OKMIN RESOURCES INC

Previous wording

Okmin entered into a Joint Venture Agreement and Operating Agreement in February 2021, committing $100,000 in the initial phase to acquire working interests in ten oil and gas leases located in Okmulgee and Muskogee Counties in Oklahoma. Under the Operating Agreement, Okmin has a 50% Working Interest in 710 acres and a 25% interest in 80 acres. The Company’s Joint Venture partner, Blackrock Energy LLC (“Blackrock”), is the operator of the project. Pursuant to a further agreement entered into on June 10, 2022, the Company added an additional five oil and gas leases across 739 acres to its Joint Venture with Blackrock, thereby expanding the overall project to fifteen leases covering over 1,500 acres. In the nine months ended March 31, 2024, lease operating expenses including taxes recorded across the extended Joint Venture totaled $39,477 and our share of the Joint Venture recorded revenues of $41,109 from oil and gas sales, predominantly oil, compared with $37,912 in revenues for the corresponding nine months ended March 31, 2023.

Current wording

Okmin entered into a Joint Venture Agreement and Operating Agreement in February 2021, committing $100,000 in the initial phase to acquire working interests in ten oil and gas leases located in Okmulgee and Muskogee Counties in Oklahoma. Under the Operating Agreement, Okmin has a 50% Working Interest in 710 acres and a 25% interest in 80 acres. The Company’s Joint Venture partner, Blackrock Energy LLC (“Blackrock”), is the operator of the project. Pursuant to a further agreement entered into on June 10, 2022, the Company added an additional five oil and gas leases across 739 acres to its Joint Venture with Blackrock, thereby expanding the overall project to fifteen leases covering over 1,500 acres. In the three months ended September 30, 2024, lease operating expenses including taxes recorded across the extended Joint Venture totaled $5,334 and our share of the Joint Venture recorded revenues of $4,808 from oil and gas sales, predominantly oil, compared with $14,556 in revenues for the corresponding three months ended September 30, 2023.

Previous wording

The Company through its wholly owned Kansas subsidiary, Okmin Operations, LLC entered into an agreement in July 2021 to acquire a 72.5% Net Revenue Interest in the Vitt Lease located in Neosho County, Kansas. Okmin Operations, LLC acquired the lease with a cash payment of $25,000 together with a commitment to make additional capital and operating expenditures to rework the wells on the lease. The lease covers 160 acres and after initial reworking now includes nine oil wells, two idle wells and four water injection wells. At present the wells are not pumping, as they require additional maintenance work. As of our last fiscal year end on June 30, 2023, additional expenditures beyond the purchase totaled approximately $101,000. During the nine months ended March 31, 2024, the Company’s expenditures at the Vitt Lease totaled $5,719. For the nine months ended March 31, 2024, the Company received $1,972 in revenues from the project compared to revenues for the nine months ending March 31, 2023 of $5,209.

Current wording

The Company through its wholly owned Kansas subsidiary, Okmin Operations, LLC entered into an agreement in July 2021 to acquire a 72.5% Net Revenue Interest in the Vitt Lease located in Neosho County, Kansas. Okmin Operations, LLC acquired the lease with a cash payment of $25,000 together with a commitment to make additional capital and operating expenditures to rework the wells on the lease. The lease covers 160 acres and after initial reworking now includes nine oil wells, two idle wells and four water injection wells. At present the wells are not pumping, as they require additional maintenance work. As of the fiscal year ending on June 30, 2024, aggregate additional expenditures beyond the purchase totaled approximately $108,000. During the three months ended September 30, 2024, the Company did not conduct any work on the Vitt lease, so expenditures totaled $250. For the three months ended September 30, 2024, the Company received no revenue from the project compared to revenues for the three months ending September 30, 2023 of $1,972.

Previous wording

The Company and SPO had previously entered into a gas gathering agreement in June 2023 in an effort to restore and ultimately improve gas flows into the gas transit pipeline system. SPO has been working to upgrade the gas gathering system on the property, including replacing older gas gathering lines with new modern lines. The older lines were discovered to contain numerous leaks which likely contributed to the lack of throughput to the compressor station. For the nine months ended March 31, 2024, the Company’s expenditures at West Sheppard Pool were $14,594.

Current wording

The Company and SPO had previously entered into a gas gathering agreement in June 2023 in an effort to restore and ultimately improve gas flows into the gas transit pipeline system. During the year ended June 30, 2024 and the three months ended September 30, 2024, we received no revenue from the property as gas sales continued to be suspended due to further required pipeline work and the failure of equipment owned by the gas pipeline company at its compressor station. In order to replace the failed equipment, the gas pipeline company is requiring additional gas throughput to justify the investment. SPO has been working to upgrade the gas gathering system on the property, including replacing older gas gathering lines with new modern lines. The older lines were discovered to contain numerous leaks which likely contributed to a lack of throughput to the compressor station.

Previous wording

Prior to the suspension of activities following a compressor outage, only 6 of the 26 wells on the property were selling into the pipeline. Subsequently an additional 4 wells were connected in late 2022, so in total there are now 10 of the 26 wells at West Sheppard Pool connected to the gas gathering system.

Current wording

Prior to the suspension of activities following a compressor outage, only 6 of the 26 wells on the property were selling into the pipeline. Subsequently an additional 4 wells were connected in late 2022, so in total there are now 10 of the 26 wells at West Sheppard Pool connected to the gas gathering system. Many of those wells would likely benefit from workovers to increase their production potential, and six wells were identified by the operator for reentry to perforate and fracture new zones for both oil and gas. The property also has the potential for infill drilling for new wells within the property. Any work is dependent upon obtaining additional capital, which could include adding an additional partner to fund this work program.

Previous wording

Pushmataha has seven existing gas wells ranging in depth from 10,000 - 12,300 feet. The wells were inactive since 2019 due to line leaks and lower gas prices, though in April 2021 some wells were put back online and have at various intervals produced between 100 - 300 thousand cubic feet per day (MCFD). Through the fiscal year ended June 30, 2023, we recorded $60,066 in revenues from gas sales at the project. Earlier in the fiscal year ended June 30, 2023, the wells were shut in, as the operator awaited repairs to a gas leak by the pipeline owner to the pipeline gathering system. The operator subsequently resumed production on the leases.

Current wording

Pushmataha has seven existing gas wells ranging in depth from 10,000 - 12,300 feet. The wells were inactive since 2019 due to line leaks and lower gas prices, though in April 2021 some wells were put back online and have at various intervals produced between 100 - 300 thousand cubic feet per day (MCFD).

Previous wording

In the nine months ended March 31, 2024, the Company’s lease operating expenditures on the project were $16,022 with additional gas fees, transportation and taxes aggregating $4,882. For the nine months ended March 31, 2024 the Company recorded $10,849 in revenues from the project compared to revenues for the nine months ending March 31, 2023 of $53,397.

Current wording

In the three months ended September 30, 2024, the Company’s lease operating expenditures on the project were $3,538 with additional gas fees, transportation and taxes aggregating $717. For the three months ended September 30, 2024 the Company recorded $1,242 in revenues from the project compared to revenues for the three months ended September 30, 2023 of $6,149.

Previous wording

Management is actively evaluating various new strategic investment and acquisition opportunities in the resources sector, including opportunities to potentially broaden our activities beyond the development of conventional oil and gas projects. To assist in this process, the Company has established a Board of Advisors and appointed Dr. John N. O’Brien as its Senior Advisory Board Member.

Current wording

Management is actively evaluating various new strategic investment and acquisition opportunities in the resources sector, including opportunities to potentially broaden our activities beyond the development of conventional oil and gas projects.

Previous wording

We generated $8,465 in revenue from oil and gas sales for the three months ended March 31, 2024, as compared to $30,228 in revenues generated in the three months ended March 31, 2023. The decrease in revenue is predominantly attributable to lower natural gas prices. These lower prices not only reduced the sales price we received for each MCF sold, but also led to the curtailment of operations on certain of our properties until prices improve which resulted in a decrease of our production volumes. We also received $706 in interest income from our cash balances for three months ended March 31, 2024.

Current wording

We generated $5,991 in revenue from oil and gas sales for the three months ended September 30, 2024, as compared to $22,677 in revenues generated in the three months ended September 30, 2024. The decrease in revenue is predominantly attributable to lower natural gas prices. These lower prices not only reduced the sales price we received for each MCF sold, but also led to the curtailment of operations on certain of our properties until prices improve which resulted in a decrease of our production volumes. We also received $507 in interest income from our cash balances for three months ended September 30, 2024.

Previous wording

General and administrative expenses increased to $103,894 for the three months ended March 31, 2024 compared to $68,830 for the three months ended March 31, 2023, This increase is attributable to the Company recording additional legal and professional fees that we did not have in the previous corresponding quarter. Other expenses related to compensation, interest, rent, accounting and professional fees and other general and administrative expenses necessary for our operations.

Current wording

General and administrative expenses decreased to $59,379 for the three months ended September 30, 2024 compared to $104,928 for the three months ended September 30, 2024. This decrease is attributable to a decrease in legal and professional fees and the Company’s curtailment of some operations. Expenses related to compensation, interest, rent, accounting and professional fees and other general and administrative expenses necessary for our operations.

Previous wording

The net loss for the three months ended March 31, 2024 was $121,127 compared to a net loss of $138,718 for the three months ended March 31, 2023. The expenses during the three month period ended March 31, 2024, included: $25,429 in lease operating expenses (including taxes and royalties), $40,500 in deferred and unpaid compensation, $3,966 in interest expense, $25,288 to outside consultants, $26,350 in legal and professional fees and other general and administrative expenses necessary for our operations. These amounts included $25,288 of non-cash items with stock issued in lieu of services. Expenses during the comparative three month period ended March 31, 2023, including lease operating expenses, were higher and included: $100,019 in lease operating expenses (including taxes and royalties), $40,500 in compensation, $4,658 in interest expense, $12,500 in connection with our manager of land and resource development, $9,206 in professional fees and other general and administrative expenses necessary for our operations.

Current wording

The net loss for the three months ended September 30, 2024 was $67,785 compared to a net loss of $111,835 for the three months ended September 30, 2023. The expenses during the three month period ended September 30, 2024, included: $9,717 in lease operating expenses (including taxes and royalties), $40,500 in deferred and unpaid compensation, $4,320 in interest expense and financing costs, $8,400 in compliance listing related fees, $9,599 in accounting and professional fees and other general and administrative expenses necessary for our operations. Expenses during the comparative three month period ended September 30, 2023, including lease operating expenses, were higher and included: $33,485 in lease operating expenses (including taxes and royalties), $40,500 in compensation, a non-cash amount of $25,300 in connection with the services of outside consultants with stock issued in lieu of services, $4,278 in interest expense, legal and professional fees and other general and administrative expenses necessary for our operations.

Previous wording

Net cash used in financing activities in the nine months ended March 31, 2024 totaled $10,000 which was entirely for repayment of debt. Net cash from financing activities in the corresponding nine months ended March 31, 2023 totaled $363,875, which was predominantly comprised of private placements of equity securities during the period.

Current wording

Net cash used in financing activities in the three months ended September 30, 2024 totaled $6,000 which was entirely for repayment of debt. Net cash from financing activities in the corresponding period ended September 30, 2023 totaled $108,325, which was predominantly comprised of stock issued in lieu of services during the period

Previous wording

As of March 31, 2024, we had total assets of $838,637, comprised primarily of cash and cash equivalents of $83,646, production revenue receivable of $6,712, oil and gas properties $697,560 and prepaid expenses of $50,719. As at March 31, 2024, we had total liabilities of $470,449, primarily comprised of convertible debt and related interest payable of $206,699, accounts payable of $27,500 and accrued liabilities of $236,250 which is predominantly deferred compensation expense as the CEO is currently deferring salary in an effort to conserve cash.

Current wording

As of September 30, 2024, we had total assets of $366,615, comprised primarily of cash and cash equivalents of $73,602, oil and gas properties $292,877 and prepaid expenses of $136. As at March 31, 2024, we had total liabilities of $600,938, primarily comprised of convertible debt and related interest payable of $202,506, accounts payable of $36,480 and accrued liabilities of $317,250 which is predominantly deferred compensation expense as the CEO is currently deferring salary in an effort to conserve cash.

Previous wording

Our business plan calls for substantial capital resource requirements and we have incurred significant losses since inception. The Company had a net loss of $324,814 for the nine months ended March 31, 2024 and an accumulated deficit of $1,160,118 as of March 31, 2024. The Company had a working capital deficit of $122,673 as at March 31, 2024 and for the remainder of the 2024 fiscal year, the Company anticipates cash needs of approximately $70,000. The Company anticipates receiving limited revenue from oil and gas sales and intends to obtain the remaining capital through private sales of securities or debt funding.

Current wording

Our business plan calls for substantial capital resource requirements and we have incurred significant losses since inception. The Company had a net loss of $67,785 for the three months ended September 30, 2024 and an accumulated deficit of $1,776,303 as of September 30, 2024. The Company had a working capital deficit of $527,336 as at September 30, 2024. For the 2025 fiscal year we anticipate cash needs of approximately $300,000 for general corporate overhead and for operations on our existing lease properties. This amount does not include funding for any potential workovers, re-entries, stimulation treatments and recompletions of existing non or low producing wells. Any new work on our properties will require additional capital. A portion of the required cash will be obtained from oil and gas sales. The Company plans to obtain the remainder of the required capital through private sales of securities or debt financing.

Previous wording

As reflected in the accompanying condensed financial statements, the Company had a net loss of $324,814 for the nine months ended March 31, 2024 and an accumulated deficit of $1,160,118 as of March 31, 2024. These factors, among others, raise doubt about the Company’s ability to continue as a going concern.

Current wording

As reflected in the accompanying condensed financial statements, the Company had a net loss of $67,785 for the three months ended September 30, 2024 and an accumulated deficit of $1,776,303 as of September 30, 2024. These factors, among others, raise doubt about the Company’s ability to continue as a going concern.