US ENERGY CORP

Our oil and gas properties are described below and under Item 8, Notes to Consolidated Financial Statements under the captions “Oil and Natural Gas Producing Activities” and “Supplemental Oil and Natural Gas Information (Unaudited)”, respectively.

Oil and Natural Gas Interests

Reserve estimates are based on average prices per barrel of oil and per Mmbtu of natural gas at the first day of each month of the 12-month period prior to the end of the reporting period. Reserve estimates as of December 31, 2025, 2024, and 2023 are based on the following average prices, in each case as adjusted for transportation, quality, and basis differentials applicable to our properties on a weighted average basis:

Presented below is a summary of our proved oil and natural gas reserve quantities, all of which are located in the United States, as of the December 31, 2025, 2024, and 2023:

Internal Controls Over Proved Reserve Estimates * *

Our internal controls over the recording of proved reserves are structured to objectively and accurately estimate our reserve quantities and values in compliance with the SEC’s regulations. Our process for managing and monitoring our proved reserves is delegated to On Point Resources, a third-party independent petroleum engineering company. Oversight is provided by management and the Audit Committee of our Board of Directors, as discussed below.

On Point Resources, Inc.'s President, Don Jacks has worked in the energy industry since 1981 and has been contracted by the Company to perform our proved reserve estimates since 2019. He holds a Bachelor of Science Degree and a Master of Science Degree in Petroleum Engineering from The University of Texas at Austin and has been a Registered Professional Petroleum Engineer in the state of Texas since 1992. He is also a member of the Society of Petroleum Evaluation Engineers (SPEE) and has been a chapter officer since 2005. Technical and engineering reviews of our assets are performed quarterly by Mr. Jacks and reported to our management. Data obtained from these reviews, in conjunction with economic data and our ownership information, is used in making a determination of estimated proved reserve quantities.

Our reserves are reviewed by our management quarterly and by the Audit Committee of our Board of Directors at least annually. Our management, which includes our Chief Executive Officer and Chief Financial Officer, is responsible for reviewing and verifying that the estimate of proved reserves is reasonable, complete, and accurate. The Audit Committee reviews a summary of the final reserves estimate and meets independently with Mr. Jacks separate from our management to discuss processes and findings in the reserve report. The Audit Committee can and does request reports and information from Mr. Jacks to independently verify values reported by the management team.

*Oil and Natural Gas Production, Production Prices, and Production Costs.*The following table sets forth certain information regarding our net production volumes, average sales prices realized and certain expenses associated with sales of oil and natural gas for the years ended December 31, 2025, 2024, and 2023.

(1) Net prices realized represent actual prices realized without regard to the effects of commodity derivatives.

We encourage you to read this information in conjunction with the information contained in our financial statements and related notes included in this annual report on Form 10-K, at the end of Part III hereof.

The following table provides a regional summary of our production for the years ended December 31, 2025, 2024, and 2023:

*Drilling and Other Exploratory and Development Activities - Oil and Natural Gas.*The Company had no oil and natural gas development or exploratory drilling activity for the year ending December 31, 2025. For the years ending December 31, 2024 and 2023, the Company participated in 1 gross, productive well, 0.8 and 0.01 net to the Company.

The number of gross oil and gas wells is the total number of wells we participated in, regardless of our ownership interest in the wells. The information above should not be considered indicative of future drilling performance, nor should it be assumed that there is any correlation between the number of productive wells drilled and the amount of oil and natural gas that may ultimately be recovered. SeeItem 7. Management’s Discussion and Analysis of Financial Condition and Results of Operationsin this annual report on Form 10-K.

Present Activities. Since April 12, 2023, we have not drilled or participated in the drilling of any oil and natural gas wells, however, we are in the process of returning to production idle wells we acquired in 2022. The table above does not include industrial gas wells. The Company drilled one industrial gas well during the fourth quarter of 2024 and two in 2025.

*Oil and Natural Gas Properties, Acreage.*The table below presents our leasehold acreage for oil and natural gas) as of December 31, 2025. The Company does not have any undeveloped oil and natural gas leasehold acreage. As of December 31, 2025, all of our acreage is held by production.

*Productive Wells.*As of December 31, 2025, the Company had the following gross and net productive wells by region for our oil and natural gas activities:

Industrial Gas Assets

Excluded from tables above are our assets related to our industrial gas project. Resulting from two acquisitions, one occurring on June 26, 2024, and another on January 7, 2025, as of December 31, 2025 we have approximately 116,384 and 80,695 gross and net acres, respectively, of leasehold on the Kevin Dome in Toole County, Montana.

Office Space

As of December 31, 2025, we have leased office space for our Company headquarters in Houston, Texas of 11,000 square feet. The lease is described in greater detail in “Note 4. Leases”, to the footnotes to the financial statements included herein. We also own a 1,200 square-foot office building in Cutbank, Montana.

The Company believes its existing facilities and equipment are in good operating condition and are suitable for the conduct of its business.