What changed in this filing

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

2026-02-10 compared with 2025-11-12 · 40 added, 33 removed, 11 unchanged (87% of the section changed)

Quantitative and Qualitative Disclosures About Market Risk

primary source of market risk for us includes fluctuations in commodity prices and interest rates.

All of our financial instruments are

for purposes other than trading.

and Qualitative Disclosures About Market Risk

sources of market risk for us include fluctuations in commodity prices and interest rates.

All of our financial instruments are for purposes

other than trading.

Credit risk is the risk of loss as a result of nonperformance by other parties of their contractual obligations.

credit risk is related to oil and gas production sold to various purchasers and the receivables are generally not collateralized.

September 30, 2025, our largest credit risk associated with any single purchaser was $295,461 or 34% of our total oil and gas receivables.

We have not experienced any significant credit losses.

Our primary credit risk

is related to oil and gas production sold to various purchasers and the receivables are generally not collateralized.

At December 31,

2025, our largest credit risk associated with any single purchaser was $288,468 or 40% of our total oil and gas receivables.

experienced any significant credit losses.

Our most significant market risk is the pricing applicable to our crude oil and natural gas production.

Our financial

condition, results of operations, and capital resources are highly dependent upon the prevailing market prices of, and demand for, oil

and natural gas.

Pricing for oil and natural gas production has been volatile and unpredictable for several years, and we expect this

volatility to continue in the future.

prices for natural gas have been adversely affected by temporary pipeline capacity constraints primarily in the Permian Basin.

that can cause price fluctuations include the level of global demand for petroleum products, foreign and domestic supply of oil and gas,

the establishment of and compliance with production quotas by oil-exporting countries, weather conditions, the price and availability

of alternative fuels, and overall political and economic conditions in oil producing and consuming countries.

example, in the last twelve months, the NYMEX West Texas Intermediate (“WTI”) posted price for crude oil has ranged from

a low of $53.11 per bbl in May 2025 to a high of $76.02 per bbl in January 2025.

The Henry Hub Spot Market Price (“Henry Hub”)

for natural gas has ranged from a low of $1.21 per MMBtu in November 2024 to a high of $7.15 per MMBtu in February 2025.

30, 2025, the WTI posted price for crude oil was $58.35 and the Henry Hub spot price for natural gas was $3.12 per MMBtu.

of Operations below for realized prices.

Pipeline capacity constraints and maintenance in the Permian Basin area has contributed to a

wider difference between the WaHa Hub and the Henry Hub and at times prices were negative.

in oil and natural gas prices will materially adversely affect our financial condition, liquidity, ability to obtain financing, and operating

Our financial condition,

results of operations, and capital resources are highly dependent upon the prevailing market prices of, and demand for, oil and natural

Prices for oil and natural gas production has been volatile and unpredictable for several years, and we expect this volatility to

continue in the future.

Currently, prices

for natural gas have been adversely affected by temporary pipeline capacity constraints primarily in the Permian Basin.

can cause price fluctuations include the level of global demand for petroleum products, foreign and domestic supply of oil and gas, the

establishment of and compliance with production quotas by oil-exporting countries, weather conditions, the price and availability of alternative

fuels and overall political and economic conditions in oil producing and consuming countries.

in the last twelve months, the NYMEX West Texas Intermediate (“WTI”) posted price for crude oil has ranged from a low of $51.25

per bbl in December 2025 to a high of $76.02 per bbl in January 2025.

The Henry Hub Spot Market Price (“Henry Hub”) for natural

gas has ranged from a low of $2.65 per MMBtu in June and October 2025 to a high of $9.86 per MMBtu in January 2025.

On December 31, 2025,

the WTI posted price for crude oil was $53.40 and the Henry Hub spot price for natural gas was $4.00.

See Results of Operations above

for the Company’s realized prices.

Pipeline capacity constraints and maintenance in the Permian Basin area had contributed to a

wider difference between WaHa Hub and the Henry Hub and at times prices were negative.

These conditions adversely impacted realized prices

during certain periods and contributed to variability in operating results.

oil and natural gas prices will materially adversely affect our financial condition, liquidity, ability to obtain financing and operating

Changes in oil and gas prices impact both estimated future net revenue and the estimated quantity of proved reserves.

3 unchanged sentences

and development activities.

In addition, a non-cash write-down of our oil and gas properties could be required under full cost accounting

In addition, a noncash write-down of our oil and gas properties could be required under full cost accounting

rules if prices declined significantly, even if it is only for a short period of time.

1 unchanged sentence

oil and natural gas that can be produced economically.

Thus, we may experience material increases or decreases in reserve quantities

solely as a result of price changes and not as a result of drilling or well performance.

any improvements in oil and gas prices can have a favorable impact on our financial condition, results of operations and capital resources.

Thus, we may experience material increases or decreases in reserve quantities solely

as a result of price changes and not as a result of drilling or well performance.

Similarly, any

improvements in oil and gas prices can have a favorable impact on our financial condition, results of operations and capital resources.

Oil and natural gas prices do not necessarily fluctuate in direct relationship to each other.

If the average oil price had increased

or decreased by ten dollars per barrel for the first six months of fiscal 2026, our operating revenues would have increased or decreased

If the average gas price had increased or decreased by one dollar per mcf for the first six months of fiscal 2026, our operating

revenues would have increased or decreased by $340,963.

If the average oil price had increased or

decreased by ten dollars per barrel for the first nine months of fiscal 2026, our operating revenues would have increased or decreased

If the average gas price had increased or decreased by one dollar per mcf for the first nine months of fiscal 2026, our operating

revenues would have increased or decreased $501,830.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 3. Quantitative and Qualitative Disclosures About Market Risk