GULFPORT ENERGY CORP

3. PROPERTY AND EQUIPMENT

The major categories of property and equipment and related accumulated DD&A are as follows (in thousands):

Oil and Natural Gas Properties

Under the full cost method of accounting, the Company is required to perform a ceiling test each quarter. The test determines a limit, or ceiling, on the book value of the Company's oil and natural gas properties. At March 31, 2026 and 2025, the net book value of the Company's oil and gas properties was below the calculated ceiling. As a result, the Company didnot record an impairment of its oil and natural gas properties for the three months ended March 31, 2026 or 2025.

General and administrative costs capitalized to the full cost pool represent management’s estimate of costs incurred directly related to exploration and development activities such as geological and other administrative costs associated with overseeing the exploration and development activities. All general and administrative costs not directly associated with exploration and development activities are charged to expense as they are incurred. Capitalized general and administrative costs were approximately $5.5 million and $6.2 million for the three months ended March 31, 2026 and 2025, respectively.

The Company evaluates the costs excluded from its amortization calculation at least annually. Individually insignificant unevaluated properties are grouped for evaluation and periodically transferred to evaluated properties over a timeframe consistent with their expected development schedule.

The following table summarizes the Company’s non-producing properties excluded from amortization by area (in thousands):

Asset Retirement Obligation

The following table provides a reconciliation of the Company’s asset retirement obligation (in thousands):