MACH NATURAL RESOURCES LP

Previous wording

Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to provide the reader of the financial statements with a narrative from the perspective of management on the financial condition, results of operations, liquidity and certain other factors that may affect the Company’s operating results. The following discussion and analysis should be read in conjunction with our unaudited consolidated financial statements and related notes included in Part I, Item I of this Quarterly Report and also with “Risk Factors” included in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024. The following information updates the discussion of our financial condition provided in our previous filings and analyzes the changes in the results of operations for the three and six months ended June 30, 2025 and 2024.

Current wording

Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to provide the reader of the financial statements with a narrative from the perspective of management on the financial condition, results of operations, liquidity and certain other factors that may affect the Company’s operating results. The following discussion and analysis should be read in conjunction with our unaudited consolidated financial statements and related notes included in Part I, Item I of this Quarterly Report and also with “Risk Factors” included in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024. The following information updates the discussion of our financial condition provided in our previous filings and analyzes the changes in the results of operations for the three and nine months ended September 30, 2025 and 2024.

Previous wording

We are an independent upstream oil and gas company focused on the acquisition, development and production of oil, natural gas and NGL reserves in the Anadarko Basin region of Western Oklahoma, Southern Kansas and the panhandle of Texas.

Current wording

We are an independent upstream oil and gas company focused on the acquisition, development and production of oil, natural gas and NGL reserves in the Anadarko Basin region of Western Oklahoma, Southern Kansas and the panhandle of Texas; the San Juan Basin region of New Mexico and Colorado; and the Permian Basin region of West Texas.

Previous wording

Within our operating areas, our assets are prospective for multiple formations, most notably the Oswego, Woodford and Mississippian formations. Our experience in the Anadarko Basin and these formations allows us to generate significant cash available for distribution from these low declining assets in a variety of commodity price environments. We also own an extensive portfolio of complementary midstream assets that are integrated with our upstream operations. These assets include gathering systems, processing plants and water infrastructure. Our midstream assets enhance the value of our properties by allowing us to optimize pricing, increase flow assurance and eliminate third-party costs and inefficiencies. In addition, our owned midstream systems generate third-party revenue.

Current wording

Within our operating areas, our assets are prospective for multiple formations, most notably the Oswego, Woodford, Mississippian, Mancos and Fruitland formations. Our experience across these formations allows us to generate significant cash available for distribution from these low declining assets in a variety of commodity price environments. We also own an extensive portfolio of complementary midstream assets that are integrated with our upstream operations. These assets include gathering systems, processing plants and water infrastructure. Our midstream assets enhance the value of our properties by allowing us to optimize pricing, increase flow assurance and eliminate third-party costs and inefficiencies. In addition, our owned midstream systems generate third-party revenue.

Previous wording

Between 2022 and 2024, the Federal Reserve raised the target range for the federal funds rate in an effort to curb inflation. In September 2024 and November 2024, the Federal Reserve lowered the target range for the federal funds rate to its current range of 4.25% to 4.50% in light of the reduced inflation. In June 2025, inflation, as measured by the consumer price index, was 2.7%. We cannot predict the future inflation rate but to the extent we experience high inflation, we may see cost increases in our operations, including costs for drill rigs, workover rigs, tubulars and other well equipment, as well as increased labor costs. We continue to evaluate actions to mitigate supply chain and inflationary pressures and work closely with other suppliers and contractors to ensure availability of supplies on site, especially fuel, steel and chemical supplies which are critical to many of our operations. However, these mitigation efforts may not succeed or may be insufficient. Further, if we are unable to recover higher costs through higher commodity prices, our current revenue stream, estimates of future reserves, borrowing base calculations, impairment assessments of oil and natural gas properties, and values of properties in purchase and sale transactions would all be significantly impacted.

Current wording

Between 2022 and 2024, the Federal Reserve raised the target range for the federal funds rate in an effort to curb inflation. In September 2025 and October 2025, the Federal Reserve lowered the target range for the federal funds rate to its current range of 3.75% to 4.00% in light of the reduced inflation. In September 2025, inflation, as measured by the consumer price index, was 3.0%. We cannot predict the future inflation rate but to the extent we experience high inflation, we may see cost increases in our operations, including costs for drill rigs, workover rigs, tubulars and other well equipment, as well as increased labor costs. We continue to evaluate actions to mitigate supply chain and inflationary pressures and work closely with other suppliers and contractors to ensure availability of supplies on site, especially fuel, steel and chemical supplies which are critical to many of our operations. However, these mitigation efforts may not succeed or may be insufficient. Further, if we are unable to recover higher costs through higher commodity prices, our current revenue stream, estimates of future reserves, borrowing base calculations, impairment assessments of oil and natural gas properties, and values of properties in purchase and sale transactions would all be significantly impacted.

Previous wording

We have completed four acquisitions since the beginning of 2024. These acquisitions are reflected in our results of operations as of and after the date of completion for each such acquisition. As a result, periods prior to each such acquisition will not contain the results of such acquired assets which will affect the comparability of our results of operations for certain historical periods. We may continue to grow our operations through acquisitions when economical, including by funding such acquisitions under our New Revolving Credit Facility.

Current wording

We have completed six acquisitions since the beginning of 2024. These acquisitions are reflected in our results of operations as of and after the date of completion for each such acquisition. As a result, periods prior to each such acquisition will not contain the results of such acquired assets which will affect the comparability of our results of operations for certain historical periods. We may continue to grow our operations through acquisitions when economical, including by funding such acquisitions under our New Credit Agreement.

Previous wording

For the three-month period ended June 30, 2025, we had realized gains on derivative instruments of $7.0 million and unrealized gains of $48.6 million for total gains of $55.6 million. For the three-month period ended June 30, 2024, we had realized losses on derivative instruments of $4.8 million and unrealized gains of $0.1 million for total losses of $4.6 million. The increase in both realized and unrealized gains is primarily from a decrease in oil prices throughout the second quarter.

Current wording

For the three-month period ended September 30, 2025, we had realized gains on derivative instruments of $9.6 million and unrealized gains of $15.1 million for total gains of $24.8 million. For the three-month period ended September 30, 2024, we had realized gains on derivative instruments of $6.6 million and unrealized gains of $27.1 million for total gains of $33.7 million. The increase in realized gains is primarily from a decrease in oil prices throughout 2025.

Previous wording

Gathering and processing expense increased $8.0 million, or 33%, and $1.25 per Boe, or 43%, for the three-month period ended June 30, 2025, as compared to the three-month period ended June 30, 2024, primarily as a result of higher fuel costs due to higher natural gas prices. Additionally, due to changes in certain purchaser contracts in the second quarter of 2025, certain post-production costs that were previously presented as a reduction to gas revenue are now presented as gathering and processing expense.

Current wording

Gathering and processing expense increased $9.6 million, or 41%, and $0.70 per Boe, or 22%, for the three-month period ended September 30, 2025, as compared to the three-month period ended September 30, 2024, primarily as a result of higher fuel costs due to higher natural gas prices, the IKAV acquisition which added $2.4 million of expenses, and changes in certain purchaser contracts in the third quarter of 2025, which resulted in certain post-production costs that were previously presented as a reduction to gas revenue are now presented as gathering and processing expense.

Previous wording

Lease operating expense increased $3.1 million, or 7% for the three-month period ended June 30, 2025, as compared to the three-month period ended June 30, 2024, primarily as a result of an increase in company labor and contract services of $2.5 million. Lease operating expenses per Boe increased by $0.80 primarily related to the above noted increases, combined with lower production for the three-month period ended June 30, 2025, as compared to the three-month period ended June 30, 2024.

Current wording

Lease operating expense increased $15.0 million, or 34% for the three-month period ended September 30, 2025, as compared to the three-month period ended September 30, 2024, primarily as a result of the Sabinal and IKAV acquisitions, which added approximately $9.2 million of lease operating expense in the three-month period ended September 30, 2025. Additionally, there were increases in workover expenses of $1.1 million, compression expenses of $0.8 million and company labor and contract services of $0.8 million. Lease operating expenses per Boe increased by $0.97 primarily as a result of the oil heavy production from the Sabinal acquisition added to our overall cost profile.

Previous wording

Production taxes decreased $0.8 million, or 3% for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024. This decrease was in line with the decrease in oil, natural gas and NGL sales.

Current wording

Production taxes increased $0.6 million, or 6% for the three-month period ended September 30, 2025, as compared to the three-month period ended September 30, 2024. This increase was in line with the increase in oil, natural gas and NGL sales.

Previous wording

Midstream operating expense increased $0.6 million, or 22% for the three-month period ended June 30, 2025, as compared to the three-month period ended June 30, 2024, primarily as a result of higher gathering operating expense of $0.4 million.

Current wording

Midstream operating expense increased $1.5 million, or 57% for the three-month period ended September 30, 2025, as compared to the three-month period ended September 30, 2024, primarily as a result of higher gathering operating expense of $0.9 million.

Previous wording

Depreciation, depletion, amortization and accretion expense for oil and natural gas properties decreased by $1.5 million, or 2% for the three-month period ended June 30, 2025, as compared to the three-month period ended June 30, 2024. The decrease is primarily the result of a decrease in production used to calculate depletion.

Current wording

Depreciation, depletion, amortization and accretion expense for oil and natural gas properties decreased by $0.4 million, or 1% for the three-month period ended September 30, 2025, as compared to the three-month period ended September 30, 2024. The decrease is primarily the result of an increase in total reserves used to calculate depletion, offset with the increase in book value of oil and gas properties from the IKAV and Sabinal acquisitions.

Previous wording

Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024

Current wording

Nine Months Ended September 30, 2025 Compared to the Nine Months Ended September 30, 2024

Previous wording

Production decreased 524 MBoe, or 6% for the three-month period ended June 30, 2025, as compared to the three-month period ended June 30, 2024. The decrease was primarily a result of natural well declines on our producing wells, partially offset with new production on wells completed subsequent to June 30, 2024.

Current wording

Production decreased 212 MBoe, or 1% for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024. The decrease was primarily a result of natural well declines on our producing wells, partially offset with production on wells acquired in the Sabinal and IKAV acquisitions.

Previous wording

For the six-month period ended June 30, 2025, we had realized gains on derivative instruments of $8.7 million and unrealized gains of $6.2 million for total gains of $14.9 million. For the six-month period ended June 30, 2024, we had realized losses on derivative instruments of $0.8 million and unrealized losses of $33.1 million for total losses of $33.9 million. The increase in both realized and unrealized gains is primarily from a decrease in oil prices throughout the second quarter of 2025.

Current wording

For the nine-month period ended September 30, 2025, we had realized gains on derivative instruments of $18.3 million and unrealized gains of $21.3 million for total gains of $39.6 million. For the nine-month period ended September 30, 2024, we had realized gains on derivative instruments of $5.8 million and unrealized losses of $6.0 million for total losses of $0.2 million. The increase in realized gains is primarily from a decrease in oil prices throughout 2025.

Previous wording

Midstream revenue decreased $0.3 million, or 2% for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024, primarily due to lower third-party volumes flowing through our midstream facilities for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024.

Current wording

Midstream revenue increased $0.4 million, or 2% for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024, primarily due to lower third-party volumes flowing through our midstream facilities for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024.

Previous wording

Product sales increased $2.3 million, or 17% for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024. This increase was primarily a result of the increase in the average selling price of natural gas. These increases corresponded with the increase in our cost of product sales noted below.

Current wording

Product sales increased $2.2 million, or 11% for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024. This increase was primarily a result of the increase in the average selling price of natural gas. These increases corresponded with the increase in our cost of product sales noted below.

Previous wording

Gathering and processing expense increased $4.2 million, or 7%, and $0.59 per Boe, or 17%, for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024, primarily as a result of higher fuel costs due to higher natural gas prices. Additionally, due to changes in certain purchaser contracts in the second quarter of 2025, certain post production-costs that were previously presented as a reduction to natural gas revenue are now presented as gathering and processing expense.

Current wording

Gathering and processing expense increased $13.8 million, or 17%, and $0.62 per Boe, or 19%, for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024, primarily as a result of higher fuel costs due to higher natural gas prices, the IKAV acquisition which added $2.4 million of expenses, and changes in certain purchaser contracts in the third quarter of 2025, which resulted in certain post-production costs that were previously presented as a reduction to gas revenue are now presented as gathering and processing expense.

Previous wording

Lease operating expense increased $11.1 million, or 13% for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024, primarily as a result of an increase in company labor and contract services of $4.9 million, higher saltwater disposal related expenses of $3.8 million, and higher compression expenses of $1.3 million. Lease operating expenses per Boe increased by $1.22 primarily related to the above noted increases, combined with lower production for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024.

Current wording

Lease operating expense increased $26.0 million, or 20% for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024, primarily as a result the IKAV and Sabinal acquisitions, which added $9.2 million of lease operating expense. Additionally, there was an increase in company labor and contract services of $5.6 million, higher saltwater disposal related expenses of $2.8 million, and higher compression expenses of $2.1 million. Lease operating expenses per Boe increased by $1.15 primarily related to the above noted increases, combined with lower production for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024, and as a result of the oil heavy production from the Sabinal acquisition added to our overall cost profile.

Previous wording

Production taxes decreased $0.8 million, or 7% for the three-month period ended June 30, 2025, as compared to the three-month period ended June 30, 2024. This decrease was in line with the decrease in oil, natural gas and NGL sales.

Current wording

Production taxes decreased $0.2 million, or 1% for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024. This decrease was in line with the decrease in oil, natural gas and NGL sales.

Previous wording

Midstream operating expense increased $1.0 million, or 19% for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024, primarily as a result of an increase of $0.4 million in both gathering operating expense and plant operating expense.

Current wording

Midstream operating expense increased $2.5 million, or 32% for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024, primarily as a result of an increase of $1.3 million in gathering operating expense and increases of $0.6 million in both produced water operating expense and plant operating expense.

Previous wording

Cost of product sales increased $0.5 million, or 8% for the three-month period ended June 30, 2025, as compared to the three-month period ended June 30, 2024. This increase was primarily a result of the increase in the average selling price of natural gas. These increases were consistent with the increase in product sales noted above.

Current wording

Cost of product sales increased $2.6 million, or 15% for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024. This increase was primarily a result of the increase in the average selling price of natural gas. These increases were consistent with the increase in product sales noted above.

Previous wording

Depreciation, depletion, amortization and accretion expense for oil and natural gas properties decreased by $5.7 million, or 4% for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024. The decrease is primarily the result of a decrease in production used to calculate depletion.

Current wording

Depreciation, depletion, amortization and accretion expense for oil and natural gas properties decreased by $6.1 million, or 3% for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024. The decrease is primarily the result of an increase in total reserves used to calculate depletion, offset with the increase in book value of oil and gas properties from the IKAV and Sabinal acquisitions.

Previous wording

Our primary sources of liquidity and capital are cash flows generated by operating activities, borrowings under the New Revolving Credit Facility, and proceeds from the issuance of equity and debt. At June 30, 2025, outstanding borrowings under the New Revolving Credit Facility were $565.0 million with $5.0 million in letters of credit outstanding, and the remaining availability under the New Revolving Credit Facility was $180.0 million at June 30, 2025.

Current wording

Our primary sources of liquidity and capital are cash flows generated by operating activities, borrowings under the New Credit Agreement, and proceeds from the issuance of equity and debt. At September 30, 2025, outstanding borrowings under the New Credit Agreement were $1.2 billion with $5.0 million in letters of credit outstanding, and the remaining availability under the New Credit Agreement was $295.0 million at September 30, 2025.

Previous wording

Historically, our business plan has focused on acquiring and then exploiting the development and production of our assets. We spent approximately $115.5 million during the six-month period ended June 30, 2025 on development costs and our budget for 2025 is between $260.0 million and $280.0 million. For purposes of calculating our cash available for distribution, we define development costs as all of our capital expenditures, other than acquisitions. Our development efforts and capital for 2025 is anticipated to focus on a mix of drilling Oswego, Woodford, Red Fork and Mississippian wells.

Current wording

Historically, our business plan has focused on acquiring and then exploiting the development and production of our assets. We spent approximately $174.6 million during the nine-month period ended September 30, 2025 on development costs and our budget for the remainder of 2025 is between $70.0 million and $75.0 million. For purposes of calculating our cash available for distribution, we define development costs as all of our capital expenditures, other than acquisitions. Our development efforts and capital for 2026 is anticipated to focus on a mix of drilling Mississippian, Mancos and Fruitland wells.

Previous wording

During the six-month period ended June 30, 2025, we spent approximately$96.7 million on drilling and completion activities and related equipmentand spud 16.1 net wells while bringing online 18.6 net wells, $15.1 million on remedial workovers and other capital projects,$3.7 million on midstream and other property and equipment capital projects and$91.3 million on acquisitions of oil and natural gas properties and other property and equipment.

Current wording

During the nine-month period ended September 30, 2025, we spent approximately$145.2 million on drilling and completion activities and related equipmentand spud 20.3 net wells while bringing online 20.9 net wells, $23.8 million on remedial workovers and other capital projects,$5.6 million on midstream and other property and equipment capital projects and$1.3 billion on acquisitions of oil and natural gas properties and other property and equipment.

Previous wording

Our 2025 capital expenditures program is largely discretionary and within our control. We could choose to defer a portion of these planned 2025 capital expenditures depending on a variety of factors, including, but not limited to, the success of our drilling activities, prevailing and anticipated prices for oil and natural gas, the availability of necessary equipment, including acid to be used for our acid stimulation completion, infrastructure and capital, the receipt and timing of required regulatory permits and approvals, seasonal conditions, drilling and acquisition costs and the level of participation by other working interest owners. A deferral of planned capital expenditures, particularly with respect to drilling and completing new wells, could result in a reduction in anticipated production and cash flows and reduce our cash available for distribution to unitholders.

Current wording

Our 2025 and 2026 capital expenditures program is largely discretionary and within our control. We could choose to defer a portion of these planned capital expenditures depending on a variety of factors, including, but not limited to, the success of our drilling activities, prevailing and anticipated prices for oil and natural gas, the availability of necessary equipment, including acid to be used for our acid stimulation completion, infrastructure and capital, the receipt and timing of required regulatory permits and approvals, seasonal conditions, drilling and acquisition costs and the level of participation by other working interest owners. A deferral of planned capital expenditures, particularly with respect to drilling and completing new wells, could result in a reduction in anticipated production and cash flows and reduce our cash available for distribution to unitholders.

Previous wording

Net cash provided by operating activities increased $11.9 million for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024. The increase in net cash provided by operating activities is primarily a result of an increase in the average selling price of natural gas, offset with a decrease in production. Additionally, we had an increase in realized gains on derivative instruments of $9.5 million for the six-month period ended June 30, 2025 primarily from a decrease in oil prices throughout the second quarter of 2025.

Current wording

Net cash provided by operating activities increased $6.6 million for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024. The increase in net cash provided by operating activities is primarily a result of an increase in the average selling price of natural gas, offset with a decrease in production. Additionally, we had an increase in realized gains on derivative instruments of $12.5 million for the nine-month period ended September 30, 2025 primarily from a decrease in oil prices throughout 2025.

Previous wording

Net cash used in investing activities increased $127.1 million for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024. The increase in net cash used in investing activities is primarily a result of increases in cash used to acquire assets of $100.1 million in the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024. This was slightly offset by decreases in capital expenditures on our oil and gas properties and on our other property and equipment of $6.3 million and $3.2 million, respectively, due to decreased drilling and completion activities in the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024.

Current wording

Net cash used in investing activities increased $629.1 million for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024. The increase in net cash used in investing activities is primarily a result of increases in cash used to acquire assets of $593.8 million in the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024. Additionally, we had a decrease in proceeds from the sale of oil and gas properties of $35.5 million in the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024.

Previous wording

Net cash used in financing activities

Current wording

Net cash provided by (used in) financing activities

Previous wording

Net cash used in financing activities decreased $31.4 million for the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024. The decrease in net cash used in investing activities is primarily due to an increase in cash provided by borrowings on our credit facilities, net of repayments of $565.0 million, and an increase in cash provided from proceeds from follow-on offerings of $221.1 million. These were partially offset by increases in cash used for repayments of our term loan of $742.5 million, prepayment penalties of $7.7 million and new debt issuance costs of $13.8 million. Additionally, there was a decrease in cash used for distributions to unitholders of $8.9 million in the six-month period ended June 30, 2025, as compared to the six-month period ended June 30, 2024.

Current wording

Net cash provided by (used in) financing activities increased $538.6 million for the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024. The increase is primarily due to an increase in cash provided by borrowings under our New Credit Agreement and Revolving Credit Agreement, net of repayments of $1.2 billion, and an increase in cash provided from proceeds from equity offerings of $91.2 million. These were partially offset by increases in cash used for repayments of borrowings under our Term Loan Credit Agreement of $721.9 million, prepayment penalties of $7.7 million and new debt issuance costs of $23.0 million. Additionally, there was a decrease in cash used for distributions to unitholders of $49.5 million in the nine-month period ended September 30, 2025, as compared to the nine-month period ended September 30, 2024.

Previous wording

On February 27, 2025, the Company entered into the New Revolving Credit Facility, among the Company, the lenders and issuing banks party thereto from time to time and Truist Bank, as the administrative agent and collateral agent.

Current wording

On February 27, 2025, the Company entered into the New Credit Agreement, among the Company, the lenders and issuing banks party thereto from time to time and Truist Bank, as the administrative agent and collateral agent.

Previous wording

The New Revolving Credit Facility has (i) an initial borrowing base and elected commitment amount of $750.0 million, with a maximum commitment amount of $2.0 billion subject to borrowing base availability, (ii) a maturity date of February 27, 2029 and (iii) an interest rate equal to, at the Company’s election, (a) term SOFR (subject to a 0.10% per annum adjustment) plus a margin ranging from 3.00-4.00% per annum or (b) a base rate plus a margin ranging from 2.00-3.00% per annum, with the margin dependent upon borrowing base utilization at the time of determination. The Company is also required to pay a commitment fee of 0.50% per annum on the daily unused portion of the current aggregate commitments under the New Revolving Credit Facility.

Current wording

The New Credit Agreement has (i) an initial borrowing base and elected commitment amount of $750.0 million, with a maximum commitment amount of $2.0 billion subject to borrowing base availability, (ii) a maturity date of February 27, 2029 and (iii) an interest rate equal to, at the Company’s election, (a) term SOFR (subject to a 0.10% per annum adjustment) plus a margin ranging from 3.00-4.00% per annum or (b) a base rate plus a margin ranging from 2.00-3.00% per annum, with the margin dependent upon borrowing base utilization at the time of determination. The Company is also required to pay a commitment fee of 0.50% per annum on the daily unused portion of the current aggregate commitments under the New Credit Agreement.

Previous wording

The New Revolving Credit Facility’s borrowing base is redetermined semi-annually, in April and October. The New Revolving Credit Facility requires the Company to maintain as of the last day of each fiscal quarter (i) a consolidated total net leverage ratio of less than or equal to 3.00 to 1.00, and (ii) a current ratio of no less than 1.00 to 1.00. In July 2025, the

Current wording

The New Credit Agreement’s borrowing base is redetermined semi-annually, in April and October. The New Credit Agreement requires the Company to maintain as of the last day of each fiscal quarter (i) a consolidated total net leverage ratio of less than or equal to 3.00 to 1.00, and (ii) a current ratio of no less than 1.00 to 1.00. In July 2025, the

Previous wording

Company entered into the Letter Agreement pursuant to which the lenders under the New Revolving Credit Facility waived

Current wording

Company entered into the Letter Agreement pursuant to which the lenders under the New Credit Agreement waived

Previous wording

The Company used borrowings from the New Revolving Credit Facility, together with cash on hand and proceeds from the February 2025 Offering, to repay the Term Loan Credit Agreement and the Revolving Credit Agreement in full.

Current wording

The Company used borrowings from the New Credit Agreement, together with cash on hand and proceeds from the February 2025 Offering, to repay the Term Loan Credit Agreement and the Revolving Credit Agreement in full.

Previous wording

We are a party to firm transportation contracts for the transport of natural gas. We paid approximately $0.1 million and $0.2 million in firm transportation contracts for the three and six month periods ended June 30, 2025, respectively. As of June 30, 2025, the Company has no material amounts remaining under these agreements. For further information on firm transportation contracts, see Note 10 of our consolidated financial statements.

Current wording

We are a party to firm transportation contracts for the transport of natural gas. We paid approximately $0.1 million and $0.2 million in firm transportation contracts for the three and nine month periods ended September 30, 2025, respectively. As of September 30, 2025, the Company has no material amounts remaining under these agreements. For further information on firm transportation contracts, see Note 10 of our consolidated financial statements.

Previous wording

Our operating lease obligations include long-term lease payments for office space, vehicles, equipment related to exploration, development and production activities. We paid approximately $4.0 million and $1.9 million in operating lease payments for the three and six month periods ended June 30, 2025, respectively, and expect to pay approximately $17.7 million in operating lease payments through 2029. For further information on our operating lease obligations, see Note 11 of our consolidated financial statements.

Current wording

Our operating lease obligations include long-term lease payments for office space, vehicles, equipment related to exploration, development and production activities. We paid approximately $6.1 million and $2.1 million in operating lease payments for the three and nine month periods ended September 30, 2025, respectively, and expect to pay approximately $23.6 million in operating lease payments through 2029. For further information on our operating lease obligations, see Note 11 of our consolidated financial statements.

Previous wording

We include in this Quarterly Report the supplemental non-GAAP financial performance measure Adjusted EBITDA and provide our calculation of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income, our most directly comparable financial measure calculated and presented in accordance with GAAP. We define Adjusted EBITDA as net income before (1) interest expense, net, (2) depreciation, depletion, amortization and accretion, (3) unrealized loss (gain) on derivative instruments, (4) loss on debt extinguishment, (5) equity-based compensation expense and (6) (gain) loss on sale of assets, net.

Current wording

We include in this Quarterly Report the supplemental non-GAAP financial performance measure Adjusted EBITDA and provide our calculation of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income, our most directly comparable financial measure calculated and presented in accordance with GAAP. We define Adjusted EBITDA as net income before (1) interest expense, net, (2) depreciation, depletion, amortization and accretion, (3) unrealized loss (gain) on derivative instruments, (4) impairment on oil and gas assets, (5) loss on debt extinguishment, (6) equity-based compensation expense and (7) (gain) loss on sale of assets, net.

Previous wording

Cash available for distribution is not a measure of net income or net cash flow provided by or used in operating activities as determined by GAAP. Cash available for distribution is a supplemental non-GAAP financial performance measure used by our management and by external users of our financial statements, such as industry analysts, investors, lenders, rating agencies and others, to assess our ability to internally fund our exploration and development activities, pay distributions, and to service or incur additional debt. We define cash available for distribution as net income adjusted for (1) interest expense, net, (2) depreciation, depletion, amortization and accretion, (3) unrealized loss (gain) on derivative instruments, (4) loss on debt extinguishment, (5) equity-based compensation expense, (6) (gain) loss on sale of assets, net, (7) cash interest expense, net, (8) development costs and (9) change in accrued realized derivative settlements. Development costs include all of our capital expenditures, other than acquisitions. Cash available for distribution will not reflect changes in working capital balances. Cash available for distribution is not a measurement of our financial performance or liquidity under GAAP and should not be considered as an alternative to, or more meaningful than, net income or net cash provided by or used in operating activities as determined in accordance with GAAP or as indicators of our financial performance and liquidity. The GAAP measure most directly comparable to cash available for distribution is net income. Cash available for distribution should not be considered as an alternative to, or more meaningful than, net income.

Current wording

Cash available for distribution is not a measure of net income or net cash flow provided by or used in operating activities as determined by GAAP. Cash available for distribution is a supplemental non-GAAP financial performance measure used by our management and by external users of our financial statements, such as industry analysts, investors, lenders, rating agencies and others, to assess our ability to internally fund our exploration and development activities, pay distributions, and to service or incur additional debt. We define cash available for distribution as net income adjusted for (1) interest expense, net, (2) depreciation, depletion, amortization and accretion, (3) unrealized loss (gain) on derivative instruments, (4) impairment on oil and gas assets, (5) loss on debt extinguishment, (6) equity-based compensation expense, (7) (gain) loss on sale of assets, net, (8) cash interest expense, net, (9) development costs and (10) change in accrued realized derivative settlements. Development costs include all of our capital expenditures, other than acquisitions. Cash available for distribution will not reflect changes in working capital balances. Cash available for distribution is not a measurement of our financial performance or liquidity under GAAP and should not be considered as an alternative to, or more meaningful than, net income or net cash provided by or used in operating activities as determined in accordance with GAAP or as indicators of our financial performance and liquidity. The GAAP measure most directly comparable to cash available for distribution is net income. Cash available for distribution should not be considered as an alternative to, or more meaningful than, net income.

Previous wording

Our critical accounting policies and estimates are disclosed in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Estimates” in our Annual Report for the year ended December 31, 2024. No modifications have been made during the six months ended June 30, 2025.

Current wording

Our critical accounting policies and estimates are disclosed in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Estimates” in our Annual Report for the year ended December 31, 2024. No modifications have been made during the nine months ended September 30, 2025.