Aug 13, 2026 earnings call — Record quarter and False Caney test
Company reported highest quarterly revenue of $22.5 million and highest production, with average production 4,690 BOE per day.
Revenue $0.0B (est $0.0B) · EPS $0.23 (est $0.21)
Key quotes
"Our second quarter resulted in the company having its highest quarterly revenue, production and adjusted EBITDA in the history of the company."
"We have a whole core that shows that the False Caney is highly oil saturated and it has excellent characteristics on logs from numerous wells in the field."
"We anticipate the 4 new wells in our 2026 drilling program will add on to this growth, primarily in the fourth quarter when the wells are expected to be contributing a full quarter of production."
Analyst Q&A 3
Why production stayed strong and guidance drivers
Q (Steve Ferazani · Sidoti): Why did production stay strong in 2Q despite no new volumes? Were there factors not included in the late-June guidance, and will costs like water hauling continue?
A: Management said the wells performed well and gas lift/compression gave temporary boosts, so production held up but will start a normal decline later. The gas purchaser volume adjustment goes back to '24 and earlier periods. They said the biggest driver for guidance is how the 4 wells coming online perform; 3Q should be the low quarter and 4Q the high quarter. Workovers should be isolated to the quarter and water hauling should taper down through the year, though slightly above last year.
"On the guidance test, yes, because it's a lot of production coming on at once, right?" — Wolf E. Regener (CEO)
Risk and expectations for 2-mile False Caney well
Q (Nicholas Pope · ROTH Capital): What are the remaining risks for the Lavina (False Caney) 2-mile well and how will you judge success versus the core Caney wells? Also, how will its initial rates compare to Caney?
A: Wolf said the False Caney zone is a little thinner than the Caney but could still be comparable if repeatable. He gave reserve and acreage context: the Caney has 11,500 acres net to them, about 9,900 prospective acres, and 40 million barrels proved in the Caney. He said the main unknowns are flow rates and decline rates, it's too early to know initial rates, and they expect core and steering work to make the well definitive.
"But if you look at how much acreage we have in our proved reserves for our Caney itself, it's like 11,500 acres net to us." — Wolf E. Regener (CEO)
Casing problem, costs, and gas/oil mix
Q (Richard Dearnley · Longport Partners): Why did the Clifton Mack wells need extra casing and how much extra pressure was there? What did those wells cost? Is gas/oil ratio increasing or temporary? And will False Caney be more oil saturated?
A: Wolf said it was not a casing failure but they had to run extra casing strings to isolate a shallower low-pressure interval and higher pressures lower in the hole; he has no quantifiable pressure number yet. He said those wells were more expensive than their normal wells but they have not disclosed a specific cost. On gas/oil mix, Gary said the 70% in May and June skewed the quarter; Wolf added earlier new wells had higher oil percent but more gas came in later, and they won't know False Caney's oil percentage until they drill and fracture it.
"Well, we haven't specified it specifically, but they were more expensive than our normal wells." — Wolf E. Regener (CEO)