Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2026

Summary of Significant Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Note 2 – Summary of Significant Accounting Policies

The Company has provided a full discussion of its significant accounting policies, estimates, and judgments in Note 2 – Summary of Significant Accounting Policies in its Annual Report on Form 10–K for the fiscal year ended December 31, 2025. The Company has not changed any of its significant accounting policies during the three months ended March 31, 2026.

Revenue Recognition

The following table presents the Company’s oil, natural gas, and NGL revenues disaggregated by revenue stream:

	Three Months Ended March 31,
	2026		2025
	(In thousands)
Crude oil sales	$	67,838	$	10,788
Natural gas sales		8,956		1,223
NGL sales		6,623		1,579
Total revenues	$	83,417	$	13,590

The Company recognizes revenue from the sales of crude oil, natural gas, and NGLs at the point that control of the produced crude oil, natural gas, and NGL volumes are transferred to the purchaser, which may differ depending on the applicable contractual terms.

The Company considers the transfer of control to have occurred when the production is delivered to the purchaser because at that time, the purchaser has the ability to direct the use of, and obtain substantially all of the remaining benefits from, the crude oil, natural gas, or NGL production. Transfer of control dictates the presentation of the Company’s transportation and processing expenses within its condensed consolidated statements of operations. Transportation and processing expenses incurred prior to the transfer of control are recorded gross within transportation and processing expenses in the accompanying condensed consolidated statements of operations. Gathering, transportation, and processing expenses incurred subsequent to the transfer of control are recorded net within crude oil, natural gas, and NGL sales revenues.

Additionally, the Company has made an accounting election to exclude certain qualifying taxes collected from customers and remitted to governmental authorities from its reported revenues and is presenting those amounts as a component of operating expense in the accompanying condensed consolidated statements of operations. The amounts due from purchasers are reflected in oil, natural gas, and NGL accrued revenue on the accompanying condensed consolidated balance sheets and consists of uncollateralized accrued crude oil, natural gas, and NGL revenue due under normal trade terms, generally requiring payment within 30 days of production. The Company records the differences between its estimates and the actual amounts received for product sales in the month that payment is received from the purchaser. Additionally, the Company has determined that product returns or refunds are very rare and therefore, the Company accounts for them as they occur, and it generally provides no warranty.

Income Taxes

For the three months ended March 31, 2026, the Company recognized an income tax benefit of $38.4 million, resulting in an effective income tax rate of 20.1%. The Company did not recognize any income tax benefit or expense for the three months ended March 31, 2025.

Supplemental Disclosures of Cash Flow Information

The following table presents non–cash investing and financing activities and supplemental cash flow disclosures relating to the cash paid for interest for the periods presented:

	Three Months Ended March 31,
	2026		2025
	(In thousands)
Non–cash investing activities:
Increase in capital expenditure accrued liabilities and accounts payable	$	24,183	$	25,939

Non–cash financing activities:
Common Stock issued upon conversion of Series F Preferred Stock	$	36,186	$	1,351
Common Stock issued for Series F Preferred Stock dividends ⁽¹⁾	$	3,487	$	—
Common Stock issued to Bayswater as part of Bayswater Acquisition purchase price ⁽²⁾	$	—	$	16,000
Common Stock issuance costs included in accrued liabilities	$	—	$	3,078
Series F Preferred Stock agreement amendment fees and issuance costs included in accrued liabilities and accounts payable	$	3,327	$	6,778
Common Stock issued upon conversion of Senior Convertible Note ⁽³⁾	$	—	$	18,164
Common Stock issued upon conversion of Series D Preferred Stock	$	—	$	8,475

Supplemental disclosure:
Cash paid for interest	$	6,903	$	915

⁽¹⁾	The Company elected to issue shares of Common Stock for the Series F Preferred Stock dividends payable on March 1, 2026. Refer to Note 12 – Mezzanine Equity for a discussion of the Series F Preferred Stock.

⁽²⁾

The Company issued approximately 3.7 million shares of the Company’s common stock, par value $0.01 per share (“Common Stock”) to Bayswater (as defined herein) as part of the Bayswater Purchase Price (as defined herein). Refer to Note 3 – Acquisitions for a discussion of the Bayswater Acquisition (as defined herein).

⁽³⁾

During the three months ended March 31, 2025, YA II PN, LTD., a Cayman Islands exempt limited company (“Yorkville”), converted the remaining $11.3 million of the initial $15.0 million convertible promissory note (the “Senior Convertible Note”) in exchange for 2.1 million shares of Common Stock. Refer to Note 9 – Debt for a discussion of the Senior Convertible Note.

Recently Issued Accounting Pronouncements

In November 2024, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2024–03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220–40): Disaggregation of Income Statement Expenses (“ASU 2024–03”), which requires the disclosure of specific information about certain costs and expenses. ASU 2024–03 is effective for annual periods beginning January 1, 2027, with early adoption permitted. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures.