What changed in this filing

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Item 2. Properties

2025-06-27 compared with 2024-06-27 · 47 added, 47 removed, 133 unchanged (41% of the section changed)

4 unchanged sentences

accordance with current SEC rules, the average prices used in computing reserves at March 31, 2025 were $73.79 per bbl of oil compared

to $92.02 in 2023, a decrease of 16%, and $2.75 per mcf of natural gas compared to $5.68 in 2023, a decrease of 52%, such prices are

based on the 12-month unweighted arithmetic average market prices for sales of oil and natural gas on the first calendar day of each

month during fiscal 2024.

The benchmark price of $73.96 per bbl of oil at March 31, 2024 versus $87.45 at March 31, 2023, was adjusted

by lease for gravity, transportation fees and market differentials and did not give effect to derivative transactions.

The benchmark

price of $2.45 per mcf of natural gas at March 31, 2024 versus $5.96 at March 31, 2023, was adjusted by lease for BTU content, transportation

to $76.88 in 2024, a decrease of 4%, and $2.14 per mcf of natural gas compared to $2.75 in 2024, a decrease of 22%, such prices are based

on the 12-month unweighted arithmetic average market prices for sales of oil and natural gas on the first calendar day of each month

during fiscal 2025.

The benchmark price of $71.00 per bbl of oil at March 31, 2025 versus $73.96 at March 31, 2024, was adjusted by lease

for gravity, transportation fees and market differentials and did not give effect to derivative transactions.

The benchmark price of

$2.44 per mcf of natural gas at March 31, 2025 versus $2.45 at March 31, 2024, was adjusted by lease for BTU content, transportation

fees and market differentials.

2 unchanged sentences

to the Company’s consolidated financial statements.

reserves are estimated reserves of crude oil (including condensate and natural gas liquids) and natural gas that geological and engineering

reserves are estimated reserves of crude oil (including condensate) and natural gas that geological and engineering

data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating

55 unchanged sentences

Oil (per Bbl)

reserve estimates do not include the Company’s interest in two LLCs referred to in Item 1.

Business – Company Profile

on page 4 hereto.

The first LLC has returned $276,098 and 92% of the total investment since inception in fiscal 2020.

PV-10 Value represents the discounted future net cash flows attributable to our proved oil and gas reserves before income tax, discounted

at 10% per annum, which is the most directly comparable GAAP financial measure.

PV-10 is relevant and useful to investors because

it presents the discounted future net cash flows attributable to our estimated net proved reserves prior to taking into account future

corporate income taxes.

Further, investors may utilize the measure as a basis for comparison of the relative size and value of our

reserves to other companies.

We use this measure when assessing the potential return on investment related to our oil and natural

gas properties.

Our reconciliation of this non-GAAP financial measure is shown in the table as the PV-10, less future income taxes,

discounted at 10% per annum, resulting in the standardized measure of discounted future net cash flows.

The standardized measure

of discounted future net cash flows represents the present value of future cash flows attributable to our proved oil and natural

gas reserves after income tax, discounted at 10%.

accordance with SEC requirement, the standardized measure of discounted future net cash flows was computed by applying 12-month first

day of the month average prices for oil and gas during the fiscal year to the estimated future production of proved oil and gas reserves,

less estimated future expenditures (based on year-end costs) to be incurred in developing and producing the proved reserves, less

estimated future income tax expenses (based on year-end statutory tax rates, with consideration of future tax rates already legislated)

to be incurred on pretax net cash flows less tax basis of the properties and available credits, and assuming continuation of existing

economic conditions.

prices reflect adjustment by lease for quality, transportation fees and market differentials.

These reserve

estimates do not include the Company’s interest in two LLCs referred to in Item 1.

Business – Company Profile on page

The PV-10 Value represents

the discounted future net cash flows attributable to our proved oil and gas reserves before income tax, discounted at 10% per annum,

which is the most directly comparable GAAP financial measure.

PV-10 is relevant and useful to investors because it presents the discounted

future net cash flows attributable to our estimated net proved reserves prior to taking into account future corporate income taxes.

Further, investors may utilize the measure as a basis for comparison of the relative size and value of our reserves to other companies.

We use this measure when assessing the potential return on investment related to our oil and natural gas properties.

Our reconciliation

of this non-GAAP financial measure is shown in the table as the PV-10, less future income taxes, discounted at 10% per annum, resulting

in the standardized measure of discounted future net cash flows.

The standardized measure of discounted future net cash flows represents

the present value of future cash flows attributable to our proved oil and natural gas reserves after income tax, discounted at 10%.

In accordance with SEC

requirement, the standardized measure of discounted future net cash flows was computed by applying 12-month first day of the month

average prices for oil and gas during the fiscal year to the estimated future production of proved oil and gas reserves, less estimated

future expenditures (based on year-end costs) to be incurred in developing and producing the proved reserves, less estimated future

income tax expenses (based on year-end statutory tax rates, with consideration of future tax rates already legislated) to be incurred

on pretax net cash flows less tax basis of the properties and available credits, and assuming continuation of existing economic conditions.

These prices reflect adjustment

by lease for quality, transportation fees and market differentials.

fiscal 2025, we added proved reserves of 101 thousand BOE (“MBOE”) through extensions and discoveries, added 77 MBOE through

1 unchanged sentence

Such downward revisions are primarily attributable to

a decrease in crude oil and natural gas prices and partially the result of reserves written off due to the five-year limitation and the

change in the timing of new development.

The reserves written off were primarily royalty interests on leases in DeSoto Parish, Louisiana and Karnes County,

Texas which are held by production and still in place to be developed in the future.

reserves written off due to the five-year limitation and the change in the timing of new development.

The reserves written off were primarily

in Lea County, New Mexico due to a change in the timing of development in wells in which we own a working interest.

These interests are

held by production and still in place to be developed in the future.

the fiscal year ending March 31, 2025, we had a working or royalty interest in the development of 27 wells, converting reserves of approximately

62,000 BOE from proved undeveloped to proved developed – producing with capital cost of approximately $940,000.

84,000 BOE from proved undeveloped to proved developed – producing with a capital cost of approximately $645,000.

and gas prices significantly impact the calculation of the PV-10 and the standardized measure of discounted future net cash flows.

11 unchanged sentences

have not filed any other oil or gas reserve estimates or included any such estimates in reports to other federal or foreign governmental

authority or agency during the year ended March 31, 2024, and no major discovery is believed to have caused a significant change in our

estimates of proved reserves since that date.

authorities or agencies during the year ended March 31, 2025, and no major discovery is believed to have caused a significant change

in our estimates of proved reserves since that date.

following table sets forth our drilling activity in wells in which we own a working interest for the years ended March 31:

15 unchanged sentences

drill, complete, and develop our acreage.

We expect to capitalize on this development, which requires no capital expenditure funding from

us, and believe the anticipated aggregate royalty receipts will enable us to grow our cash flows.

A number of the horizontal wells in

which the Company participates involve longer lateral which are more efficient and have greater estimated ultimate recovery.

We expect to capitalize on this development, which requires no capital expenditure funding

from us and believe the anticipated aggregate royalty receipts will enable us to grow our cash flows.

A number of the horizontal wells

in which the Company participates involve longer lateral which are more efficient and have greater estimated ultimate recovery.

Wells and Acreage

31 unchanged sentences

Total oil and gas revenue

natural gas products.

gas production is converted to oil production using a ratio of six Mcf to one Bbl of oil.

on a 365 day year.

Includes natural gas

Natural gas production

is converted to oil production using a ratio of six Mcf to one Bbl of oil.

Calculated on a 365-day

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-K

Item 2. Properties