624,000 ( 76,000 ) Income taxes — — Net current period other comprehensive income (loss) 624,000 ( 161,000 ) Ending accumulated retirement plans benefit income 2,347,000 1,723,000 Accumulated other comprehensive income, net of taxes $ 2,642,000 $ 1,943,000 The amortization of net actuarial gain for the retirement plans are included in the computation of net periodic benefit (income) cost which is a component of “General and administrative” expenses on the accompanying Consolidated Statements of Operations (see Note 9 for additional details). 14. FAIR VALUE MEASUREMENTS Fair Value of Financial Instruments The carrying values of cash and cash equivalents, accounts and other receivables, note receivable, accounts payable and accrued current liabilities approximate their fair values due to the short-term nature of the instruments. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis The estimated fair values of oil and natural gas properties and the asset retirement obligation incurred in the drilling of oil and natural gas wells or assumed in the acquisitions of additional oil and natural gas working interests are based on an estimated discounted cash flow model and market assumptions. The assumptions used in the calculation of estimated discounted cash flows were primarily Level 3 assumptions; assumptions included future commodity prices, projections of estimated quantities of oil and natural gas reserves, expectations for timing and amount of future development, operating and asset retirement costs, projections of future rates of production, expected recovery rates and risk adjusted discount rates. 92 Barnwell estimates the fair value of asset retirement obligations based on the projected discounted future cash outflows required to settle abandonment and restoration liabilities. Such an estimate requires assumptions and judgments regarding the existence of liabilities, the amount and timing of cash outflows required to settle the liability, what constitutes adequate restoration, inflation factors, credit adjusted discount rates, and consideration of changes in legal, regulatory, environmental and political environments. Abandonment and restoration cost estimates are determined in conjunction with Barnwell’s reserve engineers based on historical information regarding costs incurred to abandon and restore similar well sites, information regarding current market conditions and costs, and knowledge of subject well sites and properties. Asset retirement obligation fair value measurements in the current period were Level 3 fair value measurements. As further described in Note 8, the Company recognizes the fair value of a liability for an asset retirement obligation in the period in which it is incurred if a reasonable estimate of fair value can be made. Asset retirement obligations are not measured at fair value subsequent to initial recognition. 15. DEBT Insurance Premium Financing In March 2025, the Company entered into a short-term financing agreement with a third-party to finance the Company’s directors and officers insurance premium in the amount of $ 183,000 , with a term of 11 months and an annual interest rate of 9.4 %. The Company had made a down payment of $ 15,000 and was required to make monthly principal and interest payments of $ 16,000 over the term of the agreement, which was set to mature in February 2026. The insurance premium financing was repaid in full in September 2025. 16. LEASES The Company’s right-of-use (“ROU”) assets and lease liabilities at September 30, 2025, primarily relate to non-cancelable operating leases for our Hawaii corporate and Canadian office spaces and our leasehold land interest for Lot 4C held by Kaupulehu Developments. Management determines if a contract is or contains a lease at inception of the contract or modification of the contract. A contract is or contains a lease if the contract conveys the right to control the use of the asset for a period in exchange for consideration. Operating lease ROU assets and liabilities are recognized based on the present value of future minimum lease payments over the expected lease term at commencement date. The Company’s leases do not provide a readily determinable implicit rate; therefore, management uses the Company’s incremental borrowing rate to discount lease payments based on information available at lease commencement. Our lease terms may include options to extend or terminate the lease when it is reasonably certain we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the expected lease terms. The Company has lease agreements with lease and non-lease components and the non-lease components are excluded in the calculation of the ROU asset and lease liability and expensed as incurred. None of the Company’s lease agreements contain material residual value guarantees or material restrictions or covenants. A ROU asset and corresponding lease liability is not recorded for leases with an initial term of 12 months or less (short-term leases) as the Company recognizes lease expense for these leases as incurred over the lease term. 93 Leases recorded on the consolidated balance sheet consist of the following: September 30, 2025 2024 Assets: Operating lease right-of-use assets $ 145,000 $ 39,000 Total right-of-use assets $ 145,000 $ 39,000 Liabilities: Current portion of operating lease liabilities (1) $ 78,000 $ 68,000 Operating lease liabilities 93,000 7,000 Total lease liabilities $ 171,000 $ 75,000 ______________ (1) Amount included in “Other Current Liabilities” in the Consolidated Balance Sheets . The components of lease expense are as follows: Year ended September 30, 2025 2024 Operating lease cost $ 114,000 $ 87,000 Variable lease cost 155,000 142,000 Total lease cost $ 269,000 $ 229,000 Supplemental information related to leases is as follows: September 30, 2025 2024 Cash paid related to operating lease liabilities $ 142,000 $ 114,000 Operating leases: Weighted-average remaining lease term (in years) 2.2 0.9 Weighted-average discount rate 8.20 % 6.99 % The remaining lease payments for our operating leases as of September 30, 2025, are as follows: Fiscal year ending: 2026 $ 88,000 2027 59,000 2028 36,000 2029 — 2030 — Thereafter — Total lease payments 183,000 Less: amounts representing interest ( 12,000 ) Present value of lease liabilities $ 171,000 The lease payments for the Lot 4C leasehold land zoned conservation were subject to renegotiation as of January 1, 2006. Per the lease agreement, the lease payments will remain unchanged pending an appraisal, whereupon the lease rent could be adjusted to fair market value. Barnwell does not know the amount of the new lease payments which could be effective upon performance of the appraisal; they may remain unchanged or increase, and Barnwell currently expects the adjustment, if any, to not be material. 94 The future lease payment disclosures above assume the minimum lease payments for leasehold land in effect at December 31, 2005 remain unchanged through December 2025, the end of the lease term. 17. STOCKHOLDERS' EQUITY Share-based Payment Arrangements 2018 Equity Incentive Plan The stockholder-approved 2018 Equity Incentive Plan is administered by the Compensation Committee of the Board of Directors and provides for the issuance of incentive stock options, nonstatutory stock options, stock options with stock appreciation rights, restricted stock, restricted stock units and performance units, qualified performance-based awards, and stock grants to employees, consultants and non-employee members of the Board of Directors. 1,600,000 shares of Barnwell common stock have been reserved for issuance and as of September 30, 2025, a total of 751,724 shares remain available for grant. Barnwell currently has a policy of issuing new shares to satisfy share option exercises when the optionee requests shares. In October 2025, the Board of Directors of the Company granted a total of 133,335 restricted stock units to the independent directors of the Board as partial payment of director fees for their service as members of the Board. The restricted stock units vest ratably over a three-year period, subject to the director’s continued service through the applicable vesting date. On October 27, 2025, Barnwell Industries, Inc. appointed Philip Patman, Jr. as the Company’s Executive Vice President – Finance and in connection with Mr. Patman’s appointment, the Company entered into an executive employment agreement with Mr. Patman, dated, and effective, as of October 27, 2025 (the “Employment Agreement”). Pursuant to the terms of the Employment Agreement, on October 27, 2025, Mr. Patman received the following awards which were issued pursuant to the Company’s Amended and Restated 2018 Equity Incentive Plan, as amended from time to time: a stock award of 83,207 shares of the Company’s common stock; a restricted stock unit award for 83,208 shares of the Company’s common stock (the “Initial RSU Award”); and an incentive stock option to purchase 185,000 shares of the Company’s common stock (the “Initial Stock Option” and, together with the Initial RSU Award, the “Initial Equity Awards”). Both Initial Equity Awards vest according to the following schedule: 34 % of the total on October 27, 2026; 33 % of the total on October 27, 2027; and 33 % of the total on October 27, 2028. The Initial Stock Option has a term of ten years and an exercise price of $ 1.21 per share (the closing price of the Company’s common stock on October 27, 2025). As of December 8, 2025, 266,974 shares remain available for grant under the 2018 Equity Incentive Plan. Stock Options In February 2021, the Company’s Board of Directors (the “Board”) granted options to purchase 665,000 shares of common stock, 310,000 shares to independent directors and 355,000 shares to employees. 605,000 shares of the stock options granted have an exercise price equal to the closing market price of Barnwell’s stock on the date of grant of $ 3.33 , vest annually over three years , and expire in ten years from the date of grant. 60,000 shares of the stock options granted have an exercise price of $ 3.66 ( 110 % of the closing market price on the date of grant for options granted to affiliates), vest annually over 95 three years , and expire in five years from the date of grant. Of the 665,000 shares of common stock granted, 150,000 vested stock options expired and 100,000 shares were forfeited, both of which were as a result of director departures since the date of grant. The following assumptions were used in estimating the fair value for equity-classified stock options granted in the year ended September 30, 2021: > 10% Owner-Employee Others Number of shares 60,000 605,000 Expected volatility 127.4 % 105.8 % Expected dividends None None Expected term (in years) 3.5 6.0 Risk-free interest rate 0.19 % 0.82 % Expected forfeitures None None Fair value per share $ 2.51 $ 2.70 The application of alternative assumptions could produce significantly different estimates of the fair value of share-based compensation, and consequently, the related costs reported in the “General and administrative” expenses in the Consolidated Statements of Operations. The following table summarizes Barnwell’s equity-classified stock options activity from October 1, 2024 through September 30, 2025: Options Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at October 1, 2024 465,000 $ 3.37 Granted — — Exercised — — Expired/Forfeited ( 50,000 ) 3.33 Outstanding at September 30, 2025 415,000 $ 3.38 4.6 $ — Exercisable at September 30, 2025 415,000 $ 3.38 4.6 $ — Compensation cost for stock option awards is measured at the grant date based on the fair value of the award and is recognized as an expense over the requisite service period. During the years ended September 30, 2025 and 2024, the Company recognized share-based compensation expense related to stock options of nil and $ 50,000 , respectively. There was no impact on income taxes for the years ended September 30, 2025 and 2024 due to a full valuation allowance on the related deferred tax asset. There is no remaining unrecognized compensation cost related to stock options as of September 30, 2025. Restricted Stock Units On November 2, 2023, the Board granted a total of 76,336 restricted stock units to the independent directors of the Board as partial payment of director fees for their service as members of the Board. The restricted stock units vest ratably over a three-year period, subject to the director’s continued service through the applicable vesting dates; provided that, any unvested restricted stock would vest upon a director’s death, disability, a change in control of the Company resulting in the director not continuing as a 96 director or the director not being renominated for election even though he was willing to stand for re-election. On May 16, 2024, the Board granted 60,000 restricted stock units to the Company’s President and Chief Executive Officer. The restricted stock units vest ratably over a three-year period, subject to the employee’s continued service through the applicable vesting dates. On October 24, 2024, the Board granted a total of 105,820 restricted stock units to the independent directors of the Board as partial payment of director fees for their service as members of the Board. The restricted stock units vest ratably over a three-year period, subject to the director’s continued service through the applicable vesting dates. On January 19, 2025, the Board granted a total of 66,000 restricted stock units to the Company's President and Chief Executive Officer. The restricted stock units vest ratably over a three-year period, subject to the employee’s continued service through the applicable vesting dates. The following table summarizes Barnwell’s restricted stock units activity from October 1, 2024 through September 30, 2025: Restricted Stock Units Shares Weighted-Average Grant Date Fair Value Nonvested at October 1, 2024 110,892 $ 2.63 Granted 171,820 1.82 Vested (1) ( 50,182 ) 2.37 Forfeited ( 78,356 ) 2.13 Nonvested at September 30, 2025 154,174 $ 2.07 ______________ (1) The underlying common stock for 30,182 vested restricted stock units were not yet issued as of September 30, 2025; in October 2025, the Company issued 30,182 shares of common stock for these vested restricted stock units. Compensation cost for restricted stock unit awards is measured at fair value and is recognized as an expense over the requisite service period. During the years ended September 30, 2025 and 2024, the Company recognized share-based compensation expense related to vested restricted stock units of $ 195,000 and $ 158,000 , respectively. There was no impact on income taxes for the years ended September 30, 2025 and 2024 due to a net operating loss and net operating loss carryforwards with a full valuation allowance in the relevant taxing jurisdiction. As of September 30, 2025, the total remaining unrecognized compensation cost related to nonvested restricted stock units was $ 151,000 , which is expected to be recognized over the weighted-average remaining requisite service period of 1.5 years. Common Stock Issued for Services On September 29, 2025, the Board approved and ratified a common stock grant to directors Kenneth Grossman and Joshua Horowitz for their services on behalf of the Company and the Board pertaining to the various legal actions between Ned L. Sherwood and certain of his affiliates and the Company and the 2025 shareholder proxy contest. Each director was granted 65,000 shares of Barnwell common stock and the total value of the all the shares granted was $ 177,000 which was valued using the closing price of Barnwell's common stock on September 29, 2025, the date of grant. 97 Limited-Duration Shareholder Rights Plan On January 26, 2025, the Board adopted a shareholder rights plan and declared a dividend of one right (a “Right”) in respect of each of the Company’s issued and outstanding shares of common stock, par value $ 0.50 per share (“Common Stock”). The dividend was payable to the shareholders of record at the close of business on February 7, 2025. Each Right initially entitled the registered holder, subject to the terms of the Rights Agreement (as defined below), to purchase from the Company one share of Common Stock, at a price equal to $ 9.00 , subject to certain adjustments (as adjusted from time to time, the “Exercise Price”). The terms of the Rights are set forth in the Rights Agreement, dated as of January 26, 2025 (as it may be amended from time to time, the “Rights Agreement”), by and between the Company and Broadridge Corporate Issuer Solutions, LLC, as rights agent (or any successor rights agent, the “Rights Agent”). In general terms, the Rights Agreement imposes significant dilution upon any person or group (other than the Company or certain related persons) that is or becomes the beneficial owner of 20 % (the “Triggering Percentage”) or more of the Company’s outstanding Common Stock without the prior approval of the Board. A person or group that becomes the beneficial owner of the Triggering Percentage or more is called an “Acquiring Person.” Any Rights held by an Acquiring Person will be null and void and may not be exercised. Shareholders that beneficially own the Triggering Percentage or more of the Company’s outstanding Common Stock on the date the plan is adopted, are not considered Acquiring Persons; however, such Shareholders generally may not acquire, or obtain the right to acquire, beneficial ownership of 0.25 % or more additional shares of the Company’s outstanding Common Stock. The term “beneficial ownership” is defined in the Rights Agreement and includes, among other things, certain securities that may be exercised or converted into shares of Common Stock and certain derivative arrangements. The Rights will expire prior to the earliest of (i) the close of business on January 26, 2026 (subject to the shareholders of the Company approving an extension of the Rights Agreement through a date on or prior to January 26, 2028); (ii) the time at which the Rights are redeemed pursuant to the Rights Agreement; (iii) the time at which the Rights are exchanged pursuant to the Rights Agreement; and (iv) upon the occurrence of certain transactions. This description of the Rights Agreement herein does not purport to be complete and is qualified in its entirety by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on January 27, 2025. 18. COMMITMENTS AND CONTINGENCIES Incentive compensation plan Barnwell established incentive compensation plans to compensate the four oil and natural gas segment Canadian executive officers. The value of the plans are directly related to our oil and natural gas segment's free cash flows from Canadian properties and the divestiture of Canadian oil and natural gas assets. As of September 30, 2025, Barnwell has accrued approximately $ 118,000 in bonus compensation under these plans and the amount is reported in “Accrued compensation” on the Consolidated Balance Sheet. 98 Environmental Matters Because of the inherent uncertainties associated with environmental assessment and remediation activities, future expenses to remediate sites identified in the future, if any, could be incurred. Barnwell's management is not currently aware of any significant environmental contingent liabilities requiring disclosure or accrual. Legal and Regulatory Matters Barnwell is routinely involved in disputes with third parties that occasionally require litigation. In addition, Barnwell is required to maintain compliance with all current governmental controls and regulations in the ordinary course of business. Barnwell’s management is not aware of any claims or litigation involving Barnwell that are likely to have a material adverse effect on its results of operations, financial position or liquidity, other than the shareholder contest actions discussed elsewhere in this filing. Other Matters Barnwell is obligated to pay Nearco Enterprises Ltd. 10.4 %, net of non-controlling interests' share, of Kaupulehu Developments’ gross receipts from real estate transactions. This fee represents compensation for promotion and marketing of Kaupulehu Developments’ property and were determined based on the estimated fair value of such services. These fees are included in general and administrative expenses. Barnwell is obligated to pay its external real estate legal counsel’s estate 1.2 %, net of non-controlling interests' share, of all Increment II payments received by Kaupulehu Developments for services provided by its external real estate legal counsel in the negotiation and closing of the Increment II transaction. These fees are included in general and administrative expenses. Kaupulehu Developments is also obligated to pay an amount equal to 0.72 % and 0.20 % of the cumulative net profits of KD II to KD Development and a pool of various individuals, respectively, all of whom are partners of KKM and are unrelated to Barnwell, in compensation for the agreement of these parties to admit the new development partner for Increment II. Such compensation will be reflected as the obligation becomes probable and the amount of the obligation can be reasonably estimated. 99 19. INFORMATION RELATING TO THE CONSOLIDATED STATEMENTS OF CASH FLOWS The following table details the effect of changes in current assets and liabilities on the Consolidated Statements of Cash Flows, and presents supplemental cash flow information: Year ended September 30, 2025 2024 Increase (decrease) from changes in: Receivables $ 191,000 $ 610,000 Income tax receivable 6,000 ( 3,000 ) Other current assets 308,000 155,000 Accounts payable 458,000 1,017,000 Accrued compensation ( 247,000 ) ( 58,000 ) Other current liabilities ( 492,000 ) 379,000 Increase from changes in current assets and liabilities $ 224,000 $ 2,100,000 Supplemental disclosure of cash flow information: Cash paid during the year for: Income taxes paid, net of refunds $ 196,000 $ 71,000 Supplemental disclosure of non-cash financing activities: Prepaid insurance funded directly by short-term premium financing borrowing $ 168,000 $ — Capital expenditure accruals related to oil and natural gas acquisition and development decreased $ 2,136,000 during the year ended September 30, 2025 and increased $ 1,291,000 during the year ended September 30, 2024. Additionally, capital expenditure accruals related to oil and natural gas asset retirement obligations decreased $ 684,000 and $ 577,000 during the years ended September 30, 2025 and September 30, 2024, respectively. 20. RELATED PARTY TRANSACTIONS Kaupulehu Developments is entitled to receive payments from the sales of lots and/or residential units by KD I and KD II. KD I and KD II are part of the Kukio Resort Land Development Partnerships in which Barnwell holds indirect 19.6 % and 10.8 % non-controlling ownership interests, respectively, accounted for under the equity method of investment. The percentage of sales payments are part of transactions which took place in 2004 and 2006 where Kaupulehu Developments sold its leasehold interests in Increment I and Increment II to KD I's and KD II's predecessors in interest, respectively, which was prior to Barnwell’s affiliation with KD I and KD II which commenced on November 27, 2013, the acquisition date of our ownership interest in the Kukio Resort Land Development Partnerships. Changes to the arrangement above, effective March 7, 2019, are discussed in Note 6. No lots were sold during the year ended September 30, 2025. During the year ended September 30, 2024, Barnwell received $ 500,000 in percentage of sales payments from KD I from the sale of the last two single-family lots within Increment I. 100 On September 29, 2025, the Board approved and ratified a common stock grant to directors Kenneth Grossman and Joshua Horowitz for their services on behalf of the Company and the Board pertaining to the various legal actions between Ned L. Sherwood and certain of his affiliates and the Company and the 2025 shareholder proxy contest. Each director was granted 65,000 shares of Barnwell common stock and the total value of the all the shares granted was $ 177,000 which was valued using the closing price of Barnwell's common stock on September 29, 2025, the date of grant. Barnwell Pension Plan In the quarter ended June 30, 2025, the Pension Plan purchased shares of Barnwell common stock which resulted in the Pension Plan owning more than 5 % of the Company's common shares outstanding. The Pension Plan has filed Schedule 13Ds with the Securities and Exchange Commission reporting its beneficial ownership of Barnwell common stock. As of September 30, 2025, the Pension Plan held 666,077 shares of Barnwell common stock. All the shares purchased by the Pension Plan were made on the open market through a brokerage account. 21. SUBSEQUENT EVENTS Share-based Payment Arrangements In October 2025, the Board of Directors of the Company granted a total of 133,335 restricted stock units to the independent directors of the Board as partial payment of director fees for their service as members of the Board. The restricted stock units vest ratably over a three-year period, subject to the director’s continued service through the applicable vesting date. On October 27, 2025, Barnwell Industries, Inc. appointed Philip Patman, Jr. as the Company’s Executive Vice President – Finance and in connection with Mr. Patman’s appointment, the Company entered into an executive employment agreement with Mr. Patman, dated, and effective, as of October 27, 2025 (the “Employment Agreement”). Pursuant to the terms of the Employment Agreement, on October 27, 2025, Mr. Patman received the following awards which were issued pursuant to the Company’s Amended and Restated 2018 Equity Incentive Plan, as amended from time to time: a stock award of 83,207 shares of the Company’s common stock; a restricted stock unit award for 83,208 shares of the Company’s common stock (the “Initial RSU Award”); and an incentive stock option to purchase 185,000 shares of the Company’s common stock (the “Initial Stock Option” and, together with the Initial RSU Award, the “Initial Equity Awards”). Both Initial Equity Awards vest according to the following schedule: 34 % of the total on October 27, 2026; 33 % of the total on October 27, 2027; and 33 % of the total on October 27, 2028. The Initial Stock Option has a term of ten years and an exercise price of $ 1.21 per share (the closing price of the Company’s common stock on October 27, 2025). Investment in Kukio Resort Land Development Partnerships In November 2025, Kaupulehu Developments entered into an agreement with Mr. David Johnston, the son of Mr. Terry Johnston, a partner in Kaupulehu Developments, to surrender any and all remaining rights for Increment II for $ 2,000,000 of which $ 70,000 was received. Additionally, the purchaser has the right to extend the closing by up to two years by making a $ 70,000 payment in each of the next two years, with those payments applied against the $ 2,000,000 purchase price. The closing of this transaction is entirely dependent on the purchaser and therefore may not happen. 101 Subsequent to fiscal 2025, pursuant to a unit purchase agreement KDK, of which Barnwell holds a 19.6 % interest, agreed to sell KDK’s interests in Increment II to Mr. David Johnston for $ 2,109,000 . The unit purchase agreement is subject to due diligence, and there is no certainty that the transaction will close. Furthermore, there is also no assurance on the timing or amounts that the general partner of KDK would distribute upon a closing. Private Placement Offering On November 24, 2025, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with certain investors (the “Purchasers”), including certain directors of the board of directors of the Company pursuant to which the Company agreed to issue and sell an aggregate of: (i) 2,221,141 shares of its common stock, par value $ 0.50 per share (the “Common Stock”), and (ii) warrants (the “Common Warrants”) to purchase up to 1,029,104 shares of Common Stock (the “Warrant Shares”) in a private placement offering of the Company’s securities (the “Offering”). The directors of the Company participating as Purchasers in the Offering and certain other Purchasers did not receive any Common Warrants. The price of the shares of Common Stock sold in the private placement was $ 1.10 per share of Common Stock. The Common Warrants have an exercise price of $ 1.65 per share, can be exercised starting one hundred eighty ( 180 ) days following the date of closing of the Offering (the “Initial Exercise Date”) and will be exercisable for three years following the Initial Exercise Date. The Offering closed on November 28, 2025 (the “Closing Date”) and the gross proceeds received from the Offering was approximately $ 2,443,000 . Pursuant to the terms of the Purchase Agreement, the Company has agreed to register for resale the shares of Common Stock and the Warrant Shares and plans to file an initial registration statement covering such resale no later than forty-five ( 45 ) days after the Closing Date. In connection with the transaction, and conditioned upon the Closing, one of the Purchasers, Mr. Bradley L. Radoff, had the right to appoint a director to the Company’s board of directors. Accordingly, the Company has appointed Mr. Radoff’s designee, Mr. Joshua E. Schechter, effective November 28, 2025, to the Board of Directors to serve until the Company’s next annual meeting of stockholders. The foregoing descriptions of the Purchase Agreement and the Common Warrants are not complete and are qualified in their entirety by reference to the full text of the Form of Purchase Agreement and the Form of Common Warrant, which are attached as Exhibit 10.1 and 4.1, respectively, to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on November 26, 2025. 22. SUMMARY OF SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) Disclosure is not required as Barnwell qualifies as a smaller reporting company. 102 23. SUPPLEMENTARY OIL AND NATURAL GAS INFORMATION (UNAUDITED) The following tables summarize information relative to Barnwell’s oil and natural gas operations, which are conducted in Canada and was, until August 8, 2025, conducted in the U.S. states of Oklahoma and Texas (see Note 7). Proved reserves are the estimated quantities of oil, natural gas and natural gas liquids which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions. Proved producing oil and natural gas reserves are reserves that can be expected to be recovered through existing wells with existing equipment and operating methods. The estimated net interests in total proved and proved producing reserves are based upon subjective engineering judgments and may be affected by the limitations inherent in such estimations. The process of estimating reserves is subject to continual revision as additional information becomes available as a result of drilling, testing, reservoir studies and production history. There can be no assurance that such estimates will not be materially revised in subsequent periods. (A) Oil and Natural Gas Reserves The following tables summarizes changes in the estimates of Barnwell’s net interests in total proved reserves of oil and natural gas liquids and natural gas, which are now all located in Canada. All of the information regarding reserves in this Form 10-K is derived from the report of our independent petroleum reserve engineers, InSite, and is included as an Exhibit to this Form 10-K. The Company emphasizes that reserve estimates are inherently imprecise and that estimates of new discoveries and undeveloped locations are more imprecise than estimates of established proved producing oil and natural gas properties. Accordingly, these estimates are expected to change as future information becomes available. Proved oil and natural gas reserves are the estimated quantities of oil and natural gas that geological and engineering data demonstrate, with reasonable certainty, to be recoverable in future years from known reservoirs under economic and operating conditions (i.e., prices and costs) existing at the time the estimate is made. Oil (Bbls) Canada United States Total Proved reserves: Balance at September 30, 2023 787,000 112,000 899,000 Revisions of previous estimates 222,000 ( 3,000 ) 219,000 Extensions, discoveries and other additions 117,000 — 117,000 Acquisitions of reserves 4,000 — 4,000 Less sales of reserves ( 54,000 ) — ( 54,000 ) Less production ( 184,000 ) ( 19,000 ) ( 203,000 ) Balance at September 30, 2024 892,000 90,000 982,000 Revisions of previous estimates ( 65,000 ) ( 1,000 ) ( 66,000 ) Less sales of reserves ( 20,000 ) ( 79,000 ) ( 99,000 ) Less production ( 164,000 ) ( 10,000 ) ( 174,000 ) Proved Reserves, September 30, 2025 643,000 — 643,000 103 NGL (Bbls) Canada United States Total Proved reserves: Balance at September 30, 2023 150,000 177,000 327,000 Revisions of previous estimates 70,000 15,000 85,000 Extensions, discoveries and other additions 15,000 — 15,000 Acquisitions of reserves 2,000 — 2,000 Less sales of reserves ( 2,000 ) — ( 2,000 ) Less production ( 36,000 ) ( 28,000 ) ( 64,000 ) Balance at September 30, 2024 199,000 164,000 363,000 Revisions of previous estimates 44,000 ( 22,000 ) 22,000 Less sales of reserves ( 35,000 ) ( 129,000 ) ( 164,000 ) Less production ( 43,000 ) ( 13,000 ) ( 56,000 ) Proved Reserves, September 30, 2025 165,000 — 165,000 Natural Gas (Mcf) Canada United States Total Proved reserves: Balance at September 30, 2023 5,010,000 1,691,000 6,701,000 Revisions of previous estimates 826,000 82,000 908,000 Extensions, discoveries and other additions 313,000 — 313,000 Acquisitions of reserves 16,000 — 16,000 Less sales of reserves ( 139,000 ) — ( 139,000 ) Less production ( 1,085,000 ) ( 259,000 ) ( 1,344,000 ) Balance at September 30, 2024 4,941,000 1,514,000 6,455,000 Revisions of previous estimates ( 263,000 ) ( 66,000 ) ( 329,000 ) Less sales of reserves ( 283,000 ) ( 1,309,000 ) ( 1,592,000 ) Less production ( 966,000 ) ( 139,000 ) ( 1,105,000 ) Proved Reserves, September 30, 2025 3,429,000 — 3,429,000 104 Total Equivalent Reserves (Boe) Canada United States Total Proved reserves: Balance at September 30, 2023 1,772,000 571,000 2,343,000 Revisions of previous estimates 430,000 27,000 457,000 Extensions, discoveries and other additions 184,000 — 184,000 Acquisitions of reserves 9,000 — 9,000 Less sales of reserves ( 79,000 ) — ( 79,000 ) Less production ( 401,000 ) ( 90,000 ) ( 491,000 ) Balance at September 30, 2024 1,915,000 508,000 2,423,000 Revisions of previous estimates ( 65,000 ) ( 37,000 ) ( 102,000 ) Less sales of reserves ( 102,000 ) ( 425,000 ) ( 527,000 ) Less production ( 368,000 ) ( 46,000 ) ( 414,000 ) Proved Reserves, September 30, 2025 1,380,000 — 1,380,000 The following tables summarize changes in the estimates of Barnwell’s net interests in total proved undeveloped reserves and presents the balances of total proved developed reserves of oil and natural gas liquids and natural gas, which are now all located in Canada. Proved developed oil and natural gas reserves are proved reserves that can be expected to be recovered through existing wells and equipment in place and under operating methods being utilized at the time the estimates were made. Oil (Bbls) Canada United States Total Proved undeveloped reserves: Balance at September 30, 2023 92,000 — 92,000 Conversion to proved developed reserves ( 98,000 ) — ( 98,000 ) Revisions of previous estimates 6,000 — 6,000 Additions due to a new well 109,000 — 109,000 Balance at September 30, 2024 109,000 — 109,000 Revisions of previous estimates ( 109,000 ) — ( 109,000 ) Proved Undeveloped Reserves, September 30, 2025 — — — Proved Developed Reserves, September 30, 2024 783,000 90,000 873,000 Proved Developed Reserves, September 30, 2025 643,000 — 643,000 105 NGL (Bbls) Canada United States Total Proved undeveloped reserves: Balance at September 30, 2023 18,000 — 18,000 Conversion to proved developed reserves ( 10,000 ) — ( 10,000 ) Revisions of previous estimates ( 8,000 ) — ( 8,000 ) Additions due to a new well 23,000 — 23,000 Balance at September 30, 2024 23,000 — 23,000 Revisions of previous estimates ( 23,000 ) — ( 23,000 ) Proved Undeveloped Reserves, September 30, 2025 — — — Proved Developed Reserves, September 30, 2024 176,000 164,000 340,000 Proved Developed Reserves, September 30, 2025 165,000 — 165,000 Natural Gas (Mcf) Canada United States Total Proved undeveloped reserves: Balance at September 30, 2023 608,000 — 608,000 Conversion to proved developed reserves ( 279,000 ) — ( 279,000 ) Revisions of previous estimates ( 330,000 ) — ( 330,000 ) Additions due to a new well 641,000 — 641,000 Balance at September 30, 2024 640,000 — 640,000 Revisions of previous estimates ( 640,000 ) — ( 640,000 ) Proved Undeveloped Reserves, September 30, 2025 — — — Proved Developed Reserves, September 30, 2024 4,301,000 1,514,000 5,815,000 Proved Developed Reserves, September 30, 2025 3,429,000 — 3,429,000 106 Total Equivalent Reserves (Boe) Canada United States Total Proved undeveloped reserves: Balance at September 30, 2023 211,000 — 211,000 Conversion to proved developed reserves ( 155,000 ) — ( 155,000 ) Revisions of previous estimates ( 56,000 ) — ( 56,000 ) Additions due to a new well 239,000 — 239,000 Balance at September 30, 2024 239,000 — 239,000 Revisions of previous estimates ( 239,000 ) — ( 239,000 ) Proved Undeveloped Reserves, September 30, 2025 — — — Proved Developed Reserves, September 30, 2024 1,676,000 508,000 2,184,000 Proved Developed Reserves, September 30, 2025 1,380,000 — 1,380,000 (B) Capitalized Costs Relating to Oil and Natural Gas Producing Activities All capitalized costs relating to oil and natural gas producing activities in Canada and the U.S. are summarized as follows: September 30, 2025 Canada United States Total Proved properties $ 74,511,000 $ — $ 74,511,000 Unproved properties — — — Total capitalized costs 74,511,000 — 74,511,000 Accumulated depletion, depreciation, and impairment 65,358,000 — 65,358,000 Net capitalized costs $ 9,153,000 $ — $ 9,153,000 September 30, 2024 Canada United States Total Proved properties $ 76,963,000 $ 6,594,000 $ 83,557,000 Unproved properties — — — Total capitalized costs 76,963,000 6,594,000 83,557,000 Accumulated depletion, depreciation, and impairment 64,402,000 2,601,000 67,003,000 Net capitalized costs $ 12,561,000 $ 3,993,000 $ 16,554,000 107 (C) Costs Incurred in Oil and Natural Gas Property Acquisition, Exploration and Development Year ended September 30, 2025 Canada United States Total Acquisition of properties: Proved $ — $ — $ — Unproved — — — Exploration costs 22,000 — 22,000 Development costs 234,000 — 234,000 Total $ 256,000 $ — $ 256,000 Year ended September 30, 2024 Canada United States Total Acquisition of properties: Proved $ 146,000 $ — $ 146,000 Unproved — — — Exploration costs 34,000 — 34,000 Development costs 3,865,000 183,000 4,048,000 Total $ 4,045,000 $ 183,000 $ 4,228,000 (D) Results of Operations for Oil and Natural Gas Producing Activities Year ended September 30, 2025 Canada United States Total Net revenues $ 12,392,000 $ 1,171,000 $ 13,563,000 Production costs ( 8,546,000 ) ( 420,000 ) ( 8,966,000 ) Depletion ( 2,801,000 ) ( 343,000 ) ( 3,144,000 ) Impairment of assets — ( 865,000 ) ( 865,000 ) Pre-tax results of operations (1) 1,045,000 ( 457,000 ) 588,000 Estimated income tax expense (2) 214,000 10,000 224,000 Results of operations (1) $ 831,000 $ ( 467,000 ) $ 364,000 Year ended September 30, 2024 Canada United States Total Net revenues $ 15,093,000 $ 2,303,000 $ 17,396,000 Production costs ( 9,230,000 ) ( 619,000 ) ( 9,849,000 ) Depletion ( 4,139,000 ) ( 808,000 ) ( 4,947,000 ) Impairment of assets ( 2,164,000 ) ( 721,000 ) ( 2,885,000 ) Pre-tax results of operations (1) ( 440,000 ) 155,000 ( 285,000 ) Estimated income tax expense (2) 320,000 20,000 340,000 Results of operations (1) $ ( 760,000 ) $ 135,000 $ ( 625,000 ) _________________ (1) Before general and administrative expenses, interest expense, and foreign exchange gains and losses. (2) Estimated income tax expense includes changes to the deferred income tax valuation allowance necessary for the portion of Canadian and U.S. federal tax law deferred tax assets that may not be realizable. 108 (E) Standardized Measure, Including Year-to-Year Changes Therein, of Estimated Discounted Future Net Cash Flows The following tables utilize reserve and production data estimated by independent petroleum reserve engineers. The information may be useful for certain comparison purposes but should not be solely relied upon in evaluating Barnwell or its performance. Moreover, the projections should not be construed as realistic estimates of future cash flows, nor should the standardized measure be viewed as representing current value. The estimated future cash flows at September 30, 2025 and 2024 were based on average sales prices in effect on the first day of the month for the preceding twelve month period in accordance with SEC Release No. 33-8995. The future production and development costs represent the estimated future expenditures that we will incur to develop and produce the proved reserves, assuming continuation of existing economic conditions. The future income tax expenses were computed by applying statutory income tax rates in existence at September 30, 2025 and 2024 to the future pre-tax net cash flows relating to proved reserves, net of the tax basis of the properties involved. Material revisions to reserve estimates may occur in the future, development and production of the oil and natural gas reserves may not occur in the periods assumed and actual prices realized and actual costs incurred are expected to vary significantly from those used. Management does not rely upon this information in making investment and operating decisions; rather, those decisions are based upon a wide range of factors, including estimates of probable reserves as well as proved reserves and price and cost assumptions different than those reflected herein. Barnwell has included all abandonment, decommissioning and reclamation costs and inactive well costs in accordance with best practice recommendations into the Company’s reserve reports. Standardized Measure of Discounted Future Net Cash Flows Year ended September 30, 2025 Canada United States Total Future cash inflows $ 48,624,000 $ — $ 48,624,000 Future production costs ( 30,967,000 ) — ( 30,967,000 ) Future development costs ( 50,000 ) — ( 50,000 ) Future income tax expenses ( 972,000 ) — ( 972,000 ) Future net cash flows excluding abandonment, decommissioning and reclamation 16,635,000 — 16,635,000 Future abandonment, decommissioning and reclamation ( 18,007,000 ) — ( 18,007,000 ) Future net cash flows ( 1,372,000 ) — ( 1,372,000 ) 10% annual discount for timing of cash flows 8,042,000 — 8,042,000 Standardized measure of discounted future net cash flows $ 6,670,000 $ — $ 6,670,000 109 Year ended September 30, 2024 Canada United States Total Future cash inflows $ 75,293,000 $ 12,043,000 $ 87,336,000 Future production costs ( 42,601,000 ) ( 5,080,000 ) ( 47,681,000 ) Future development costs ( 2,795,000 ) — ( 2,795,000 ) Future income tax expenses ( 2,666,000 ) ( 161,000 ) ( 2,827,000 ) Future net cash flows excluding abandonment, decommissioning and reclamation 27,231,000 6,802,000 34,033,000 Future abandonment, decommissioning and reclamation ( 18,026,000 ) ( 50,000 ) ( 18,076,000 ) Future net cash flows 9,205,000 6,752,000 15,957,000 10% annual discount for timing of cash flows 2,697,000 ( 2,804,000 ) ( 107,000 ) Standardized measure of discounted future net cash flows $ 11,902,000 $ 3,948,000 $ 15,850,000 Changes in the Standardized Measure of Discounted Future Net Cash Flows Year ended September 30, 2025 2024 Beginning of year $ 15,850,000 $ 19,913,000 Sales of oil and natural gas produced, net of production costs ( 4,597,000 ) ( 7,547,000 ) Net changes in prices and production costs, net of royalties and wellhead taxes ( 2,132,000 ) ( 12,201,000 ) Extensions and discoveries — 1,725,000 Net change due to purchases and sales of minerals in place ( 3,715,000 ) ( 895,000 ) Changes in future development costs 2,610,000 170,000 Revisions of previous quantity estimates ( 1,618,000 ) 9,478,000 Net change in income taxes ( 854,000 ) 1,786,000 Accretion of discount 1,156,000 3,359,000 Other - changes in the timing of future production and other 354,000 76,000 Other - net change in Canadian dollar translation rate ( 384,000 ) ( 14,000 ) Net change ( 9,180,000 ) ( 4,063,000 ) End of year $ 6,670,000 $ 15,850,000 110 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.