Phoenix Energy One, LLC

Limitations on Effectiveness of Controls and Procedures

In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and principal financial officer, evaluated, as of the end of the period covered by this Quarterly Report, the effectiveness of our disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective at the reasonable assurance level as of March 31, 2026 as a result of the material weaknesses described below.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. In connection with the audit of our consolidated financial statements as of and for the year ended December 31, 2025, our auditors identified several material weaknesses in our internal control over financial reporting. The material weaknesses identified were: (i) inadequate segregation of duties within key financial areas; (ii) entity-level controls that were not sufficiently designed, documented or consistently maintained across the Committee of Sponsoring Organizations of the Treadway Commission (COSO) components to provide reasonable assurance that material misstatements would be prevented or detected on a timely basis; (iii) ineffective processes for identifying and assessing risks impacting internal control over financial reporting; (iv) insufficient evaluation and determination as to whether components of internal controls were present and functioning; (v) ineffective information technology general controls supporting the financial reporting process; and (vi) ineffective controls over the completeness and accuracy of information used in the operation of control activities.

These material weaknesses did not result in any identified material misstatements in the Company’s condensed consolidated financial statements included in this Quarterly Report. However, these material weaknesses could result in a misstatement of the Company’s financial statements that would not be prevented or detected on a timely basis.

Management’s Remediation Efforts

Management has begun implementing measures designed to remediate the material weaknesses described above. These remediation efforts include, but are not limited to: enhancing segregation of duties within financial reporting and related systems; enhancing the design and documentation of entity-level controls across the COSO components; strengthening the Company's formal risk assessment processes related to financial reporting; implementing additional procedures to evaluate whether internal control components are present and functioning; implementing improvements to information technology general controls, including user access management, system change management, and system monitoring controls; establishing additional controls over the completeness and accuracy of information used in financial reporting processes; and expanding internal control documentation, training and monitoring activities.

These measures include engaging with external consulting firms to assist with technical accounting matters and to improve the design and operating effectiveness of our internal control over financial reporting. In addition, the Company implemented a new accounting system effective January 1, 2026, which management believes will enhance financial reporting processes and support improvements to internal control over financial reporting. The Company will continue to evaluate the effectiveness of controls associated with this system as part of its remediation efforts.

Changes in Internal Control over Financial Reporting

We are taking actions to remediate the material weaknesses relating to our internal control over financial reporting, as described above. Except as discussed above, there were no changes in our internal control over financial reporting (as that term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the three months ended March 31, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.