INFINITY NATURAL RESOURCES, INC. 10-K

ITEM 1A. RISK FACTORS Investing in our Class A common stock involves risks. You should carefully consider the following risks and uncertainties, as well as the other information contained in this Annual Report, including those described in “Cautionary Statement Regarding Forward-Looking Statements.” The risks and uncertainties described below are not the only ones we face. Additional risks not presently known to us or that we currently deem immaterial may also materially affect our business. The occurrence of any of the following risks or additional risks and uncertainties that are currently immaterial or unknown could materially and adversely affect our business, financial condition, liquidity, results of operations and cash flows. The trading price of our Class A common stock could decline due to any of these risks, and you may lose all or part of your investment. Risks Related to Commodity Prices Oil, natural gas and NGL prices are volatile. A sustained decline in prices could adversely affect our business, financial condition and results of operations, liquidity and our ability to meet our financial commitments or cause us to delay our planned capital expenditures. Our revenues, operating results, profitability, liquidity and ability to grow depend primarily upon the prices we receive for the oil, natural gas and NGLs we sell. We require substantial expenditures to replace our oil, natural gas and NGL reserves, sustain production and fund our business plans, including our development and exploratory drilling efforts. Lower commodity prices negatively affect the amount of cash available for capital expenditures, could negatively affect our ability to borrow money or raise additional capital and, as a result, could have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows. In addition, low prices may reduce the quantities of oil, natural gas and NGL reserves that may be economically produced and result in an impairment of our natural gas and oil properties. Historically, the markets for oil, natural gas and NGLs have been volatile, and they are likely to continue to be volatile. Wide fluctuations in oil, natural gas and NGL prices may result from relatively minor changes in the supply of or demand for oil, natural gas and NGLs, market uncertainty and other factors that are beyond our control, including: • worldwide and regional economic conditions impacting the supply and demand for oil, natural gas and NGLs, including inflationary pressures; • changes in seasonal temperatures, including the number of heating degree days during winter months and cooling degree days during summer months; • the level of oil, natural gas and NGL exploration, development and production; • the level of U.S. LNG exports; • prevailing prices on local price indexes in the areas in which we operate; • the proximity, capacity, cost and availability of gathering and transportation facilities; • localized and global supply and demand fundamentals and transportation availability; • the cost of exploring for, developing, producing and transporting reserves; • the spot price of LNG on world markets; • weather conditions and natural disasters; • technological advances affecting energy consumption; • the price and availability of alternative fuels; • speculative trading in natural gas derivative contracts; • armed conflict, political instability or civil unrest in oil and gas producing regions, including instability in the Middle East and the conflict between Russia and Ukraine, and the related potential effects on laws and regulations or the imposition of economic or trade sanctions; • the occurrence or threat of epidemic or pandemic diseases, or any government response to such occurrence or threat; • political and economic conditions in or affecting major LNG consumption regions or countries, particularly Asia and Europe; 18 Table of Contents • actions of the Organization of the Petroleum Exporting Countries (“OPEC”), including the ability and willingness of the members of OPEC and other exporting nations to agree to and maintain oil price and production controls, including the anticipated increases in supply from Russia and OPEC, particularly Saudi Arabia; • U.S. trade policies and their effect on U.S. oil, natural gas and NGL exports; • expectations about future commodity prices; and • U.S. federal, state and local and non-U.S. governmental regulation and taxes. Lower commodity prices may reduce our operating margins, cash flow and borrowing ability. If we are unable to obtain needed capital or financing on satisfactory terms, our ability to develop future reserves or make acquisitions could be adversely affected. Also, using lower prices in estimating proved reserves may result in a reduction in proved reserve volumes due to economic limits. In addition, sustained periods with natural gas prices at levels lower than current Henry Hub strip prices or oil prices lower than current WTI strip prices may adversely affect our drilling economics, cash flow and our ability to raise capital, which may require us to re-evaluate and postpone or substantially restrict our development program and result in the reduction of some of our proved undeveloped reserves and related PV-10. As a result, a substantial or extended decline in commodity prices may materially and adversely affect our future business, financial condition, results of operations, liquidity and ability to meet our financial commitments or cause us to delay our planned capital expenditures. We could experience periods of higher costs if commodity prices rise. These increases could reduce our profitability, cash flow and ability to complete development activities as planned. Historically, our capital and operating costs have risen during periods of increasing oil, natural gas and NGL prices and drilling activity in our areas of operation and other major shale basins throughout the U.S. These cost increases result from a variety of factors beyond our control, such as increases in the cost of sand and other proppant used in hydraulic fracturing operations; steel and other raw materials that we and our vendors rely upon; increased demand for labor, services and materials as drilling activity increases; and increased taxes. Such costs may rise faster than increases in our revenue if commodity prices rise, thereby negatively impacting our profitability, cash flow and ability to complete development activities as scheduled and on budget. This impact may be magnified to the extent that our ability to participate in the commodity price increases is limited by our derivative activities. Furthermore, high oil prices have historically led to more development activity in oil-focused shale basins and resulted in service cost inflation across all U.S. shale basins, including our areas of operation. Higher levels of development activity in oil-focused shale basins have also historically resulted in higher levels of associated gas production that places downward pressure on natural gas prices. To the extent natural gas prices decline due to a period of increased associated gas production and we experience service cost inflation during such period, our cash flow and profitability may be materially adversely impacted. Certain factors could require us to write down the carrying values of our properties, including commodity prices decreasing to a level such that our future undiscounted cash flows from our properties are less than their carrying value. Accounting rules require that we periodically review the carrying value of our properties for possible impairment. Based on prevailing commodity prices and specific market factors and circumstances at the time of prospective impairment reviews and the continuing evaluation of development plans, drilling and completion results, production data, economics and other factors, we may be required to write down the carrying value of our properties. A write-down constitutes a non-cash impairment charge to earnings. Lower commodity prices in the future could result in impairments of our properties, which could have a material adverse effect on our results of operations for the periods in which such charges are taken. For example, natural gas prices are a critical component to our fair value estimate of our natural gas properties. If these prices decline, we will record an impairment, which is a non-cash charge to earnings, if we determine that an asset’s carrying value exceeds its estimated fair value. Impairment expense may have a material adverse effect on our earnings. We could experience further material write-downs as a result of other factors, including low production results or high lease operating expenses, capital expenditures or transportation fees. Risks Related to Our Reserves, Leases and Drilling Locations Reserve estimates depend on many assumptions that may turn out to be inaccurate. Any material inaccuracies in reserve estimates or underlying assumptions will materially affect the quantities and present value of our reserves. The process of estimating oil, natural gas and NGL reserves is complex. It requires interpretations of available technical data and many assumptions, including assumptions relating to current and future economic conditions and commodity prices. Any significant inaccuracies in these interpretations or assumptions could materially affect the estimated quantities and present value of our reserves. In order to prepare reserve estimates, production rates and timing of development expenditures must be projected and available geological, geophysical, production and engineering data must be analyzed. The extent, quality and reliability of this data can vary. The process also requires economic assumptions about matters such as commodity prices, drilling and operating expenses, capital expenditures, taxes and availability of funds. 19 Table of Contents Actual future production, commodity prices, revenues, taxes, development expenditures, operating expenses and quantities of recoverable reserves may vary materially from our estimates. For instance, initial production rates reported by us or other operators may not be indicative of future or long-term production rates, our recovery efficiencies may be worse than expected and production declines may be greater than we estimate and may be more rapid and irregular when compared to initial production rates. In addition, we may adjust reserve estimates of proved reserves to reflect additional production history, results of development activities, current commodity prices and other existing factors. Any significant variance could materially affect the estimated quantities and present value of our reserves. Furthermore, our development plan calls for completing horizontal wells using tighter frac spacing and substantially higher proppant volumes, which may increase the risk that these wells interfere with production from existing or future wells in the same spacing section and horizon, which in turn may result in lower recoverable reserves. There can be no assurance that our reserves will ultimately be produced. You should not assume that the present values of future net cash flows from our reserves presented in this Annual Report are the current market value of our estimated reserves. Actual future prices and costs may differ materially from those used in our present value estimates using SEC pricing. If spot prices or future actual prices are below the prices used in our current reserve estimates, using those prices in estimating proved reserves may result in a decrease in proved reserve volumes due to economic limits. You should not assume that the PV-10 values of our estimated reserves are accurate estimates of the current fair value of our estimated oil, natural gas and NGL reserves. Unless we replace our reserves with new reserves and develop those new reserves, our reserves and production will decline, which would adversely affect our future cash flows and results of operations. Producing natural gas and oil reservoirs generally are characterized by declining production rates that vary depending upon reservoir characteristics and other factors. Unless we conduct successful ongoing development activities or continually acquire properties containing proved reserves, our proved reserves will decline as those reserves are produced. Our future reserves and production, and therefore our future cash flow and results of operations, are highly dependent on our success in efficiently developing our current reserves and economically finding or acquiring additional recoverable reserves. We may not be able to develop, find or acquire sufficient additional reserves to replace our current and future production. If we are unable to replace our current and future production, the value of our reserves will decrease, and our business, financial condition and results of operations would be materially and adversely affected. The development of our estimated PDNPs and PUDs may take longer and may require higher levels of capital expenditures than we currently anticipate. Therefore, our estimated PDNPs and PUDs may not be ultimately developed or produced. As of December 31, 2024, approximately 60% of our total estimated proved reserves were classified as proved undeveloped under SEC pricing. Estimated net future development costs relating to the development of our PDNPs and PUDs at December 31, 2024 are approximately $630 million over the next five years. Moreover, the development of probable and possible reserves will require additional capital expenditures and such reserves are less certain to be recovered than proved reserves. Development of these undeveloped reserves may take longer and require higher levels of capital expenditures than we currently anticipate. We plan to fund our capital development program primarily through cash flow from our operations. Our ability to fund these expenditures is subject to a number of risks. For additional information, see “—Our development projects and acquisitions require substantial capital expenditures. We may be unable to obtain any required capital or financing on satisfactory terms, which could lead to a decline in our production and reserves.” Delays in the development of our reserves, increases in costs to drill and develop such reserves or decreases in commodity prices will reduce the PV-10 value of our estimated PUDs and future net cash flows estimated for such reserves and may result in some projects becoming uneconomic. In addition, delays in the development of reserves could cause us to have to reclassify some of our PUDs as unproved reserves. Furthermore, there is no certainty that we will be able to convert our PUDs to developed reserves or that our undeveloped reserves will be economically viable or technically feasible to produce. Further, SEC rules require that, subject to limited exceptions, PUDs may only be booked if they relate to wells scheduled to be drilled within five years after the date of booking. This requirement has limited and may continue to limit our ability to book additional PUDs as we pursue our drilling program. As a result, we may be required to reclassify certain of our PUDs if we do not drill those wells within the required five-year timeframe. 20 Table of Contents Our undeveloped acreage must be drilled before lease expiration to hold the acreage by production. In highly competitive markets for acreage, failure to drill sufficient wells to hold acreage could result in a substantial lease renewal cost or, if renewal is not feasible, loss of our lease and prospective drilling opportunities. Leases on oil and natural gas properties typically have a term of three to five years, after which they expire unless, prior to expiration, a well is drilled and production of hydrocarbons in paying quantities is established. In addition, many of our oil and natural gas leases require us to drill wells that are commercially productive, and if we are unsuccessful in drilling such wells, we could lose our rights under such leases. Although approximately 84% of our acreage is HBP, held by operations or held-by-storage as of December 31, 2024, the remaining acreage is subject to expiration over future years. Of the remaining 16% of our acreage not HBP, approximately 3% will be subject to expiration in 2025, 1% in 2026 and approximately 96% thereafter, although a portion of our leases generally grant us the right to extend these leases for an additional three or five-year period. Although we seek to actively manage our undeveloped properties, our drilling plans for these areas are subject to change based upon various factors, including drilling results, oil and natural gas prices, the availability and cost of capital, drilling and production costs, availability of drilling services and equipment, gathering system and pipeline transportation constraints and regulatory approvals. Low commodity prices may cause us to delay our drilling plans and, as a result, lose our right to develop the related properties. The cost to renew expiring leases may increase significantly, and we may not be able to renew such leases on commercially reasonable terms or at all. If we are unable to fund renewals of expiring leases, we could lose portions of our acreage and our actual drilling activities may differ materially from our current expectations, which could adversely affect our business. Our identified drilling locations are scheduled out over many years, making them susceptible to uncertainties that could materially alter the occurrence or timing of their drilling. We have specifically identified and scheduled certain drilling locations as an estimation of our future multiyear drilling activities on our existing acreage. Our identified drilling locations represent locations to which proved, probable or possible reserves were attributable. Our ability to drill and develop these locations depends on a number of uncertainties, including commodity prices, statutory unitization, availability and cost of capital, drilling and production costs, availability of drilling services and equipment, availability and cost of sand and other proppant used in hydraulic fracturing operations, drilling results, gathering system and pipeline transportation constraints, access to and availability of water sourcing and distribution systems, access to and availability of saltwater disposal systems, regulatory approvals, the cooperation of other working interest owners and other factors. Because of these uncertain factors, we do not know if the drilling locations we have identified will ever be drilled or if we will be able to produce oil or natural gas from these or any other drilling locations. In addition, unless production is established within the spacing units covering the undeveloped acres on which some of the potential locations are obtained, the leases for such acreage will expire. Further, certain of the horizontal wells we intend to drill in the future may require pooling or unitization with adjacent leaseholds controlled by third parties. If these third parties are unwilling to pool or unitize such leaseholds with ours, the total locations we can drill may be limited. As such, our actual drilling activities may materially differ from those presently identified. For more information on our future potential acreage expirations, see “Item 1. Business and Properties—Our Properties— Undeveloped Acreage Expirations as of December 31, 2024.” Although we plan to fund our drilling program primarily with cash flow from operations, if our cash flows are less than we expect or we change our drilling activities, we may be required to borrow under our Credit Facility or issue debt or equity securities in order to pursue the development of these locations, and we may not be able to raise or generate the capital required to do so. For additional information, see “—Our development projects and acquisitions require substantial capital expenditures. We may be unable to obtain any required capital or financing on satisfactory terms, which could lead to a decline in our production and reserves.” Any drilling activities we are able to conduct on these locations may not be successful, may not result in production or additions to our estimated proved reserves and could result in a downward revision of our estimated proved reserves, which could have a material adverse effect on the borrowing base under our Credit Facility or our future business and results of operations. Additionally, if we curtail our drilling program, we may be required to reduce our estimated proved reserves, which could reduce the borrowing base under our Credit Facility. Properties that we decide to drill may not yield oil, natural gas and NGLs in commercially viable quantities. Although we believe that the vast majority of our drilling locations are technically proved, any inability to develop commercially viable quantities will adversely affect our results of operations and financial condition. Properties that we decide to drill that do not yield natural gas in commercially viable quantities will adversely affect our results of operations and financial condition. There is no way to predict in advance of drilling and testing whether any particular prospect will yield oil, natural gas or NGLs in sufficient quantities to recover drilling and completion costs or to be economically viable. The use of geologic data and other technologies and the study of producing fields in the same area will not enable us to know conclusively prior to drilling whether oil, natural gas or NGLs will be present or, if present, whether oil, natural gas or NGLs will be present in commercial quantities. We cannot assure you that the analogies we draw from available data from other wells, more fully explored prospects or producing fields will be applicable to our drilling prospects. 21 Table of Contents Seismic data is subject to interpretation and may not accurately identify the presence of drilling hazards, which could adversely affect the results of our drilling operations. Seismic data and visualization techniques are only tools used to assist geoscientists in identifying subsurface structures and hydrocarbon indicators and do not enable the interpreter to know whether hydrocarbons are, in fact, present in those structures. As a result, even if we were to use and interpret seismic data in analyzing our drilling prospects, our drilling activities may not be successful or economical. In addition, the use of advanced technologies, such as 3-D seismic data, requires greater pre-drilling expenditures than traditional drilling strategies, and we could incur losses as a result of such expenditures. Risks Related to Our Operations Our development projects and acquisitions require substantial capital expenditures. We may be unable to obtain any required capital or financing on satisfactory terms, which could lead to a decline in our production and reserves. The oil and gas industry is capital-intensive. Although we expect to fund our capital budget primarily with cash flow from our operations, a number of factors could cause our cash flow to be less than we expect, including the results of our drilling and completion program. Moreover, our capital budgets are based on a number of assumptions, including drilling and completion costs, midstream service costs, commodity prices and drilling results, and are therefore subject to change. If our cash flows are less than we expect, we decide to pursue acquisitions or we change our capital budgets, we may be required to borrow under our Credit Facility or issue debt or equity securities to consummate such acquisitions or fund our drilling and completion program. The incurrence of additional indebtedness, either through borrowings under our Credit Facility, the issuance of debt securities or otherwise, would require that a portion of our cash flow from operations be used for the payment of interest and principal on our indebtedness, thereby reducing our ability to use cash flow from operations to fund capital expenditures and acquisitions. The issuance of additional equity securities would be dilutive to our other stockholders. The actual amount and timing of our future capital expenditures may differ materially from our estimates as a result of, among other things: commodity prices; actual drilling results; the availability and cost of drilling rigs and other services and equipment; the availability, cost and adequacy of midstream gathering, processing, compression and transportation infrastructure; and regulatory, technological and competitive developments. Our cash flow from operations and access to capital are subject to a number of variables, including: • the prices at which our production is sold; • the amount of our proved reserves; • the amount of hydrocarbons we are able to produce from existing wells; • our ability to acquire, locate and produce new reserves; • the amount of our operating expenses; • cash settlements from our derivative activities; • our ability to borrow under our Credit Facility; and • our ability to access the capital markets or sell non-core assets. If our revenues or the borrowing base under our Credit Facility decrease as a result of lower commodity prices, operational difficulties, declines in reserves or for any other reason, we may have limited ability to obtain the capital necessary to make acquisitions or sustain our operations at current levels. If additional capital is needed, we may not be able to obtain debt or equity financing on terms acceptable to us, if at all. If cash flow generated by our operations or available borrowings under our Credit Facility are insufficient to meet our capital requirements, the failure to obtain additional financing could result in a curtailment of the development of our properties, which in turn could lead to a decline in our reserves and production and could materially and adversely affect our business, financial condition and results of operations. Drilling for and producing oil, natural gas and NGLs are high-risk activities with many uncertainties that could adversely affect our business, financial condition or results of operations. Our future financial condition and results of operations will depend on the success of our development, production and acquisition activities, which are subject to numerous risks beyond our control. For example, we cannot assure you that wells we drill will be productive or that we will recover all or any portion of our investment in such wells. Drilling for oil, natural gas and NGLs often involves unprofitable efforts from wells that do not produce sufficient oil, natural gas and NGLs to return a profit at then-realized prices after deducting drilling, operating and other costs. In addition, our cost of drilling, completing and operating wells is often uncertain. 22 Table of Contents Our decisions to develop or purchase prospects or properties will depend, in part, on the evaluation of data obtained through geophysical and geological analyses, production data and engineering studies, which are often inconclusive or subject to varying interpretations. For a discussion of the uncertainty involved in these processes, see “—Reserve estimates depend on many assumptions that may turn out to be inaccurate. Any material inaccuracies in reserve estimates or underlying assumptions will materially affect the quantities and present value of our reserves.” Further, many factors may increase the cost of, curtail, delay or cancel our scheduled drilling projects, including: • declines in oil, natural gas and NGL prices; • increases in the cost of, and shortages or delays in the availability of, proppant, equipment, services and qualified personnel or in obtaining water for hydraulic fracturing activities; • equipment failures, accidents or other unexpected operational events; • capacity or pressure limitations on gathering systems, processing and treating facilities or other related midstream infrastructure; • coal and other mineral ownership permitting issues may impact our ability to develop on our current timeline; • drilling in the vicinity of coal mining operations and certain other structures; • any future lack of available capacity on interconnecting transmission pipelines; • complying with regulatory requirements, including limitations on freshwater sourcing, wastewater disposal, emission of greenhouse gases (“GHGs”) and hydraulic fracturing; • pressure or irregularities in geological formations; • limited availability of financing on acceptable terms; • issues related to compliance with or liability arising under environmental laws and regulations; • environmental hazards, such as natural gas leaks, oil spills, pipeline and tank ruptures and unauthorized discharges of brine, well stimulation and completion fluids, toxic gases or other pollutants into the environment; • compliance with contractual requirements; • competition for surface locations from other operators that may own rights to drill at certain depths across portions of our leasehold; • adverse weather conditions; • title issues or legal disputes regarding leasehold rights; and • other market limitations in our industry. Some of our properties are in areas that may have been partially depleted or drained by offset (i.e., neighboring) wells, and certain of our wells may be adversely affected by actions other operators may take when drilling, completing or operating wells that they own. Some of our properties are in areas that may have been partially depleted or drained by earlier drilled offset wells. We have no control over offsetting operators who could take actions such as drilling and completing nearby wells, which actions could adversely affect our operations. When a new offset well is completed and produced, reserves previously attributed to offset wells may be produced by the new well which could cause a depletion of our proved reserves and may inhibit our ability to further develop our proved reserves. The possibility for these impacts may increase with respect to wells that are shut in as a response to lower commodity prices or the lack of pipeline and storage capacity. In addition, completion operations and other activities conducted on other nearby wells could cause us, in order to protect our existing wells, to shut in production for indefinite periods of time. Shutting in our wells and damage to our wells from offset completions could result in increased costs and could adversely affect the reserves and re-commenced production from such shut in wells as well as the timing of cash flows from impacted wells. Our operations are also subject to conservation regulations, including the regulation of the size of drilling and spacing units or proration units, the number of wells that may be drilled in a unit, the rate of production allowable from oil and gas wells and the unitization or pooling of oil and gas properties. Some states allow the forced pooling or unitization of tracts to facilitate exploration and development, while other states rely on voluntary pooling of lands and leases. Such rules often impact the ultimate timing of our exploration and development plans. In addition, federal and state conservation laws generally limit the venting or flaring of natural gas, and state conservation laws impose certain requirements regarding the ratable purchase of production. These regulations limit the amounts of oil and gas we can produce from our wells and the number of wells or the locations at which we can drill. 23 Table of Contents Part of our business strategy involves using some of the latest available horizontal drilling and completion techniques, which involve risks and uncertainties in their application. Our operations involve utilizing some of the latest drilling and completion techniques, which include drilling longer laterals and completing wells with larger fluid volumes and higher proppant volumes. The difficulties we face drilling horizontal wells include: • landing our wellbores in the desired drilling zone; • staying in the desired drilling zone while drilling horizontally through the formation; • running casing the entire length of the wellbore; • potentials for casing failures; and • being able to run and remove tools and other equipment consistently through the entire length of the wellbore. Difficulties that we face while completing our wells include: • the ability to fracture stimulate the planned number of stages with the planned amount of fluid and proppant; • the ability to run tools through the entire length of the wellbore during completion operations; and • the ability to successfully clean out the wellbore after completion of the final fracture stimulation stage. In addition, certain of the new techniques we are adopting may cause irregularities or interruptions in production due to offset wells being shut in and the time required to drill and complete multiple wells before any such wells begin producing. Furthermore, our development plan calls for completing horizontal wells using greater fluid volumes and substantially higher proppant volumes in addition to drilling additional and longer laterals off of existing well pads, which may increase the risk that these wells interfere with production from existing or future wells in the same spacing section and horizon. This may cause such wells to produce at lower rates than we anticipate and produce lower recoverable reserves. These latest drilling and completion techniques require substantially more capital on a per well basis (when compared to vertical wells), which may result in us drilling and completing fewer wells per year. If our development and production results are less than anticipated, the return on our investment for a particular well or region may not be as attractive as we anticipated, and we could incur material write-downs of our undeveloped acreage, and its value could decline in the future. Our ability to produce oil, natural gas and NGLs economically and in commercial quantities is dependent on the availability of adequate supplies of water for drilling and completion operations and access to water and waste disposal or recycling facilities and services at a reasonable cost. Restrictions on our ability to obtain water or dispose of produced water and other waste may have an adverse effect on our financial condition, results of operations and cash flows. The hydraulic fracturing stimulation process on which we depend to produce commercial quantities of oil, natural gas and NGLs requires the use and disposal of significant quantities of water. The availability of water recycling facilities and other disposal alternatives to receive all of the water produced from our wells may affect our production. Our inability to secure sufficient amounts of water, to dispose of or recycle the water used in our operations or to timely obtain water sourcing permits or other rights could adversely impact our operations. The availability of water may change over time in ways that we cannot control, including as a result of shifting weather patterns. Additionally, the imposition of new environmental initiatives and regulations could include restrictions on our ability to obtain water or dispose of waste and adversely affect our business and operating results. Our producing properties are concentrated in the Appalachian Basin, making us vulnerable to risks associated with operating in one major geographic area. Our producing properties are geographically concentrated in the Appalachian Basin in eastern Ohio and southwestern Pennsylvania. As of December 31, 2024, all of our total estimated proved reserves were attributable to properties located in this area. As a result of this concentration, we may be disproportionately exposed to the impact of regional supply and demand factors, delays or interruptions of production from wells in this area caused by, and costs associated with, governmental regulation, state and local political activities, processing or transportation capacity constraints, market limitations, availability of equipment and personnel, water shortages or other drought related conditions or interruption of the processing or transportation of oil, natural gas or NGLs. Due to the concentrated nature of our portfolio of properties, a number of our properties could experience any of the same conditions at the same time, resulting in a relatively greater impact on our results of operations than they might have on other companies that have a more diversified portfolio of properties. 24 Table of Contents The marketability of certain of our production is dependent upon transportation and other facilities, which we do not control. If these facilities are unavailable, or if there are any increases in the cost of using these services or facilities, our operations could be interrupted, our revenues could be reduced and our costs could increase. The marketability of certain of our oil, natural gas and NGLs production depends in part upon the availability, proximity and capacity of transportation pipelines, plants and other midstream facilities, which are owned by third parties. Certain of our natural gas production is collected from the wellhead by third-party gathering lines and transported to gas processing or treating facilities and/or transmission pipelines. Our oil and NGLs production in some cases are also dependent on certain midstream infrastructure. We do not control these third-party facilities and our access to them may be limited, curtailed or denied. Economic, regulatory or other issues may affect the construction and availability of needed third-party facilities. These pipelines, plants, and other midstream facilities may become unavailable because of testing, turnarounds, line repair, maintenance, reduced operating pressure, lack of operating capacity, regulatory requirements, and curtailments of receipts or deliveries due to insufficient capacity or because of damage from severe weather conditions or other operational issues. These third-party facilities may experience unplanned downtime or maintenance for a variety of reasons outside our control, and our production could be materially negatively impacted as a result of such outages. Insufficient production from our wells to support the construction of pipeline facilities by third parties or a significant disruption in the availability of third-party midstream facilities or other production facilities could adversely impact our ability to deliver to market or produce our oil, natural gas and NGLs and thereby cause a significant interruption in our operations. If, in the future, we are unable, for any sustained period, to implement gathering, treating, processing, fractionation or transportation arrangements or encounter production related difficulties, we may be required to shut in or curtail production. Any such shut-in or curtailment, or an inability to obtain favorable terms for delivery of the natural gas produced from our fields, would materially and adversely affect our financial condition and results of operations. Additionally, certain of our gas gathering arrangements are subject to cost-of-service fee arrangements. The variable nature of these fee arrangements may result in per unit cost increases over time. If such increases occur, our costs could rise, which would negatively impact our financial results. The unavailability or high cost of drilling rigs, completion crews, equipment, supplies, personnel and oilfield services could adversely affect our ability to execute our development plans within our budget and on a timely basis. The demand for drilling rigs, completion crews, pipe and other equipment and supplies, including sand and other proppant used in hydraulic fracturing operations, as well as for qualified and experienced field personnel, geologists, geophysicists, engineers and other professionals in our industry, can fluctuate significantly, often in correlation with inflationary pressures, commodity prices or drilling activity in our areas of operation and in other shale basins in the U.S., causing periodic shortages of supplies and needed personnel and rapid increases in costs. Increased drilling activity could materially increase the demand for and prices of these goods and services, and we could encounter rising costs and delays in or an inability to secure the personnel, equipment, power, services, resources and facilities access necessary for us to conduct our drilling and development activities, which could result in production volumes being below our forecasted volumes. In addition, any such negative effect on production volumes, or significant increases in costs could have a material adverse effect on our cash flow and profitability. The loss of one or more of the purchasers of our production could adversely affect our business, results of operations, financial condition and cash flows. The largest purchaser of our oil and natural gas during the year ended December 31, 2024, accounted for approximately 55% of our total oil, natural gas and NGL revenues. As is typical in our industry, this purchaser’s contract is short-term in nature and is renewed in six-month increments. While we are not substantially dependent on this purchaser’s contract and we believe that we could find replacement purchasers of our oil and natural gas on acceptable terms if any one or more of the significant purchasers were unable to satisfy their contractual obligations, there can be no assurance that we will be able to do so on terms that we consider acceptable or at all. To the extent we are unable to replace such purchasers, it would adversely affect our business, financial condition, results of operations and cash flows. Further, the inability of one or more of our customers to pay amounts owed to us could adversely affect our business, financial condition, results of operations and cash flows. We may incur losses as a result of title defects in the properties in which we invest. The existence of a material title deficiency can render a lease worthless and adversely affect our results of operations and financial condition. While we typically obtain title opinions prior to commencing drilling operations on a lease or in a unit, the failure of title may not be discovered until after a well is drilled, in which case we may lose the lease and the right to produce all or a portion of the minerals under the property. 25 Table of Contents We may be unable to make attractive acquisitions or successfully integrate acquired businesses, and any inability to do so may disrupt our business and hinder our ability to grow. In the future we may make acquisitions of assets or businesses that complement or expand our current business. However, there is no guarantee we will be able to identify attractive acquisition opportunities. In the event we are able to identify attractive acquisition opportunities, we may not be able to complete the acquisition or do so on commercially acceptable terms. Competition for acquisitions may also increase the cost of, or cause us to refrain from, completing acquisitions. The success of completed acquisitions will depend on our ability to effectively integrate the acquired businesses into our existing operations. The process of integrating acquired businesses may involve unforeseen difficulties and may require a disproportionate amount of our managerial and financial resources. In addition, possible future acquisitions may be larger and for purchase prices significantly higher than those paid for earlier acquisitions. No assurance can be given that we will be able to identify additional suitable acquisition opportunities, negotiate acceptable terms, obtain financing for acquisitions on acceptable terms or successfully acquire identified targets. Our failure to achieve consolidation savings, to integrate the acquired businesses and assets into our existing operations successfully or to minimize any unforeseen operational difficulties could have a material adverse effect on our financial condition and results of operations. In addition, our Credit Facility imposes certain limitations on our ability to enter into mergers or combination transactions and to incur certain indebtedness, which could indirectly limit our ability to acquire assets and businesses. For additional information, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Financing Agreements—Credit Facility.” Future legislation or changes in tax laws and regulations may result in the elimination of certain U.S. federal income tax deductions currently available with respect to oil and gas exploration and production. Additionally, future federal or state legislation may impose new or increased taxes or fees on oil and natural gas extraction, transportation and sales. We are subject to taxation by various governmental authorities at the federal, state and local levels in the jurisdictions in which we operate. New legislation could be enacted by these governmental authorities, which could increase our tax burden and increase the cost to produce oil, natural gas or NGLs. Members of Congress periodically introduce legislation to revise U.S. federal income tax laws which could have a material impact on us. In the past, legislation has been proposed that would, if enacted into law, make significant changes to U.S. federal and state income tax laws, including to certain key U.S. federal income tax incentives currently available to oil and natural gas exploration and production companies. Future adverse changes could include, but are not limited to, (a) the repeal of the percentage depletion allowance for oil and natural gas properties, (b) the elimination of current deductions for intangible drilling and development costs, and (c) an extension of the amortization period for certain geological and geophysical expenditures. In addition, federal or state legislation increasing the amount of tax imposed on oil and natural gas extraction, transportation or sales could also be enacted. It is unclear whether these or similar changes will be enacted and, if enacted, how soon any such changes could become effective. The passage of any legislation as a result of these proposals or other similar changes to federal or state income tax laws could eliminate or postpone certain tax deductions or credits that are currently available with respect to oil and natural gas exploration and development, which could result in increased operating costs and negatively affect our financial condition, results of operations and cash flows. Additionally, state and local taxing authorities in jurisdictions in which we operate or own assets may enact new taxes, such as the imposition of a severance tax on the extraction of natural resources in states in which we produce natural gas, NGLs and oil or change the rates of existing taxes, which could adversely impact our earnings, cash flows and financial position. Changes in effective tax rates, or adverse outcomes resulting from other tax increases or an examination of our income or other tax returns, could adversely affect our results of operations and financial condition. Any changes in our effective tax rates or tax liabilities could adversely affect our results of operations and financial condition. Our future effective tax rates could be subject to volatility or adversely affected by a number of factors, including: • changes in the valuation of our deferred tax assets and liabilities; • expected timing and amount of the release of any tax valuation allowances; • expansion into or future activities in new jurisdictions; • the availability of tax deductions, credits, exemptions, refunds and other benefits to reduce tax liabilities; • tax effects of share-based compensation; and • changes in tax laws, tax regulations, accounting principles, or interpretations or applications thereof. 26 Table of Contents In addition, we are also subject to the examination of our tax returns by the U.S. Internal Revenue Service (the “IRS”) and other tax authorities. An adverse outcome arising from an examination of our income or other tax returns could result in higher tax exposure, penalties, interest or other liabilities that could have an adverse effect on our operating results and financial condition. We regularly assess the likelihood of an adverse outcome resulting from these examinations to determine the adequacy of our provision for income taxes. Although we believe our tax provisions are adequate, the final determination of tax audits and any related disputes could be materially different from our historical income tax provisions and accruals. The results of audits or related disputes could have an adverse effect on our financial statements for the period or periods for which the applicable final determinations are made. Continuing or worsening inflationary pressures and associated changes in monetary policy may result in increases to the cost of our goods, services, and personnel, which in turn could cause our capital expenditures and operating costs to rise. Inflation has been an ongoing concern in the U.S. since 2021. Ongoing inflationary pressures may result in increases to the costs of our oilfield goods, services and personnel, which would, in turn, cause our capital expenditures and operating costs to rise. Sustained levels of high inflation could cause the U.S. Federal Reserve and other central banks to increase interest rates, which could have the effects of raising the cost of capital and depressing economic growth, either of which, or the combination thereof, could hurt the financial and operating results of our business and impact our ability to raise capital. We are not the operator of all of our oil and natural gas properties and therefore are not in a position to control the timing of development efforts, the associated costs or the rate of production of the reserves on such properties. We are not the operator of all of the properties in which we have an interest. Thus, we have limited ability to exercise influence over the operations of such non-operated properties or their associated costs. Dependence on the operator and other working interest owners for these projects, and limited ability to influence operations and associated costs, could prevent the realization of targeted returns on capital in drilling or acquisition activities. The success and timing of development and exploration activities on properties operated by others will depend upon a number of factors that will be largely outside of our control, including: • the timing and amount of capital expenditures; • the availability of suitable drilling equipment, production and transportation infrastructure and qualified operating personnel; • the operator’s expertise and financial resources; • approval of other participants in drilling wells; • selection of technology; and • the rate of production of the reserves. In addition, when we are not the majority owner or operator of a particular oil or natural gas project, if we are not willing or able to fund our capital expenditures relating to such projects when required by the majority owner or operator, our interests in these projects may be reduced or forfeited. Properties we acquire may not produce as projected, and we may be unable to determine reserve potential, identify liabilities associated with the properties that we acquire or obtain protection from sellers against such liabilities. Acquiring natural gas or oil properties requires us to assess recoverable reserves; future oil, natural gas and NGL prices and their applicable differentials; development and operating costs and potential liabilities, including environmental liabilities. In connection with these assessments, we perform a review of the subject properties that we believe to be generally consistent with industry practices. Such assessments are inexact and inherently uncertain. For these reasons, the properties we have acquired or will acquire in the future may not produce as expected or may not be accretive to free cash flow. In connection with the assessments, we perform a review of the subject properties, but such a review may not reveal all existing or potential problems. In the course of our due diligence, we may not review every well, pipeline or associated facility. We cannot necessarily observe structural and environmental concerns, such as any groundwater contamination or pipe corrosion, when a review is performed. We may be unable to obtain contractual indemnities from the seller for liabilities created prior to our purchase of the property. We may be required to assume the risk of the physical condition of the properties in addition to the risk that the properties may not perform in accordance with our expectations. 27 Table of Contents Strategic determinations, including the allocation of capital and other resources to strategic opportunities, are subject to risk and uncertainties, and our failure to appropriately allocate capital and resources among our strategic opportunities may adversely affect our financial condition. Our future growth prospects are dependent upon our ability to identify optimal strategies for investing our capital resources to produce superior rates of return. In developing our business plan, we consider allocating capital and other resources to various aspects of our businesses, including well development, reserve acquisitions, exploratory activity, corporate items (including share and debt repurchases) and other alternatives, including investments into new proprietary technologies and strategies surrounding the generation and monetization of environmental attributes from our operations, including but not limited to carbon credit offsets. We also consider likely sources of capital, including cash generated from operations and borrowings under our Credit Facility. Notwithstanding the determinations made in the development of our core business plan, business opportunities not previously identified periodically come to our attention, including possible acquisitions and dispositions and opportunities to monetize technological improvements to our operations. If we fail to identify optimal business strategies, optimize our capital investment and capital raising opportunities, use our other resources in furtherance of our business strategies, make appropriate capital investment decisions or anticipate regulatory, policy and market changes associated with any of our strategic determinations, our financial condition and future growth may be adversely affected. Moreover, economic or other circumstances may change from those contemplated by our business plan, and our failure to recognize or respond to those changes may limit our ability to achieve our objectives. We may incur substantial losses and be subject to substantial liability claims as a result of our operations. Additionally, we may not be insured for, or our insurance may be inadequate to protect us against, these risks. We maintain insurance against some, but not all, operating risks and losses. Losses and liabilities arising from uninsured and underinsured events could materially and adversely affect our business, financial condition or results of operations. Our development activities are subject to all of the operating risks associated with drilling for and producing oil, natural gas and NGLs, including, but not limited to, the possibility of: • environmental hazards, such as unplanned releases of pollution into the environment, including soil, groundwater and air contamination; • abnormally pressured formations; • mechanical difficulties, such as stuck oilfield drilling and service tools and casing collapse; • fires, explosions and ruptures of pipelines; • personal injuries and death; • natural disasters; and • terrorist attacks targeting natural gas and oil related facilities and infrastructure. Any of these events could adversely affect our ability to conduct operations or result in substantial loss to us as a result of claims for: • injury or loss of life; • damage to and destruction of property, natural resources and equipment; • pollution and other environmental damage; • regulatory investigations and penalties; and • repair and remediation costs. We may elect not to obtain insurance for certain of these risks if we believe that the cost of available insurance is excessive relative to the risks presented. In addition, risks related to pollution and the environment are generally not fully insurable. The occurrence of an event that is not fully covered by insurance could have a material adverse effect on our business, financial condition or results of operations. 28 Table of Contents Competition in our industry is intense, making it more difficult for us to acquire properties, market oil, natural gas and NGLs, secure trained personnel and raise additional capital. Our ability to acquire additional oil and gas properties and to find and develop reserves in the future will depend on our ability to evaluate and select suitable properties and to consummate transactions in a highly competitive environment for acquiring properties, marketing oil, natural gas and NGLs and securing trained personnel. Also, there is substantial competition for capital available for investment in the oil and gas industry. Many of our competitors possess and employ greater financial, technical and personnel resources than we do. Those companies may be able to pay more for natural gas and oil properties and to evaluate, bid for and purchase a greater number of properties than our financial or personnel resources permit. In addition, other companies may be able to offer better compensation packages to attract and retain qualified personnel than we are able to offer. We may not be able to compete successfully in the future in acquiring natural gas and oil properties, developing reserves, marketing our production, attracting and retaining quality personnel and raising additional capital, which could have a material adverse effect on our business. The loss of senior management or technical personnel could adversely affect operations. We depend on the services of our senior management and technical personnel. We do not maintain, nor do we plan to obtain, any insurance against the loss of any of these individuals. The loss of the services of our senior management or technical personnel could have a material adverse effect on our business, financial condition and results of operations. Loss of our information and computer systems could adversely affect our business. We are heavily dependent on our information systems and computer-based programs, including our well operations information, geologic data, electronic data processing and accounting data. If any of such programs or systems were to fail or create erroneous information in our hardware or software network infrastructure or we were subject to cyberspace breaches or attacks, possible consequences include our loss of communication links, inability to find, produce, process and sell oil, natural gas and NGLs, costs associated with incident response or lost employee time and inability to automatically process commercial transactions or engage in similar automated or computerized business activities. Any such consequence could have a material adverse effect on our business. Cyberattacks targeting systems and infrastructure used by the oil and gas industry and related regulations may adversely impact our operations and, if we are unable to obtain and maintain adequate protection for our data, our business may be harmed. Our business has become increasingly dependent on digital technologies to conduct certain exploration, development and production activities. We depend on digital technology to estimate quantities of oil, natural gas and NGL reserves, process and record financial and operating data, analyze seismic and drilling information, and communicate with our customers, employees and third-party partners. The U.S. government has issued public warnings that indicate that energy assets might be specific targets of cybersecurity threats. Our technologies, systems, networks, and those of our vendors, suppliers and other business partners, may become the target of cyberattacks or information security breaches that could result in the unauthorized access to our seismic data, reserves information, customer or employee data or other proprietary or commercially sensitive information could lead to data corruption, communication interruption, or other disruptions in our exploration or production operations or planned business transactions, any of which could have a material adverse impact on our results of operations. If our information technology systems cease to function properly or our cybersecurity is breached, we could suffer disruptions to our normal operations, which may include drilling, completion, production and corporate functions. A cyberattack involving our information systems and related infrastructure, or that of our business associates, could result in supply chain disruptions that delay or prevent the transportation and marketing of our production, non-compliance leading to regulatory fines or penalties, loss or disclosure of, or damage to, our or any of our customer’s, supplier’s or royalty owners’ data or confidential information that could harm our business by damaging our reputation, subjecting us to potential financial or legal liability, and requiring us to incur significant costs, including costs to repair or restore our systems and data or to take other remedial steps. In addition, certain cyber incidents, such as surveillance, may remain undetected for an extended period. Our systems for protecting against cybersecurity risks may not be sufficient. As cyberattacks continue to evolve, including those leveraging artificial intelligence, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any vulnerabilities to cyberattacks. In addition, new laws and regulations governing data privacy, cybersecurity, and the unauthorized disclosure of confidential information pose increasingly complex compliance challenges and potentially elevate costs, and any failure to comply with these laws and regulations could result in significant penalties and legal liability. Terrorist activities could materially adversely affect our business and results of operations. Terrorist attacks, including eco-terrorism, the threat of terrorist attacks, whether domestic or foreign, as well as military or other actions taken in response to these acts, could affect the energy industry, the environment and industry related economic conditions, 29 Table of Contents including our operations, the operations of our customers, as well as general economic conditions, consumer confidence, spending and market liquidity. Strategic targets, including energy-related assets, may be at greater risk of future attacks than other targets in the United States. The occurrence or threat of terrorist attacks in the United States or other countries could adversely affect the global economy in unpredictable ways, including the disruption of energy supplies and markets, increased volatility in commodity prices or the possibility that the infrastructure on which we rely could be a direct target or an indirect casualty of an act of terrorism, and, in turn, could materially adversely affect our business and results of operations. A deterioration in general economic, business or industry conditions would have a material adverse effect on our results of operations, liquidity, financial condition, results of operations, cash flows and ability to pay dividends on our Class A common stock. Concerns over global economic conditions, energy costs, geopolitical issues, inflation, the availability and cost of credit and the European, Asian and the U.S. financial markets have contributed to economic volatility and diminished expectations for the global economy. Historically, concerns about global economic growth have had a significant impact on global financial markets and commodity prices. If the economic climate in the United States or abroad deteriorates, worldwide demand for petroleum products could diminish, which could impact the price at which we can sell our production, affect the ability of our vendors, suppliers and customers to continue operations and materially adversely impact our results of operations, liquidity, financial condition, results of operations, cash flows and ability to pay dividends on our Class A common stock. We previously identified material weaknesses in our internal control over financial reporting and may identify additional material weaknesses in the future which, if not corrected, could affect the reliability of our consolidated financial statements and have other adverse consequences. As more fully disclosed in this Annual Report under “Item 9A. Controls and Procedures,” we evaluated, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2024. Based on that evaluation, we concluded that our disclosure controls and procedures were ineffective as of December 31, 2024 due to material weaknesses identified in our internal control over financial reporting. A material weakness (as defined in Rule 12b-2 under the Exchange Act) is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. We have identified material weaknesses in our internal control over financial reporting which relate to: (a) our general segregation of duties, including the review and approval of journal entries; (b) the lack of a formalized risk assessment process; (c) identification and implementation of control activities, including over information technology; (d) identification and application of a sufficient level of formal accounting policies and procedures; and (e) maintaining a sufficient complement of accounting and financial reporting resources commensurate with our financial reporting requirements. Our management has concluded that these material weaknesses in our internal control over financial reporting are due to the fact that we previously operated as a private company with limited resources and have not had the necessary business processes and related internal controls formally designed and implemented coupled with the appropriate resources with the appropriate level of experience and technical expertise to oversee our business processes and controls. Our management is in the process of developing a remediation plan. The material weaknesses will be considered remediated when our management designs and implements effective controls that operate for a sufficient period of time and management has concluded, through testing, that these controls are effective. Our management will monitor the effectiveness of its remediation plans and will make changes management determines to be appropriate. As of December 31, 2024, these material weaknesses have not yet been remediated. If not remediated, these material weaknesses could result in material misstatements to our annual or interim consolidated financial statements that might not be prevented or detected on a timely basis, or in delayed filing of required periodic reports. We cannot assure you that the measures we have taken to date, or any measures we may take in the future, will be sufficient to remediate the control deficiencies that led to the material weaknesses in our internal control over financial reporting described above or to avoid potential future material weaknesses. In addition, neither our management nor an independent registered public accounting firm has ever performed an evaluation of our internal control over financial reporting in accordance with the provisions of the Sarbanes-Oxley Act because no such evaluation has been required. Had we or our independent registered public accounting firm performed an evaluation of our internal control over financial reporting in accordance with the provisions of the Sarbanes-Oxley Act, additional material weaknesses may have been identified. If we are unable to assert that our internal control over financial reporting is effective, or when required in the future, if our independent registered public accounting firm is unable to express an unqualified opinion as to 30 Table of Contents the effectiveness of the internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of the our Class A common stock could be adversely affected and we could become subject to litigation or investigations by the NYSE, the SEC, or other regulatory authorities, which could require additional financial and management resources. Effective internal controls are necessary for us to provide reliable financial reports, prevent fraud and operate successfully as a public company. If we are unable to successfully remediate our existing or any future material weakness in our internal control over financial reporting, or identify any additional material weaknesses that may exist, the accuracy and timing of our financial reporting may be adversely affected, we may be unable to maintain compliance with securities laws requirements regarding timely filing of periodic reports in addition to applicable stock exchange listing requirements, we may be unable to prevent fraud, investors may lose confidence in our financial reporting, and our stock price may decline as a result. Additionally, our reporting obligations as a public company could place a significant strain on our management, operational and financial resources and systems for the foreseeable future and may cause us to fail to timely achieve and maintain the adequacy of our internal control over financial reporting. Risks Related to Our Derivative Transactions, Debt and Access to Capital Our derivative activities could result in financial losses or could reduce our earnings. To achieve more predictable cash flows and reduce our exposure to adverse fluctuations in the prices of oil, natural gas and NGLs, we enter into derivative contracts for a significant portion of our projected oil, natural gas and NGL production, primarily consisting of swaps. For additional information, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Cash Flow Activity—Derivative Activities.” Accordingly, our earnings may fluctuate significantly as a result of changes in the fair value of our derivative instruments. Derivative instruments also expose us to the risk of financial loss in some circumstances, including when: • production is less than the volume covered by the derivative instruments; • the counterparty to the derivative instrument defaults on its contractual obligations; • there is an increase in the differential between the underlying price in the derivative instrument and actual prices received for the sale of our production; or • there are issues with regard to legal enforceability of such instruments. The use of derivatives may, in some cases, require the posting of cash collateral with counterparties. If we enter into derivative instruments that require cash collateral and commodity prices change in a manner adverse to us, our cash otherwise available for use in our operations would be reduced, which could limit our ability to make future capital expenditures and make payments on our indebtedness, and which could also limit the size of our borrowing base. Future collateral requirements will depend on arrangements with our counterparties and oil, natural gas and NGL prices. The cost to drill and complete our wells often increases in times of rising commodity prices. To the extent our drilling and completion costs increase but our derivative arrangements limit the benefit we receive from increases in commodity prices, our margins could be limited, which could have a material adverse effect on our financial condition. In addition, the amount we pay in production taxes is calculated without taking our derivative arrangements into account, and if our derivative arrangements limit the benefit we receive from increases in commodity prices, the effective tax rate we pay in production taxes could increase. Our derivative contracts expose us to risk of financial loss if a counterparty fails to perform under a contract. Disruptions in the financial markets could lead to sudden decreases in a counterparty’s liquidity, which could make the counterparty unable to perform under the terms of the contract, and we may not be able to realize the benefit of the contract. We are unable to predict sudden changes in a counterparty’s creditworthiness or ability to perform. Even if we do accurately predict sudden changes, our ability to negate the risk may be limited depending upon market conditions. During periods of declining commodity prices, our derivative contract receivable positions would generally increase, which increases our counterparty credit exposure. If the creditworthiness of our counterparties deteriorates and results in their nonperformance, we could incur a significant loss with respect to our derivative contracts. 31 Table of Contents The failure of our hedge counterparties, significant customers or working interest holders to meet their obligations to us may adversely affect our financial results. Our hedging transactions expose us to the risk that a counterparty fails to perform under a derivative contract. Disruptions in the financial markets could lead to sudden decreases in a counterparty’s liquidity, which could make such party unable to perform under the terms of the derivative contract, and we may not be able to realize the benefit of the derivative contract. Any default by a counterparty to these derivative contracts when they become due could have a material adverse effect on our financial condition and results of operations. Our ability to collect payments from the sale of oil, natural gas and NGLs to our customers depends on the payment ability of our customer base, which includes several significant customers. If any one or more of our significant customers fail to pay us for any reason, we could experience a material loss. We generally do not require our customers to post collateral, but we are managing our credit risk as a result of the current commodity price environment through the attainment of financial assurances from certain customers. In addition, if any of our significant customers cease to purchase our oil, natural gas and NGLs or reduce the volume of the oil, natural gas and NGLs that they purchase from us, the loss or reduction could have a detrimental effect on our revenues and may cause a temporary interruption in sales of, or a lower price for, our oil, natural gas and NGLs. We also face credit risk through joint interest receivables. Joint interest receivables arise from billing entities who own partial working interests in the wells we operate. Though we often have the ability to withhold future revenue disbursements to recover non-payment of joint interest billings, the inability or failure of working interest holders to meet their obligations to us or their insolvency or liquidation may adversely affect our financial results. Our ability to obtain financing on terms acceptable to us may be limited in the future by, among other things, increases in interest rates. We require continued access to capital and our business and operating results can be harmed by factors such as the availability, terms of and cost of capital, increases in interest rates or a reduction in credit rating. We may use our Credit Facility to finance a portion of our future growth, and these factors could cause our cost of doing business to increase, limit our ability to pursue acquisition opportunities, reduce cash flow used for drilling and place us at a competitive disadvantage. Volatility in the global financial markets, significant losses in financial institutions’ U.S. energy loan portfolios, or environmental and social concerns may lead to a contraction in credit availability impacting our ability to finance our operations or our ability to refinance our Credit Facility or other outstanding indebtedness. An increase in interest rates could increase our interest expense and materially adversely affect our financial condition. A significant reduction in cash flow from operations or the availability of credit could materially and adversely affect our ability to achieve our planned growth and operating results. The borrowing base under our Credit Facility may be reduced if commodity prices decline, which could hinder or prevent us from meeting our future capital needs. Our Credit Facility limits the amounts that we can borrow up to a borrowing base amount, which the lenders, in their sole discretion, determine semiannually in the spring and fall. The borrowing base depends on, among other things, projected revenues from, and asset values of, the oil and natural gas properties securing the loan. The lenders can unilaterally adjust the borrowing base and the borrowings permitted to be outstanding under our Credit Facility. Any increase in the borrowing base requires the consent of the lenders holding 100% of the commitments. In the future, we may not be able to access adequate funding under our Credit Facility (or a replacement facility) as a result of a decrease in the borrowing base due to the issuance of new indebtedness, the outcome of a subsequent borrowing base redetermination or an unwillingness or inability on the part of lending counterparties to meet their funding obligations and the inability of other lenders to provide additional funding to cover the defaulting lender’s portion. Declines in commodity prices could result in a determination to lower the borrowing base in the future and, in such case, we could be required to repay any indebtedness in excess of the redetermined borrowing base. As a result, we may be unable to implement our respective drilling and development plan, make acquisitions or otherwise carry out business plans, which would have a material adverse effect on our financial condition and results of operations and impair our ability to service our indebtedness. The enactment of derivatives legislation could have an adverse effect on our ability to use derivative instruments to reduce the effect of commodity price, interest rate and other risks associated with our business. The Dodd-Frank Act, enacted on July 21, 2010, established federal oversight and regulation of the over-the-counter derivatives market and of entities, such as us, that participate in that market. The Dodd-Frank Act requires the Commodity Futures Trading Commission (“CFTC”) to promulgate rules and regulations implementing the Dodd-Frank Act. Although the CFTC has issued final regulations in certain areas, in other areas, final regulations and the scope of relevant definitions and/or exemptions still remain to be 32 Table of Contents finalized. On January 24, 2020, U.S. banking regulators published a new approach for calculating the quantum of exposure of derivative contracts under their regulatory capital rules. This approach to measuring exposure is referred to as the standardized approach for counterparty credit risk or SA-CCR. It requires certain financial institutions to comply with significantly increased capital requirements for over-the-counter commodity derivatives beginning on January 1, 2022. In addition, on September 15, 2020, the CFTC issued a final rule regarding the capital a swap dealer or major swap participant is required to set aside with respect to its swap business, which has a compliance date of October 6, 2021. These two sets of regulations and the increased capital requirements they place on certain financial institutions may reduce the number of products and counterparties in the over-the-counter derivatives market available to us and could result in significant additional costs being passed through to end-users like us. The full impact of the Dodd-Frank Act’s swap regulatory provisions and the related rules of the CFTC on our business will not be known until all of the rules to be adopted under the Dodd-Frank Act have been adopted and fully implemented and the market for derivatives contracts has adjusted. The Dodd-Frank Act and any new regulations could significantly increase the cost of derivative contracts, materially alter the terms of derivative contracts, reduce the availability of derivatives to protect against risks we encounter and reduce our ability to monetize or restructure our existing derivative contracts. If we reduce our use of derivatives as a result of the Dodd-Frank Act and CFTC rules, our results of operations may become more volatile and our cash flows may be less predictable, which could adversely affect our ability to plan for and fund capital expenditures. Any of these consequences could have a material and adverse effect on us, our financial condition or our results of operations. In addition, the European Union and other non-U.S. jurisdictions have implemented and continue to implement regulations with respect to the derivatives market. To the extent we transact with counterparties in foreign jurisdictions, we may become subject to such regulations, which could have adverse effects on our operations similar to the possible effects on our operations of the Dodd-Frank Act’s swap regulatory provisions and the rules of the CFTC. Risks Related to our Class A Common Stock and Capital Structure We are a holding company. Our sole material asset is our equity interest in INR Holdings and we are accordingly dependent upon distributions from INR Holdings to pay taxes, make payments under the Tax Receivable Agreement and cover our corporate and other overhead expenses. We are a holding company and have no material assets other than our equity interest in INR Holdings. For additional information, see “Item 1. Business—Corporate Reorganization.” We have no independent means of generating revenue or cash flow, and our ability to pay our taxes and operating expenses (including payments due under the Tax Receivable Agreement) or declare and pay dividends in the future, if any, is dependent upon the financial results and cash flows of INR Holdings and distributions we receive from INR Holdings. INR Holdings will continue to be treated as a partnership for U.S. federal income tax purposes and, as such, generally will not be subject to any entity-level U.S. federal income tax. Instead, any taxable income of INR Holdings will be allocated to holders of LLC Interests, including us. Accordingly, we will incur income taxes on our allocable share of any net taxable income of INR Holdings. Under the terms of the INR Holdings LLC Agreement, INR Holdings is obligated, subject to various limitations and restrictions, including with respect to our debt agreements, to make tax distributions to holders of LLC Interests, including us. To the extent INR Holdings has available cash, we intend to cause INR Holdings (a) to generally make pro rata distributions to its unitholders, including us, in an amount at least sufficient to allow us to pay our taxes and make payments under the Tax Receivable Agreement and (b) to reimburse us for our corporate and other overhead expenses through non-pro rata payments that are not treated as distributions under the INR Holdings LLC Agreement. To the extent that we are unable to make payments under the Tax Receivable Agreement for any reason, such payments will be deferred and will accrue interest until paid. We are limited, however, in our ability to cause INR Holdings and its subsidiaries to make these and other distributions to us due to the restrictions under our Credit Facility. To the extent that we need funds and INR Holdings or its subsidiaries are restricted from making such distributions under applicable law or regulation or under the terms of their financing arrangements, or are otherwise unable to provide such funds, it could materially adversely affect our liquidity and financial condition. Pearl and NGP collectively hold a substantial majority of our capital stock and voting power. As of March 21, 2025, Pearl owns INR Units and corresponding Class B common stock representing approximately 47.5% of our voting power and NGP owns INR Units and corresponding Class B common stock representing approximately 15.8% of our voting power (together representing 63.3% of our combined voting power). As set out in the Charter, based on their respective voting interest in us, NGP has the right to nominate one director and Pearl has the right to nominate a number of directors proportionate to their beneficial ownership of the combined voting power of our Class A common stock and Class B common stock. As of March 21, 2025, Pearl and NGP are entitled to nominate five and one members of our board of directors, respectively, and thereby are entitled to significant control of our management and affairs. Further, although Pearl and NGP are entitled to act separately and have no obligation to act together in their own respective interests with respect to their stock in us, they will together have an even greater voting interest in us and ability to control our management and affairs. In addition, they will be able to determine the outcome of all matters requiring shareholder approval, including mergers and other material transactions, and will be able to cause or prevent a change in the composition of our board of directors or a change of control of our company 33 Table of Contents that could deprive our shareholders of an opportunity to receive a premium for their Class A common stock as part of a sale of our company. The existence of significant shareholders may also have the effect of deterring hostile takeovers, delaying or preventing changes in control or changes in management, or limiting the ability of our other shareholders to approve transactions that they may deem to be in the best interests of our company. So long as Pearl individually or Pearl and NGP, collectively, continue to control a significant amount of our voting power, they will be able to strongly influence all matters requiring stockholder approval, regardless of whether or not other stockholders believe that a potential transaction is in their own best interests. In any of these matters, the interests of Pearl and NGP may differ or conflict with the interests of our other stockholders. Moreover, this concentration of stock ownership may also adversely affect the trading price of our Class A common stock to the extent investors perceive a disadvantage in owning stock of a company with a significant stockholder. Conflicts of interest could arise in the future between us and Pearl, NGP and their respective affiliates, including their portfolio companies concerning conflicts over our operations or business opportunities. Pearl and NGP are both investment firms and have investments in other companies in the energy industry. As a result, Pearl and NGP may, from time to time, acquire interests in businesses that directly or indirectly compete with our business, as well as businesses that are our customers or suppliers. As such, Pearl, NGP or their respective portfolio companies may acquire or seek to acquire the same assets that we seek to acquire and, as a result, those acquisition opportunities may not be available to us or may be more expensive for us to pursue. Any actual or perceived conflicts of interest with respect to the foregoing could have an adverse impact on the trading price of our Class A common stock. An active, liquid trading market for our Class A common stock may not be maintained. We can provide no assurance that we will be able to maintain an active trading market for our Class A common stock. The lack of an active market may impair your ability to sell your shares at the time you wish to sell them or at a price that you consider reasonable. An inactive market may also impair our ability to raise capital by selling our Class A common stock and our ability to acquire other companies, products or technologies by using our Class A common stock as consideration. Certain of our directors have significant duties with, and spend significant time serving, entities that may compete with us in seeking acquisitions and business opportunities and, accordingly, may have conflicts of interest in allocating time or pursuing business opportunities. Certain of our directors, who are responsible for managing the direction of our operations and acquisition activities, hold positions of responsibility with other entities (including Pearl- or NGP-affiliated entities) that are in the business of identifying and acquiring oil and natural gas properties. The existing positions held by these directors may give rise to fiduciary or other duties that are in conflict with the duties they owe to us. These directors may become aware of business opportunities that may be appropriate for presentation to us as well as to the other entities with which they are or may become affiliated. Due to these existing and potential future affiliations, they may present potential business opportunities to other entities prior to presenting them to us, which could cause additional conflicts of interest. They may also decide that certain opportunities are more appropriate for other entities with which they are affiliated, and as a result, they may elect not to present those opportunities to us. These conflicts may not be resolved in our favor. Our amended and restated certificate of incorporation (“Charter”) and amended and restated bylaws (“Bylaws”), as well as Delaware law, contain provisions that could discourage acquisition bids or merger proposals, which may adversely affect the market price of our Class A common stock. Our Charter authorizes our board of directors to issue preferred stock without stockholder approval. If our board of directors elects to issue preferred stock, it could be more difficult for a third party to acquire us. In addition, some provisions of our Charter and Bylaws could make it more difficult for a third party to acquire control of us, even if the change of control would be beneficial to our stockholders, including: • authorizing “blank check” preferred stock that our board of directors could issue to increase the number of outstanding shares to discourage a takeover attempt; • prohibiting stockholders from acting by written consent at any time when Pearl beneficially owns, in the aggregate, less than 35% in voting power of our common stock; • limitations on the ability of our stockholders to call special meetings; 34 Table of Contents • the requirement that the affirmative vote of holders representing at least 66 2/3% of the voting power of all outstanding shares of capital stock (or a majority of the voting power of all outstanding shares of capital stock if Pearl beneficially owns at least 35% of the voting power of all such outstanding shares) be obtained to amend our Bylaws, to remove directors or to amend our certificate of incorporation; • providing that the board of directors is expressly authorized to adopt, or to alter or repeal, our Bylaws; and • establishing advance notice and certain information requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders at stockholder meetings. In addition, certain change of control events have the effect of accelerating the payment due under our Tax Receivable Agreement, which could be substantial and accordingly serve as a disincentive to a potential acquirer of our company. For additional information, see “—In certain cases, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual benefits we realize, if any, in respect of the tax attributes subject to the Tax Receivable Agreement.” Any provision of our Charter, Bylaws or Delaware law that has the effect of delaying, preventing or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our Class A common stock and could also affect the price that some investors are willing to pay for our Class A common stock. We cannot assure you that we will be able to pay dividends on our Class A common stock. Our board of directors may elect to declare cash dividends on our Class A common stock, subject to our compliance with applicable law, and depending on, among other things, economic conditions, our financial condition, results of operations, projections, liquidity, earnings, legal requirements, and restrictions in the agreements governing our indebtedness (as further discussed below). The payment of any future dividends will be at the discretion of our board of directors. The declaration and amount of any future dividends is subject to the discretion of our board of directors, and we have no obligation to pay any dividends at any time. We have not adopted, and do not currently expect to adopt, a written dividend policy. Our ability to pay dividends depends on our receipt of cash dividends from our operating subsidiaries, which may further restrict our ability to pay dividends as a result of the laws of their jurisdiction of organization, agreements of our subsidiaries or covenants under any existing and future outstanding indebtedness we or our subsidiaries incur. Our Credit Facility contains restrictions on the payment of dividends. Such restrictions allow us to pay dividends only when certain conditions are met, including certain required leverage ratio and financial metrics. For additional information, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Financing Agreements—Credit Facility.” Due to the foregoing, we cannot assure you that we will be able to pay a dividend in the future or continue to pay a dividend after we commence paying dividends. Future sales of our Class A common stock in the public market could reduce our stock price, and any additional capital raised by us through the sale of equity or convertible securities may dilute ownership in us. We may issue additional shares of Class A common stock or convertible securities in future public offerings. Immediately following the completion of the IPO, we had 15,237,500 shares of Class A common stock outstanding and 45,638,889 shares of Class B common stock outstanding. Immediately following the completion of the IPO, Pearl and NGP owned 38,526,173 INR Units and the corresponding shares of Class B common stock, representing approximately 63.3% of our total outstanding capital stock. All such shares are restricted from immediate resale under the federal securities laws and are subject to lock-up agreements that expire July 29, 2025, and the shares may be sold into the market in the future. Certain of the Legacy Owners are party to a registration rights agreement with us that requires us to effect the registration of their shares in certain circumstances no earlier than the expiration of the lock-up period. We cannot predict the size of future issuances of our Class A common stock or securities convertible into Class A common stock or the effect, if any, that future issuances and sales of shares of our Class A common stock will have on the market price of our Class A common stock. Sales of substantial amounts of our Class A common stock (including shares issued in connection with an acquisition), or the perception that such sales could occur, may adversely affect prevailing market prices of our Class A common stock. This impact could be increased to the extent there is a less active trading market for our shares. We limit the liability of, and indemnify, our directors and officers. Although our directors and officers are accountable to us and must exercise good faith, good business judgement and integrity in handling our affairs, our Charter and the indemnification agreements that we entered into with all of our non-employee directors and officers provide that our non-employee directors and officers will be indemnified to the fullest extent permitted under Delaware 35 Table of Contents law. As a result, our stockholders may have fewer rights against our non-employee directors and officers than they would have absent such provisions in our Charter and indemnification agreements, and a stockholder’s ability to seek and recover damages for a breach of fiduciary duties may be reduced or restricted. Pursuant to our Charter and indemnification agreements, each non-employee director and officer who is made a party to a legal proceeding because he or she is or was a non-employee director or officer, is indemnified by us from and against any and all liability, except that we may not indemnify a non-employee director or officer: (i) for breach of the director’s or officer’s duty of loyalty to us or our stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) with respect to any director, pursuant to Section 174 of the Delaware General Corporation Law (the “DGCL”), (iv) for any transaction from which the director or officer derived an improper personal benefit or (v) with respect to any officer, in any action by or in the right of us. We are required to pay or reimburse attorney’s fees and expenses of a non-employee director or officer seeking indemnification as they are incurred, provided the non-employee director or officer executes an agreement to repay the amount to be paid or reimbursed if there is a final determination by a court of competent jurisdiction that such person is not entitled to indemnification. The requirements of being a public company, including compliance with the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the requirements of the Sarbanes-Oxley Act, may strain our resources, increase our costs and distract management, and we may be unable to comply with these requirements in a timely or cost-effective manner. As a result of the IPO, we became a public company, and, as such, we need to comply with new laws, regulations and requirements, certain corporate governance provisions of the Sarbanes-Oxley Act, related regulations of the SEC and the requirements of the NYSE, with which we were not required to comply as a private company. Complying with these statutes, regulations and requirements may occupy a significant amount of time of our board of directors and management and significantly increase our costs and expenses. We need to continue our efforts to: • institute a more comprehensive compliance function; • comply with rules promulgated by the NYSE; • prepare and distribute periodic public reports in compliance with our obligations under the federal securities laws; • establish new internal policies; and • involve and retain to a greater degree outside counsel and accountants in the above activities. Furthermore, while we generally must comply with Section 404 of the Sarbanes Oxley Act for our fiscal year ending December 31, 2024, we are not required to perform an evaluation of our internal control over financial reporting in connection with this Annual Report and our independent registered public accounting firm will not be required to attest to the effectiveness of our internal controls until our first annual report subsequent to our ceasing to be an “emerging growth company” within the meaning of Section 2(a)(19) of the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, we may not be required to have our independent registered public accounting firm attest to the effectiveness of our internal controls until as late as our annual report for the fiscal year ending December 31, 2030. Once it is required to do so, our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our controls are documented, designed, operated or reviewed. Compliance with these requirements may strain our resources, increase our costs and distract management, and we may be unable to comply with these requirements in a timely or cost-effective manner. In addition, we expect that being a public company subject to these rules and regulations may make it more difficult and more expensive for us to obtain directors’ and officers’ liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our board of directors or as executive officers. We cannot predict or estimate the amount of additional costs we may incur or the timing of such costs. For as long as we are an emerging growth company, we will not be required to comply with certain reporting requirements, including disclosure about our executive compensation, that apply to other public companies. We are classified as an “emerging growth company” under the JOBS Act. In addition, we have reduced SOX compliance requirements, as discussed elsewhere. For as long as we are an emerging growth company we will not be required to, among other things, (a) comply with any new requirements adopted by the PCAOB requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer, (b) provide certain disclosure regarding executive compensation required of larger public companies or (c) hold nonbinding advisory votes on executive compensation. We will remain an emerging growth company up until the last day of the fiscal year following the fifth anniversary of the IPO, or such earlier time that we have more than $1.235 billion of revenues in a fiscal year, have more than $700.0 million in market value of our Class A common stock held by non-affiliates (and have been a public company for at least 12 months), or issue more than $1.0 billion of non-convertible debt over a three-year period. 36 Table of Contents Because we have elected to take advantage of the extended transition period pursuant to Section 107 of the JOBS Act, our financial statements may not be comparable to those of other public companies. Section 107 of the JOBS Act provides that an emerging growth company can use the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. This permits an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We are choosing to take advantage of this extended transition period and, as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for private companies. Accordingly, our financial statements may not be comparable to companies that comply with public company effective dates, and our stockholders and potential investors may have difficulty in analyzing our operating results by comparing us to such companies. We may issue preferred stock whose terms could adversely affect the voting power or value of our Class A common stock. Our Charter authorizes us to issue, without the approval of our stockholders, one or more classes or series of preferred stock having such designations, preferences, limitations and relative rights, including preferences over our Class A common stock respecting dividends and distributions, as our board of directors may determine. The terms of one or more classes or series of preferred stock could adversely impact the voting power or value of our Class A common stock. For example, we might grant holders of preferred stock the right to elect some number of our directors in all events or on the happening of specified events or the right to veto specified transactions. Similarly, the repurchase or redemption rights or liquidation preferences we might assign to holders of preferred stock could affect the residual value of the Class A common stock. Terms of subsequent financings may adversely impact stockholder equity. If we raise more equity capital from the sale of Class A common stock, institutional or other investors may negotiate terms more favorable than the current prices of our Class A common stock. If we issue debt securities, the holders of the debt would have a claim to our assets that would be prior to the rights of stockholders until the debt is paid. Interest on these debt securities would increase costs and could negatively impact our operating results. If securities or industry analysts do not publish research or reports or publish unfavorable research about our business, if they adversely change their recommendations regarding our Class A common stock or if our operating results do not meet their expectations, our stock price could decline. The trading market for our Class A common stock is influenced by the research and reports that industry or securities analysts publish about us or our business. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline. Moreover, if one or more of the analysts who cover our company downgrades our Class A common stock or if our operating results do not meet their expectations, our stock price could decline. Our Charter designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to bring a claim in a different judicial forum for disputes with us or our directors, officers, employees or agents. Our Charter provides that unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will, to the fullest extent permitted by applicable law, be the sole and exclusive forum for (a) any derivative action or proceeding brought on our behalf, (b) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, employees or agents to us or our stockholders, (c) any action asserting a claim arising pursuant to any provision of the DGCL, our Charter or Bylaws, or (d) any action asserting a claim against us that is governed by the internal affairs doctrine, in each such case subject to such Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein. Notwithstanding the foregoing sentence, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under U.S. federal securities laws, including the Securities Act and the Exchange Act. This choice of forum may limit a stockholder’s ability to bring a claim in a different judicial forum for disputes with us or our directors, officers, employees or agents, which may discourage such lawsuits against us and such persons. Alternatively, if a court were to find these provisions of our Charter inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our financial condition or results of operations. 37 Table of Contents We will be required to make payments under the Tax Receivable Agreement for certain tax benefits we may claim, and the amounts of such payments could be significant. In connection with the consummation of the IPO, we entered into a Tax Receivable Agreement with the Legacy Owners. This agreement generally provides for the payment by us to the Legacy Owners of 85% of the net cash savings, if any, in U.S. federal, state and local income tax that we (a) actually realize with respect to taxable periods ending after the IPO or (b) are deemed to realize in the event of a change of control (as defined under the Tax Receivable Agreement, which includes certain mergers, asset sales and other forms of business combinations and certain changes to the composition of our board of directors) or if the Tax Receivable Agreement terminates early (at our election or as a result of our breach) with respect to any taxable periods ending on or after such change of control or early termination event, in each case, as a result of (i) the tax basis increases resulting from the exchange of INR Units and the corresponding surrender of an equivalent number of shares of Class B common stock by the Legacy Owners for a number of shares of Class A common stock on a one-for-one basis or, at our option, the receipt of an equivalent amount of cash (the “Exchange Right”) pursuant to the INR Holdings LLC Agreement and (ii) deductions arising from imputed interest deemed to be paid by us as a result of, and additional tax basis arising from, any payments we make under the Tax Receivable Agreement. We will retain the benefit of the remaining 15% of these cash savings, if any. If we experience a change of control or the Tax Receivable Agreement terminates early, we could be required to make a substantial, immediate lump-sum payment. For additional information, see “Item 13. Certain Relationships and Related Transactions, and Director Independence—Tax Receivable Agreement.” The payment obligations under the Tax Receivable Agreement are our obligations and not obligations of INR Holdings. For purposes of the Tax Receivable Agreement, cash savings in tax generally are calculated by comparing our actual tax liability to the amount we would have been required to pay had we not been able to utilize any of the tax benefits subject to the Tax Receivable Agreement. The amounts payable, as well as the timing of any payments, under the Tax Receivable Agreement are dependent upon future events and assumptions, including the timing of the exchanges of INR Units along with surrendering a corresponding number of our Class B common stock, the price of our Class A common stock at the time of each exchange, the extent to which such exchanges are taxable transactions, the amount of the exchanging INR Unit Holder’s tax basis in its INR Units at the time of the relevant exchange, the depreciation, depletion and amortization periods that apply to the increase in tax basis, the amount and timing of taxable income we generate in the future, the U.S. federal, state and local income tax rates then applicable, and the portion of our payments under the Tax Receivable Agreement that constitute imputed interest or give rise to depreciable, depletable or amortizable tax basis. We expect that the payments that we will be required to make under the Tax Receivable Agreement could be substantial. Any payments made by us to the Legacy Owners under the Tax Receivable Agreement will not be available for reinvestment in INR Holdings (or indirectly, its business) and generally will reduce the amount of overall cash flow that might have otherwise been available to us. The term of the Tax Receivable Agreement commenced on January 3, 2025 and will continue until all such tax benefits have been utilized or expired and all required payments are made, unless we exercise our right to terminate the Tax Receivable Agreement (or the Tax Receivable Agreement is terminated due to other circumstances, including our breach of a material obligation thereunder or certain mergers or other changes of control) by making the termination payment specified in the agreement. In the event that the Tax Receivable Agreement is not terminated, the payments under the Tax Receivable Agreement are not anticipated to commence until 2030 at the earliest (with respect to the tax year 2025). The payments under the Tax Receivable Agreement will not be conditioned upon a holder of rights under the Tax Receivable Agreement having a continued ownership interest in us or INR Holdings. In addition, certain rights under the Tax Receivable Agreement (including the right to receive payments) will be transferable in connection with transfers permitted thereunder. For additional information, see “Item 13. Certain Relationships and Related Transactions, and Director Independence—Tax Receivable Agreement.” In certain cases, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual benefits we realize, if any, in respect of the tax attributes subject to the Tax Receivable Agreement. If we experience a change of control (as defined under the Tax Receivable Agreement, which includes certain mergers, asset sales and other forms of business combinations and certain changes to the composition of our board of directors) or the Tax Receivable Agreement terminates early (at our election or as a result of our breach), we could be required to make a substantial, immediate lump-sum payment. This payment would equal the present value of hypothetical future payments that could be required under the Tax Receivable Agreement. The calculation of the hypothetical future payments will be based upon certain assumptions and deemed events set forth in the Tax Receivable Agreement, including (a) the sufficiency of taxable income to fully utilize the tax benefits, (b) any INR Units (other than those held by us) outstanding on the termination date are exchanged on the termination date and (c) the utilization of certain loss carryovers. Our ability to generate net taxable income is subject to substantial uncertainty. Accordingly, as a result of the assumptions, the required lump-sum payment may be significantly in advance of, and could materially exceed, the realized future tax benefits to which the payment relates. This payment obligation could (i) make us a less attractive target for an acquisition, particularly in the case of an acquirer that cannot use some or all of the tax benefits that are the subject of the Tax Receivable Agreement and (ii) result in holders of our Class A common stock receiving substantially less consideration in connection with a change of control transaction than they would receive in the absence of such obligation. Accordingly, the Legacy Owners’ interests may conflict with those of the holders of our Class A common stock. 38 Table of Contents As a result of either an early termination or a change of control, we could be required to make payments under the Tax Receivable Agreement that exceed our actual cash tax savings under the Tax Receivable Agreement. Consequently, our obligations under the Tax Receivable Agreement could have a substantial negative impact on our liquidity and could have the effect of delaying, deferring or preventing certain mergers, asset sales, other forms of business combinations or other changes of control. For example, assuming no material changes in the relevant tax law, we expect that if we experienced a change of control or the Tax Receivable Agreement were terminated immediately after the IPO, the estimated lump-sum payment to the Legacy Owners would have been approximately $134.3 million (calculated using a discount rate equal to a per annum rate of 150 basis points, applied against an undiscounted liability of approximately $169.5 million) as of February 3, 2025, including approximately $6.8 million to each of our Chief Executive Officer and Chief Financial Officer, approximately $80.9 million to Pearl, approximately $27.0 million to NGP and the remainder to other members of management. There can be no assurance that we will be able to finance our obligations under the Tax Receivable Agreement. In the event that our payment obligations under the Tax Receivable Agreement are accelerated upon certain mergers, other forms of business combinations or other changes of control, the consideration payable to holders of our Class A common stock could be substantially reduced. If we experience a change of control (as defined under the Tax Receivable Agreement), our obligation to make a substantial, immediate lump-sum payment could result in holders of our Class A common stock receiving substantially less consideration in connection with a change of control transaction than they would receive in the absence of such obligation. The amount due will be equal to the present value of the anticipated future tax benefits that are the subject of the Tax Receivable Agreement, based on certain assumptions outlined in the Tax Receivable Agreement (including the discount rate to be used and that we will have sufficient taxable income to realize all potential tax benefits that are subject to the Tax Receivable Agreement), which payment may be made significantly in advance of the actual realization, if any, of such future tax benefits. Such cash payment to the Legacy Owners could be greater than the specified percentage of any actual benefits we ultimately realize in respect of the tax benefits that are subject to the Tax Receivable Agreement. In these situations, our obligations under the Tax Receivable Agreement could have a substantial negative impact on our liquidity and could have the effect of delaying, deferring or preventing certain mergers, asset sales, other forms of business combinations or other changes of control. Further, holders of rights under the Tax Receivable Agreement may not have an equity interest in us or INR Holdings. Accordingly, the interests of holders of rights under the Tax Receivable Agreement may conflict with those of the holders of our Class A common stock. For additional information, see “—In certain cases, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual benefits we realize, if any, in respect of the tax attributes subject to the Tax Receivable Agreement” and “Item 13. Certain Relationships and Related Transactions, and Director Independence—Tax Receivable Agreement.” There can be no assurance that we will be able to fund or finance our obligations under the Tax Receivable Agreement. We may need to cause INR Holdings to incur debt and make distributions to the holders of LLC Interests, including us, to finance payments under the Tax Receivable Agreement to the extent our cash resources are insufficient to meet our obligations under the Tax Receivable Agreement as a result of timing discrepancies or otherwise. We will not be reimbursed for any payments made under the Tax Receivable Agreement in the event that any tax benefits are subsequently disallowed. Payments under the Tax Receivable Agreement will be based on the tax reporting positions that we will determine, which are complex and factual in nature, and the IRS or another tax authority may challenge all or part of the tax basis increases upon which payments under the Tax Receivable Agreement are based, as well as other related tax positions that we take, and a court could sustain such challenge. The holders of rights under the Tax Receivable Agreement will not reimburse us for any payments previously made under the Tax Receivable Agreement if such basis increases or other benefits are subsequently disallowed, except that excess payments made to any such holder will be netted against payments otherwise to be made, if any, to such holder after our determination of such excess. However, we might not determine that we have effectively made an excess cash payment to a Legacy Owner for a number of years following the initial time of such payment and, if any of our tax reporting positions are challenged by a taxing authority, we will not be permitted to reduce any future cash payments under the Tax Receivable Agreement until any such challenge is finally settled or determined. As a result, in such circumstances, we could make payments that are greater than our actual cash tax savings, if any, and may not be able to recoup those payments, which could adversely affect our liquidity. The applicable U.S. federal income tax rules for determining applicable tax benefits we may claim are complex and factual in nature, and there can be no assurance that the IRS or a court will not disagree with our tax reporting positions. As a result, payments could be made under the Tax Receivable Agreement significantly in excess of any actual cash tax savings that we realize in respect of the tax attributes with respect to a Legacy Owner that are the subject of the Tax Receivable Agreement. 39 Table of Contents If INR Holdings were to become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes, we and INR Holdings might be subject to potentially significant tax inefficiencies, and we would not be able to recover payments previously made by us under the Tax Receivable Agreement even if the corresponding tax benefits were subsequently determined to have been unavailable due to such status. We intend to operate such that INR Holdings does not become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes. A “publicly traded partnership” is a partnership the interests of which are traded on an established securities market or are readily tradable on a secondary market or the substantial equivalent thereof. Under certain circumstances, exchanges of INR Units pursuant to the Exchange Right or other transfers of INR Units could cause INR Holdings to be treated as a publicly traded partnership. Applicable U.S. Treasury regulations provide for certain safe harbors from treatment as a publicly traded partnership, and we intend to operate such that exchanges or other transfers of INR Units qualify for one or more such safe harbors. If INR Holdings were to become a publicly traded partnership, significant tax inefficiencies might result for us and for INR Holdings, including as a result of our inability to file a consolidated U.S. federal income tax return with INR Holdings. In addition, we would no longer have the benefit of certain increases in tax basis covered under the Tax Receivable Agreement, and we would not be able to recover any payments previously made by us under the Tax Receivable Agreement, even if the corresponding tax benefits (including any claimed increase in the tax basis of INR Holdings’ assets) were subsequently determined to have been unavailable. In certain circumstances, INR Holdings will be required to make tax distributions to us and the INR Unit Holders, and the tax distributions that INR Holdings will be required to make may be substantial. INR Holdings will be treated as a partnership for U.S. federal income tax purposes and, as such, is not subject to U.S. federal income tax. Instead, taxable income will be allocated to the INR Unit Holders and us. Pursuant to the INR Holdings LLC Agreement, INR Holdings will generally make pro rata cash distributions, or tax distributions, to the INR Unit Holders and us. However, as the managing member of INR Holdings, we may determine to increase the tax rate applicable to tax distributions by INR Holdings. Funds used by INR Holdings to satisfy its tax distribution obligations will not be available for reinvestment in our business. Moreover, the tax distributions that INR Holdings will be required to make may be substantial. The Legacy Owners’ interests may not be fully aligned with the interests of the holders of our Class A common stock. The Legacy Owners’ interests may not be fully aligned with yours, which, due to the concentrated ownership of our common stock by the Legacy Owners, could lead to actions that are not in your best interests. Because the Legacy Owners hold their economic interest in our business primarily through INR Holdings, the Legacy Owners may have conflicting interests with holders of shares of our Class A common stock. For example, the Legacy Owners may have different tax positions from us, which could influence their decisions regarding whether and when we should dispose of assets or incur new or refinance existing indebtedness, especially in light of the existence of the Tax Receivable Agreement, and whether and when we should respond to a breach of any of our material obligations under the Tax Receivable Agreement, undergo certain changes of control for purposes of the Tax Receivable Agreement or terminate the Tax Receivable Agreement. In addition, the structuring of future transactions may take into consideration these tax or other considerations even where no similar benefit would accrue to us. For additional information, see “Item 13. Certain Relationships and Related Transactions, and Director Independence—Tax Receivable Agreement.” Further, if the IRS makes audit adjustments to INR Holdings’ U.S. federal income tax returns, it may assess and collect any taxes (including any applicable penalties and interest) resulting from such audit adjustment directly from INR Holdings rather than from the Legacy Owners directly, in which case we may economically bear a portion of such taxes (including any applicable penalties and interest) even though we did not economically benefit from the income giving rise to such taxes. INR Holdings may be permitted to make an election which would have the effect of requiring the IRS to collect any such taxes (including penalties and interest) from the members of INR Holdings (including the Legacy Owners), rather than from INR Holdings, but there can be no assurance that INR Holdings will be permitted to or will make this election. If, as a result of any such audit adjustment, INR Holdings is required to make payments of taxes, penalties and interest, INR Holdings’ cash available for distributions to us may be substantially reduced. Further, the Legacy Owners, who are the only holders of INR Units other than us, have the right to consent to certain amendments to the INR Holdings LLC Agreement, as well as to certain other matters. The Legacy Owners may exercise these voting rights in a manner that conflicts with the interests of the holders of our Class A common stock. Pearl, one of the Legacy Owners, holds a number of shares of our non-economic Class B common stock that will permit it to have significant influence over our overall management and direction. Circumstances may arise in the future when the interests of the Legacy Owners conflict with the interests of our stockholders. 40 Table of Contents Risks Related to Environmental and Regulatory Matters Our operations are subject to stringent environmental, health and safety laws and regulations that may expose us to significant costs and liabilities that could exceed current expectations. We are subject to stringent and complex federal, state and local environmental, health and safety (“EHS”) laws and regulations, including laws and regulations governing the discharge of materials into the environment, emissions controls and other environmental protection and occupational health and safety concerns. Any discharge by us of natural gas, NGLs, oil and other pollutants into the air, soil or water may give rise to liabilities on our part to the government and third parties. Certain environmental laws and regulations, such as the Comprehensive Environmental Response Compensation and Liability Act (“CERCLA”) and comparable state laws, may impose strict, retroactive and joint and several, liability for environmental contamination, including the release of hazardous substances, which could render us potentially liable for remediation costs, damage to natural resources or other damages, without regard to fault or the legality of the conduct at the time of the release or if contamination was caused by prior owners, operators or other third parties. Governmental agencies, citizen organizations, neighboring landowners and other third parties could file claims for personal injury, property damage and recovery of response costs. Remediation costs and other damages arising as a result of environmental laws and regulations, and costs associated with changes to existing EHS laws and regulations or the interpretation thereof, or the adoption of new EHS laws and regulations over time could adversely impact our financial condition or results of operations. Moreover, any failure by us to comply with applicable EHS laws and regulations could result in the imposition of administrative, civil or criminal penalties or the issuance of injunctions that could delay or prohibit operations, which could in turn have a material adverse effect on our business. We are required to hold certain U.S. federal, state and local EHS permits and may require new or amended EHS permits from time to time, including with respect to stormwater discharges, waste handling and disposal, or air emissions, which may subject us to new or revised permitting conditions that may be onerous or with which it may be costly to comply. These permits and authorizations often contain numerous compliance requirements, including monitoring and reporting obligations and operational restrictions, such as emissions limits. Noncompliance with necessary permits or the failure to obtain additional permits could subject us to future penalties, operating restrictions, or delays in obtaining new or amended permits or permit renewals that could have a material adverse effect on our business, financial condition or results of operations. EHS laws and regulations are constantly evolving and may become increasingly complicated and more stringent in the future. In addition, new or additional laws and regulations, new interpretations of existing requirements or changes in enforcement policies could impose unforeseen liabilities, significantly increase compliance costs, or result in delays of, or denial of rights to conduct, our development programs. For example, in June 2015, the Environmental Protection Agency (the “EPA”) and the U.S. Army Corps of Engineers (the “Corps”) issued a rule under the Clean Water Act (the “CWA”) defining the scope of the EPA’s and the Corps’ jurisdiction over waters of the United States (“WOTUS”), which was repealed in December 2019 and replaced in June 2020 by the Navigable Waters Protection Rule (the “NWPR”) before ever taking effect. A coalition of states and cities, environmental groups and agricultural groups challenged the NWPR, which was vacated by a federal district court in August 2021. In January 2023, the EPA and the Corps issued a final rule to revise the definition of WOTUS to put back into place the pre-2015 definition; however, this definition of WOTUS was impacted by the U.S. Supreme Court’s May 2023 decision in Sackett v. EPA , wherein the Court held that the jurisdiction of the CWA extends only to those adjacent wetlands that are indistinguishable from traditional navigable bodies of water due to a continuous surface connection. In September 2023, the EPA and the Corps published a direct-to-final rule redefining WOTUS to amend the January 2023 rule and align with the decision in Sackett . Subsequent litigation from approximately half of the states and other plaintiffs challenging the September 2023 rule is ongoing, and the pre-2015 definition of WOTUS is in effect in these states while litigation continues. In addition, in an April 2020 decision further defining the scope of the CWA, the U.S. Supreme Court held that, in certain cases, discharges from a point source to groundwater could fall within the scope of the CWA and require a permit. The Court rejected the EPA and the Corps’ assertion that groundwater should be totally excluded from the CWA. In November 2023, the EPA issued draft guidance describing the information that should be used to determine which discharges through groundwater may require a permit. However, in January 2025, President Trump issued executive orders directing (i) the EPA and the Corps to identify planned or potential actions that could be subject to emergency treatment under Section 404 of the CWA and (ii) the heads of all federal agencies to identify and begin the processes to suspend, revise, or rescind all agency actions, including all existing regulations and guidance documents, that are unduly burdensome on the identification, development, or use of domestic energy resources. Accordingly, future implementation and enforcement of these rules and policies is uncertain at this time. To the extent a new rule or further litigation expands the scope of the CWA’s jurisdiction, we could face increased costs and delays with respect to obtaining permits for dredge and fill activities in wetland areas. Such potential regulations or litigation could increase our operating costs, reduce our liquidity, delay or halt our operations or otherwise alter the way we conduct our business, which in turn could materially adversely affect our results of operations and financial position. Future EHS laws and regulations (or changes to existing laws and regulations or their interpretation) may also negatively impact natural gas and oil exploration, production, gathering and transportation companies, which in turn could have a material adverse effect on our business, financial conditions and results of our operations. 41 Table of Contents We may be involved in legal and regulatory proceedings that could result in substantial liabilities. Like many oil and gas companies, we are from time to time involved in various legal and other proceedings, such as title, royalty or contractual disputes, regulatory compliance matters and personal injury, environmental damage or property damage matters, in the ordinary course of our business. Such legal and regulatory proceedings are inherently uncertain and their results cannot be predicted. Regardless of the outcome, such proceedings could have an adverse impact on us because of legal costs, diversion of management or other personnel and other factors. In addition, it is possible that a resolution of one or more such proceedings could result in civil or criminal liability, penalties or sanctions, as well as judgments, consent decrees or orders requiring a change in our business practices, which could materially and adversely affect our business, operating results or financial condition. Accruals for such liability, penalties or sanctions may be insufficient, and judgments and estimates to determine accruals or range of losses related to legal and other proceedings could change from one period to the next, and such changes could be material. As of December 31, 2024, we are not aware of any potentially material legal proceeding that has been brought against us. Climate change legislation or regulations restricting emissions of GHGs could result in increased operating costs and adversely affect our business. More stringent laws and regulations relating to climate change and GHG emissions may arise from a variety of sources, including international, national, regional and state levels of government and associated administrative bodies and could cause us to incur material expenses to comply with such laws and regulations. In response to findings that emissions of carbon dioxide, methane and other GHGs present an endangerment to public health and the environment and in the absence of comprehensive federal legislation on GHG emission control, the EPA has adopted regulations pursuant to the federal Clean Air Act (the “CAA”) to reduce GHG emissions from various sources, but the future of these regulations is not clear. The EPA has adopted rules requiring the monitoring and reporting of GHG emissions from specified onshore and offshore oil, natural gas and NGL production sources in the U.S. on an annual basis, which include certain segments of our operations. The EPA published a final rule in March 2024, entitled Standards of Performance for New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing Sources: Oil and Natural Gas Sector Climate Review, which went into effect in May 2024 and requires, among other things, the phase out of routine flaring of natural gas from newly constructed wells (with some exceptions), standardization of installation and maintenance of emission control devices, and routine leak monitoring at all well sites and compressor stations. Notably, the EPA updated the applicability date for Subparts OOOOb and OOOOc to December 6, 2022, meaning that sources constructed prior to that date will be considered existing sources with later compliance deadlines under state plans. The final rule gives states, along with federal tribes that wish to regulate existing sources, two years until March 2026 to develop and submit their plans for reducing methane emissions from existing sources. The final emissions guidelines under Subpart OOOOc provide three years until 2029 from the plan submission deadline for existing sources to comply. The final rule is subject to ongoing litigation but remains in effect. However, in January 2025, President Trump issued an executive order directing the heads of all federal agencies to identify and begin the processes to suspend, revise or rescind all agency actions that are unduly burdensome on the identification, development or use of domestic energy resources. Consequently, future implementation and enforcement of the final rule remains uncertain at this time. Compliance with these and other air pollution control monitoring and permitting requirements, along with the required associated technical investments, has the potential to delay the development of natural gas projects and increase our costs of development, which costs could be significant. Additionally, in 2022, the IRA was signed into law, which could accelerate the transition to a lower carbon economy. The IRA provides incentives for the development of renewable energy, clean hydrogen, clean fuels and supporting infrastructure and carbon capture and sequestration. In addition, the IRA includes a methane emissions reduction program that amends the Clean Air Act to include a Methane Emissions and Waste Reduction Incentive Program for petroleum and natural gas systems. This program requires the EPA to impose a “Waste Emissions Charge” on certain natural gas and oil sources that are already required to report under the EPA’s Greenhouse Gas Reporting Program. To implement the program, in May 2024, EPA finalized revisions to the Greenhouse Gas Reporting Program for the oil and natural gas sector. The emissions reported under the Greenhouse Gas Reporting Program will be the basis for any payments under the Methane Emissions Reduction Program. However, petitions for reconsideration to EPA are pending and litigation in the D.C. Circuit has commenced. In November 2024, EPA finalized a regulation to implement the Inflation Reduction Act’s Waste Emissions Charge. The fee imposed under the Methane Emissions Reduction Program for 2024 is $900 per ton emitted over annual methane emissions thresholds, and increases to $1,200 in 2025, and $1,500 in 2026. In January 2025, industry associations challenged the Waste Emissions Charge rule in the D.C. Circuit. However, in February 2025, Congress voted to repeal the Waste Emissions Charge rule pursuant to the Congressional Review Act, which measure is expected to be signed by President Trump. The Inflation Reduction Act may also be subject to amendment or repeal through Congressional budget reconciliation. Consequently, future implementation and enforcement of these rules remains uncertain at this time. Additionally, some states have issued mandates to reduce emissions of GHGs, primarily through planned development of GHG emission inventories and potential cap-and-trade programs. Most of these types of programs require major sources of emissions or major producers of fuels to acquire and subsequently surrender emission allowances, with the number of allowances available being reduced each year until a target goal is achieved. 42 Table of Contents Additionally, some states have issued mandates to reduce emissions of GHGs, primarily through the planned development of GHG emission inventories and potential cap-and-trade programs. For example, Pennsylvania has taken steps to bring the state into a consortium of Northeastern and Mid-Atlantic States, the Regional Greenhouse Gas Initiative (“RGGI”), that sets price and declining limits on CO2 emissions from power plants. In December 2021, the Pennsylvania Attorney General approved a proposed regulation which would allow Pennsylvania to join RGGI. However, in May 2024, the Pennsylvania Climate Emissions Reduction Initiative was introduced in the Pennsylvania General Assembly, which would adopt a RGGI-like carbon-pricing program for the state and, if enacted, the Governor stated he would withdraw Pennsylvania from RGGI. In February 2025, legislation that would repeal the state’s participation in RGGI passed the Pennsylvania Senate. At this time, it is unclear to what extent, if any, Pennsylvania will continue to seek participation in RGGI or to adopt a similar emissions cap-and-trade program for the state. Most of these types of programs require major sources of emissions or major producers of fuels to acquire and subsequently surrender emission allowances, with the number of allowances available being reduced each year until a target goal is achieved. The cost of these allowances could increase over time. While new laws and regulations that are aimed at reducing GHG emissions could increase demand for natural gas, they may also result in increased costs for permitting, equipping, monitoring and reporting GHGs associated with natural gas production and use. Internationally, the United Nations-sponsored Paris Agreement (the “Paris Agreement”) requires member states to individually determine and submit non-binding emissions reduction targets every five years after 2020. In 2021, the Biden Administration recommitted the U.S. to the Paris Agreement and announced a goal of reducing U.S. emissions by 50-52% below 2005 levels by 2030. In September 2021, the Biden Administration publicly announced the “Global Methane Pledge,” an international pact that aims to reduce global methane emissions at least 30% below 2020 levels by 2030, including “all feasible reductions” in the energy sector. Further, at the 28th Conference of the Parties (“COP28”) in December 2023, member countries entered into an agreement that calls for actions toward achieving, at a global scale, a tripling of renewable energy capacity and doubling energy efficiency improvements by 2030. The goals of the agreement, among other things, are to accelerate efforts toward the phase-down of unabated coal power, phase out inefficient fossil fuel subsidies and take other measures that drive the transition away from fossil fuels in energy systems. Most recently, at COP29 participants representing 159 countries met and, among other things, agreed on rules to operationalize international carbon markets under Article 6 of the Paris Agreement. Various state and local governments have also vowed to continue to enact regulations to satisfy their proportionate obligations under the Paris Agreement. However, in January 2025, the Trump Administration issued executive orders directing the immediate notice to the United Nations of the United States’ withdrawal from the Paris Agreement and all other agreements made under the United Nations Framework Convention on Climate Change. The full impact of these actions remains uncertain at this time. We may also be subject to risks related to more restrictive requirements for the development of pipeline infrastructure or LNG export facilities, as well as more restrictive GHG emissions limitations for oil and gas facilities. For example, in January 2024, the Biden Administration announced a temporary pause on pending decisions on new exports of LNG to countries that the U.S. does not have free trade agreements with, pending Department of Energy review of the underlying analyses for authorization, including an assessment of the impact of GHG emissions. In a July 2024 ruling, the Western District of Louisiana stayed this temporary pause on LNG exports to non-free trade agreement countries. The Biden Administration appealed the ruling in August 2024 and the litigation remains ongoing. In December 2024, the Department of Energy released its report on LNG exports. However, in January 2025, the Trump Administration issued an executive order directing the Department of Energy to restart reviews of applications for approvals of LNG export projects as expeditiously as possible. Further, in April 2024, the European Union adopted a regulation to track and reduce methane emissions in the energy sector, including requiring new monitoring, reporting and verification measures to be applied by importers of oil, natural gas and coal into the European Union by January 1, 2027, and “maximum methane intensity values” must be met by 2030 and every year thereafter. Each member state will have the power to impose administrative penalties for failure to comply and the standard will be mandatory for supply contracts signed after the law takes effect. This and other changes in law and governmental policy may have impacts on our business that are difficult to anticipate. In addition, the SEC adopted the SEC Climate Rules in March 2024, which will mandate detailed disclosure of certain climate-related information for certain public companies. The SEC Climate Rules are currently stayed pending legal challenges and it is unclear when the rules will become effective, if at all. For these reasons, we cannot currently predict with certainty the timing and costs of implementation or any potential adverse impacts resulting therefrom. However, any new climate disclosure requirements could result in our experiencing additional operational and compliance burdens and incurring significant additional costs relating to the assessment and disclosure of climate- and sustainability-related matters, including costs relating to establishment of additional internal controls and collecting, measuring and analyzing information relating to such matters. Similar burdens could affect our customers, resulting in lower demand for our products. Further, enhanced climate-related disclosure requirements could lead to reputational or other harm with customers, regulators, investors or other stakeholders and could also increase our litigation risks relating to statements alleged to have been made by us or others in our industry regarding climate change risks, or in connection with any future disclosures we may make regarding reported emissions, particularly given the uncertainties and estimations involved in calculating and reporting GHG emissions. More broadly, the adoption and implementation of new or more stringent international, federal, state, or local legislation, regulations or other regulatory initiatives related to climate change or GHG emissions from oil and natural gas facilities could result in increased costs of compliance or costs of consumption, thereby reducing demand for our products, and could require us to incur increased operating costs, such as costs to purchase and operate emissions control systems, to acquire emissions allowances or to comply with new regulatory requirements, and to monitor and report on GHG emissions. Additionally, political, litigation, and financial risks may result in (a) restriction or cancellation of certain oil and natural gas production activities, (b) incurrence of obligations for alleged damages resulting from climate change or (c) impairment of our ability to continue operating in an economic manner. To the extent that governmental entities in the U.S. or other countries implement or impose climate change regulations on the oil and gas industry, it could have a material adverse effect on our business, including by restricting our ability to execute on our business strategy; requiring additional capital, compliance, operating and maintenance costs; increasing the cost of our products and services; reducing demand for our products and services; reducing our access to financial markets or creating greater potential for governmental investigations or litigation. In addition, the Supreme Court’s decision in Loper Bright Enterprises v. Raimondo to overrule Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. ended the concept of general deference to regulatory agency interpretations of laws and introduced new complexity for federal agencies and administration of climate change policy and regulatory programs. However, many of these initiatives are expected to continue. Consequently, legislation and regulatory programs to address climate change or reduce emissions of GHGs could have an adverse effect on our business, financial condition and results of operations. 43 Table of Contents Federal, state and local legislative and regulatory initiatives relating to hydraulic fracturing as well as governmental reviews of such activities could result in increased costs, additional operating restrictions or delays, limits to the areas in which we can operate and reductions in our oil, natural gas and NGL production, which could adversely affect our production and business. Hydraulic fracturing is an important and common practice that is used to stimulate production of natural gas and/or oil from low permeability subsurface rock formations. The hydraulic fracturing process involves the injection of water, sand and chemicals under pressure through a cased and cemented wellbore into targeted subsurface formations to fracture the surrounding rock and stimulate production. We regularly use hydraulic fracturing as part of our operations, as does much of the domestic oil and natural gas industry. Hydraulic fracturing typically is regulated by state oil and natural gas commissions, but the EPA has asserted federal regulatory authority pursuant to the U.S. Safe Drinking Water Act (“SDWA”) over certain hydraulic fracturing activities involving the use of diesel fuels and issued permitting guidance in February 2014 regarding such activities. In addition, the EPA finalized rules in June 2016 that prohibit the discharge of wastewater from hydraulic fracturing operations to publicly owned wastewater treatment plants. In December 2016, the EPA released its final report on the potential impacts of hydraulic fracturing on drinking water resources. The final report concluded that certain activities associated with hydraulic fracturing may impact drinking water resources under some circumstances. To date, the EPA has taken no further action in response to the 2016 report. Congress has from time to time considered legislation to provide for federal regulation of hydraulic fracturing under the SDWA and to require disclosure of the chemicals used in the hydraulic fracturing process. New federal legislation regulating hydraulic fracturing may be considered again in the future. At the state level, several states have adopted or are considering legal requirements that could impose more stringent permitting, disclosure and well construction requirements on hydraulic fracturing activities. For example, Ohio, Pennsylvania and West Virginia have each adopted a law requiring oil and natural gas operators to disclose chemical ingredients used to hydraulically fracture wells, and Ohio requires oil and natural gas operators to conduct pre-drill baseline water quality sampling of certain water wells near a proposed horizontal well. Unlike Ohio, Pennsylvania does not require oil and natural gas operators to conduct pre-drilling water supply sampling, but Pennsylvania law incentivizes testing as such sampling can preserve a legal defense regarding pollution of water supply. Additional states could also decide to place prohibitions on hydraulic fracturing. Local governments also may seek to adopt ordinances within their jurisdictions regulating the time, place and manner of drilling activities in general or hydraulic fracturing activities in particular. Some states and municipalities have banned and others seek to ban hydraulic fracturing altogether. If new or more stringent federal, state or local legal restrictions relating to the hydraulic fracturing process are adopted in areas where we operate, we could incur potentially significant added costs to comply with such requirements, experience delays, curtailment in or exclusion from the pursuit of exploration, development or production activities. Changes to trade regulation, quotas, duties or tariffs, caused by the changing U.S. and geopolitical environments or otherwise, may increase our costs, result in fewer growth capital opportunities or projects, limit the amount of raw materials and products that we can import, decrease demand for certain of our services or otherwise adversely impact our business. International trade disputes, geopolitical tensions and military conflicts have led, and continue to lead, to new and increasing export restrictions, trade barriers, tariffs and other trade measures that can increase our manufacturing and transportation costs, limit our ability to sell to certain customers or markets, limit our ability to procure, or increase our costs for, components or raw materials, impede or slow the movement of our goods across borders, or otherwise restrict our ability to conduct operations. The U.S. has recently instituted or proposed changes in trade policies that include the negotiation or termination of trade agreements, the imposition of higher tariffs on imports into the U.S., economic sanctions on individuals, corporations or countries and other government regulations affecting trade between the U.S. and other countries. Such imposition of tariffs on certain goods imported into the U.S. has triggered retaliatory actions from certain foreign governments potentially resulting in a “trade war.” A “trade war” or other governmental action related to tariffs or international trade agreements or policies could increase our costs, reduce the demand or opportunity to deploy growth capital in our businesses at attractive rates of return, limit the amount of raw materials, components and other products that we can import, restrict our customers’ ability to deploy growth capital or transport products and therefore decrease demand for certain of our services and/or adversely affect the U.S. economy or certain sectors thereof and, thus, adversely impact our businesses. 44 Table of Contents Prolonged negative investor sentiment toward upstream oil and natural gas focused companies could limit our access to capital funding, damage our reputation and adversely impact our business, financial condition and results of operations. Certain segments of the investor community have developed negative sentiment toward investing in our industry. There have been efforts in recent years, for example, to influence the investment community, including investment advisors, insurance companies and certain sovereign wealth, pension and endowment funds and other groups, by promoting divestment of fossil fuel equities and pressuring lenders to limit funding and insurance underwriters to limit coverages to companies engaged in the extraction of fossil fuel reserves. The lending and investment practices of institutional lenders have been the subject of intensive lobbying efforts in recent years, oftentimes public in nature, by environmental activists and foreign citizenry concerned about climate change. Some investors, including certain pension funds, university endowments and family foundations, have stated policies to reduce or eliminate their investments in the natural gas and oil sector based on social and environmental considerations. There is also a risk that financial institutions may be required to adopt policies that have the effect of reducing the funding provided to the fossil fuel sector. Certain commercial and investment banks based both domestically and internationally have announced that they are adopting climate change guidelines for their banking and investing activities, often in connection with increased regulatory expectations and requirements, which may result in them limiting funding for natural gas and oil projects. Institutional lenders who provide financing to energy companies have also become more attentive to sustainable lending practices, and some may elect not to provide traditional energy producers or companies that support such producers with funding. Ultimately, these developments could reduce the availability of capital funding to us for potential development projects or to refinance our existing indebtedness, each of which could have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows. Legislation or regulatory initiatives intended to address seismic activity, as well as government reviews of such activities, could restrict our drilling and production activities, as well as our ability to dispose of saltwater produced from such activities, which could limit our ability to produce oil, natural gas and NGLs economically and have a material adverse effect on our business. Local, state and federal regulatory agencies, including in Pennsylvania and Ohio, have in the past focused on a possible connection between hydraulic fracturing-related activities, particularly the underground injection of wastewater into disposal wells and the increased occurrence of seismic activity, and regulatory agencies at all levels are continuing to study the possible linkage between oil and gas activity and induced seismicity. In addition, several lawsuits have been filed in some states, alleging that disposal well operations have caused damage to neighboring properties or otherwise violated state and federal rules regulating waste disposal. In response to these concerns, regulators in some states and local municipalities, including in Pennsylvania, are seeking to impose or have imposed additional requirements, including obligations regarding the permitting of produced water disposal wells or otherwise assessing the relationship between seismicity and the use of such wells. To the extent any new regulations are adopted to restrict hydraulic fracturing activities or the disposal of fluids associated with such activities, it may adversely affect our business, financial condition and results of operations. We dispose of some of the saltwater produced from our drilling and production operations by injecting it into wells pursuant to permits issued to us and third parties by governmental authorities overseeing such disposal activities. While these permits are issued pursuant to existing laws and regulations, these legal requirements are subject to change, which could result in the imposition of more stringent operating constraints or new monitoring and reporting requirements, owing to, among other things, concerns of the public or governmental authorities regarding such gathering or disposal activities. The adoption and implementation of any new laws or regulations that restrict our ability to dispose of saltwater produced from our drilling and production activities by limiting volumes, disposal rates, disposal well locations or otherwise, or requiring us to shut down disposal wells, could have a material adverse effect on our business, financial condition and results of operations. Restrictions on drilling activities intended to protect certain species of wildlife may adversely affect our ability to conduct drilling activities in areas where we operate. Our operations may be adversely affected by seasonal or permanent restrictions on drilling activities designed to protect various wildlife species and/or habitats. The Endangered Species Act (“ESA”) and (in some cases) comparable state laws were established to protect endangered and threatened species and similar protections are offered to migratory birds under the Migratory Bird Treaty Act (“MBTA”) and other federal and state statutes. The U.S. Fish and Wildlife Service (“FWS”) may designate critical habitat and suitable habitat areas that it believes are necessary for survival of a threatened or endangered species. A critical habitat or suitable habitat designation could result in material restrictions to land use and may materially delay or prohibit land access for drilling activities. In April 2024, the U.S. Fish and Wildlife Service finalized three rules governing critical habitat designation and expanding protection options for species listed as threatened pursuant to the ESA. Among other changes to the rules, a determination of whether a species is threatened or endangered will be made “without reference to possible economic or other impacts of such determination,” 45 Table of Contents and protections that are granted to species found to be endangered will be automatically extended to species found to be threatened. The revised rules also make it easier to designate areas as critical for a species’ survival, even if the species is no longer found in those areas. In August 2024, environmental groups challenged the new ESA regulations in federal district court, which litigation remains ongoing. However, in January 2025, President Trump issued an executive order directing agencies to use, to the maximum extent permissible, the ESA regulation on consultations in emergencies to facilitate the domestic energy supply. The executive order also requires the quarterly convening of the Endangered Species Act Committee to ensure prompt and efficient review of all submissions for potential actions that could facilitate energy development. As a result, future implementation and enforcement of these rules remains uncertain at this time. Like the ESA, similar protections are offered to migratory birds under MBTA, which makes it illegal to, among other things, hunt, capture, kill, possess, sell or purchase migratory birds, nests or eggs without a permit. This prohibition covers most bird species in the U.S. The Department of the Interior issued a legal opinion in December 2017, followed by a final rule in January 2021, that narrowed certain protections afforded to migratory birds pursuant to the MBTA. The Department of the Interior revoked the rule in October 2021 and issued an advance notice of proposed rulemaking seeking comment to the Department of the Interior’s plan to develop regulations that authorize incidental take under certain prescribed conditions. However, the Department of the Interior has not yet issued proposed regulations. These rules, and any future rules, could materially affect our operations and development. For instance, permanent restrictions imposed to protect threatened or endangered species could prohibit drilling in certain areas or require the implementation of expensive mitigation measures. A critical habitat or suitable habitat designation in areas where we conduct our business could result in material restrictions to land use and may materially delay, or prohibit land access for, oil, natural gas and NGL development. The designation of previously unprotected species in areas where we operate as threatened or endangered could cause us to incur increased costs arising from species protection measures or could result in limitations on our activities that could have a material and adverse impact on our ability to develop and produce our reserves. There is also increasing interest in nature-related matters beyond protected species, such as general biodiversity, which may similarly require us or our customers to incur costs or take other measures which may adversely impact our business or operations. We are subject to risks related to climate change, which could have a material adverse effect on our business, financial condition and results of operations. Increasing attention from governmental and regulatory bodies, investors, consumers, industry and other stakeholders on combating climate change, together with technological advances in fuel economy and energy generation devices as well as climate change activism, governmental requirements and societal expectations on companies to address climate change, may create new competitive conditions that result in reduced demand for the oil, natural gas or NGLs we produce for our customers’ products. Such requirements, advancements and expectations may include, for instance, requirements to implement fuel conservation measures, regulations favoring renewable energy resources, increasing consumer demand for alternative forms of energy and lower emission products or services and other changes in consumer behavior. The potential impact of changing demand for oil, natural gas or NGLs services and products may have a material adverse effect on our business, financial condition, results of operations and cash flows or those of the customers we serve, which could, in turn, affect demand for our products. Such developments may also adversely impact, among other things, the availability of necessary third-party services and facilities as well as market prices of, or our access to, raw materials such as energy and water, which may increase our operational costs and adversely affect our ability to successfully carry out our business strategy. Further, the enactment of climate change-related policies and initiatives across the market at the corporate level and/or investor community level may in the future result in increases in our compliance costs and other operating costs and have other adverse effects (e.g., greater potential for governmental investigations or litigation, reductions in demand for our products or stimulating demand for alternative forms of energy that do not rely on combustion of fossil fuels). Furthermore, negative public perception regarding the oil and gas industry resulting from, among other things, concerns raised by advocacy groups about climate change, emissions, hydraulic fracturing, seismicity or oil spills may lead to increased litigation risk and regulatory, legislative and judicial scrutiny, which may, in turn, lead to new state and federal safety and environmental laws, regulations, guidelines and enforcement interpretations. These actions may cause operational delays or restrictions, increased operating costs, additional regulatory burdens and increased risk of litigation for us or our customers, thereby reducing demand for our products. Finally, many scientists have concluded that increasing concentrations of GHGs in the Earth’s atmosphere produce climate changes that may have significant physical effects, such as increased frequency and severity of storms, droughts, floods or other climatic events. Such effects could adversely affect or delay demand for our products, or our customers’ products, or cause us to incur significant costs in preparing for, or responding to, the effects thereof. Energy needs could increase or decrease as a result of weather conditions, depending on the duration and magnitude of any such weather events, and adversely impact our operating costs or revenues. To the extent the frequency of extreme weather events increases, due to climate change or otherwise, this could impact operations in various ways, including damage to or disruption of operations at our facilities, increased insurance premiums or increases to the cost of providing service or changes to the availability of insurance coverage, reduced availability of electrical power, road accessibility and transportation facilities, as well as impacts on personnel, supply chain, distribution chain or customers, as well 46 Table of Contents as potentially increased costs for, or difficulty procuring, consistent levels of insurance coverages in the aftermath of such effects. Such physical risks may also impact the infrastructure on which we rely to produce or transport our products. In addition, while our consideration of changing weather conditions and inclusion of safety factors in design is intended to reduce the uncertainties that climate change and other events may potentially introduce, our ability to mitigate the adverse impacts of these events depends in part on the effectiveness of our facilities and our disaster preparedness and response and business continuity planning, which may not have considered or been prepared for every eventuality. Further, demand for our products, or our customers’ products, may increase or decrease as a result of extreme weather conditions depending on the duration and magnitude of any such climate changes, such as to the extent warmer weathers reduce the demand for energy for heating purposes. The effect of fluctuations on supply and demand may become more pronounced within specific geographic oil and natural gas producing areas, which may cause these conditions to occur with greater frequency or magnify the effects of these conditions. If any such effects were to occur as a result of climate change or otherwise, they could have a material adverse effect on our assets, our financial condition and our results of operations. Due to the concentrated nature of our portfolio of properties, a number of our properties could experience any of the same conditions at the same time, resulting in a relatively greater impact on our results of operations than they might have on other companies that have a diversified portfolio of properties. Increasing attention to Environmental, Social and Governance (“ESG”) and sustainability matters may expose us to additional risk, which could have an adverse effect on our business, financial condition and results of operations and damage our reputation. Companies across all industries are facing increasing scrutiny from a variety of stakeholders related to their ESG and sustainability practices. If we do not adapt to or comply with investor or other stakeholder expectations and standards on ESG matters (including with respect to climate change) as they continue to evolve, or if we are perceived to have not responded appropriately or quickly enough to growing concern for ESG and sustainability issues, regardless of whether there is a regulatory or legal requirement to do so, we may suffer from reputational damage and our business, financial condition and/or stock price could be materially and adversely affected. Moreover, while we may create and publish voluntary disclosures regarding ESG matters from time to time, some of the statements in those voluntary disclosures may be based on hypothetical expectations and assumptions that may or may not be representative of current or actual risks or events, or forecasts of expected risks or events, including the costs associated therewith. ESG-related disclosure continues to emerge as an area where we may be, or may become, subject to required disclosures in certain jurisdictions, depending on our purported nexus to such jurisdictions and any such mandatory disclosures may similarly necessitate the use of hypothetical, projected or estimated data, some of which is not controlled by us and is inherently subject to imprecision. Disclosures reliant upon such expectations and assumptions are necessarily uncertain and may be prone to error or subject to misinterpretation, given the long timelines involved and the lack of an established single approach to identifying, measuring and reporting on many ESG matters. Failure or a perception of failure to implement our ESG strategy or achieve sustainability goals and targets, including emissions reduction targets, could damage our reputation, causing our investors or consumers to lose confidence in us and negatively impacting our operations. Our continuing efforts to research, establish, accomplish and accurately report on the implementation of our ESG strategy, including any ESG goals, may also create additional operational risks and expenses and expose us to reputational, legal and other risks. Should we fail to comply with all applicable FERC administered statutes, rules, regulations and orders, we could be subject to substantial penalties and fines. While our pipeline systems have not been regulated by FERC under the Natural Gas Act of 1938 (“NGA”) or the Natural Gas Policy Act of 1978 (“NGPA”), FERC has adopted certain regulations and policies that may subject certain of our otherwise non-FERC jurisdictional facilities to market transparency, anti-market-manipulation, and oversight requirements, including annual reporting requirements. Additional rules and regulations pertaining to those and other matters may be considered or adopted by FERC from time to time. Under the Energy Policy Act of 2005 (the “EPAct of 2005”), FERC has civil penalty authority under the NGA and the NGPA to impose penalties for violations of up to $1,584,648 per day for each violation, in addition to disgorgement of profits associated with any violation. Failure to comply with FERC rules and regulations in the future could subject us to civil penalty liability, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.