Sky Quarry Inc.
For the period ended Mar 31, 2026. Filed May 15, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 15, 2026
SKYQ$1.98+6.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-14.
0001096906-25-001869
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-15.
0001096906-26-000807
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 64 previous paragraphs and 66 current paragraphs.
20 unchanged; 30 reworded; 16 added; 14 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
We operate a regional refinery (the Eagle Springs Refinery) producing diesel, VGO, naphtha and liquid paving asphalt from crude oil suppliers in the Uintah basin near Nevada and Utah. In addition to our goal of growing the refinery, we have a separate division in the development-stage (P.R. Springs) formed to deploy technologies to facilitate the recycling of waste asphalt shingles and remediation of oil-saturated sands and soils, providing sustainable refined crude products. We anticipate several benefits from the recycling and production of oil from asphalt shingles reducing the dependence on landfills for the disposal of waste and reducing dependence on foreign oil.
Current report
The Company has a single segment reporting approach given all revenues are generated from Foreland Refining products. The Company anticipates the possibility of segmental reporting in the future in connection with alternative revenue streams and cost centers.
Current report
ATM Program
Current report
On April 22, 2026, the Company replaced Cantor Fitzgerald & Co. with Muriel Siebert & Co., LLC (“Siebert” or the “Agent”) as the principal and/or the sole designated sales agent and updated the size of the program to up to $12,600,000. As of March 31, 2026, the Company issued 426,143 shares of common stock through its previous ATM sales agent, Cantor Fitzgerald & Co., generating net proceeds of $747,975.
Current report
Exclusivity Agreement
Current report
In March 2026, the Company entered into an exclusivity agreement (the “Exclusivity Agreement”) with a counterparty in connection with the Company’s evaluation of a potential transaction involving the acquisition of digital infrastructure assets (the “Potential Transaction”). No definitive terms have been agreed upon, and the Company has not entered into any definitive agreement with respect to the Potential Transaction.
Current report
Plant Outages and Maintenance
Current report
Our facilities require ongoing maintenance and from time-to-time certain repairs, improvements and retrofitting, which may require us to temporarily shut down or operate at a diminished capacity. Our Eagle Springs refinery operated by Foreland Refinery Corporation experienced a shut down during the fourth quarter of 2025 in connection with a boiler repair. Currently, repairs have been completed, and the refinery is being prepared to resume operations, subject to the procurement of feedstock. The unscheduled repairs and outages at Foreland’s Eagle Springs Refinery have had a negative impact on our final financial results for the third and fourth quarters of 2025, and financial results for the first quarter of 2026. Currently, we expect the facility to be operational by the end of the second quarter of 2026.
Current report
Additionally, feedstock pricing, based partly on WTI market pricing rose from approximately $57 per barrel on January 1, 2026 to $101 per barrel by March 31, 2026, roughly a 77% increase according to the US Energy Information Agency (EIA). Currently, we believe regional market dynamics may be reflected in the second half of 2026 in crack spreads or refinery margins, based on industry peers’ publicly available comments.
Current report
Cost of goods sold as a percentage of net sales was 101,723% for the three months ended March 31, 2026, compared to 112% for the three months ended March 31, 2025. We believe this comparison is not meaningful as the refinery was not operational during the first quarter of 2026 as described above.
Current report
Our general and administrative expenses decreased by $722,221 for the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily due to a decrease of $124,897 in executive compensation attributable to a smaller Board of Directors with lower fees expensed in the current year. The decreased in general and administrative costs for the three months ended March 31, 2026 compared to 2025 were also due to a $511,968 decrease in professional fees, primarily consisting of decreases in advertising and marketing, and business development.
Current report
Our total assets increased by $97,282 due to the changes in property, plant and equipment of $178,523, and cash $31,458.
Current report
ATM Program
Current report
We continue to maintain an ATM Program. On January 12, 2026, we entered into a Controlled Equity OfferingSM Sales Agreement (the “Sales Agreement”) with Cantor, pursuant to which we, from time to time, may offer and sell shares (the “ATM Shares”) of our common stock, through or to Cantor, acting as principal and/or sales agent, having an aggregate sales price of up to $4,700,000.
Current report
On April 22, 2026, the Company entered into that certain Amended and Restated Sales Agreement (the “A&R Sales Agreement”) with Siebert, pursuant to which Siebert replaced Cantor as the principal and/or the sole designated sales agent. The material terms and conditions of the Sales Agreement otherwise remain unchanged.
Current report
On April 22, 2026, in connection with its ATM Program, the Company filed a prospectus supplement with the SEC, updating the aggregate sales price to up to $12,600,000, pursuant to the A&R Sales Agreement. As of March 31, 2026, the Company issued 426,143 shares of common stock through Cantor under the ATM Program, generating net proceeds of $747,975.
Removed paragraphs (14)
Previous report
You should read the following discussion and analysis together with our unaudited condensed consolidated financial statements and the notes to our unaudited condensed consolidated financial statements, which appear elsewhere in this report, as well as our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission (the “SEC”) on April 21, 2025.
Previous report
Our Management’s Discussion and Analysis contains not only statements that are historical facts, but also statements that are forward-looking (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934). Forward-looking statements are, by their very nature, uncertain and risky. These risks and uncertainties include international, national and local general economic and market conditions; demographic changes; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; raw material costs and availability; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other risks that might be detailed from time to time in our filings with the Securities and Exchange Commission.
Previous report
Although the forward-looking statements in this Quarterly Statement reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by them. Consequently, and because forward-looking statements are inherently subject to risks and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. You are urged to carefully review and consider the various disclosures made by us in this report and in our other reports as we attempt to advise interested parties of the risks and factors that may affect our business, financial condition, and results of operations and prospects.
Previous report
The following discussion and analysis of financial condition and results of operations of the Company is based upon, and shouldbe read in conjunction with, its unaudited financial statements and related notes elsewhere in this Form 10-Q, which have been prepared in accordance with accounting principles generally accepted in the United States.
Previous report
We are an oil production, refining, and a development-stage environmental remediation company formed to deploy technologies to facilitate the recycling of waste asphalt shingles and remediation of oil-saturated sands and soils. The recycling of asphalt shingles is expected to reduce the dependence on landfills for the removal of waste and to also reduce dependence on foreign and domestic virgin crude oil extraction for industrial uses.
Previous report
Corporate History
Previous report
We were incorporated in Delaware on June 4, 2019, as “Recoteq, Inc.” On April 22, 2020, we changed our name to “Sky Quarry Inc.” Sky Quarry is a holding company and has no operations. The purpose of the holding company is to maintain ownership over our subsidiaries, create management efficiencies and establish an organizational structure to facilitate the potential acquisition of other businesses within or complementary to our industry.
Previous report
On September 16, 2020, we acquired 2020 Resources LLC. The assets of 2020 Resources include an oil sands remediation facility (the “PR Spring facility”) and a 100% interest in asphalt bitumen leases covering approximately 5,930 acres in the PR Spring region in Utah. On September 16, 2020, we also acquired 2020 Resources (Canada) Ltd, an entity which is currently inactive.
Previous report
On September 30, 2022, we acquired Foreland Refining Corporation, which is engaged in the refining of heavy crude oil into diesel and other petroleum products (naphtha, vacuum gas oil, and paving asphalt liquids) at its Eagle Springs Refinery located near Ely, Nevada. The acquisition of Foreland was immediately accretive to our revenues and cash flow and provides a strong base for growth. We believe the acquisition is a strategic fit and will form an important role in the future enabling us to vertically integrate the production and refining of oil from waste materials to energy in a sustainable and efficient manner.
Previous report
We had net sales of $1,336,963 and $12,211,402 for the three and nine months ended September 30, 2025, compared to $4,846,795 and $19,174,369 for the three and nine months ended September 30, 2024.
Previous report
We had net sales of $1,336,963 for the three months ended September 30, 2025, compared to $4,846,795 for the three months ended September 30, 2024, a decrease of $3,509,832. Year to date net sales of $12,211,402 for the nine months ended September 30, 2025, compared to $19,174,369 for the three months ended September 30, 2024, a decrease of $6,962,967. The decline in net sales for the third quarter of 2025 compared to the prior period was primarily due to the Company’s challenges associated with regaining supply volumes previously disrupted in May and June 2024 as a result of the Foreland Refinery outage, disruption and refurbishment in 2024. Additionally, WTI pricing fell from $87 per barrel on April 5, 2024, to $63 per barrel on September 30, 2025, which corresponded with reduced pricing in the end sales products.
Previous report
Cost of goods sold as a percentage of net sales was 179% for the three months ended September 30, 2025, compared to 98% for the three months ended September 30, 2024. Our year to date cost of goods sold as a percentage of net sales was 116% for the nine months ended September 30, 2025, compared to 99% for the nine months ended September 30, 2024. The increased cost as a percentage of revenues was due efficiency constraints with the Company continuing to regain supply streams as a result of the refurbishment of the Foreland refinery in 2024.
Previous report
Our general and administrative expenses increased during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 primarily due to an increase of $112,153 in executive compensation primarily from new additional directors added and their related directors’ fees expense, and increased professional fees of approximately $159,723 associated with the Company going public late in fiscal 2024. the increased selling general and administrative costs for the nine months ended September 30, 2025 compared to 2024 were also due to a $375,636 increase in executive compensation from the Company’s public offering occurring late in 2024 and ongoing public company costs, and an increase in professional fees of $1,086,106 from added directors fees associated with going public and the requirement of additional board members.
Previous report
Our total assets decreased by $6,095,340 due to the changes in current assets as well as decreases in restricted cash of $2,111,796, property, plant and equipment of $795,402, and right-of-use assets of $1,060,172, offset by an increase in oil and gas properties of $216,950.
Reworded paragraphs (30)
Previous wording
We have developed a process for separating oil from oily sands and other oil-bearing solids utilizing a proprietary solvent which we refer to as our ECOSolv technology or the ECOSolv process. The solvent is used in a closed-loop distillation and evaporation circuit which results in up to 99% of the solvent being recoverable for continuous reuse and requires no water. The solvent has demonstrated oil separation rates of up to 95% in bench testing using samples of both mined crushed ore and ground asphalt shingles.
Current wording
We have developed a process for separating oil from oily sands and other oil-bearing solids utilizing a proprietary solvent, which we refer to as our ECOSolv technology or the ECOSolv process. The solvent is used in a closed-loop distillation and evaporation circuit which results in up to 99% of the solvent being recoverable for continuous reuse and requires no water. The solvent has demonstrated oil separation rates of up to 95% in bench testing using samples of both mined crushed ore and ground asphalt shingles. Bench testing was conducted in house, and through unaffiliated third parties which were completed in May and August 2022.
Previous wording
We intend to retrofit the PR Spring Facility, located in southeast Utah (as defined below) to recycle waste asphalt shingles using our ECOSolv technology, to produce and sell oil as well as asphalt paving aggregate mined from our bitumen deposit.
Current wording
Currently, we intend to finish retrofitting our oil sands remediation facility located in PR Spring in eastern Utah in the 2027 calendar year when the necessary funding is obtained to recycle waste asphalt shingles using our ECOSolv technology, to produce and sell oil as well as asphalt paving aggregate mined from our bitumen deposit.
Previous wording
We also plan to develop modular asphalt shingle recycling facilities (the “ASR Facility”) which can be deployed in cities with high concentrations of waste asphalt shingles and near asphalt shingle manufacturing centers.
Current wording
We intend to continue to develop regional model asphalt shingle recycling facilities, which can be deployed in areas with high concentrations of waste asphalt shingles and near asphalt shingle manufacturing centers. Our design contemplates a modular, scalable, purpose-built facility capable of remediating waste asphalt shingles and separation into their base components of bitumen / asphalt cement, shingle granules, sand aggregate, limestone and fiberglass.
Previous wording
We filed a Certificate of Amendment to our Certificate of Incorporation with the State of Delaware on April 9, 2024 (the “Effective Split Date”) to effect a one-for-three (1-for-3) (the “Split Ratio”) reverse stock split of our shares of common stock (the “Reverse Stock Split”), without changing the par value, rights, terms, conditions, and limitations of such shares of common stock. No fractional shares were issued in connection with the Reverse Stock Split, and any of our stockholders that were entitled to receive a fractional share as a result of the Reverse Stock Split instead received one additional share of our common stock in lieu of the fractional share. The Reverse Stock Split did not in itself affect any stockholder’s ownership percentage of our common stock, except to the extent that any fractional share was rounded up to the nearest whole share. The number of shares of common stock subject to the exercise of outstanding options, warrants and convertible securities was also reduced by the Split Ratio as of the Effective Split Date and their respective exercise prices were increased by the Split Ratio. Neither the authorized shares of capital stock nor the par value per share of our common stock was affected by the Reverse Stock Split.
Current wording
We filed a Certificate of Amendment to our Certificate of Incorporation with the State of Delaware on March 5, 2026, to affect a one-for-eight (1-for-8) reverse stock split (the “Reverse Stock Split”) of our shares of common stock, par value $0.0001 (the “Common Stock”). The Reverse Stock Split was effective on March 15, 2026, at 11:59 PM Eastern Time.
Previous wording
All historical share and per-share amounts reflected throughout the consolidated financial statements have been adjusted to reflect the Reverse Stock Split.
Current wording
All historical share and per-share amounts reflected throughout the consolidated financial statements and our discussions herein in this Item 2 have been adjusted to reflect the Reverse Stock Split.
Previous wording
As a result of our financial condition, we have included in our condensed consolidated financial statements as of September 30, 2025 and December 31, 2024, and for the three and nine months ended September 30, 2025 and 2024, a note indicating that there is significant doubt about the Company’s ability to continue as a going concern. The opinion on the December 31, 2024 audited financial statements from our independent registered public accounting firm for those statements also includes an explanatory paragraph describing the uncertainty as to our ability to continue as a going concern. From inception (June 4, 2019) through September 30, 2025, we have incurred accumulated net losses of $33,301,117. To address our going concern, we aim to increase revenues by securing greater volumes of crude oil for our Foreland refinery, which should enhance our contribution margin. Additionally, we are pursuing opportunities to reduce debt service through refinancing or repayment of existing obligations, establish strategic partnerships, and raise capital through equity or debt offerings, or a combination of these actions. Given our current revenue and cash usage levels, we have pressing working capital needs that necessitate raising funds through equity or debt issuance, coupled with efforts to boost revenue and control operating expenses. However, there is no guarantee that we will be able to raise sufficient capital, grow revenues, and generate the cash flow needed to meet our operating expenses and capital requirements effectively.
Current wording
As a result of our financial condition, we have included in our condensed consolidated financial statements as of March 31, 2026 and December 31, 2025, and for the three months ended March 31, 2026 and 2025, a note indicating that there is significant doubt about the Company’s ability to continue as a going concern. The opinion on the December 31, 2025 audited financial statements from our independent registered public accounting firm for those statements also includes an explanatory paragraph describing the uncertainty as to our ability to continue as a going concern. From inception (June 4, 2019) through March 31, 2026, we have incurred accumulated net losses of $38,486,733. To address our going concern, we aim to increase revenues by securing greater volumes of crude oil for our Foreland refinery, which should enhance our contribution margin. Additionally, we are pursuing opportunities to reduce debt service through refinancing or repayment of existing obligations, establish strategic partnerships, and raise capital through equity or debt offerings, or a combination of these actions. Given our current revenue and cash usage levels, we have pressing working capital needs that necessitate raising funds through equity or debt issuance, coupled with efforts to boost revenue and control operating expenses. However, there is no guarantee that we will be able to raise sufficient capital, grow revenues, and generate the cash flow needed to meet our operating expenses and capital requirements effectively.
Previous wording
Results of Operations for the Three and Nine Months Ended September 30, 2025 and 2024
Current wording
Results of Operations for the Three Months ended March 31, 2026 and 2025
Previous wording
This section includes a summary of our historical results of operations, followed by detailed comparisons of our results for the three and nine months ended September 30, 2025 and 2024, respectively. We have derived this data from our unaudited interim condensed consolidated financial statements included in this Quarterly Report.
Current wording
This section includes a summary of our historical results of operations, followed by detailed comparisons of our results for the three months ended March 31, 2026 and 2025, respectively. We have derived this data from our unaudited interim condensed consolidated financial statements included in this Quarterly Report.
Previous wording
Our net sales were $12,211,402 for the nine months ended September 30, 2025, compared to $19,174,369 for the nine months ended September 30, 2024. Our cost of goods sold for the three months ended September 30, 2025, were $2,387,726, compared to $4,750,839 for the three months ended September 30, 2024. Year to date cost of goods sold of $14,105,226 for the nine months ended September 30, 2025, compared to $18,994,553 for the nine months ended September 30, 2024. Cost of goods sold does not change directly with sales due to certain fix cost allocations across significantly lower production barrels. The significant decrease in our sales were the direct result of the company’s challenges associated with regaining supply streams disrupted in May and June 2024 as a result of the Foreland Refinery outage, disruption and refurbishment in 2024. Additionally, West Texas Intermediate pricing fell from $87 per barrel on April 5, 2024, to $63 per barrel on September 30, 2025, which corresponded with reduced pricing in the end sales products.
Current wording
We had net sales of $383 for the three months ended March 31, 2026, compared to $6,332,967 for the three months ended March 31, 2025. Our cost of goods sold for the three months ended March 31, 2026, were $389,601, compared to $7,059,059 for the three months ended March 31, 2025. Cost of goods sold does not change directly with sales due to certain fixed cost allocations across significantly lower production barrels. The significant decrease in our sales were the direct result of the company’s challenges associated with the outage of our Eagle Springs refinery.
Previous wording
Our operating expenses were $1,502,038 for the three months ended September 30, 2025, compared to $1,281,108 for the three months ended September 30, 2024. Year to date operating expenses were $5,061,408 for the nine months ended September 30, 2025, compared to $3,861,835 for the nine months ended September 30, 2024. Our operating expenses consisted of General and Administrative, non-cash charges associated with Share-Based Payments, Depreciation and Amortization, and Foreign Exchange rate changes with the Canadian Dollar.
Current wording
Our operating expenses were $1,215,446 for the three months ended March 31, 2026, compared to $1,937,485 for the three months ended March 31, 2025. Our operating expenses consisted of general and administrative and depreciation and amortization.
Previous wording
Net Sales and Net Income (Loss)
Current wording
Net Sales and Net Loss
Previous wording
Our net sales, costs of goods sold, gross profit, operating expenses, other income (expense) and net loss for the three months and nine months ended September 30, 2025 and 2024, were as follows:
Current wording
Our net sales, costs of goods sold, gross profit, operating expenses, other income (expense) and net loss for the three months ended March 31, 2026 and 2025, were as follows:
Previous wording
The following table shows net sales by category for the three and nine month periods ended September 30, 2025 and 2024:
Current wording
The following table shows net sales by category for the three months ended March 31, 2026 and 2025:
Previous wording
Beginning in late June 2025, the Company’s production was limited due to crude supplier disruptions and delays in completing certain maintenance activities. The Company expects production to resume in January 2026.
Current wording
We had net sales of $383 for the three months ended March 31, 2026, compared to $6,332,967 for the three months ended March 31, 2025, a decrease of $6,332,584. Beginning in late June 2025, the Company’s production was limited due to crude supplier disruptions and delays in completing certain maintenance activities. The lack of refinery operational revenue during the first quarter of 2026 was the result of refinery repairs that were concluded subsequent to the end of the period. Restart challenges and reconnecting refinery feedstock supply will be the primary focus of the Company in the subsequent quarter to generate revenues from operations. The Company expects production to resume in June of 2026.
Previous wording
The following table shows cost of goods sold by category for the three and nine month periods ended September 30, 2025 and 2024:
Current wording
The following table shows cost of goods sold by category for the three months ended March 31, 2026 and 2025:
Previous wording
Our cost of goods sold for the three months ended September 30, 2025 was $2,387,726 compared to $4,750,839 for the three months September 30, 2024, a decrease of $2,363,113. Our year to date cost of goods sold for the nine months ended September 30, 2025, was $14,105,226 compared to $18,994,553 for the nine months September 30, 2024, a decrease of $4,889,327. Gross profit for the three months ended September 30, 2025 was a negative $1,050,763, compared to $95,956 for the three months ended September 30, 2024, a decrease of $1,146,719 for the comparative period. Our gross profit for the nine months ended September 30, 2025, was a negative $1,893,824, compared to $179,816 for the nine months ended September 30, 2024, a decrease of $2,073,640 for the comparative period. The decline in cost of sales for the nine months ended September 30, 2025 presented compared to the prior periods was primarily due to the decline in net sales described above and the contribution margin covering more fixed costs within cost of goods sold.
Current wording
Our cost of goods sold for the three months ended March 31, 2026 was $389,601 compared to $7,059,059 for the three months ended March 31, 2025, a decrease of $6,669,458. Gross margin loss for the three months ended March 31, 2026 was $389,218, compared to $726,092 for the three months ended March 31, 2025, a decrease of $336,874 for the comparative period. The decline in cost of sales for the three months ended March 31, 2026 presented compared to the prior periods was primarily due to the decline in net sales described above.
Previous wording
The following table shows general and administrative expenses by category for the three and nine month periods ended September 30, 2025 and 2024:
Current wording
The following table shows general and administrative expenses by category for the three months ended March 31, 2026 and 2025:
Previous wording
Other expense was $1,237,883 for the three months ended September 30, 2025, compared to $3,260,108 for the three months ended September 30, 2024, a decrease of $2,022,225. In the three months ended September 30, 2025, other income (expense) consisted of interest expense, net of interest expense $1,059,148, loss on disposal of assets of $170,674, loss on extinguishment of debt $19,568, gain on warrant valuation $20,060, and other expense $8,553. In the three months ended September 30, 2024, other income (expense) consisted of interest expense, net of interest income of $1,320,115, offset by other expense of $4,059.
Current wording
Other expense was $715,581 for the three months ended March 31, 2026, compared to $670,117 for the three months ended March 31, 2025, a decrease of $45,464. In the three months ended March 31, 2026, other income (expense) consisted of interest expense $333,989, loss on extinguishment of debt $269,396, loss on warrant valuation $75,342, and other expense $36,854. In the three months ended March 31, 2025, other income (expense) consisted of interest expense $901,561, loss on extinguishment of debt $56,660, offset by gain on warrant valuation $274,980, other income $7,477, and gain on disposal of assets $5,647.
Previous wording
Other expense was $2,377,796 for the nine months ended September 30, 2025, compared to $6,842,474 for the nine months ended September 30, 2024, a decrease of $4,464,678. In the nine months ended September 30, 2025, other income (expense) consisted of interest expense, net of interest income $2,250,324, loss on extinguishment of debt of $76,228, offset by gain on warrant valuation $120,686, loss on disposal of assets of $166,754, and other expense of $1,872. In the nine months ended September 30, 2024, other income (expense) consisted of interest expense, net of interest income of $4,773,663, loss on extinguishment of debt of $108,887, loss on sale of assets of $25,075, offset by other income $1,085. The warrant liability is revalued at each reporting date based on changes in the underlying factors influencing the fair value of the warrants, such as the Company’s stock price, volatility, and other market conditions. The Company’s management believes that the non-cash gain recognized in the current period from the remeasurement of warrant liabilities is not reflective of ongoing operating performance. As this item did not occur in the prior-year quarter, it should be evaluated separately when comparing financial results across periods. During the period, the Company incurred significant interest expense related to its term debt. This interest expense is primarily due to the high financing costs associated with the term notes, which were utilized to support ongoing working capital needs and operational expenses. These notes, characterized by higher interest rates relative to traditional debt instruments, have resulted in a notable impact on our financial performance for the quarter. This increase in interest expense reflects the financial obligations of maintaining liquidity and funding operations, particularly during a phase of substantial investment in refinery refurbishment and related activities. The Company continues to evaluate its capital structure to optimize costs and enhance financial stability, considering refinancing options and alternative capital sources where feasible.
Current wording
The warrant liability is revalued at each reporting date based on changes in the underlying factors influencing the fair value of the warrants, such as the Company’s stock price, volatility, and other market conditions. The Company’s management believes that the non-cash gain recognized in the current period from the remeasurement of warrant liabilities is not reflective of ongoing operating performance. During the period, the Company incurred significant interest expense related to its term debt. This interest expense is primarily due to the high financing costs associated with the term notes, which were utilized to support ongoing working capital needs and operational expenses. These notes, characterized by higher interest rates relative to traditional debt instruments, have resulted in a notable impact on our financial performance for the quarter. This increase in interest expense reflects the financial obligations of maintaining liquidity and funding operations, particularly during a phase of substantial investment in refinery refurbishment and related activities. The Company continues to evaluate its capital structure to optimize costs and enhance financial stability, considering refinancing options and alternative capital sources where feasible.
Previous wording
Net loss was $3,790,684 or a loss of $0.17 per share, for the three months ended September 30, 2025, compared to net loss of $4,445,260 or $0.25 per share, for the three months ended September 30, 2024. Net loss was $9,333,028 or a loss of $0.44 per share, for the nine months ended September 30, 2025, compared to net loss of $10,524,493 or $0.59 per share, for the nine months ended June 30, 2024.
Current wording
Net loss was $2,320,245 or a loss of $(0.65) per share, for the three months ended March 31, 2026, compared to net loss of $3,333,694 or $(1.25) per share, for the three months ended March 31, 2025.
Previous wording
Our net loss compared to the previous periods’ net loss was primarily driven by a reduction in total production of the refinery which resulted in reduced revenues during the period
Current wording
Our net loss compared to the previous periods’ net loss was primarily driven by a reduction in total production of the refinery attributable to the outage which resulted in reduced revenues during the period.
Previous wording
We had negative operating cash flows for the three and nine months ended September 30, 2025. Our cash on hand as of September 30, 2025, was $362,517. While we had negative net cash from operations for the nine months ended September 30, 2025, our monthly cash flow burn rate for the nine months ended September 30, 2025, was $237,155. In connection with the Foreland Refinery acquisition and PR Spring facility retrofit program, we believe we will continue to have material capital expenditures and face long term cash needs. While we anticipate that these needs will be satisfied through the issuance of our debt and/or equity securities until such time as our cash flows from operations will satisfy our cash needs we cannot provide any assurances of such.
Current wording
We had negative operating cash flows for the three months ended March 31, 2026. Our cash on hand as of March 31, 2026, was $66,828. While we had negative net cash from operations for the three months ended March 31, 2026, our monthly cash flow burn rate for the three months ended March 31, 2026, was $196,210. In connection with the Foreland Refinery acquisition and PR Spring facility retrofit program, we believe we will continue to have material capital expenditures and face long term cash needs. While we anticipate that these needs will be satisfied through the issuance of our debt and/or equity securities until such time as our cash flows from operations will satisfy our cash needs, we cannot provide any assurances of such.
Previous wording
Our cash decreased by $22,599 as of September 30, 2025, as compared to December 31, 2024. Our total current assets decreased by $2,344,920 primarily because of a decrease in inventory of $1,796,495, and accounts receivable of $919,432, offset by increase in prepaid expenses of $393,606.
Current wording
Our cash increased by $31,458 as of March 31, 2026, as compared to December 31, 2025. Our total current assets decreased by $61,721 primarily because of a decrease in inventory of $23,453, and prepaids of $65,038.
Previous wording
Our current liabilities as of September 30, 2025 as compared to December 31, 2024, increased by $156,490 and our total liabilities decreased by $57,764, both primarily as a result of an increase in accounts payable of $387,630, current portion of operating lease of $18,894, notes payable of $835,260, offset by decreases in current portion of finance lease of $16,120, finance lease liability of $971,690, lines of credit of $14,368, current maturities of notes payable of $98,860, warrant liability of $120,686, and operating lease liability of $77,824.
Current wording
Our current liabilities as of March 31, 2026 as compared to December 31, 2025, increased by $1,275,910 and our total liabilities increased by $1,286,434, both primarily as a result of an increase in accounts payable of $777,065, related-party payables of $372,212, notes payable of $10,524, lines of credit of $95,401, and warrant liability of $75,342.
Previous wording
The decrease in cash and assets and increase in liabilities, noted above, are due to the losses described above.
Current wording
The increase in liabilities, noted above, are due to the losses described above.
Previous wording
On June 27, 2025, the Company’s wholly owned subsidiary, Foreland Refining Corporation, launched a Regulation Crowdfunding (Reg CF) offering to raise up to $1.235 million to fund working capital and general corporate purposes. As of September 30, 2025, the subsidiary had raised $0 in commitments. Although the Reg CF is being conducted at the subsidiary level, the proceeds are expected to support business lines that may be consolidated into the Company’s operations. The offering is not expected to have a material near-term impact on the Company’s consolidated liquidity position.
Current wording
On June 27, 2025, the Company’s wholly owned subsidiary, Foreland Refining Corporation, launched a Regulation Crowdfunding (Reg CF) offering to raise up to $1.235 million to fund working capital and general corporate purposes. As of March 31, 2026, the subsidiary had raised $513,300 in commitments. Although the Reg CF is being conducted at the subsidiary level, the proceeds are expected to support business lines that may be consolidated into the Company’s operations. The offering is not expected to have a material near-term impact on the Company’s consolidated liquidity position.
Previous wording
Our cash on hand as of September 30, 2025, was $362,517. The Company will continue to require additional cash to meet ongoing operational and capital needs. Despite the company’s efforts to increase production capacity at the refinery, as well as ongoing maintenance and refurbishment activities, and the high interest payments, we are not yet generating sufficient cash flow to cover operational costs. The need for cash is driven by both ongoing operating expenses, and costs of indebtedness. We anticipate that these needs will be satisfied through the issuance of debt or the sale of our equity securities, or a combination thereof, until such time as improvements to our cash flows from operations will satisfy our cash flow needs. Management remains committed to securing the necessary resources to ensure the Company can meet its financial obligations and continue executing its long-term objectives. There is no assurance, however, that we will be successful in these efforts.
Current wording
Our cash on hand as of March 31, 2026, was $66,828. The Company will continue to require additional cash to meet ongoing operational and capital needs. Despite the company’s efforts to increase production capacity at the refinery, as well as ongoing maintenance and refurbishment activities, and the high interest payments, we are not yet generating sufficient cash flow to cover operational costs. The need for cash is driven by both ongoing operating expenses, and costs of indebtedness. We anticipate that these needs will be satisfied through the issuance of debt or the sale of our equity securities, or a combination thereof, until such time as improvements to our cash flows from operations will satisfy our cash flow needs. Management remains committed to securing the necessary resources to ensure the Company can meet its financial obligations and continue executing its long-term objectives. There is no assurance, however, that we will be successful in these efforts.
Previous wording
Our net cash used in operating activities for the nine months ended September 30, 2025, were $1,982,648 , as compared to cash used of $4,616,746 for the nine months ended September 30, 2024. Our net cash used in operating activities for the nine months ended September 30, 2025, consisted of a net loss of $9,333,028, favorable working capital changes of $4,551,167, less share based compensation of $546,417, depreciation and amortization of $873,984, amortization of debt issuance costs of $1,172,292, amortization of right-of-use asset of $80,920, loss on extinguishment of debt of $76,228, and gain on revaluation of warrant liability of $120,686, and loss on sale of assets of $170,058. Our net cash used in operating activities for the nine months ended September 30, 2024, consisted of a net loss of $10,524,493, less unfavorable changes in working capital of $275,854, share-based compensation of $534,572, depreciation and amortization of $589,267, amortization of right-of-use asset of $52,455, amortization of debt issuance costs of $2,936,408, loss on issuance of warrants of $1,936,937, and loss on extinguishment of debt of $108,887.
Current wording
Our net cash used in operating activities for the three months ended March 31, 2026 and 2025, was $588,631 and $1,963,224, respectively. Our net cash used in operating activities for the three months ended March 31, 2026, consisted of a net loss of $2,320,245, favorable working capital changes of $1,374,593, adjusted for share based compensation of $87,454, depreciation and amortization of $264,857, amortization of debt issuance costs of $101,649, amortization of right-of-use asset of $20,943, loss on extinguishment of debt of $269,396, and loss on revaluation of warrant liability of $75,342. Our net cash used in operating activities for the three months, ended March 31, 2025 consisted of a net loss of $3,333,694, less unfavorable changes in working capital of $738,676, share-based compensation of $78,880, depreciation and amortization of $242,004, amortization of right-of-use asset of $24,129, amortization of debt issuance costs of $765,793, loss on extinguishment of debt of $56,660.
Previous wording
Our cash flow used in investing activities for the nine months ended September 30, 2025 and 2024, was $124,859 and $1,899,212, respectively, a decrease of $1,774,353. Our investing activities during the nine months ended September 30, 2025, consisted of a net increase from proceeds of sale of assets of $14,060, and payments for oil and gas properties of $48,544, and property, plant and equipment of$90,374. Our investing activities during the nine months ended September 30, 2024, consisted of payments for exploration and evaluation assets of $689,992, and payments for property, plant and equipment of $1,209,220.
Current wording
Our cash flow used in investing activities for the three months ended March 31, 2026 and 2025, was $443,380 and $316,210, respectively, an increase of $127,170. Our investing activities during the three months ended March 31, 2026, consisted of a net increase from proceeds of sale of assets of $0, and payments for oil and gas properties of $0, and property, plant and equipment of $443,380. Our investing activities during the three months ended March 31, 2025, consisted of a net increase from property, plant and equipment of $297,389, purchase of oil and gas development assets of $32,881 and an increase from proceeds of sale of assets of $14,060.
Previous wording
Our net cash provided by (used in) financing activities for the nine months ended September 30, 2025 and 2024, was $316,230 and $5,023,764, respectively, a decrease of $4,707,534. Our cash flows from financing activities during the nine months ended September 30, 2025, consisted of proceeds of lines of credit of $10,076,552, proceeds from notes payable of $2,314,980, offset by payments on lines of credit of $10,090,920, payments on notes payable of $1,969,382, and payments of debt issuance costs of $15,000. Our cash flows from financing activities during the nine months ended September 30, 2024, consisted of proceeds of lines of credit of $33,556,317, proceeds from notes payable of $16,767,738, and issuance of preferred stock of $308,000, and issuance of common stock of $4,790,597, offset by payments on lines of credit of $34,889,877, payments on notes payable of $12,216,266, common stock offering costs of $1,720,619, discounts on notes payable of $1,531,252, and preferred stock offering costs of $40,874.
Current wording
Our net cash provided by (used in) financing activities for the three months ended March 31, 2026 and 2025, was $1,064,894 and ($24,050), respectively, a decrease of $1,088,944. Our cash flows from financing activities during the three months ended March 31, 2026, consisted of proceeds of lines of credit of $97,720, proceeds from notes payable of $227,830, proceeds from common stock $747,975, offset by payments on lines of credit of $2,319, payments on notes payable of $6,312. Our cash flows from financing activities during the three months ended March 31, 2025, consisted of proceeds of lines of credit of $5,339,736, and proceeds from notes payable of $143,237, offset by payments on lines of credit of $4,272,336, and payments on notes payable of $1,231,214, and payments on finance lease of $3,473.