Annual report [Section 13 and 15(d), not S-K Item 405]

REVENUE RECOGNITION

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REVENUE RECOGNITION
 12 Months Ended
Dec. 31, 2025
Revenue from Contract with Customer [Abstract]  
REVENUE RECOGNITION
NOTE 2 — REVENUE RECOGNITION
The Company predominantly derives its revenue from the sale of produced crude oil, natural gas, and NGLs. The contractual performance obligation is satisfied when the product is delivered to the purchaser. Revenue is recorded in the month the product is delivered to the purchaser. The Company receives payment from one to three months after delivery. The Company has utilized the practical expedient in Accounting Standards Codification ("ASC") 606-10-50-14, which states an entity is not required to disclose the transaction price allocated to remaining performance obligations if the variable consideration is allocated entirely to a wholly unsatisfied performance obligation. Under the Company’s sales contracts, each unit of production delivered to a purchaser represents a separate performance obligation, therefore, future volumes to be delivered are wholly unsatisfied and disclosure of transaction price allocated to remaining performance obligation is not required. The transaction price includes variable consideration as product pricing is based on published market prices and adjusted for contract specified differentials such as quality, energy content, and transportation. The guidance does not require that the transaction price be fixed or stated in the contract. Estimating the variable consideration does not require significant judgment and the Company engages third party sources to validate the estimates. Revenue is recognized net of royalties due to third parties in an amount that reflects the consideration the Company expects to receive in exchange for those products. Once consideration is received from the purchaser, the Company records any variances between the estimates and actual amounts, which has historically not been significant.
Oil sales. Under the Company’s oil sales contracts, the Company sells oil production at the point of delivery and collects an agreed upon index price, net of pricing differentials. The Company recognizes revenue at the net price received when control transfers to the purchaser at the point of delivery and it is probable the Company will collect the consideration it is entitled to receive.
Natural gas and NGL sales. Under the majority of the Company’s natural gas sales processing contracts, the Company delivers unprocessed natural gas to midstream processing entities at the wellhead, and the midstream processing entities obtain control of the natural gas and NGLs at the wellhead. The midstream processing entities gather and process the natural gas and NGLs and remit proceeds to the Company for the resulting sale of natural gas and NGLs. Under these processing agreements, the Company recognizes revenue when control transfers to the purchasers at the point of delivery and it is probable the Company will collect the consideration it is entitled to receive. As such, the Company accounts for any fees and deductions as a reduction of the transaction price.
The Company has only one minor contract with a natural gas processing entity in place where the point of control does not pass at the wellhead. Under this agreement, the point of control of the gas dictates that the associated fees are recorded as an expense.
Disaggregation of revenue. The following table presents revenues disaggregated by product for the years ended December 31, 2025, 2024, and 2023.
For the years ended December 31,
2025 2024 2023
Oil, Natural Gas, and Natural Gas Liquids Revenues
Oil $ 307,553,614  $ 363,971,394  $ 349,044,863 
Natural gas (1)
(9,297,614) (9,265,335) 334,175 
Natural gas liquids 8,922,072  11,621,355  11,676,963 
Total oil, natural gas, and natural gas liquids revenues $ 307,178,072  $ 366,327,414  $ 361,056,001 
(1) In 2024 and 2025, the Company experienced a net negative total gas revenue, due to the significant reduction in gross realized sales prices per Mcf, coupled with the growth in the plant fees per Mcf.