GULFPORT ENERGY CORP

13. LEASES

Nature of Leases

The Company has operating leases on certain equipment with remaining lease durations in excess of one year. The Company recognizes a right-of-use asset and lease liability on the balance sheet for all leases with lease terms of greater than one year. Short-term leases that have an initial term of one year or less are not capitalized.

The Company has historically entered into contractsfor drilling rigs with varying terms with third parties to ensure operational continuity, cost control and rig availability in its operations.

The Company rents office space for its corporate headquarters, field locations and certain other equipment from third parties. These agreements are typically structured with non-cancelable terms ofone year tofive years. The Company has determined these agreements represent operating leases with a lease term that equals the primary non-cancelable contract term. The Company has included any renewal options that it has determined are reasonably certain of exercise in the determination of the lease terms.

Discount Rate

As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company's incremental borrowing rate reflects the estimated rate of interest that it would pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment.

Future amounts due under operating lease liabilities as of June 30, 2026 were as follows (in thousands):

Leases Not Yet Commenced

In May 2026, the Company executed afive-year lease agreement for office space with a commencement date of September 1, 2026. As the lease had not commenced as of June 30, 2026, no right-of-use asset or lease liability was recognized. Upon commencement, the Company expects to recognize an operating lease right-of-use asset and a corresponding lease liability of approximately $5 million.

In April 2026, the Company entered into an amended drilling rig lease agreement that extends the lease term approximatelytwo years. As of June 30, 2026, the amended lease had not commenced, and therefore no right-of-use asset or lease liability had been recognized. Upon commencement in July 2026, the Company recognized an operating lease right-of-use asset and a corresponding lease liability of approximately $22 million.

Lease costs incurred consisted of the following (in thousands):

(1) The majority of the Company's total lease cost was capitalized to the full cost pool, and the remainder was included in either lease operating expenses or general and administrative expenses in the accompanying consolidated statements of operations.

The weighted average remaining lease term as of June 30, 2026 was 0.3 years. The weighted average discount rate used to determine the operating lease liability as of June 30, 2026 was 6.10%.