What changed in this filing

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Item 1B. Unresolved Staff Comments

2026-07-13 compared with 2025-04-09 · 168 added, 129 removed, 8 unchanged (97% of the section changed)

1B Unresolved Staff Comments

1C Cybersecurity

Management and Strategy

Company’s cybersecurity environment is led by our third-party information technology (IT) contractor, which, in addition to cybersecurity

matters, oversees the Company’s IT infrastructure.

The IT contractor is responsible for monitoring and managing the security

of the Company’s corporate network and enterprise systems, including technical controls, and safety protocols and responding to security

Company maintains a cybersecurity risk management program that establishes safeguards for protecting the confidentiality, integrity,

and availability of our data, technology, and information systems.

The program includes general controls for managing changes in and

access to the Company’s IT environment, cybersecurity awareness and training to help employees identify and mitigate against cybersecurity

threats, cybersecurity incident response plans and third-party incident response retainers to help expedite the Company’s response

in the event of a cybersecurity incident.

Company’s IT contractor is primarily responsible for the day-to-day operation of the Company’s cybersecurity program and

for identifying cybersecurity threats and incidents and managing the material risks associated with the cybersecurity threats.

The Company’s

IT contractor engages third-party vendors and cybersecurity consortiums periodically for cybersecurity-related guidance and certifications.

In the event of a cybersecurity incident, the Company’s process calls for the IT contractor, our Chief Executive Officer and our

Chief Financial Officer, to work to assess and respond to the incident and provide briefings to the Audit Committee of the Board of Directors.

Audit Committee is responsible for providing oversight over management’s processes to identify and evaluate cybersecurity risks to which

the Company is exposed and to implement processes and programs to manage cybersecurity risks and mitigate any incidents.

The Audit Committee

also reports material cybersecurity risks to the Board.

We believe this risk management process provides visibility and oversight to

allow the Board and executive leadership team to make timely, data-driven decisions ensuring that the Company, its employees, investors,

and partners are adequately protected.

of and for the year ended December 31, 2024, there have been no cybersecurity incidents that have materially affected the Company’s

business strategy, results of operations, or financial condition.

Item 1B Unresolved Staff Comments

Item 1C Cybersecurity

Risk Management and Strategy

The Company’s cybersecurity environment is led by our third-party

information technology (IT) contractor, which, in addition to cybersecurity matters, oversees the Company’s IT infrastructure.

The IT contractor is responsible for monitoring and managing the security of the Company’s corporate network and enterprise systems,

including technical controls, and safety protocols and responding to security threats.

The Company maintains a cybersecurity risk management program that

establishes safeguards for protecting the confidentiality, integrity, and availability of our data, technology, and information systems.

The program includes general controls for managing changes in and access to the Company’s IT environment, cybersecurity awareness

and training to help employees identify and mitigate against cybersecurity threats, cybersecurity incident response plans and third-party

incident response retainers to help expedite the Company’s response in the event of a cybersecurity incident.

The Company’s IT contractor is primarily responsible for the

day-to-day operation of the Company’s cybersecurity program and for identifying cybersecurity threats and incidents and managing

the material risks associated with the cybersecurity threats.

The Company’s IT contractor engages third-party vendors and cybersecurity

consortiums periodically for cybersecurity-related guidance and certifications.

In the event of a cybersecurity incident, the Company’s

process calls for the IT contractor, our Chief Executive Officer and our Chief Financial Officer, to work to assess and respond to the

incident and provide briefings to the audit committee of the board of directors.

The audit committee is responsible for providing oversight over management’s

processes to identify and evaluate cybersecurity risks to which the Company is exposed and to implement processes and programs to manage

cybersecurity risks and mitigate any incidents.

The Audit Committee also reports material cybersecurity risks to the board of directors.

We believe this risk management process provides visibility and oversight to allow the board and executive leadership team to make timely,

data-driven decisions ensuring that the Company, its employees, investors, and partners are adequately protected.

As of and for the year ended December 31, 2025, there have been no

cybersecurity incidents that have materially affected the Company’s business strategy, results of operations, or financial condition.

Description of Property

1993, Royale had concentrated on development of properties in the Sacramento Basin and the San Joaquin Basin of Northern and Central

In the last few years it has moved its focus to Mitchell County and Ector County, Texas.

In 2024, Royale participated in

the drilling of four gross (0.0722 net) oil wells in Texas all of which are productive.

industry standards, Royale generally acquires oil and natural gas acreage without warranty of title except as to claims made by, though,

or under the transferor.

In these cases, Royale attempts to conduct due diligence as to title before the acquisition, but it cannot assure

that there will be no losses resulting from title defects or from defects in the assignment of leasehold rights.

Title to property most

often carries encumbrances, such as royalties, overriding royalties, carried and other similar interests, and contractual obligations,

all of which are customary within the oil and natural gas industry.

is a discussion of Royale’s significant oil and natural gas properties.

Reserves at December 31, 2024, for each property discussed

below, have been determined by Netherland, Sewell & Associates, Inc., registered professional petroleum engineers, in accordance

with reports submitted to Royale on February 17, 2025.

owns interests in nine gas fields with locations ranging throughout the Sacramento Basin in California.

At December 31, 2024, Royale

operated 10 wells and owns interests in 13 non-operated gas wells in Northern California and 8 non-operated oil wells in Southern and

Central California.

Our California estimated total proven, developed, and undeveloped net reserves are approximately 0.160 BCFE, according

to Royale’s independently prepared reserve report as of December 31, 2024.

December 31, 2024, Royale owned and operated interests in 26 oil wells in its Jameson field.

Additionally, Royale owns interests in

six non-operated oil wells in the Permian Basin in Texas and three non-operated gas wells, two located in Oklahoma and one located

Our Texas estimated total producing, developed, and undeveloped reserves are approximately 277.6 million barrels of oil

equivalent (“MBOE”) , according to Royale’s independently prepared reserve report as of December 31, 2024.

of oil equivalent or BOE is determined using a ratio of six Mcf of natural gas equal to one barrel of oil equivalent.

The ratio does

not assume price equivalency and, given price differentials, the price for a BOE for natural gas differs significantly from the

price for a barrel of oil.

Since 1993, Royale had concentrated on development of properties in

the Sacramento Basin and the San Joaquin Basin of Northern and Central California.

In the last few years it has moved its focus to Mitchell

County and Ector County, Texas.

In 2025, Royale participated in the drilling of one gross (0.0035 net) oil well in Texas which was productive.

Following industry standards, Royale generally acquires oil and natural

gas acreage without warranty of title except as to claims made by, though, or under the transferor.

In these cases, Royale attempts to

conduct due diligence as to title before the acquisition, but it cannot assure that there will be no losses resulting from title defects

or from defects in the assignment of leasehold rights.

Title to property most often carries encumbrances, such as royalties, overriding

royalties, carried and other similar interests, and contractual obligations, all of which are customary within the oil and natural gas

Following is a discussion of Royale’s significant oil and natural

gas properties.

Reserves at December 31, 2025, for each property discussed below, have been determined by Netherland, Sewell & Associates,

Inc., registered professional petroleum engineers, in accordance with reports submitted to Royale on March 11, 2026.

At December 31, 2025, Royale owned and operated interests in 26 oil

wells in its Jameson field.

Additionally, Royale owns interests in eight non-operated oil wells in the Permian Basin in Texas and three

non-operated gas wells, two located in Oklahoma and one located in Texas.

Our Texas estimated total producing, developed, and undeveloped

reserves are approximately 919.6 thousand barrels of oil equivalent (“MBOE”), according to Royale’s independently prepared

reserve report as of December 31, 2025.

Barrel of oil equivalent or BOE is determined using a ratio of six Mcf of natural gas equal to

one barrel of oil equivalent.

The ratio does not assume price equivalency and, given price differentials, the price for a BOE for natural

gas differs significantly from the price for a barrel of oil.

A barrel of NGL also differs significantly in price from a barrel of oil.

and Undeveloped Leasehold Acreage

of December 31, 2024, Royale owned leasehold interests in the following developed and undeveloped properties in both gross and net acreage.

is one million BOE, determined using a ratio of six Mcf of natural gas equal to one BOE.

and Net Productive Wells

of December 31, 2024 and 2023, Royale owned interests in the following oil and gas wells in both gross and net:

following table sets forth Royale’s drilling activities during the years ended December 31, 2024 and 2023.

All wells are located

in the continental U.S., in California and Texas.

Type of Well(a)

Royale owns interests in nine gas fields with locations ranging throughout

the Sacramento Basin in California.

At December 31, 2025, Royale operated 10 wells and owns interests in 12 non-operated gas wells in

Northern California and 8 non-operated oil wells in Southern and Central California.

Our California estimated total proved, developed,

and undeveloped net reserves are approximately 0.170 BCFE, according to Royale’s independently prepared reserve report as of December

Developed and Undeveloped Leasehold Acreage

As of December 31, 2025, Royale owned leasehold interests in the following

developed and undeveloped properties in both gross and net acreage.

Gross and Net Productive Wells

As of December 31, 2025 and 2024, Royale owned interests in the following

oil and gas wells in both gross and net:

Drilling Activities

The following table sets forth Royale’s drilling activities during

the years ended December 31, 2025 and 2024.

All wells are located in the continental U.S., in California and Texas.

Gross Wells(b)

Type of Well(a)

Developmental

exploratory well is one that is drilled in search of new oil and natural gas reservoirs, or to test the boundary limits of a previously

discovered reservoir.

A developmental well is one drilled on a previously known productive area of an oil and natural gas reservoir with

the objective of completing that reservoir.

wells represent the number of actual wells in which Royale owns an interest.

Royale’s interest in these wells may range from 1%

producing well is one that produces oil and/or natural gas that is being purchased on the market.

dry well is a well that is not deemed capable of producing hydrocarbons in paying quantities.

“net well” is deemed to exist when the sum of fractional ownership working interests in gross wells or acres equals one.

The number of net wells is the sum of the fractional working interests owned in gross wells expressed as a whole number or a fraction.

following table summarizes, for the years indicated, Royale’s net share of oil and natural gas production, average sales price

per barrel (BBL), per thousand cubic feet (MCF) of natural gas, and the MCF equivalent (MCFE) for the barrels of oil based on a 6 to

1 ratio of the price per barrel of oil to the price per MCF of natural gas.

“Net” production is production that Royale owns

either directly or indirectly through partnership or joint venture interests produced to its interest after deducting royalty, limited

partner or other similar interests.

Royale generally sells its oil and natural gas at prices then prevailing on the “spot market”

and does not have any material long term contracts for the sale of natural gas at a fixed price.

Developmental

a) An exploratory well is one that

is drilled in search of new oil and natural gas reservoirs, or to test the boundary limits of a previously discovered reservoir.

A developmental

well is one drilled on a previously known productive area of an oil and natural gas reservoir with the objective of completing that reservoir.

b) Gross wells represent the number

of actual wells in which Royale owns an interest.

Royale’s interest in these wells may range from 1% to 100%.

c) A producing well is one that produces

oil and/or natural gas that is being purchased on the market.

dry well is a well that is not deemed capable of producing hydrocarbons in economic quantities.

e) One “net well” is

deemed to exist when the sum of fractional ownership working interests in gross wells or acres equals one.

The number of net wells is

the sum of the fractional working interests owned in gross wells expressed as a whole number or a fraction.

The following table summarizes, for the years indicated, Royale’s

net share of oil and natural gas production, average sales price per barrel (BBL), per thousand cubic feet (MCF) of natural gas, and the

MCF equivalent (MCFE) for the barrels of oil based on a 6 to 1 ratio of the price per barrel of oil to the price per MCF of natural gas.

“Net” production is production that Royale owns either directly or indirectly through partnership or joint venture interests

produced to its interest after deducting royalty, limited partner or other similar interests.

Royale generally sells its oil and natural

gas at prices then prevailing on the “spot market” and does not have any material long term contracts for the sale of natural

gas at a fixed price.

Average sales price

Net production costs and taxes

Lifting costs (per MCFE)

has established, and is responsible for, internal controls designed to provide reasonable assurance that the estimates of proved reserves

are computed and reported in accordance with rules and regulations promulgated by the SEC as well as established industry practices used

by independent engineering firms and our peers.

These internal controls include documented process workflows and qualified professional

engineering and geological personnel with specific reservoir experience.

Our internal processes and controls surrounding this process

are routinely tested.

We also retain outside independent engineering firms to prepare estimates of our proved reserves.

Management reviews

and approves our reserve estimates, whether prepared internally or by third parties.

Our Chief Executive Officer oversaw our outside

independent engineering firm, Netherland, Sewell & Associates, Inc.

(“NSAI”), in connection with the preparation of their

estimates of our proved reserves as of December 31, 2024.

We also regularly communicate with NSAI throughout the year regarding technical

and operational matters critical to our reserve estimations.

Our Chief Executive Officer, with input from other members of management,

is responsible for the selection of our third-party engineering firms and review of the reports generated.

Our Chief Executive Officer

has over 39 years of experience in the oil and natural gas industry and is a graduate of the University of Oklahoma with a degree in

Chemical Engineering.

During his career, he has had various relevant responsibilities in technical and leadership roles including asset

management, drilling and completions, production engineering, reservoir engineering and reserves management, economic evaluations and

field development in U.S.

Lifting costs (per BOE)

Reserve Estimates

Management has established, and is responsible for, internal controls

designed to provide reasonable assurance that the estimates of proved reserves are computed and reported in accordance with rules and

regulations promulgated by the SEC as well as established industry practices used by independent engineering firms and our peers.

internal controls include documented process workflows and qualified professional engineering and geological personnel with specific reservoir

Our internal processes and controls surrounding this process include collection and submission of data reconciled with reviewed

accounting records for production, lease operating expense, and revenue to our independent reserve engineering firm.

We also retain outside

independent engineering firms to prepare estimates of our proved reserves.

Management reviews and approves our reserve estimates, whether

prepared internally or by third parties.

Our reserve estimates as of December 31, 2025, which we refer to as the Reserve Report, were

prepared based on a report by Netherland, Sewell & Associates, Inc.

(“NSAI”), our independent petroleum engineering firm.

The Royale’s technical person primarily responsible for overseeing the preparation of its reserve estimates is Johnny Jordan, Royale’s

Chief Executive Officer, who oversaw NSAI in connection with the preparation of their estimates of our proved reserves as of December

We also regularly communicate with NSAI throughout the year regarding technical and operational matters critical to Royale’s

reserve estimations.

Our Chief Executive Officer, with input from other members of management, is responsible for the selection of our

third-party engineering firms and review of the reports generated.

Jordan has over 40 years of experience in the oil and natural gas

industry and is a graduate of the University of Oklahoma with a degree in Chemical Engineering.

During his career, he has had various

relevant responsibilities in technical and leadership roles including asset management, drilling and completions, production engineering,

reservoir engineering and reserves management, economic evaluations and field development in U.S.

onshore projects.

The third-party engineering reports are also provided to our Audit Committee.

Proved Oil and Natural Gas Reserves

of December 31, 2024, Royale had proved developed reserves of 238,310 MCF and total proved reserves of 392,760 MCF of natural gas.

of December 31, 2024, Royale also had proved developed oil and NGL combined reserves of 152,550 BBL and total proved oil and NGL combined

reserves of 238,740 BBL.

of December 31, 2023, Royale had proved developed reserves of 357,940 MCF and total proved reserves of 473,540 MCF of natural gas.

the same period, Royale also had proved developed oil and NGL combined reserves of 138,060 BBL and total proved oil and NGL combined

reserves of 217,780 BBL.

2024, our overall proved developed and undeveloped oil reserves increased by 9.6% and our previously estimated proved developed and undeveloped

oil reserve quantities were revised upward by approximately 32 thousand barrels.

This upward revision was mainly the result of an increase

in proved undeveloped oil reserves from drilling locations which the Company had previously estimated.

Our overall proved developed and

undeveloped natural gas reserves decreased by 17.1% and our previously estimated proved developed and undeveloped natural gas reserve

quantities were revised upward by approximately 4 thousand cubic feet of natural gas.

This upward revision was mainly the result of an

increase in proved undeveloped natural gas reserves from drilling locations which the Company had previously estimated.

and gas reserve estimates and the discounted present value estimates associated with the reserve estimates are based on numerous engineering,

geological and operational assumptions that generally are derived from limited data.

Within NSAI, the technical

person primarily responsible for preparing the estimates set forth in the Reserve Report meets or exceeds the education, training, and

experience requirements set forth in the Standards Pertaining to the Estimating and Auditing of Oil and Gas Reserves Information promulgated

by the Society of Petroleum Engineers, and is proficient in applying industry standard practices to engineering and geoscience evaluations

as well as applying SEC and other industry reserves definitions and guidelines.

Within NSAI, the technical persons primarily responsible

for preparing the estimates set forth in the Reserve Report each have over 20 years of industry experience.

NSAI does not own an interest

in any of our properties, nor is it employed by us on a contingent basis.

The Reserve Report was also provided to Royale’s audit

Net Proved Oil and Natural Gas Reserves

All other states

As of December 31, 2025, Royale had proved developed reserves of 602,379

MCF and total proved reserves of 1,815,759 MCF of natural gas.

As of December 31, 2025, Royale also had proved developed oil and NGL combined

reserves of 217,714 BBL and total proved oil and NGL combined reserves of 647,089 BBL.

As of December 31, 2024, Royale had proved developed reserves of 238,310

MCF and total proved reserves of 392,760 MCF of natural gas.

As of December 31, 2024, Royale also had proved developed oil and NGL combined

reserves of 152,550 BBL and total proved oil and NGL combined reserves of 238,740 BBL.

During 2025, our overall proved developed and undeveloped oil reserves

increased by 171.1% and our previously estimated proved developed and undeveloped oil reserve quantities were revised upward by approximately

107 thousand barrels.

This upward revision was mainly the result of an increase in proved undeveloped oil reserves from drilling locations

which the Company had previously estimated.

Our overall proved developed and undeveloped natural gas reserves increased by 362.3% and

our previously estimated proved developed and undeveloped natural gas reserve quantities were revised upward by approximately 688 thousand

cubic feet of natural gas.

This upward revision was mainly the result of an increase in proved undeveloped natural gas reserves from drilling

locations which the Company had previously estimated.

Proved Undeveloped Reserves.

As of December 31, 2025, the Company’s

proved undeveloped reserves totaled approximately 631,605 BOE, consisting of 429,375 barrels of oil and NGL and 1,213,380 MCF of natural

During 2025, the Company added 550,400 BOE of proved undeveloped reserves in its Jameson field as a result of new drilling plans

in that field.

In its other non-operated Texas properties, one gross ( 0.35 net) well was drilled during 2025, converting 22,400 BOE of

proved undeveloped reserves into proved developed reserves, and two newly planned undeveloped wells were added to the Company’s

estimates, bringing the total number of proved undeveloped well locations in those properties to six.

Capital expenditures incurred during

2025 in connection with the development of the Company’s reserves are set forth in the drilling and capital cost information presented

elsewhere in this Annual Report.

None of the Company’s proved undeveloped reserves have remained undeveloped for five years or more

following their initial disclosure as proved undeveloped reserves.

Oil and gas reserve estimates and the discounted present value estimates

associated with the reserve estimates are based on numerous engineering, geological and operational assumptions that generally are derived

from limited data.

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 1B. Unresolved Staff Comments