Q2 2024 U.S. Energy Corp Earnings Call

August 8, 2024

Assistance during the conference. Please press Star zero from your telephone keypad.

Please note this conference is being recorded.

Speaker Change: At this time I'll hand, the conference over to <unk> Mcguire.

Speaker Change: You may now begin.

Speaker Change: Thank you operator, and good morning, everyone and welcome to U S Energy Corp, second quarter 2024 results Conference call, Brian Smith, Our Chief Executive Officer will provide an overview of our operating results and discuss the company's strategic outlook and our Chief Financial Officer, Mark Z. Jack we have a more detailed review of our financial results.

I know.

Ryan Smith: We don't need to do that again for this initial get off the ground phase of proving our concept. So I think it's a mixture of that. I mean, I don't have the exact answer right now. You know, it's, we're in a flexible position to be opportunistic on these, these type of assets and these type of transactions. You know, our main assets remaining right now on the oil and gas side are in Montana and in East Texas, but if you look at our map, we have a lot of straggler stuff in between those two areas. And in situations where, you know, hypothetically, we can clear $2 million on a small asset sale, take off 2X out of ARO and our balance sheet and combine another, you know, $300,000 annually on corporate overhead synergies ranging from insurance, GNA, et cetera, you know, those dollars go straight to our, our new project and you know, that's how I look at the funding.

Speaker Change: After the market closed yesterday U S energy issued a press release summarizing operating and financial results for the quarter ended June 32020 for.

Operator: Greetings, and welcome to the US Energy Corporation second quarter 2024 results conference call. Next time, I'll just put Spencer in listen-only mode.

Operator: Corporations, welcome to the US Energy Corporation 2nd quarter, 24 results conference call. This time, all participants are in listen-only mode. The question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Please note, this conference is being recorded. At this time, I'll hand the conference over to Mason McGuire. Mason, you may now begin.

Speaker Change: Greetings. Welcome to the U.S. Energy Corporation's second quarter 2024 results conference call. At this time, all participants are in listen-only mode. The question and answer session will follow the formal presentation.

Speaker Change: This press release together with accompanying presentation materials are available in the Investor Relations section of our website at Www Dot <unk> Dot com todays discussion may contain forward looking statements about future business and financial expectations. Actual results may differ significantly from those projected in today's forward looking statements due to various <unk>.

Operator: The question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Please note, this conference is being recorded. At this time, I'll hand the conference over to Mason McGuire. Mason, you may now begin.

Speaker Change: If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Please note this conference is being recorded.

At this time, I'll hand the conference over to Mason McGuire. Mason, you may now begin.

Mason McGuire: Thank you, operator, and good morning, everyone. Welcome to US Energy Corp's 2nd quarter 2024 Results Conference call. Ryan Smith, our Chief Executive Officer, will provide an overview of our operating results and discuss the company's strategic outlook, and our Chief Financial Officer, Mark Zajac, will give a more detailed review of our financial results. After the market closed yesterday, US Energy issued a press release summarizing its operating and financial results for the quarter ended June 30, 2024.

Mason McGuire: Thank you, Operator, and good morning, everyone. Welcome to US Energy Corp's second quarter 2024 results conference call. Ryan Smith, our Chief Executive Officer, will provide an overview of our operating results and discuss the company's strategic outlook, and our Chief Financial Officer, Mark Zajac, will give a more detailed review of our financial results. After the market closed yesterday, US Energy issued a press release summarizing its operating and financial results for the quarter ended June 30, 2024.

Ryan Smith: And in situations where, you know, hypothetically, we can clear $2 million on a small asset sale, take off 2X out of ARO and our balance sheet and combine another, you know, $300,000 annually on corporate overhead synergies ranging from insurance, GNA, et cetera, you know, those dollars go straight to our, our new project and you know, that's how I look at the funding. And you know, so far the deals we've done, the capital has been highly accessible. Robert, thank you, bro, that's a elaboration of your thinking, Ryan, it's helpful. Absolutely, thanks, Charles.

Speaker Change: Risks and uncertainties, including the risks described in our periodic reports filed with the Securities and Exchange Commission.

Ryan Smith: Thank you operator and good morning everyone. Welcome to US Energy Corp's second quarter 2024 results conference call. Ryan Smith, our Chief Executive Officer, will provide an overview of our operating results and discuss the company's strategic outlook.

Speaker Change: As required by law, we undertake no obligation to update our forward looking statements.

Speaker Change: Further please note that the non-GAAP financial measures may be disclosed during this call a full reconciliation of GAAP to non-GAAP measurements are available in our latest quarterly earnings release and conference call presentation.

Speaker Change: and our Chief Financial Officer, Mark Zajac, will give a more detailed review of our financial results.

Speaker Change: After the market closed yesterday, US Energy issued a press release summarizing operating and financial results for the quarter ended June 30, 2024.

Mason McGuire: This press release, together with the company presentation materials, is available in the investor relations section of our website at www.usnrgy.com. Today's discussion may contain forward-looking statements about future business and financial expectations. However, actual results may differ significantly from those projected in today's forward-looking statements due to the various risks and uncertainties included in the risks described in our periodic report filed with the Securities and Exchange Commission. Except as required by law, we undertake no obligation to update our forward-looking, and further, please note that the non-gap financial measures may be disclosed during this call. A full reconciliation of gap to non-gap measurements is available in our latest quarterly earnings release and conference call presentation. With that, I'd like to turn the call over to Ryan.

Mason McGuire: This press release, together with accompanying presentation materials, is available in the investor relations section of our website at www.usnrg.com. Today's discussion may contain forward-looking statements about future business and financial expectations. Actual results may differ significantly from those projected in today's forward-looking statements due to the various risks and uncertainties included in the risks described in our periodic reports filed with the Securities and Exchange Commission. Except as required by law, we undertake no obligation to update our forward-looking statements. Additionally, please note that non-GAAP financial measures may be disclosed during this call. A full reconciliation of GAAP to non-GAAP measurements is available in our latest quarterly earnings release and conference call presentation. With that, I'd like to turn the call over to Ryan.

Speaker Change: With that I'd like to turn the call over to Ryan Smith.

Ryan Smith: Good morning, everyone and thank you for joining us today I'm pleased to share with you our results from this quarter as well as provide an update on our strategic outlook, our quarter and results reflect the hard work and resiliency of our operational team as well as the results of the company's business development efforts to begin we closed our initial transaction targeting helium.

Speaker Change: This press release together with accompanying presentation materials are available in the investor relations section of our website at www.usnrg.com.

Ryan Smith: And you know, so far the deals we've done, the capital has been highly accessible.

Ryan Smith: Thank you.

Charles Mead: Robert, thank you, bro. That's an elaboration of your thinking, Ryan; it's helpful. Absolutely, thanks, Charles.

Speaker Change: Today's discussion may contain forward-looking statements about future business and financial expectations. Actual results may differ significantly from those projected in today's forward-looking statements due to the various risks and uncertainties included in the risks described in our periodic reports filed with the Securities and Exchange Commission.

Operator: Thank you.

Ryan Smith: At this time, we've reached the end of the question-and-answer session, and I'll turn the call over to Ryan Smith for closing remarks. Yes, I thank everybody for calling in this morning. Thank you for your time.

Ryan Smith: At this time, we've reached the end of the question and answer session and I'll turn the call over to Ryan Smith for closing remarks. Yes, I thank everybody for calling in this morning. Thank you for your time. We're very excited about the transactions that we're undertaking and we're developing right now and we look forward to rejoining you on our next call and giving market updates on the activity in the interim.

Ryan Smith: Other industrial gases in late June as well as entered into a letter of intent for a complementary and contiguous acreage position to the transaction that is already closed.

Speaker Change: Except as required by law, we undertake no obligation to update our forward-looking statements.

Ryan Smith: The assets are located across the keven dome structure in Montana and area with an extensive presence a vast <unk> nitrogen and helium resources.

Ryan Smith: We're very excited about the transactions that we're undertaking and we're developing right now, and we look forward to rejoining you on our next call and giving market updates on the activity in the interim.

Speaker Change: Further, please note that the non-GAAP financial measures may be disclosed during this call. A full reconciliation of GAAP to non-GAAP measurements are available in our latest quarterly earnings release and conference call presentation.

Speaker Change: These new assets of which we have closed on one and expect to close on the other during the fourth quarter of 2024 represent a tremendous development opportunity for U S energy and immediately move to the front of our corporate line and competing and ultimately demand in capital allocation.

Ryan Smith: Good morning everyone, and thank you for joining us today. I'm pleased to share with you our results from this quarter as well as provide an update on our strategic outlook. Our quarter-end results reflect the hard work and resiliency of our operational team, as well as the results of the company's business development efforts. To begin, we closed our initial transaction targeting helium and other industrial gases in late June, as well as entered into a letter of intent for a complementary and contiguous acreage position to the transaction that is already closed.

Operator: This concludes today's conference. We disconnect your lines this time and thank you for your participation. Have a wonderful day.

Speaker Change: With that, I'd like to turn the call over to Ryan Smith.

Operator: This concludes today's conference. We disconnect your lines this time and thank you for your participation. Have a wonderful day.

Ryan Smith: Good morning everyone and thank you for joining us today. I'm pleased to share with you our results from this quarter as well as provide an update on our strategic outlook. Our quarter end results reflect the hard work and resiliency of our operational team.

Speaker Change: As we undertake our near term drilling activity of which we have two initial wells being drilled in September with potential further development in the late fall we have many data points on productive zones, while still believing the helium dominant pay zones have largely Virgin reservoir pressure, resulting in what we expect to be highly productive wells with minimal declines at modest capital call.

Ryan Smith: The assets are located across the Keevan Dome structure in Montana, an area with an extensive presence of vast CO2, nitrogen, and helium resources. These new assets, of which we have closed on one and expect to close on the other during the fourth quarter of 2024, represent a tremendous development opportunity for US Energy and immediately moved to the front of our corporate line and competing and ultimately demanding capital allocation. As we undertake our near-term drilling activity, of which we have two initial wells being drilled in September, with potential further development in the late fall, we have many data points on productive zones while still believing the helium-dominant pay zones have largely virgin reservoir pressure, resulting in what we expect to be highly productive wells with minimal declines at modest capital costs of $1.2 to $1.8 million due to their relative shallow and conventional nature.

Ryan Smith: These new assets, which we have closed on one and expect to close on the other during the fourth quarter of 2024, represent a tremendous development opportunity for US Energy and immediately moved to the front of our corporate line and competing and ultimately demanding capital allocation. As we undertake our near-term drilling activity, of which we have two initial wells being drilled in September, with potential further development in the late fall, we have many data points on productive zones while still believing the helium-dominant pay zones have largely virgin reservoir pressure, resulting in what we expect to be highly productive wells with minimal declines at modest capital costs of $1.2 to $1.8 million due to their relative shallow and conventional nature.

Speaker Change: as well as the results of the company's business development efforts to begin we closed our initial transaction targeting helium and other industrial gases in late june as well as entered into a letter of intent for a complelimentary and contintiuous acreage position to the transaction that is already closed

Speaker Change: Costs of one two to $1 $8 million due to their relative shallow and conventional nature.

Speaker Change: The assets are located across the Keevan Dome structure in Montana, an area with an extensive presence of vast CO2, nitrogen, and helium resources.

Speaker Change: The expected size and minimal decline rates of the newly drilled wells are expected to support highly economic development of the asset base, both at the field and associated infrastructure level without the need to undertake an unrealistic in unfunded book capital spending plan. This is advantageous for numerous obvious reasons and the effects will ultimately show up in our realized economics.

Speaker Change: These new assets, of which we have closed on one and expect to close on the other during the fourth quarter of 2024, represent a tremendous development opportunity for U.S. Energy and immediately move to the front of our corporate line in competing and ultimately demanding capital allocation.

Speaker Change: Additionally, our wells in the initial period will target our areas of high confidence, while also bringing additional clarity to the productive parameters of the asset base.

Speaker Change: As we undertake our near-term drilling activity, of which we have two initial wells being drilled in September , with potential further development in the late fall, we have many data points on productive zones while still believing the helium-dominant pay zones have largely virgin reservoir pressure.

Speaker Change: We plan to have results from the first two wells during the fourth quarter and plan on sharing these results on our fourth quarter earnings release.

Speaker Change: Final point on our recent transactions and a very critical aspect on the background summary of the key even though Montana assets is the vast majority of helium production in the United States is hydrocarbon based driven by being a byproduct of natural gas the helium and industrial gas sources across U S synergies, new assets or non hydrocarbon based and part.

Speaker Change: resulting in what we expect to be highly productive wells with minimal declines at modest capital costs of 1.2 to 1.8 million dollars due to their relative shallow and conventional nature.

Ryan Smith: The expected size and minimal decline rates of the newly drilled wells are expected to support highly economic development of the asset base, both at the field and associated infrastructure level, without the need to undertake an unrealistic and unfundable capital spending plan. This is advantageous for numerous obvious reasons, and the effects will ultimately show up in our realized economics.

Speaker Change: The expected size and minimal decline rates of the newly drilled wells are expected to support highly economic development of the asset base, both at the field and associated infrastructure level, without the need to undertake an unrealistic and unfundable capital spending plan.

Speaker Change: Industrial gas streams, making this project is low or in an environmental footprint as any of its type in the United States.

Speaker Change: This is advantageous for numerous obvious reasons and the effects will ultimately show up in our realized economics. Additionally, our wells in the initial period will target our areas of high confidence while also bringing additional clarity to the productive parameters of the asset base.

Ryan Smith: Additionally, our wells in the initial period will target our areas of high confidence, while also bringing additional clarity to the productive parameters of the asset. We plan to have results from the first two wells during the fourth quarter and plan on sharing these results in our fourth quarter earnings release. My final point on our recent transactions and a very critical aspect of the background summary of the Keven Dome, Montana asset, is the vast majority of helium production in the United States is hydrocarbon-based, driven by it being a byproduct of natural gas.

Speaker Change: Turning to our legacy oil and gas assets, we achieved net daily production of approximately 221 barrels of oil equivalent per day, an increase over the first quarter of 2024 with oil production, representing approximately 62% of our total production.

Speaker Change: we plan to have results from the first two wells during the fourth quarter and plan on sharing these results on our fourth quarter earnings release

Speaker Change: With the remainder consisting of an approximately even split of natural gas and Ngls.

Speaker Change: My final point on our recent transactions and a very critical aspect on the background summary of the Keven Dome, Montana assets.

As explained in our release yesterday, our operations were heavily impacted by severe flooding that made national news throughout east, Texas and the Gulf coast during the quarter.

Speaker Change: is the vast majority of helium production in the United States is hydrocarbon-based.

Speaker Change: While this is the second large weather system to hit the Gulf Coast. This year and nearly identical effects were felt during the first quarter, primarily all of the effective production is located on our lesser producing areas and has been brought back online.

Ryan Smith: The helium and industrial gas sources across US Energy's new assets are non-hydrocarbon-based and part of industrial gas streams, making this project as low of an environmental footprint as any of its type in the United States. Turning to our legacy oil and gas assets, we achieved net daily production of approximately 1,221 barrels of oil equivalent per day, an increase over the first quarter of 2024, with oil production representing approximately 62% of our total production, with the remainder consisting of an approximately even split of natural gas and NGL.

Speaker Change: driven by being a byproduct of natural gas the helium and industrial gas sources across u s energy's new assets are nonhydrocarbon-based and part of industrial gas streams making this project as low of an environmental footprint as any of its type in the united states

There are no long term issues expected by the weather and the Companys core asset focus areas were unaffected and continue to perform to our expectations.

Speaker Change: Turning to our legacy oil and gas assets, we achieved net daily production of approximately 1,221 barrels of oil equivalent per day, an increase over the first quarter of 2024, with oil production representing approximately 62% of our total production.

Speaker Change: I'm, particularly proud to highlight our substantial achievements in cost management in the face of adverse weather conditions, our lease operating expense came in at $3 1 million.

Speaker Change: Representing a decrease in total expense to the prior quarter.

Speaker Change: The majority of our LOE is fixed at this point in our per barrel metric is highly sensitive to any variations in production.

Speaker Change: with the remainder consisting of an approximately even split of natural gas and NGLs.

Ryan Smith: As explained in our release yesterday, our operations were heavily impacted by severe flooding that made national news throughout East Texas and the Gulf Coast during the quarter. While this is the second large weather system to hit the Gulf Coast this year, and nearly identical effects were felt during the first quarter, primarily all the effective production is located in our lesser producing areas and has been brought back online.

Speaker Change: As explained in our release yesterday, our operations were heavily impacted by severe flooding that made national news throughout East Texas and the Gulf Coast during the quarter.

Speaker Change: Our per barrel costs for the second quarter was $27 69 per BOE, a 5% decrease from the first quarter. The weather driven loss production combined with additional expenses on the same areas combined for the elevated metric. We believe our per barrel LOE will revert back to the low $20 per barrel range are significantly lower than what was.

Speaker Change: While this is the second large weather system to hit the Gulf Coast this year, and nearly identical effects were felt during the first quarter, primarily all of the effective production is located on our lesser producing areas and has been brought back online.

Ryan Smith: There are no long-term issues expected because of the weather, and the company's core asset focus areas were unaffected and continue to perform to our expectations. I'm particularly proud to highlight our substantial achievements in cost management in the face of adverse weather conditions. Our lease operating expense came in at $3.1 million, representing a decrease in total expense compared to the prior quarter. A majority of our LOE is fixed at this point, and our per barrel metric is highly sensitive to any variations in production. Our per barrel cost for the second quarter was $27.69 per BOE, a 5% decrease from the first quarter. The weather-driven loss production, combined with additional expenses on the same areas, combined for the elevated metric.

Speaker Change: Realized.

Speaker Change: There are no long-term issues expected by the weather, and the company's core asset focus areas were unaffected and continue to perform to our expectations.

Speaker Change: As we continue moving through 2020 for majority of our capital will be spent efficiently on developing our recent transactions and highest return projects combined with supporting the production profile of our legacy asset base, continuing the company's share repurchase plan, maintaining balance sheet integrity and being advantageous of organically.

Speaker Change: I'm particularly proud to highlight our substantial achievements in cost management in the face of adverse weather conditions. Our lease operating expense came in at $3.1 million, representing a decrease in total expense to the prior quarter.

Generated M&A opportunities.

Speaker Change: A majority of our LOE is fixed at this point, and our per barrel metric is highly sensitive to any variations in production.

Speaker Change: U S energy has historically targeted being a growth platform that aggregated oil and gas assets, while oil prices have been more supportive over the last couple of years than were previously experienced the challenges facing public small and mid cap e&ps are real specifically when managing current cost of capital and executing on meaningful transactions that are truly accretive to <unk>.

Speaker Change: our perparal cost for the second quarter was twenty-seven dollars in sixty-nine cent for booe a five percent decrease from the first quarter the weather-driven loss production combined with additional expenses on the same areas combined for the elevated metric

Ryan Smith: We believe our per barrel LOE will revert back to the low $20 per barrel range or be significantly lower than what was realized. As we continue moving through 2024, the majority of our capital will be spent efficiently on developing our recent transactions and highest return projects, combined with supporting the production profile of our legacy asset base, continuing the company's share repurchase plan, maintaining balance sheet integrity, and being advantageous to organically generated M&A opportunities.

Ryan Smith: We believe our per barrel LOE will revert back to the low $20 per barrel range or significantly lower than what was realized. As we continue moving through 2024, the majority of our capital will be spent efficiently on developing our recent transactions and highest return projects. Combined with supporting the production profile of our legacy asset base, continuing the company's shared repurchase plan, maintaining balance sheet integrity, and being advantageous to organically generated M&A hopper.

Speaker Change: We believe our per barrel LOE will revert back to the low $20 per barrel range or significantly lower than what was realized.

Speaker Change: <unk> shareholders we.

Speaker Change: We've grown the platform here at the company when applicable we've also targeted asset sales when we felt the market was tilted in the seller's favor as shown by our last two asset sales. The most recent representing our exit from our South Texas properties.

Speaker Change: As we continue moving through 2024, the majority of our capital will be spent efficiently on developing our recent transactions and highest return projects, combined with supporting the production profile of our legacy asset base.

Speaker Change: These transactions have left us with an ideal balance sheet extremely low levels, a simple bank debt and a clean cap structure that is able to support development, while any development projects will of course need development capital use energy sits in a highly enviable position relative to any perceived peer of having significant sources of internally generated non dilutive capital.

Speaker Change: continuing the company's share repurchase plan, maintaining balance sheet integrity, and being advantageous of organically generated M&A opportunities.

Ryan Smith: US Energy has historically targeted being a growth platform that aggregates oil and gas assets. While oil prices have been more supportive over the last couple of years than previously experienced, the challenges facing public, small, and mid-cap EMPs are real, specifically when managing current costs of capital and executing on meaningful transactions that are truly accretive to existing shareholders. We have grown the platform here at the company when applicable. We have also targeted asset sales when we felt the market was tilted in the seller's favor, as shown by our last two asset sales, the most recent representing our exit from our South Texas property.

Ryan Smith: US Energy has historically targeted being a growth platform that aggregates oil and gas. While oil prices have been more supportive over the last couple of years than previously experienced, the challenges facing public, small, and mid-cap EMPs are real, specifically when managing current costs of capital and executing on meaningful transactions that are truly accretive to existing shareholders. We have grown the platform here at the company when applicable. We have also targeted asset sales when we felt the market was tilted in the seller's favor, as shown by our last two asset sales, the most recent representing our exit from our South Texas property.

Speaker Change: US Energy has historically targeted being a growth platform that aggregated oil and gas assets.

Speaker Change: Whether it's cash flow from existing operations are more meaningfully opportunistic asset sales, having that lever to pull for significant cash value is a huge advantage, particularly with a highly desirable and immediate use of proceeds.

Speaker Change: While oil prices have been more supportive over the last couple of years than were previously experienced, the challenges facing public small and mid-cap EMPs are real, specifically when managing current costs of capital and executing on meaningful transactions that are truly accretive to existing shareholders.

Speaker Change: We believe that U S energy stands out from other energy companies of our size in this backdrop of current energy industry dynamics.

Speaker Change: We have grown the platform here at the company when applicable. We've also targeted asset sales when we felt the market was tilted in the seller's favor, as shown by our last two asset sales, the most recent representing our exit from our South Texas properties.

Speaker Change: We now have a highly economic and scalable development projects and our remaining E&P assets require minimal capital to maintain a steady production profile, leading to predictable cash flow and allowing us to effectively allocate dollars to maximize our returns on capital.

Ryan Smith: These transactions have left us with an ideal balance sheet, extremely low levels of simple bank debt, and a clean cap structure that is able to support development. While any development project will, of course, need development capital, US Energy sits in a highly enviable position relative to any perceived peer of having significant sources of internally generated non-dilutive capital. Whether it's cash flow from existing operations or, more meaningfully, opportunistic asset sales, having that lever to pull forth significant cash value is a huge advantage, particularly with a highly desirable and immediate use of the process.

Speaker Change: These transactions have left us with an ideal balance sheet, extremely low levels of simple bank debt, and a clean cap structure that is able to support development.

Speaker Change: Our approach positions and allows us to weather market fluctuations and capitalize on opportunities, making us well prepared to navigate the always evolving energy landscape.

Speaker Change: While any development project will of course need development capital, US Enrgy sits in a highly enviable position relative to any perceived peer of having significant sources of internally generated, non-dilutive capital.

Speaker Change: Our focus at U S energy remains on operational efficiency balance sheet disciplined responsible resource management underscoring our commitment to driving sustainable value creation as we move forward, we remain dedicated to capitalizing on current market conditions and leveraging our strengths to deliver continued growth and shareholder returns.

Speaker Change: Whether it's cash flow from existing operations or, more meaningfully, opportunistic asset sales, having that lever to pull forth significant cash value is a huge advantage, particularly with a highly desirable and immediate use of proceeds.

Ryan Smith: We believe that U.S. Energy stands out from other energy companies of our size in this backdrop of current energy industry dynamics. We now have a highly economical and scalable development project, and our remaining EMP assets require minimal capital to maintain a steady production profile, leading to predictable cash flow and allowing us to effectively allocate dollars to maximize our returns on capital. Our approach positions and allows us to weather market fluctuations and capitalize on opportunities, making us well prepared to navigate the always evolving energy landscape.

Ryan Smith: We believe that U.S. Energy stands out from other energy companies of our size in this backdrop of current energy industry dynamics. We now have a highly economical and scalable development project, and our remaining EMP assets require minimal capital to maintain a steady production profile leading to predictable cash flow and allowing us to effectively allocate dollars to maximize our returns on capital. [inaudible] Our approach positions and allows us to weather market fluctuations and capitalize on opportunities, making us well prepared to navigate the always evolving energy landscape.

Speaker Change: We believe that U.S. Energy stands out from other energy companies of our size in this backdrop of current energy industry dynamics.

Speaker Change: To that end during the second quarter, we continued to accelerate our previously announced share repurchase program during the quarter. The company repurchased approximately 200000 shares bringing our year to date repurchase total to approximately more and greater than 2% of the company's outstanding shares. We continue to believe that repurchasing our equity at current valuation levels as <unk>.

Speaker Change: We now have a highly economic and scalable development project and our remaining EMP assets require minimal capital to maintain a steady production profile, leading to predictable cash flow and allowing us to effectively allocate dollars to maximize our returns on capital.

Speaker Change: Our approach positions and allows us to weather market fluctuations and capitalize on opportunities, making us well-prepared to navigate the always-evolving energy landscape.

Speaker Change: Prudent and one of if not the best allocation of free cash flow along with as high of a return opportunity as we see in the marketplace.

Ryan Smith: Our focus at US Energy remains on operational efficiency, balance sheet discipline, and responsible resource management, underscoring our commitment to driving sustainable value creation. As we move forward, we remain dedicated to capitalizing on current market conditions and leveraging our strengths to deliver continued growth and shareholder return. To that end, during the second quarter, we continued to accelerate our previously announced share repurchase program. During the quarter, the company repurchased approximately 200,000 shares, bringing our year-to-date repurchase total to approximately more than greater than 2% of the company's outstanding shares.

Speaker Change: We expect to continue this activity going forward.

Speaker Change: Our focus at US Energy remains on operational efficiency, balance sheet discipline, and responsible resource management, underscoring our commitment to driving sustainable value creation.

Speaker Change: In conclusion U S energy sits at the beginning of what I believe is a true first mover advantage in this space, which I define as a growth focused non hydrocarbon industrial gas focused company in the United States. The existing small scale companies in this space are hindered by burdensome and convoluted equity structures ugly balance sheets unlisted.

Speaker Change: As we move forward, we remain dedicated to capitalizing on current market conditions and leveraging our strengths to deliver continued growth and shareholder returns.

Speaker Change: To that end, during the second quarter, we continued to accelerate our previously announced share repurchase program. During the quarter, the company repurchased approximately 200,000 shares, bringing our year-to-date repurchase total to approximately more than greater than 2% of the company's outstanding shares.

Speaker Change: On exchanges that are avoided by most institutional investors.

Speaker Change: U S energy faces none of these hurdles and we believe further corporate opportunities will present themselves as this becomes apparent in the marketplace.

Ryan Smith: We continue to believe that repurchasing our equity at current valuation levels is prudent and one of, if not the best, allocations of free cash flow along with as high of a return opportunity as we see in the marketplace. We expect to continue this activity going forward. In conclusion, US Energy sits at the beginning of what I believe is a true first-mover advantage in this space, which I define as a growth-focused, non-hydrocarbon, industrial gas-focused company in the United States.

Now I would like to introduce Mark <unk>, our CFO, who will provide a detailed update on the financial results for the second quarter. Thank.

Speaker Change: We continue to believe that repurchasing our equity at current valuation levels is prudent and one of, if not the best, allocations of free cash flow along with as high of a return opportunity as we see in the marketplace. We expect to continue this activity going forward.

Mark <unk>: Thank you Bryan and Hello, everyone, let's delve into the financial details for the second quarter of 2024.

Mark <unk>: Total oil and gas sales for the quarter amounted to approximately $6 million, reflecting a decrease from $8 million in the same period last year.

Speaker Change: in conclusion u s energy sits the beginning of what i believe is a true first mover advantage in this space which i define as a growth focused non-hydrocarbon industrial gas foccus company in the united states

Mark <unk>: This decline was attributed to a 38% reduction in volumes and partially offset by a 22% increase in realized prices. It is important to note that this quarter's production was significantly impacted by severe weather events in several of our key operating areas.

Ryan Smith: The existing small-scale companies in this space are hindered by burdensome and convoluted equity structures, ugly balance sheets, and being listed on exchanges that are avoided by most institutional investors. Xcel Energy faces none of these hurdles, and we believe further corporate opportunities will present themselves as this becomes apparent in the market. Now, I would like to introduce Mark Zajac, our CFO, who will provide a detailed update on the financial...

Ryan Smith: The existing small-scale companies in this space are hindered by burdensome and convoluted equity structures, ugly balance sheets, and being listed on exchanges that are avoided by most institutional investors. Xcelera faces none of these hurdles, and we believe further corporate opportunities will present themselves as this becomes apparent in the market. Now I would like to introduce Mark Zajac, our CFO, who will provide a detailed update on the financial results for the second quarter.

Speaker Change: the existing small scale companies in the space are hindered by burdensome and conlluted equity structures ugly balance sheets en enlisted on exchanges that are avoided by most institutional investors

Mark <unk>: Sales from oil production contributed 91% of our total revenue for the quarter, demonstrating our continued focus on optimizing our oil assets.

Speaker Change: faces none of these hurdles, and we believe further corporate opportunities will present themselves as this becomes apparent in the marketplace.

Mark <unk>: Our lease operating expense for the second quarter was approximately $3 $1 million equivalent to $27 69 per Boe, indicating.

Mark Zajac: Now, I would like to introduce Mark Zajac, our CFO , who will provide a detailed update on the financial results for the second quarter.

Mark Zajac: Thank you, Ryan. Hello, everyone.

Speaker Change: Indicating an impressive 18% reduction in total lease operating expense compared to the second quarter of 2023. This.

Mark Zajac: Thank you, Ryan. Hello, everyone. Let's delve into the financial details for the second quarter of 2024.

Mark Zajac: Let's delve into the financial details for the second quarter of 2024. Total oil and gas sales for the quarter amounted to approximately $6 million, reflecting a decrease from $8 million in the same period last year. This decline was attributed to a 38% reduction in volumes and partially offset by a 22% increase in realized prices. It is important to note that this quarter's production was significantly impacted by severe weather events in several of our key operating areas.

Speaker Change: This reduction can be attributed to asset sales fewer onetime workovers in our continued effort to increase operating efficiency.

Mark Zajac: Total oil and gas sales for the quarter amounted to approximately $6 million, reflecting a decrease from $8 million in the same period last year. This decline was attributed to a 38% reduction in volumes and partially offset by a 22% increase in realized prices.

Speaker Change: Severance and AD valorem taxes for the second quarter of 2024 totaled approximately $400000, reflecting a decline from $500000 in the same period last year as a percentage of total oil and gas sales revenue.

Speaker Change: It is important to note that this quarter's production was significantly impacted by severe weather events in several of our key operating areas.

Mark Zajac: Sales from oil production contributed 91% of our total revenue for the quarter, demonstrating our continued focus on optimizing our oil asset. Our lease operating expense for the second quarter was approximately $3.1 million, equivalent to $27.69 per BOE, indicating an impressive 18% reduction in total lease operating expense compared to the second quarter of 2023. This reduction can be attributed to asset sales, fewer one-time workovers, and our continued effort to increase operating efficiency

Speaker Change: These taxes account for approximately six 1% during the quarter.

Speaker Change: Cash general and administrative expenses was $1 6 million for the same quarter of 2024, a reduction of 43% when compared to the same period of 2023, the second quarter saw a significant reduction in accounting and professional fees and compensation and benefits when compared to the same period a year ago.

Speaker Change: Sales from oil production contributed 91% of our total revenue for the quarter, demonstrating our continued focus on optimizing our oil assets.

Speaker Change: Our lease operating expense for the second quarter was approximately $3.1 million, equivalent to $27.69 per BOE, indicating an impressive 18% reduction in total lease operating expense compared to the second quarter of 2023.

Speaker Change: Turning to our net financial performance the company reported a net loss of $2 million in the second quarter of 2024, an improvement of a half million dollars when compared to the second quarter of 2023.

Speaker Change: This reduction can be attributed to asset sales, fewer one-time workovers, and our continued effort to increase operating efficiency.

Mark Zajac: Severance and ad valorem taxes for the second quarter of 2024 totaled approximately $400,000, reflecting a decline from $500,000 in the same period last year. As a percentage of total oil and gas sales revenue, these taxes accounted for approximately 6.1% during the quarter.

Mark Zajac: Severance and the Law on Taxes for the second quarter of 2024 totaled approximately $400,000, reflecting a decline from $500,000 in the same period last year. As a percentage of total oil and gas sales revenue, these taxes account for approximately 6.1% end-of-1.

Speaker Change: Our adjusted EBITDA stood at $1 1 million in the second quarter of 2024 compared to $900000 in the same period last year influenced most notably by the reduction in total cash operating expenses from the prior period.

Speaker Change: Severance and ad valorem taxes for the second quarter of 2024 totaled approximately $400,000, reflecting a decline from $500,000 in the same period last year. As a percentage of total oil and gas sales revenue, these taxes account for approximately 6.1% during the quarter.

Speaker Change: Let's briefly touch upon our balance sheet as of June 32024, the company held outstanding debt of $7 million on our $20 million revolving credit facility, our cash position stood at $2 2 million.

Mark Zajac: Cash general and administrative expenses were $1.6 million for the second quarter of 2024, a reduction of 43 percent when compared to the same period of 2023. The second quarter saw a significant reduction in accounting and professional fees and compensation and benefits when compared to the same period a year ago. Turning to our net financial performance, the company reported a net loss of $2 million in the second quarter of 2024, an improvement of half a million dollars when compared to the second quarter of 2023.

Speaker Change: Cash, General and Administrative Expenses.

Speaker Change: was $1.6 million for the second quarter of 2024, a reduction of 43% when compared to the same period of 2023. The second quarter saw a significant reduction in accounting and professional fees and compensation and benefits when compared to the same period a year ago.

Speaker Change: Subsequent to the quarter end, we paid down $5 million of our credit facility, leaving $2 million of debt outstanding as of today.

Speaker Change: In conclusion, we are pleased with our operating performance and financial results that we are able to support the company's initiatives in a way that maintain a fault that maintained full balance integrity.

Speaker Change: Turning to our net financial performance, the company reported a net loss of $2 million in the second quarter of 2024, an improvement of a half a million dollars when compared to the second quarter of 2023.

Speaker Change: Injected is to ensure that the companies reporting process maintains a high standard of excellence and we feel confident in our ability to support any growth initiatives. We may entertain going forward. Thank you for your participation. This morning, we are now ready to take your questions.

Mark Zajac: Our adjusted EBITDA stood at $1.1 million in the second quarter of 2024 compared to $900,000 in the same period last year, influenced most notably by the reduction in total cash operating expenses from the prior period. Let's briefly touch on our balance sheet. As of June 30, 2024, the company held outstanding debt of $7 million on our $20 million revolving credit facility, and our cash position stood at $2.2 million. Subsequent to the quarter end, we paid down $5 million of our credit facility, leaving $2 million of debt outstanding as of today.

Mark Zajac: Our adjusted EBITDA stood at $1.1 million in the second quarter of 2024 compared to $900,000 in the same period last year, influenced most notably by the reduction in total cash operating expenses from the prior period. Let's briefly touch on our balance sheet. As of June 30, 2024, the company held outstanding debt of $7 million on our $20 million revolving credit facility, and our cash possession stood at $2.2 million. Subsequent to the quarter end, we paid down $5 million of our credit facility, leaving $2 million of debt outstanding as of today.

Speaker Change: Our adjusted EBITDA stood at $1.1 million in the second quarter of 2024 compared to $900,000 in the same period last year, influenced most notably by the reduction in total cash operating expenses from the prior period.

Speaker Change: Thank you will.

Now be conducting a question and answer session.

Speaker Change: If you'd like to ask a question. Please press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue.

Speaker Change: Let's briefly touch upon our balance sheet. As of June 30, 2024, the company held outstanding debt of $7 million on our $20 million revolving credit facility. Our cash position stood at $2.2 million.

Speaker Change: If I start to feel like to withdraw your question from the queue.

Speaker Change: For participants using speaker equipment may be necessary to pick up your handset before pressing the star keys.

Speaker Change: Subsequent to the quarter end, we paid down five million dollars of our credit facility, leaving two million dollars of debt outstanding as of today.

Speaker Change: One moment, please while we poll for questions. Thank you.

Mark Zajac: In conclusion, we are pleased with our operating performance and financial results, and we are able to support the company's initiatives in a way that maintains full balance integrity. My objective is to ensure that the company's reporting process maintains a high standard of excellence, and we feel confident in our ability to support any growth initiative we may entertain going forward. Thank you for your participation this morning. We are now ready to take your questions.

Speaker Change: Our first question comes from the line of Jesse Olson with <unk>. Please proceed with your question.

Speaker Change: Hi, everyone. Thanks for taking my question today I was just curious I heard the commentary on LOE per Boe.

Speaker Change: My objective is to ensure that the company's reporting process maintains a high standard of excellence And we feel confident in our ability to support any growth initiative we may entertain going forward. Thank you for your participation this morning We are now ready to take your questions

Speaker Change: Moderating.

Speaker Change: Looking forward here as operations are more normalized I'm curious, though when it comes to.

Operator: Thank you. We'll now be conducting a question and answer session. If you'd like to ask a question, please press star 1 on your telephone keypad, and a confirmation tone will indicate your line is in the question queue. You may press star 2 if you'd like to withdraw your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key.

Speaker Change: The acquisition of these additional assets in Montana and.

Speaker Change: Thank you. We will now be conducting a question and answer session.

Speaker Change: If you'd like to ask a question, please press star 1 from your telephone keypad, and a confirmation tone will indicate your line is in the question queue.

Speaker Change: The press release the commentary on <unk>.

Speaker Change: Wells being spud in the third quarter here, how should we look at G&A going forward.

Speaker Change: You may press star 2 if you'd like to withdraw your question from the queue.

Speaker Change: Thank you.

Speaker Change: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Thank you.

Operator: One moment, please, while we poll for questions. Thank you. Our first question comes from the line of Jesse Sobelson with EF Hutton. Let's receive your question. Thank you.

Operator: One moment, please, while we poll for questions. Thank you. Our first question comes from the line of Jesse Sobelson with EF Hutton. Please proceed with your question. Thank you.

Speaker Change: Hey, Jack it's Ryan good morning, Thanks for the question.

Speaker Change: Good question, So I guess.

Speaker Change: Two parts on.

Speaker Change: Our legacy oil and gas assets as we kind of explained yesterday in the release, but.

Speaker Change: Our first question comes from the line of Jesse Sovelson with EF Hutton. Please proceed with your question.

Jesse Sobelson: Hi, everyone. Thanks for taking my question today. I was just curious.

Jesse Sobelson: Hi, everyone. Thanks for taking my question today. I was just curious about LOE per BOE moderating looking forward as operations are more normalized. I'm curious, though, when it comes to the acquisition of these additional assets in Montana and, you know, I noticed in the press release the commentary on the wells being spud in the third quarter here. How should we look at G&A going forward? Thank you.

Speaker Change: Just verbalizing I think most people are aware at least.

Jesse Sovelson: Hi everyone, thanks for taking my question today. I was just curious, I heard the commentary on LOE per BOE moderating, looking forward here as operations are more normalized. I'm curious.

Speaker Change: Heavy heavy weather in the second quarter Hurricane barrel.

Jesse Sobelson: I heard the commentary on LOE per BOE moderating. Looking forward here as operations are more normalized. I'm curious, though, when it comes to the acquisition of these additional assets in Montana and you noticed in the press release the commentary on the wells being spud in the third quarter here. How should we look at G&A going forward?

Speaker Change: Came through and took a lot of our Gulf coast production offline Moshe.

Speaker Change: Most of that being and Liberty, which is just east of.

Speaker Change: Houston So.

Speaker Change: So, when it comes to the acquisition of these additional assets in Montana, and you noticed in the press release the commentary on the wells being spud in the third quarter here, how should we look at G&A going forward?

Speaker Change: Obvious comment but removing.

Speaker Change: Producing barrels and then adding the expenses to <unk>.

Speaker Change: Handle the weather related events et cetera.

Speaker Change: Inflated that per barrel metric.

Ryan Smith: Jesse, it's, it's Ryan. Good morning. Thanks for the question. Um, good question. So I guess, you know, two parts on our legacy oil and gas assets, as we kind of explained yesterday in the release, but just verbalizing, I think most people are aware that at least heavy, heavy weather in the second quarter hurricane barrel came through and took a lot of our Gulf Coast production offline, most of that being in Liberty, which is just east of Houston.

Ryan Smith: Jesse, it's Ryan. Good morning. Thanks for the question. It's a good question. So I guess, you know, two parts on our legacy oil and gas assets, as we kind of explained yesterday in the release, but just verbalizing, I think most people are aware that at least heavy, heavy weather in the second quarter hurricane barrel came through and took a lot of our Gulf Coast production offline, most of that being in Liberty, which is just east of Houston.

Speaker Change: Thank you.

Speaker Change: In the second quarter.

Speaker Change: Hey Jesse, it's Ryan. Good morning. Thanks for the question. Um, good question. So I guess, you know...

Speaker Change: It's the same even though it's a little bit less in the first quarter. It's the same reason.

Speaker Change: Going forward on an LOE basis in our oil and gas assets.

Speaker Change: Two parts on our legacy oil and gas assets, as we kind of explained yesterday in the release, but just verbalizing. I think most people are aware, at least.

Speaker Change: Outside of another I would love to say, we'll never expect another weather event on the Gulf Coast, that's probably not accurate.

But.

Speaker Change: Where we stand right here right now going forward over the next couple of quarters.

Speaker Change: Heavy, heavy weather in the second quarter, Hurricane Beryl came through and took a lot of our Gulf Coast production offline, most of that being in Liberty, which is just east of Florida.

Speaker Change: We're confident that we'll get that per barrel metric back to the numbers that we saw kind of.

Ryan Smith: So, you know, obvious comment, but removing producing barrels and then you know, adding the expenses to handle the weather-related events, etc., kind of inflated that per barrel metric in the second quarter. It's the same, even though it was a little bit less in the first quarter, it's the same reason.

Ryan Smith: So, you know, obvious comment, but removing producing barrels and then, you know, adding the expenses to handle the weather-related events, etc., kind of inflated that per barrel metric in the second quarter. It's the same, even though it was a little bit less in the first quarter, it's the same reason.

Speaker Change: of Houston. So, you know, obvious comment but, you know, removing producing barrels and then, you know, adding the expenses to

Speaker Change: Late last year from a what to expect on our upcoming drilling.

Speaker Change: We're not ready to give out.

Speaker Change: Specific guidance on those wells, yet I think that's coming in the intermediate term on our next quarterly earnings just because it's our first well the drill up there of course, we have some thoughts.

Speaker Change: handle the weather-related events, etc., you know, kind of...

Speaker Change: inflated that that per barrel metric in the second quarter it's the same even though it was a little bit less in the first quarter it's the same reason going forward on an LOE basis in our oil and gas assets

Ryan Smith: Going forward on an LOE basis in our oil and gas assets, outside of another, I would love to say, we'll never expect another weather event on the Gulf Coast. That's probably not accurate. But where we stand right now, going forward over the next couple of quarters, we're confident that we'll get that per barrel metric back to the numbers that we saw late last year. From a what to expect on our upcoming drilling.

Speaker Change: We believe these wells are going to come in around one five.

Speaker Change: 1.6, $1 4 million of capital costs first well is probably going to be a little bit more than that just while we really make sure that everything we want to do is going on.

Speaker Change: right outside of another

Speaker Change: I would love to say we'll never expect another weather event on the Gulf Coast. That's probably not accurate. But, you know, where we stand right here, right now, going forward over the next couple of quarters, we're confident that we'll get that per barrel metric back to the numbers that we saw kind of

Speaker Change: But on a metric basis on the on the new development I don't think were ready to give those numbers out yet until we have.

Ryan Smith: We're not ready to give out. We don't have specific guidance on those wells yet. I think that's coming in the intermediate term on our next quarterly earnings, just because it's our first well to drill up there. Of course, we have some thoughts. We believe these wells are going to come in around 1.5, $1.6, $1.4 million in capital costs. The first well is probably going to be a little bit more than that, just while we really make sure that everything we want to do is going on.

Speaker Change: Our first well.

Speaker Change: Building and producing from a G&A perspective.

Speaker Change: late last year from a what to expect on our our upcoming drilling. We're not ready to give out

Speaker Change: I do think our G&A is going to continue to trend down.

Speaker Change: specific guidance on those wells yet? I think that's coming in the intermediate term on our next quarterly earnings just because it's our first well to drill up there. Of course we have some thoughts, you know, we believe these wells are going to come in around 1.5

Speaker Change: As we look at our.

Speaker Change: Portfolio here of our legacy oil and gas assets.

Speaker Change: I think we have.

Speaker Change: Multiple opportunities in the current price environment, even lower prices and now to really pull forward some value.

Speaker Change: With those assets and pulling forward value on assets obvious comment isn't just the cash we receive now.

Speaker Change: That use of proceeds what's the corporate overhead synergies, we can realize with doing that.

Ryan Smith: But on a metric basis for the new development, I don't think we're ready to give those numbers out yet until we have our first well drilled and producing. From a G&A perspective. I do think our GNA is going to continue to trend down, as we look at our portfolio here of our legacy oil and gas assets. I think we have multiple opportunities in the current price environment, even lower prices than now, to really pull forward some value with those assets.

Ryan Smith: But on a metric basis for the new development, I don't think we're ready to give those numbers out yet until we have our first well drilled and producing. From a G&A perspective. I do think our, our GNA is going to continue to trend down. As we, you know, look at our portfolio here of our legacy oil and gas assets. I think we have multiple opportunities in the current price environment, at even lower prices than now, to really pull forward some value with those assets.

Speaker Change: But on a metric basis, on the new development, I don't think we're ready to give those numbers out yet until we have our first well.

Speaker Change: And ultimately I believe that that we can we can optimize our our platform here to where the G&A and the professionals that we bring on with the new development is.

Speaker Change: drilled and producing. From a G&A perspective...

Speaker Change: More than offset by the G&A optimization.

Speaker Change: I do think our our GNA is going to continue to trend down.

Speaker Change: Efficiently running our legacy assets, so I don't.

Speaker Change: As we look at our portfolio here of our legacy oil and gas assets,

Speaker Change: Believe that we will see any inflated.

Speaker Change: G&A numbers.

Speaker Change: And at the point, if there is an absolute G&A increase I think it would be on a per metric basis.

Speaker Change: know i think we have

Speaker Change: multiple opportunities in the the current price environment even you know lower prices than now to really pull forward some value

Speaker Change: Significantly less than what we realized now.

Ryan Smith: And pulling forward value on assets, an obvious comment, isn't just the cash we receive now; it's that use of proceeds, and what are the corporate overhead synergies we can realize with doing that. And ultimately, you know, I believe that we can optimize our platform here to where the DNA and the professionals that we bring on board with the new development are more than offset by the GNA optimization, efficiently running our legacy assets.

Speaker Change: Yes.

Speaker Change: With those assets and you know pulling forward value on assets obvious comment isn't just the cash we receive now It's you know that use of proceeds. What's the corporate overhead synergies we can realize with doing that?

Speaker Change: Hey, thanks.

Speaker Change: Details on the financial operations there on both those line items and then I'll ask this a lot.

Speaker Change: Question, then I'll leave it to the rest of the call but in terms of.

Speaker Change: And ultimately, you know, I believe that we can optimize our platform here to where the GNA and the professionals that we bring on with the new development is

Speaker Change: Looking at legacy asset sales.

Speaker Change: Are we still expecting to potentially lineups and future sales of some of these assets to to fund maybe build out or are we comfortable with our liquidity position today and looking elsewhere and just more so focusing on average for the business. Thank you yes of.

Speaker Change: more than offset by the the the GNA optimization.

Ryan Smith: So I don't believe that we will see any inflated DNA numbers. And at the point, if there is an absolute DNA increase, I think it would be, on a per metric basis, significantly less than what we realize now.

Speaker Change: efficiently running our legacy assets. So I don't.

Speaker Change: Of course, great question, and I'll kind of start at the end of the question and work my way through it.

Speaker Change: believe that we will see any inflated GNA numbers and at the point if there is an absolute GNA increase I think it would be on a per metric basis significantly less than what we realize now.

Perfectly comfortable with our liquidity position today to develop.

Speaker Change: Call. It the first phase of our new project.

Jesse Sobelson: Hey, thanks for the details on the financial operations there on both those line items. And then I'll ask this last question, then leave it to the rest of the call. But in terms of, you know, looking at legacy asset sales, are we still expecting to potentially line up some future sales of some of these assets to fund maybe this build out, or are we comfortable with our liquidity position today and looking elsewhere just more so focusing on the operations of the business? Thank you. Yeah, I agree.

Jesse Sobelson: Hey, thanks for the details on the financial operations there on both those line items. And then I'll ask this last question, then leave it to the rest of the call. But in terms of, you know, looking at legacy asset sales, are we still expecting to potentially line up some future sales of some of these assets to fund maybe this build out, or are we comfortable with our liquidity position today and looking elsewhere and just more so focusing on the operations of the business?

Speaker Change: Sure.

With our asset sale that we completed in July pay down another significant portion of our debt I think we have $2 million outstanding today, a little more than $2 million cash on the balance sheet.

Speaker Change: Hey, thanks for the details on the financial operations there on both those line items. And then I'll ask this last question, then leave it to the rest of the call. But in terms of, you know, looking at legacy asset sales.

The $18 million available on our revolver so.

Speaker Change: Are we still expecting to potentially line up some future sales of some of these assets to fund maybe this build-out, or are we comfortable with our liquidity position today and looking elsewhere and more so focusing on the operations of the business?

Speaker Change: With all of the normal premises of keeping our cost structure clean and keeping our leverage profile down I'm very comfortable with where we are from a liquidity perspective.

Speaker Change: Being said and just kind of diving back into my my previous answer.

Ryan Smith: Thank you.

Ryan Smith: Yeah, of course, great question. And I'll kind of start at the end of the question and work my way through it, perfectly comfortable with our, you know, liquidity position today to develop. You know, call it the first phase of our new project, with our asset sale that we completed in July paying down another significant portion of our debt. I think we have $2 million outstanding today, a little more than $2 million in cash on the balance sheet, you know, with the 18 million available on our revolver.

Speaker Change: The vast vast majority of companies there is no doubt optimization, we can do on our legacy assets.

Speaker Change: Thank you. Yeah, of course great question, and I'll kind of start at the end of the question and work my way through it I'm

Speaker Change: When you're a synergy came together over the last couple of years.

Speaker Change: perfectly comfortable with our, you know, liquidity position today to develop, you know, call it the first phase of our new project.

Speaker Change: We had an asset base, we have an asset base that is geographically diverse.

Speaker Change: Not all of those assets are equal and as I look at them going forward.

Speaker Change: With our asset sale that we completed in July , paid down another significant portion of our debt. I think we have $2 million outstanding today, a little more than 2 million cash on the balance sheet, you know, with the 18 million available on our revolver. So,

If we can pull forward.

Speaker Change: Four five years of projected cash flow at current commodity prices.

Ryan Smith: Of course, great question. I'll kind of start at the end of the question and work my way through it.

Speaker Change: Opportunistically and in a process that gets 456 bids.

Ryan Smith: I'm perfectly comfortable with our, you know, liquidity position today to develop, you know, call it the first phase of our new project, with our asset sale that we completed in July paid down another significant portion of our debt. I think we have $2 million outstanding today, a little more than $2 million in cash on the balance sheet, you know, with the 18 million available on our revolver. So, with all the normal premises of keeping our cap structure clean, keeping our leverage profile down, I'm very comfortable with where we are from a liquidity perspective. Not being said, and just kind of diving back into my previous answer. Like the vast, vast majority of companies, there is no doubt optimization we can do on our legacy assets. When US Energy came together over the last couple of years, we had an asset base. We have an asset base that is, you know, geographically diverse; not all those assets are equal.

Ryan Smith: So, with all the normal premises of keeping our cap structure clean, keeping our leverage profile down, I'm very comfortable with where we are from a liquidity perspective. Not being said, and just kind of diving back into my previous answer, like the vast, vast majority of companies, there is no doubt optimization we can do on our legacy assets. When US Energy came together over the last couple of years, we had an asset base. We have an asset base that is, you know, geographically diverse; not all those assets are equal.

Speaker Change: That's always something that we're going to look at is just.

Speaker Change: With all the normal premises of keeping our cap structure clean, keeping our leverage profile down, I'm very comfortable with where we are from a liquidity perspective.

Speaker Change: Where we trade at right now the equity valuations, if we can monetize that cash at a very significant increase.

Speaker Change: That being said and just kind of diving back into my my previous answer

Speaker Change: From where we trade and allocate that capital to work.

Speaker Change: Like the vast majority of companies, there is no doubt optimization we can do on our legacy assets. When US Energy came together over the last couple of years,

Speaker Change: We believe is extremely high rate of return project with our new.

Acquisitions and development.

Speaker Change: Kind of a no brainer so it's definitely on our radar it's definitely something we're focused on will.

Ryan Smith: And as I look at them going forward, if we can pull forward for five years of projected cash flow at current commodity prices, opportunistically in a process that gets four or five, six bids, that's always something that we're going to look at. It's just where we trade at right now, the equity valuations, if we can monetize that cash at a very significant increase from where we trade and allocate that capital to what we believe is an extremely high rate of return project with our new acquisitions and development. It's kind of a no brainer.

Speaker Change: We have an asset base that is geographically diverse, not all of those assets are equal, and as I look at them going forward, if we can pull forward

Speaker Change: We will be opportunistic about it.

Ryan Smith: And as I look at them going forward, if we can pull forward for five years of projected cash flow at current commodity prices, opportunistically and in a process that gets four or five or six bids, that's always something that we're going to look at. It's just where we trade at right now, the equity valuations, if we can monetize that cash at a very significant increase from where we trade and allocate What we believe is an extremely high rate of return project with our new acquisitions and development. It's kind of a no brainer.

Speaker Change: It's not something that's necessary.

Speaker Change: To fund things going forward, though.

Speaker Change: Okay.

Speaker Change: Great. Thank you very much.

Speaker Change: for five years of projected cash flow at current commodity prices.

Speaker Change: Thanks.

Speaker Change: Our next question is from the line of Charles Meade with Johnson Rice. Please proceed with your question.

Speaker Change: opportunistically and in a process that gets four or five, six bids, that's always something that we're going to look at. It's just, you know...

Speaker Change: Good morning, Ryan.

Speaker Change: I wanted to say.

Speaker Change: I appreciate the mid year oil and gas PDP update there.

Speaker Change: where we trade at right now, the equity valuations, if we can monetize that cash at a very significant increase

Speaker Change: I think it was just under 51 million Bucks it really highlights you value but.

Jesse Sobelson: So it's definitely on the radar. It's definitely something we're focused on. We'll be opportunistic about it. But it's not something that's necessary to fund things going forward, though.

Speaker Change: From where we trade and allocate that capital to, you know, what we believe is an extremely high rate of return project with our new Acquisitions and development. It's kind of a no-brainer. So It's it's definitely on the radar. It's definitely something we're focused on We'll be opportunistic about it

Speaker Change: Wanted to go back to I think you discussed this on the last up on your last really the last call discussing that acquisition.

Speaker Change: What is the timing to get a similar kind of PDP or third party resource estimate on.

On your helium assets I know there were at least I believe.

Speaker Change: It's not something that's necessary to fund things going forward, though.

Operator: Great. Thank you very much.

Ryan Smith: Okay, great. Thank you very much.

Speaker Change: You said youre going to have one after you drill these two wells, but are you going to have one before on.

Speaker Change: Okay, great. Thank you very much.

Charles Meade: Our next question is from the line of Charles Meade with Johnson Rice. Please submit your questions.

Operator: Our next question is from the line of Charles Meade with Johnson Rice. Please submit your questions.

Speaker Change: Thanks.

Speaker Change: On the existing wells.

Speaker Change: Our next question is from the line of Charles Meade with Johnson Rice. Please receive your questions.

Charles Meade: Good morning, Ryan. I want to say I appreciate the mid-year oil and gas PDP update there. I think it was just under 51 million bucks. It really highlights your value.

Speaker Change: Yes, great question, Charles and good morning.

Charles Meade: Good morning, Ryan. I want to say I appreciate the mid-year oil and gas PDP update there. I think it was just under $51 million. It really highlights your value.

Speaker Change: No.

Charles Meade: Good morning, Ryan. I want to say I appreciate the mid-year oil and gas PDP update there. I think it was just under 51 million bucks. It really highlights

Speaker Change: Where we stand right now on the acreage that we've closed.

Speaker Change: We have our internal data.

Speaker Change: We have a large resource report from a very well known third party.

Charles Meade: But I want to go back to, I think you discussed this on the last call discussing the acquisition, what is the timing to get a similar kind of, you know, PDP or, you know, third-party resource estimate on your helium assets? I know, or at least I believe you said you're going to have one after you drill these two wells, but are you going to have one before on the existing wells?

Speaker Change: Engineering firm.

Speaker Change: And in the World in SEC reporting and <unk> reporting resource reports arent usually.

Charles Meade: your value, but I want to go back to, I think you discussed this on the last call, discussing the acquisition.

Speaker Change: File there kind of investor presentation materials, I think once we drilled this first well coming up I think I believe we spud it on September 9th well.

Speaker Change: What is the timing to get a similar kind of, you know, PDP or, you know, third-party resource estimate on your helium assets? I know, or at least I believe

Speaker Change: We'll have our data on that well.

Speaker Change: Call. It by October one and then I think in the fourth quarter.

Speaker Change: <unk>.

Speaker Change: You said you were going to have one after you drill these two wells, but are you going to have one before on the existing wells?

Speaker Change: Both of those items, we have are our larger kind of resource overview Reserve report and then once we have.

Ryan Smith: Great question, Charles. Good morning.

Speaker Change: Yeah, great question, Charles, and good morning. So where we stand right now on the acreage that we've closed, we have our internal data.

Ryan Smith: Um, so, uh, where we stand right now on the acreage that we've closed, we have our internal data. We have a large resource report from a very well-known third-party engineering firm. Again, in the world of SEC reporting and 1P reporting, resource reports aren't usually filed; they're kind of investor presentation materials.

Speaker Change: A well drilled.

Speaker Change: And.

Operating under the assumption that we closed our transaction that were under LOI on and the producing wells that they have.

Speaker Change: We have a large resource report from a very well-known third-party engineering firm.

Speaker Change: I believe that we'll have our let's call. It one P reserves, because processing et cetera kind of makes PDP and PD NP.

Speaker Change: And in the world of SEC reporting and 1P reporting, resource reports aren't usually filed. They're kind of investor presentation materials. I think once we drill this first well coming up, I think we I believe we spotted on September the 9th.

Ryan Smith: I think once we drill this first well, coming up, I think we'll believe we spotted on September the ninth. We'll have our data on that well, call it, you know, by October 1st. And then I think in the fourth quarter, we have both of those items; we have our larger kind of resource overview, reserve report, and then once we have a well drilled and operating under the assumption that we close our transaction that we're under LOI on and the producing well that they have.

Ryan Smith: I think once we drill this first well, coming up, I think we'll believe we spotted on September the 9th. We'll have our data on that well, call it, you know, by October 1st. And then I think in the fourth quarter, we have both of those items; we have our larger kind of resource overview, reserve report, and then once we have a well drilled and operating under the assumption that we close our transaction that we're under LOI on and the producing well that they have.

Speaker Change: Sure.

Speaker Change: Very similar.

Speaker Change: By the end of the year.

Speaker Change: Hopefully by hopefully by fourth quarter earnings and Thats kind of a six week window, there fourth quarter earnings and ended the year, but.

Speaker Change: We'll have our data on that well.

Speaker Change: Let's call it you know by October 1st, and then I think in the fourth quarter we have

Speaker Change: That's my expectation, we're working with two.

Speaker Change: Of the largest <unk>.

Speaker Change: both of those items. We have our larger kind of resource overview, reserve report, and then once we have

Speaker Change: Reserve engineering firms in the World right now on getting this done so it's something on our plate and we'll be here by the end of the year got it and so if I'm understanding you correctly Brian.

Speaker Change: a well-drilled and

Can you give me get we're going to get two reports are two numbers one on the total resource and then the second on here's what's proved developed with these with these well bores is that the right understanding.

Speaker Change: operating out of the assumption that we close our transaction that we're under LOI on and the producing well that they have. I believe that we'll have our let's call it 1P reserves because processing etc kind of makes PDP and PDNP

Ryan Smith: I believe that we'll have our, let's call it, 1P reserves because processing, etc. kind of makes PDP and PDNP very similar by the end of the year. Hopefully, by fourth quarter earnings. I know that's kind of a six week window there, fourth quarter earnings at the end of the year. That's my expectation. We're working with two, of the largest. Reserve engineering firms in the world right now on getting this done. So it's something on our plate, and we'll be here by the end of the year.

Speaker Change: Absolutely and then there is another way to say it.

Speaker Change: <unk> Resource report and then the SEC report that shows up on our 10-K.

Speaker Change: very similar by the end of the year.

Speaker Change: Got it got it Okay and then secondly, you've covered this I think a bit in your last.

Speaker Change: hopefully by fourth quarter earnings. I know that's a kind of a six-week window there, fourth quarter earnings and end of the year, but

Speaker Change: On your last call you said that you'd be able to fund any development.

Speaker Change: That's my expectation. We're working with two...

Speaker Change: Internally.

Speaker Change: of the largest.

Speaker Change: Whether its asset sales or cash flow, but can you give us a sense.

Speaker Change: Reserve engineering firms in the world right now on on getting this done. So it's it's something on our plate and we'll be here by the end of the year.

Charles Meade: Got it. So if I understand you correctly, Ryan, we're kind of going to get two reports or two numbers. One on the total resource, and then the second on here's what's the proof developed with these wellbores. Is that the right understanding?

Speaker Change: You've given us an estimate for what these each of these first two wells costs I think your numbers $1 4 million, but but what is the follow on capex.

Speaker Change: Got it. So if I'm understanding you correctly, Ryan, we're kind of going to get, we're going to get two reports or two numbers, one on the total resource and then the second on here's what's proof developed with these, with these wellbores. Is that the right understanding?

Speaker Change: In the success case.

Over what timeframe does it play out.

Speaker Change: No. That's a great question and I could I could go through this for an hour, but I'll try to keep it concise and not look like.

Ryan Smith: Absolutely, and then I mean there's another way to say it: just the 1P, 2P, 3P resource report and then the SEC report that shows up on our 10K.

Speaker Change: Like for like five years out and also preface this by saying we look at this right now as as phases phase one phase II phase III, Brian. Thanks.

Speaker Change: Absolutely and then I mean there's another way to say it just the 1P, 2P, 3P resource report and then the SEC report that shows up on our 10k. Got it. Got it. Okay and then secondly you've covered this I think a bit in your last

Charles Meade: I got it. I got it. Okay, and then secondly, you've covered this, I think, a bit in your last call. On your last call, you said that you'd be able to fund any development internally, whether it's asset sales or cash flow, but can you give us a sense of how much each of these first two wells cost? I think your number is 1.4 million, but what is the follow-on capex? in the success case, and over what time frame does it play out?

Speaker Change: Thanks to.

Speaker Change: It gets bigger as phase one and get successful in phase III gets vigorous phase wanted to get successful so I'm not going to sit here and say from here to Attunity, you don't ever need outside capital, but as we look at I'll call. It. The next 12 to 18 months.

Speaker Change: On your last call, you said that you'd be able to fund any development internally.

Speaker Change: What do we need to start.

Speaker Change: whether it's asset sales or cash flow, but can you give us a sense, you've given us an estimate for what each of these first two wells cost, I think your number is 1.4 million, but what is the follow-on capex

Speaker Change: I'll call it selling our industrial gases, we need to drill two or three wells.

Speaker Change: And we need to put in a processing plant right now we think these wells I'm going to call them one five.

Ryan Smith: Yeah, no, that's a great question. And I could go through this for an hour, but I'll try to keep it concise and not look like five years out. And I'll also preface this by saying, you know, we look at this right now in phases, right? Phase one, phase two, phase three, right? Phase two gets bigger as phase one gets successful, and phase three gets bigger as phases one and two get successful.

Speaker Change: in the success case, and over what time frame does it play out?

Speaker Change: The first one comes in a little bit higher I think the next one is coming a little bit lower just as we continue to learn what we're doing it's very.

Speaker Change: And that's a great question, and I could go through this for an hour, but I'll try to keep it concise and not look like five years out. And I'll also preface this by saying, you know, we look at this right now as phases, right? Phase one, phase two, phase three.

Speaker Change: It's easier for me to say in my seat, but its very simple drilling compared to I think what most folks are historically familiar with in terms of our horizontal <unk>.

Ryan Smith: So I'm not going to sit here and say from here to eternity, like you don't ever need outside capital. But as we look at, you know, I'll call it the next 12 to 18 months, you know, what do we need to start? I'll call it selling our industrial gases. We need to drill two or three wells, and we need to put in a processing plant. Right now, we think these wells, I'm going to call them 1.5.

Speaker Change: Shell drilling.

Speaker Change: Shallow.

Speaker Change: Conventional wells.

Speaker Change: Phase 2 gets bigger as Phase 1 gets successful, and Phase 3 gets bigger as Phase 1 and 2 get successful. So, I'm not going to sit here and say, from here to eternity, like, you don't ever need outside capital. But as we look at, you know, I'll call it the next 12 to 18 months, you know, what do we need to start?

Speaker Change: Wells.

Speaker Change: So we look at it at that.

Two or three.

Speaker Change: Gives me about two or three well number.

Speaker Change: Three to $4 $5 million of drilling capital over the next where.

Speaker Change: We're drilling two now we'll probably have one at some point in time before the next summer and in the processing plant for these wells were forecasting at around eight to 9 million Bucks.

Speaker Change: I'll call it selling our industrial gases. We need to drill two or three wells.

Speaker Change: And we need to put in a processing plant. Right now we think these wells, I'm going to call them 1.5. I think the first one comes in a little bit higher. I think the next one's coming a little bit lower, just as we continue to learn what we're doing. It's very...

Ryan Smith: I think the first one comes in a little bit higher, I think the next one's coming a little bit lower, just as we continue to learn what we're doing. It's very, It's easy for me to say from my seat, but it's very simple drilling compared to, I think, what most folks are historically familiar with in terms of, like, horizontal shell drilling, shallow, conventional. Wells. So, you know, we look at it at, you know, at that two or three, excuse me, at that two or three well number, three to four and a half million dollars of drilling capital over the next, we're drilling two now, we'll probably have one at some point in time before the next summer, and in the processing plant for these wells, uh, we're forecasting at around eight to nine million dollars. It's very easy.

Speaker Change: I think from a perfect corporate finance perspective, and a how do you come up with that.

Speaker Change: A cap structure on that type of infrastructure.

Speaker Change: It's easy for me to say in my seat, but it's very simple drilling compared to, I think, what most folks are historically familiar with in terms of, like, horizontal shell drilling, shallow,

Speaker Change: Simple I think it's half equity half debt and.

Speaker Change: So you start looking at what are the equity needs for U S energy over the next 12 months to wear.

Ryan Smith: So, you know, we look at it at, you know, at that two or three, excuse me, at that two or three well number. $3 to $4.5 million of drilling capital over the next, you know, we're drilling two now; we'll probably have one at some point in time before the next summer. And in the processing plant for these wells, we're forecasting at around $8 to $9 million. You know, from a perfect corporate finance perspective and a how do you come up with a cap structure on that type of infrastructure? It's very easy.

Speaker Change: We are.

Speaker Change: conventional wells. So, you know, we look at it at, you know, at that two or three, excuse me, at that two or three well number

Speaker Change: Processing and selling meaningful amounts of industrial gases out of Montana.

Speaker Change: It's a.

Speaker Change: $8 million to $10 million.

Speaker Change: three to four and a half million dollars of drilling capital over the next, you know, we're drilling two now, we'll probably have one at some point in time before the next summer, and in the processing plant for these wells we're forecasting at around eight to nine million bucks.

Speaker Change: Yeah.

Speaker Change: Kind of equity capital need from U S energy another way to put equity capital need will just be a cash need and whether that comes from cash on hand cash from our operations a bit of credit facility debt asset sale pull forwards I think right now at least from everything that we've seen in the processes that we have brought on the divestiture side.

Speaker Change: I think from a perfect corporate finance perspective, how do you come up with that?

Ryan Smith: I think it's half equity, half debt. And so you start looking at what are the equity needs for US Energy over the next 12 months to where You know, we are, processing and selling meaningful amounts of industrial gases out of Montana. It's a... $8 to $10 million, kind of equity capital need from US Energy. Another way to put equity capital need would just be a cash need. And whether that comes from, you know, cash on hand, cash from our operations, a bit of credit facility debt, asset sale pull forwards, I think right now, at least from everything that we've seen in the processes that we've run on the divestiture side, You know, that's a number that I'm not overly concerned about right now being able to being able to fund, you know, the legacy, piggybacking on your comment a second ago, like our legacy balance sheet, which still has, you know, $50 million or so of approved oil and gas reserves really gives us that flexibility to where, you know, we're not going out to the market hat in hand, willing to take any kind of transaction, we don't need to do that. Again, for this initial get off the ground phase of, of proving our concept. So I think it's a mixture of that. I mean, I don't have the exact answer right now.

Ryan Smith: I think it's half equity, half debt. And so you start looking at what are the equity needs for US Energy over the next 12 months to where, You know, we are, processing and selling meaningful amounts of industrial gases out of Montana. It's a... $8 to $10 million, kind of equity capital need from US Energy. Another way to put equity capital need would just be a cash need. And whether that comes from, you know, cash on hand, cash more operations, a bit of credit facility debt, asset sale pool forwards, I think right now, at least from everything that we've seen in the processes that we've run on the divestiture side, you know, that's a number that I'm not overly concerned about right now being able to being able to fund, you know, the legacy, piggybacking on your comment a second ago, like our legacy balance sheet, which still has, you know, $50 million or so of approved oil and gas reserves really gives us that flexibility to where, you know, we're not going out to the market hat in hand, willing to take any kind of transaction, we don't need to do that. Again, for this initial get off the ground phase of, of proving our concept. So I think it's a mixture of that. I mean, I don't have the exact answer right now.

Speaker Change: a cap structure on that type of infrastructure, it's very simple. I think it's half equity, half debt. And so you start looking at what are the equity needs for US Energy over the next 12 months to where

Speaker Change: That's a number that I'm not overly concerned about right now being able to being able to fund.

The legacy.

Speaker Change: Just piggybacking on your comment a second ago, our legacy balance sheet, which still.

Speaker Change: You know, we are

Speaker Change: <unk> has $50 million or so of of proved oil and gas reserves really gives us that flexibility to where we're not going out to the market hat in hand willing to take any kind of transaction, we don't need to do that.

Speaker Change: Processing and selling meaningful amounts of industrial gases out of Montana

Speaker Change: It's a...

Speaker Change: eight to ten million dollar

Speaker Change: For this initial get off the ground phase of of proving our concept.

Speaker Change: kind of equity capital need from US Energy. Another way to put equity capital need would just be a cash need.

Speaker Change: So I think it's a mixture of that I mean, I don't have the exact answer right now.

Speaker Change: and whether that comes from, you know, cash on hand, cash from our operations, a bit of credit facility debt, asset sale pull forwards, I think right now, at least from everything that we've seen and the processes that we've run on the divestiture side.

Speaker Change: It's we're in a flexible position to be opportunistic on these these type of assets in these type of transactions.

Speaker Change: Our main assets remaining right now on the oil and gas side are in Montana and in.

Speaker Change: You know, that's a number that I'm not overly concerned about right now, being able to being able to fund, you know, the legacy.

Speaker Change: East, Texas, but if you look at our map, we have a lot of straggler stuff in between those two areas and.

Speaker Change: Just piggybacking on your comment a second ago like our legacy balance sheet, which still

In situations, where.

Speaker Change: Hypothetically, we can clear $2 million on a small asset sale.

Speaker Change: has.

Speaker Change: know, $50 million or so of approved oil and gas reserves really gives us that flexibility to where

Speaker Change: Takeoff to exit out of arrow and our balance sheet.

Speaker Change: You know, we're not going out to the market, hat in hand, willing to take any kind of transaction. We don't need to do that, again, for this.

Speaker Change: And combined another three to $500000 annually on I'll call it corporate overhead synergies ranging from insurance G&A et cetera.

Speaker Change: initial get-off-the-ground phase of proving our concept.

Speaker Change: Those dollars go straight to our our new project and that's how I look at the funding.

Ryan Smith: You know, we're in a flexible position to be opportunistic on these types of assets and these types of transactions. You know, our main assets remaining right now on the oil and gas side are in Montana and in. East Texas, but if you look at our map, we have a lot of straggler stuff in between those two areas and, in situations where, you know, hypothetically, we can clear $2 million on a small asset sale, take off 2x that of ARO on our balance sheet, and combine another, you know, three to $500,000 annually on what I'll call corporate overhead synergies ranging from insurance, GNA, etc. And, you know, so far, the deals we've done, the Capitol has been highly accessible.

Ryan Smith: You know, we're in a flexible position to be opportunistic on these types of assets and these types of transactions. You know, our main assets remaining right now on the oil and gas side are in Montana and in. East Texas, but if you look at our map, we have a lot of straggler stuff in between those two areas and, in situations where, you know, hypothetically, we can clear $2 million on a small asset sale, take off 2x that of ARO on our balance sheet, and combine another, you know, $300,000 to $500,000 annually on, I'll call it corporate overhead synergies ranging from insurance, G&A And, you know, so far, the deals we've done, the Capitol has been highly accessible.

Speaker Change: So, I think it's a mixture of that. I mean, I don't have the exact answer right now. You know, we're in a flexible position to be opportunistic on these.

Speaker Change: And so far the deals we've done.

Charles Meade: Got it. Thanks for all that elaboration of your thinking, Ryan. It's helpful.

Speaker Change: These type of assets and these type of transactions

Speaker Change: The capital has been highly accessible.

Speaker Change: Our main assets remaining right now on the oil and gas side are in Montana and in East Texas, but if you look at our map, we have a lot of straggler stuff in between those two areas.

Speaker Change: Got it thanks for all that.

Speaker Change: <unk> are you thinking Ryan it's helpful.

Speaker Change: Absolutely Thanks Charles.

Speaker Change: Thank you at this time, we've reached the end of the question and answer session and I will turn the call over to Ryan Smith for closing remarks.

Speaker Change: in situations where, you know, hypothetically, we can clear $2 million on a small asset sale.

Speaker Change: Yes, I, thank everybody for calling in this morning, and thank you for your time, we're very excited about the transactions that we're undertaking and we're developing right now and we look forward to.

Speaker Change: take off 2x that of ARO on our balance sheet and combine another you know three to five hundred thousand dollars annually on I'll call it corporate overhead synergies ranging from insurance, G&A, etc.

Ryan Smith: Joining you on our next call and giving market updates on the activity in the interim.

Speaker Change: You know those dollars go straight to our our new project, and you know that's how I look at the funding and You know so far the deals we've done

Ryan Smith: This concludes today's conference you may disconnect your lines at this time and thank you for your participation have a wonderful day.

Charles Meade: Got it. Thanks for all that elaboration of your thinking, Ryan. It's helpful.

Speaker Change: The Capitol has been highly accessible.

Ryan Smith: Got it. Thanks for all that elaboration of your thinking, Ryan. It's helpful.

Ryan Smith: Absolutely. Thanks, Charles.

Ryan Smith: Thank you. At this time, we've reached the end of the question and answer session, and I'll turn the call over to Ryan Smith for closing remarks.

Charles: Absolutely. Thanks, Charles.

Speaker Change: Thank you. At this time, we've reached the end of the question and answer session, and I'll turn the call over to Ryan Smith for closing remarks.

Ryan Smith: Yes, I thank everybody for calling in this morning. Thank you for your time. We're very excited about the transactions that we're undertaking and that we're developing right now, and we look forward to rejoining you on our next call and giving market updates on the activity in the interim.

Ryan Smith: Yes, I thank everybody for calling in this morning. Thank you for your time. We're very excited about the transactions that we're undertaking and we're developing right now and we look forward to rejoining you on our next call and giving market updates on the activity in the interim.

Operator: This concludes today's conference. We will disconnect your lines at this time, and thank you for your participation. Have a wonderful day.

Operator: This concludes today's conference. We will disconnect your lines at this time, and thank you for your participation.

Speaker Change: This concludes today's conference. We disconnect your lines at this time and thank you for your participation. Have a wonderful day.

Ryan Smith: The helium and industrial gas sources across US Energy's new assets are non-hydrocarbon-based and part of industrial gas streams, making this project as low of an environmental footprint as any of its type in the United States. Turning to our legacy oil and gas assets, we achieved net daily production of approximately 1221 barrels of oil equivalent per day and increased over the first quarter of 2024, with oil production representing approximately 62% of our total production, with the remainder consisting of an approximately even split of natural gas and NGL.

Q2 2024 U.S. Energy Corp Earnings Call

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