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<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0pt"></td><td style="width: 17.3pt; text-align: left">1.</td><td id="xdx_826_z1LnPr1bK307" style="text-align: justify">NATURE OF BUSINESS</td> </tr></table> Next Bridge Hydrocarbons, Inc. (the “Company”) was incorporated in Nevada on August 31, 2021, as OilCo Holdings, Inc. and changed its name to Next Bridge Hydrocarbons, Inc. pursuant to its Amended and Restated Articles of Incorporation filed on June 30, 2022. The Company is an energy company engaged in the acquisition, exploration, exploitation and development of oil and natural gas properties in the United States. The Company has minor interests in the Eastern edge of the Midland Basin in Texas (the “Hazel Project”), and two minor well interests in the Hunton wells located in Oklahoma (the “Oklahoma Properties”). The Company has no employees. We engage contractors and consultants for various roles as needed including management and high quality exploration and technical partners The Company operates its business through nine wholly owned subsidiaries Torchlight Energy, Inc., a Nevada corporation (“TEI”), Hudspeth Oil Corporation, a Texas corporation (“Hudspeth”), Torchlight Hazel, LLC, a Texas limited liability company (“Torchlight Hazel”), Wolfbone Investments, LLC, a Texas limited liability company (“Wolfbone”), Hudspeth Operating, LLC, a Texas limited liability company and wholly owned subsidiary of Hudspeth (“Hudspeth Operating”), Wildcat Panther, LLC, a Texas limited liability company (“Panther”), Wildcat Valentine, LLC, a Texas limited liability company (“Valentine”), Wildcat Cowboy, LLC, a Texas limited liability company (“Cowboy”), Wildcat Packer, LLC, a Texas limited liability company (“Packer”). All intercompany transactions have been eliminated in consolidated financial statements.

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0pt"></td><td style="width: 17.3pt; text-align: left">2.</td><td style="text-align: justify">GOING CONCERN</td> </tr></table> At December 31, 2025, the Company had not yet achieved profitable operations. The Company had a net loss of $10,561,149 for the year ended December 31, 2025. The Company expects to incur further losses in the development of its business. The Company had a working capital deficit as of December 31, 2025 of $61,853,377. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent on its ability to generate future profitable operations or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management’s plan to address the Company’s ability to continue as a going concern includes: (1) obtaining debt or equity funding from private placement, institutional, or public sources; (2) obtaining loans from financial institutions, where possible, or (3) participating in joint venture transactions with third parties. Although management believes that it will be able to obtain the necessary funding to allow the Company to remain a going concern through the methods discussed above, there can be no assurances that such methods will prove successful. These consolidated financial statements have been prepared assuming that the Company will continue as a going concern and therefore, the financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amount and classifications of liabilities that may result from the outcome of this uncertainty.

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<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0pt"></td><td style="width: 17.3pt; text-align: left">3.</td><td style="text-align: justify">SIGNIFICANT ACCOUNTING POLICIES</td> </tr></table> The Company maintains its accounts on the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America. Accounting principles followed and the methods of applying those principles, which materially affect the determination of financial position, results of operations and cash flows are summarized below: Use of estimates—The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and certain assumptions that affect the amounts reported in these consolidated financial statements and accompanying notes. Actual results could differ from these estimates. Basis of presentation—The financial statements are presented on a consolidated basis and include the accounts of Next Bridge Hydrocarbons, Inc. and its wholly owned subsidiaries, TEI, Hudspeth, Torchlight Hazel, Wolfbone, Hudspeth Operating. and Wildcat Panther, LLC, a Texas limited liability company (“Panther”), Wildcat Valentine, LLC, a Texas limited liability company (“Valentine”), Wildcat Cowboy, LLC, a Texas limited liability company (“Cowboy”), Wildcat Packer, LLC, a Texas limited liability company (“Packer”). All significant intercompany balances and transactions have been eliminated. In the opinion of management, the accompanying consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary to fairly present the financial position as of, and the results of operations for all periods presented. In preparing the accompanying financial statements, management has made certain estimates and assumptions that affect reported amounts in the consolidated financial statements and disclosures of contingencies. Actual results may differ from those estimates. Reclassification—Certain prior year amounts related to Other assets – related party have been reclassified to conform to the fiscal 2025 presentation. Risks and uncertainties—The Company’s operations are subject to significant risks and uncertainties, including financial, operational, technological, and other risks associated with operating an emerging business, including the potential risk of business failure. Concentration of risks—At times the Company’s cash balances are in excess of amounts guaranteed by the Federal Deposit Insurance Corporation. The Company’s cash is placed with a highly rated financial institution, and the Company regularly monitors the creditworthiness of the financial institutions with which it does business. Fair value of financial instruments—Financial instruments consist of cash, receivables, payables and promissory notes, if any. The estimated fair values of cash, receivables, and payables approximate the carrying amount due to the relatively short maturity of these instruments. The carrying amounts of any promissory notes approximate their fair value giving affect for the term of the note and the effective interest rates. For assets and liabilities that require re-measurement to fair value the Company categorizes them in a three-level fair value hierarchy as follows: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">●</td><td style="text-align: justify">Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.</td> </tr></table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">●</td><td style="text-align: justify">Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration.</td> </tr></table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">●</td><td style="text-align: justify">Level 3 inputs are unobservable inputs based on management’s own assumptions used to measure assets and liabilities at fair value.</td> </tr></table> A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. Cash and cash equivalents – Cash and cash equivalents include certain investments in highly liquid instruments with original maturities of three months or less. Accounts receivable – Accounts receivable consisted of amounts due from a purchaser of excess oilfield equipment. Management reviews receivables periodically and reduces the carrying amount by a valuation allowance that reflects management’s best estimate of the amount that may not be collectible. As of December 31, 2025 and 2024, no valuation allowance was considered necessary. Oil and natural gas properties – The Company uses the full cost method of accounting for exploration and development activities as defined by the SEC. Under this method of accounting, the costs of unsuccessful, as well as successful, exploration and development activities are capitalized as properties and equipment. This includes any internal costs that are directly related to property acquisition, exploration and development activities but does not include any costs related to production, general corporate overhead or similar activities. Oil and natural gas properties include costs that are excluded from costs being depleted or amortized. Oil and natural gas property costs excluded represent investments in unevaluated properties and include non-producing leasehold, geological, and geophysical costs associated with leasehold or drilling interests and exploration drilling costs. The Company allocates a portion of its acquisition costs to unevaluated properties based on relative value. Costs are transferred to the full cost pool as the properties are evaluated over the life of the reservoir. Unevaluated properties are reviewed for impairment at least quarterly and are determined through an evaluation considering, among other factors, seismic data, requirements to relinquish acreage, drilling results, remaining time in the commitment period, remaining capital plan, and political, economic, and market conditions. Impairment expense of $5,373,207 for the year ended December 31, 2025, has been recorded from the participation in drilling and development of a well on the Panther acreage in Louisiana determined to be a dry hole and management’s review of other Louisiana properties for impairment as of December 31, 2025. Impairment expense of $56,186,313 for the year ended December 31, 2024 arose from the October 8, 2024 notice from University Lands that the Company’s Orogrande mineral interest agreement would not be renewed at its December 31, 2024 scheduled expiration. Gains and losses, if any, on the sale of oil and natural gas properties are not generally reflected in income unless the gain or loss would significantly alter the relationship between capitalized costs and proved reserves. Sales of less than 100% of the Company’s interest in the oil and natural gas property are treated as a reduction of the capital cost of the field, with no gain or loss recognized, as long as doing so does not significantly affect the unit-of-production depletion rate. Costs of retired equipment, net of salvage value, are usually charged to accumulated depreciation. Capitalized interest – The Company capitalizes interest on unevaluated properties during the periods in which they are excluded from costs being depleted or amortized. During the year ended December 31, 2025, the Company capitalized $-0- of interest on unevaluated properties. Capitalized interest for the year ended December 31, 2024, was $2,182,519. Depreciation, depletion, and amortization – The depreciable base for oil and natural gas properties includes the sum of all capitalized costs net of accumulated depreciation, depletion, and amortization (“DD&A”), estimated future development costs and asset retirement costs not included in oil and natural gas properties, less costs excluded from amortization. The depreciable base of oil and natural gas properties is amortized on a unit-of-production method. Ceiling test – Future production volumes from oil and natural gas properties are a significant factor in determining the full cost ceiling limitation of capitalized costs. Under the full cost method of accounting, the Company is required to periodically perform a “ceiling test” that determines a limit on the book value of oil and natural gas properties. If the net capitalized cost of proved oil and natural gas properties, net of related deferred income taxes, plus the cost of unproved oil and natural gas properties, exceeds the present value of estimated future net cash flows discounted at 10 percent, net of related realizable tax affects, plus the cost of unproved oil and natural gas properties, the excess is charged to expense and reflected as additional accumulated DD&A. The ceiling test calculation uses a commodity price assumption which is based on the unweighted arithmetic average of the price on the first day of each month for each month within the prior 12-month period and excludes future cash outflows related to estimated abandonment costs. The determination of oil and natural gas reserves is a subjective process, and the accuracy of any reserve estimate depends on the quality of available data and the application of engineering and geological interpretation and judgment. Estimates of economically recoverable reserves and future net cash flows depend on a number of variable factors and assumptions that are difficult to predict and may vary considerably from actual results. In particular, reserve estimates for wells with limited or no production history are less reliable than those based on actual production. Subsequent re-evaluation of reserves and cost estimates related to future development of proved oil and natural gas reserves could result in significant revisions to proved reserves. Other issues, such as changes in regulatory requirements, technological advances, and other factors which are difficult to predict could also affect estimates of proved reserves in the future. Asset retirement obligations – The fair value of a liability for an asset’s retirement obligation (“ARO”) is recognized in the period in which it is incurred if a reasonable estimate of fair value can be made, with the corresponding charge capitalized as part of the carrying amount of the related long-lived asset. The liability is accreted to its then-present value each subsequent period, and the capitalized cost is depleted over the useful life of the related asset. Abandonment costs incurred are recorded as a reduction of the ARO liability. Inherent in the fair value calculation of an ARO are numerous assumptions and judgments including the ultimate settlement amounts, inflation factors, credit adjusted discount rates, timing of settlement, and changes in the legal, regulatory, environmental, and political environments. To the extent future revisions to these assumptions impact the fair value of the existing ARO liability, a corresponding adjustment is made to the oil and natural gas property balance. Settlements greater than or less than amounts accrued as ARO are recorded as a gain or loss upon settlement. Share-based compensation – Compensation cost for equity awards is based on the fair value of the equity instrument on the date of grant and is recognized over the period during which an employee is required to provide service in exchange for the award. The Company accounts for stock option awards using the calculated value method. The Company values warrant and option awards using the Black-Scholes option pricing model. The Company accounts for any forfeitures of options when they occur. Previously recognized compensation cost for an award is reversed in the period that the award is forfeited. The Company also issues equity awards to non-employees. The fair value of these option awards is estimated when the award recipient completes the contracted professional services. The Company recognizes the expense for the estimated total value of the awards during the period from their issuance until performance completion. Income taxes – Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that the related tax benefits will not be realized. Reference Note 8 to the Financial Statements. Authoritative guidance for uncertainty in income taxes requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an examination. Management has reviewed the Company’s tax positions and determined there were no uncertain tax positions requiring recognition in the consolidated financial statements. Company tax returns remain subject to federal and state tax examinations. Generally, the applicable statutes of limitation are three to four years from their respective filings. Estimated interest and penalties related to potential underpayment on any unrecognized tax benefits are classified as a component of tax expense in the statements of operation. The Company has not recorded any interest or penalties associated with unrecognized tax benefits for the year ended December 31, 2025, or for the year ended December 31, 2024. Revenue recognition – The Company’s revenue is typically generated from contracts to sell natural gas, crude oil or NGLs produced from interests in oil and natural gas properties owned by the Company. Contracts for the sale of natural gas and crude oil are evidenced by (1) base contracts for the sale and purchase of natural gas or crude oil, which document the general terms and conditions for the sale, and (2) transaction confirmations, which document the terms of each specific sale. The transaction confirmations specify a delivery point which represents the point at which control of the product is transferred to the customer. The Company elects to treat contracts to sell oil and natural gas production as normal sales, which are then accounted for as contracts with customers. The Company has determined that these contracts represent multiple performance obligations, which are satisfied when control of the commodity transfers to the customer, typically through the delivery of the specified commodity to a designated delivery point. Revenue is measured based on consideration specified in the contract with the customer, and excludes any amounts collected on behalf of third parties. The Company recognizes revenue in the amount that reflects the consideration it expects to be entitled to in exchange for transferring control of those goods to the customer. Amounts allocated in the Company’s price contracts are based on the standalone selling price of those products in the context of long-term contracts. Payment is generally received one or two months after the sale has occurred. Gain or loss on derivative instruments is outside the scope of ASC 606, Revenue Recognition, and is not considered revenue from contracts with customers subject to ASC 606. The Company may in the future use financial or physical contracts accounted for as derivatives as economic hedges to manage price risk associated with normal sales, or in limited cases may use them for contracts the Company intends to physically settle but do not meet all of the criteria to be treated as normal sales. Producer Gas Imbalances. The Company applies the sales method of accounting for natural gas revenue. Under this method, revenues are recognized based on the actual volume of natural gas sold to purchasers. Basic and diluted earnings (loss) per share – Basic earnings (loss) per common share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per common share is computed in the same way as basic earnings (loss) per common share except that the denominator is increased to include the number of additional common shares that would be outstanding if all potential common shares had been issued and if the additional common shares were dilutive. The Company had no dilutive shares for the year ended December 31, 2025, or for the year ended December 31, 2024. Reference Note 7 to the Financial Statements regarding outstanding Stock Options. Environmental laws and regulations – The Company is subject to extensive federal, state, and local environmental laws and regulations. Environmental expenditures are expensed or capitalized depending on their future economic benefit. The Company believes that it is in compliance with existing laws and regulations. The Company accrued no liability as of December 31, 2025 and December 31, 2024. Recent accounting pronouncements adopted – In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“ASU 2023-07”), which expands a public entity’s annual and interim disclosure requirements about their reportable segments, primarily through more detailed disclosures about significant segment expenses. Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures in ASC 280 on an interim and annual basis. ASU 2023-07 is effective for annual periods beginning after December 15, 2023, and for interim periods beginning after December 15, 2024. We have adopted this standard for our fiscal year 2024 annual financial statements and interim financial statements thereafter and have applied this standard retrospectively for all prior periods presented in the financial statements. The adoption did not have a material impact on our financial statements or results of operations. Accounting Pronouncements Not Yet Adopted In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”), which requires public entities to disclosure additional information about certain costs and expenses included in relevant expense captions presented on the income statement. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and for interim periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. Management is currently evaluating ASU 2024-03 to determine its impact on the Partnership’s disclosures. In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”), which provides a practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606, Revenue from Contracts with Customers. The practical expedient permits an entity to assume that current conditions as of the balance sheet date do not change for the remaining life of the current accounts receivable and current contract assets. ASU 2025-05 is effective for annual and interim periods beginning after December 15, 2025 on a prospective basis, with early adoption permitted. The Company is currently evaluating the potential impact of adopting this new guidance on the consolidated financial statements and related disclosures. Segment Reporting The Company manages its business activities on a consolidated basis and operates in a single operating and reportable segment. Operating segments are defined as components of a public entity that engages in business activities and for which discrete financial information and operating results are available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and assess performance. The Company’s Chief Executive Officer (“CEO”) has been determined to be the Chief Operating Decision Maker (CODM) of the Company. The CEO uses net income, as reported on our consolidated income statements, to assess financial performance and allocate resources on a consolidated basis. The CEO manages and evaluates the results of the Company on a consolidated basis, and net income is used to evaluate key operating decisions, such as making strategic acquisitions, determining transaction structures to capitalize on the development of oil and natural gas properties, and allocating resources for general and administrative expenditures. The CEO does not review consolidated balance sheet assets when assessing segment performance and deciding how to allocate resources. The measure of segment assets is reported on the balance sheet as total consolidated assets. Disaggregated operating revenues of the Company’s single segment and all significant segment expenses are presented separately on the Company’s consolidated statement of operations. There are no other significant segment expenses or other segment items that would require disclosure.

Use of estimates—The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and certain assumptions that affect the amounts reported in these consolidated financial statements and accompanying notes. Actual results could differ from these estimates.

Basis of presentation—The financial statements are presented on a consolidated basis and include the accounts of Next Bridge Hydrocarbons, Inc. and its wholly owned subsidiaries, TEI, Hudspeth, Torchlight Hazel, Wolfbone, Hudspeth Operating. and Wildcat Panther, LLC, a Texas limited liability company (“Panther”), Wildcat Valentine, LLC, a Texas limited liability company (“Valentine”), Wildcat Cowboy, LLC, a Texas limited liability company (“Cowboy”), Wildcat Packer, LLC, a Texas limited liability company (“Packer”). All significant intercompany balances and transactions have been eliminated. In the opinion of management, the accompanying consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary to fairly present the financial position as of, and the results of operations for all periods presented. In preparing the accompanying financial statements, management has made certain estimates and assumptions that affect reported amounts in the consolidated financial statements and disclosures of contingencies. Actual results may differ from those estimates.

Reclassification—Certain prior year amounts related to Other assets – related party have been reclassified to conform to the fiscal 2025 presentation.

Risks and uncertainties—The Company’s operations are subject to significant risks and uncertainties, including financial, operational, technological, and other risks associated with operating an emerging business, including the potential risk of business failure.

Concentration of risks—At times the Company’s cash balances are in excess of amounts guaranteed by the Federal Deposit Insurance Corporation. The Company’s cash is placed with a highly rated financial institution, and the Company regularly monitors the creditworthiness of the financial institutions with which it does business.

Fair value of financial instruments—Financial instruments consist of cash, receivables, payables and promissory notes, if any. The estimated fair values of cash, receivables, and payables approximate the carrying amount due to the relatively short maturity of these instruments. The carrying amounts of any promissory notes approximate their fair value giving affect for the term of the note and the effective interest rates. For assets and liabilities that require re-measurement to fair value the Company categorizes them in a three-level fair value hierarchy as follows: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">●</td><td style="text-align: justify">Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.</td> </tr></table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">●</td><td style="text-align: justify">Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration.</td> </tr></table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">●</td><td style="text-align: justify">Level 3 inputs are unobservable inputs based on management’s own assumptions used to measure assets and liabilities at fair value.</td> </tr></table> A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

Cash and cash equivalents – Cash and cash equivalents include certain investments in highly liquid instruments with original maturities of three months or less.

Accounts receivable – Accounts receivable consisted of amounts due from a purchaser of excess oilfield equipment. Management reviews receivables periodically and reduces the carrying amount by a valuation allowance that reflects management’s best estimate of the amount that may not be collectible. As of December 31, 2025 and 2024, no valuation allowance was considered necessary.

Oil and natural gas properties – The Company uses the full cost method of accounting for exploration and development activities as defined by the SEC. Under this method of accounting, the costs of unsuccessful, as well as successful, exploration and development activities are capitalized as properties and equipment. This includes any internal costs that are directly related to property acquisition, exploration and development activities but does not include any costs related to production, general corporate overhead or similar activities. Oil and natural gas properties include costs that are excluded from costs being depleted or amortized. Oil and natural gas property costs excluded represent investments in unevaluated properties and include non-producing leasehold, geological, and geophysical costs associated with leasehold or drilling interests and exploration drilling costs. The Company allocates a portion of its acquisition costs to unevaluated properties based on relative value. Costs are transferred to the full cost pool as the properties are evaluated over the life of the reservoir. Unevaluated properties are reviewed for impairment at least quarterly and are determined through an evaluation considering, among other factors, seismic data, requirements to relinquish acreage, drilling results, remaining time in the commitment period, remaining capital plan, and political, economic, and market conditions. Impairment expense of $5,373,207 for the year ended December 31, 2025, has been recorded from the participation in drilling and development of a well on the Panther acreage in Louisiana determined to be a dry hole and management’s review of other Louisiana properties for impairment as of December 31, 2025. Impairment expense of $56,186,313 for the year ended December 31, 2024 arose from the October 8, 2024 notice from University Lands that the Company’s Orogrande mineral interest agreement would not be renewed at its December 31, 2024 scheduled expiration. Gains and losses, if any, on the sale of oil and natural gas properties are not generally reflected in income unless the gain or loss would significantly alter the relationship between capitalized costs and proved reserves. Sales of less than 100% of the Company’s interest in the oil and natural gas property are treated as a reduction of the capital cost of the field, with no gain or loss recognized, as long as doing so does not significantly affect the unit-of-production depletion rate. Costs of retired equipment, net of salvage value, are usually charged to accumulated depreciation.

5373207

56186313

Capitalized interest – The Company capitalizes interest on unevaluated properties during the periods in which they are excluded from costs being depleted or amortized. During the year ended December 31, 2025, the Company capitalized $-0- of interest on unevaluated properties. Capitalized interest for the year ended December 31, 2024, was $2,182,519.

2182519

Depreciation, depletion, and amortization – The depreciable base for oil and natural gas properties includes the sum of all capitalized costs net of accumulated depreciation, depletion, and amortization (“DD&A”), estimated future development costs and asset retirement costs not included in oil and natural gas properties, less costs excluded from amortization. The depreciable base of oil and natural gas properties is amortized on a unit-of-production method.

Ceiling test – Future production volumes from oil and natural gas properties are a significant factor in determining the full cost ceiling limitation of capitalized costs. Under the full cost method of accounting, the Company is required to periodically perform a “ceiling test” that determines a limit on the book value of oil and natural gas properties. If the net capitalized cost of proved oil and natural gas properties, net of related deferred income taxes, plus the cost of unproved oil and natural gas properties, exceeds the present value of estimated future net cash flows discounted at 10 percent, net of related realizable tax affects, plus the cost of unproved oil and natural gas properties, the excess is charged to expense and reflected as additional accumulated DD&A. The ceiling test calculation uses a commodity price assumption which is based on the unweighted arithmetic average of the price on the first day of each month for each month within the prior 12-month period and excludes future cash outflows related to estimated abandonment costs. The determination of oil and natural gas reserves is a subjective process, and the accuracy of any reserve estimate depends on the quality of available data and the application of engineering and geological interpretation and judgment. Estimates of economically recoverable reserves and future net cash flows depend on a number of variable factors and assumptions that are difficult to predict and may vary considerably from actual results. In particular, reserve estimates for wells with limited or no production history are less reliable than those based on actual production. Subsequent re-evaluation of reserves and cost estimates related to future development of proved oil and natural gas reserves could result in significant revisions to proved reserves. Other issues, such as changes in regulatory requirements, technological advances, and other factors which are difficult to predict could also affect estimates of proved reserves in the future.

Asset retirement obligations – The fair value of a liability for an asset’s retirement obligation (“ARO”) is recognized in the period in which it is incurred if a reasonable estimate of fair value can be made, with the corresponding charge capitalized as part of the carrying amount of the related long-lived asset. The liability is accreted to its then-present value each subsequent period, and the capitalized cost is depleted over the useful life of the related asset. Abandonment costs incurred are recorded as a reduction of the ARO liability. Inherent in the fair value calculation of an ARO are numerous assumptions and judgments including the ultimate settlement amounts, inflation factors, credit adjusted discount rates, timing of settlement, and changes in the legal, regulatory, environmental, and political environments. To the extent future revisions to these assumptions impact the fair value of the existing ARO liability, a corresponding adjustment is made to the oil and natural gas property balance. Settlements greater than or less than amounts accrued as ARO are recorded as a gain or loss upon settlement.

Share-based compensation – Compensation cost for equity awards is based on the fair value of the equity instrument on the date of grant and is recognized over the period during which an employee is required to provide service in exchange for the award. The Company accounts for stock option awards using the calculated value method. The Company values warrant and option awards using the Black-Scholes option pricing model. The Company accounts for any forfeitures of options when they occur. Previously recognized compensation cost for an award is reversed in the period that the award is forfeited. The Company also issues equity awards to non-employees. The fair value of these option awards is estimated when the award recipient completes the contracted professional services. The Company recognizes the expense for the estimated total value of the awards during the period from their issuance until performance completion.

Income taxes – Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that the related tax benefits will not be realized. Reference Note 8 to the Financial Statements. Authoritative guidance for uncertainty in income taxes requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an examination. Management has reviewed the Company’s tax positions and determined there were no uncertain tax positions requiring recognition in the consolidated financial statements. Company tax returns remain subject to federal and state tax examinations. Generally, the applicable statutes of limitation are three to four years from their respective filings. Estimated interest and penalties related to potential underpayment on any unrecognized tax benefits are classified as a component of tax expense in the statements of operation. The Company has not recorded any interest or penalties associated with unrecognized tax benefits for the year ended December 31, 2025, or for the year ended December 31, 2024.

Revenue recognition – The Company’s revenue is typically generated from contracts to sell natural gas, crude oil or NGLs produced from interests in oil and natural gas properties owned by the Company. Contracts for the sale of natural gas and crude oil are evidenced by (1) base contracts for the sale and purchase of natural gas or crude oil, which document the general terms and conditions for the sale, and (2) transaction confirmations, which document the terms of each specific sale. The transaction confirmations specify a delivery point which represents the point at which control of the product is transferred to the customer. The Company elects to treat contracts to sell oil and natural gas production as normal sales, which are then accounted for as contracts with customers. The Company has determined that these contracts represent multiple performance obligations, which are satisfied when control of the commodity transfers to the customer, typically through the delivery of the specified commodity to a designated delivery point. Revenue is measured based on consideration specified in the contract with the customer, and excludes any amounts collected on behalf of third parties. The Company recognizes revenue in the amount that reflects the consideration it expects to be entitled to in exchange for transferring control of those goods to the customer. Amounts allocated in the Company’s price contracts are based on the standalone selling price of those products in the context of long-term contracts. Payment is generally received one or two months after the sale has occurred. Gain or loss on derivative instruments is outside the scope of ASC 606, Revenue Recognition, and is not considered revenue from contracts with customers subject to ASC 606. The Company may in the future use financial or physical contracts accounted for as derivatives as economic hedges to manage price risk associated with normal sales, or in limited cases may use them for contracts the Company intends to physically settle but do not meet all of the criteria to be treated as normal sales. Producer Gas Imbalances. The Company applies the sales method of accounting for natural gas revenue. Under this method, revenues are recognized based on the actual volume of natural gas sold to purchasers.

Basic and diluted earnings (loss) per share – Basic earnings (loss) per common share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings (loss) per common share is computed in the same way as basic earnings (loss) per common share except that the denominator is increased to include the number of additional common shares that would be outstanding if all potential common shares had been issued and if the additional common shares were dilutive. The Company had no dilutive shares for the year ended December 31, 2025, or for the year ended December 31, 2024. Reference Note 7 to the Financial Statements regarding outstanding Stock Options.

Environmental laws and regulations – The Company is subject to extensive federal, state, and local environmental laws and regulations. Environmental expenditures are expensed or capitalized depending on their future economic benefit. The Company believes that it is in compliance with existing laws and regulations. The Company accrued no liability as of December 31, 2025 and December 31, 2024.

Recent accounting pronouncements adopted – In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“ASU 2023-07”), which expands a public entity’s annual and interim disclosure requirements about their reportable segments, primarily through more detailed disclosures about significant segment expenses. Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures in ASC 280 on an interim and annual basis. ASU 2023-07 is effective for annual periods beginning after December 15, 2023, and for interim periods beginning after December 15, 2024. We have adopted this standard for our fiscal year 2024 annual financial statements and interim financial statements thereafter and have applied this standard retrospectively for all prior periods presented in the financial statements. The adoption did not have a material impact on our financial statements or results of operations. Accounting Pronouncements Not Yet Adopted In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”), which requires public entities to disclosure additional information about certain costs and expenses included in relevant expense captions presented on the income statement. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and for interim periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. Management is currently evaluating ASU 2024-03 to determine its impact on the Partnership’s disclosures. In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”), which provides a practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606, Revenue from Contracts with Customers. The practical expedient permits an entity to assume that current conditions as of the balance sheet date do not change for the remaining life of the current accounts receivable and current contract assets. ASU 2025-05 is effective for annual and interim periods beginning after December 15, 2025 on a prospective basis, with early adoption permitted. The Company is currently evaluating the potential impact of adopting this new guidance on the consolidated financial statements and related disclosures.

Segment Reporting The Company manages its business activities on a consolidated basis and operates in a single operating and reportable segment. Operating segments are defined as components of a public entity that engages in business activities and for which discrete financial information and operating results are available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and assess performance. The Company’s Chief Executive Officer (“CEO”) has been determined to be the Chief Operating Decision Maker (CODM) of the Company. The CEO uses net income, as reported on our consolidated income statements, to assess financial performance and allocate resources on a consolidated basis. The CEO manages and evaluates the results of the Company on a consolidated basis, and net income is used to evaluate key operating decisions, such as making strategic acquisitions, determining transaction structures to capitalize on the development of oil and natural gas properties, and allocating resources for general and administrative expenditures. The CEO does not review consolidated balance sheet assets when assessing segment performance and deciding how to allocate resources. The measure of segment assets is reported on the balance sheet as total consolidated assets. Disaggregated operating revenues of the Company’s single segment and all significant segment expenses are presented separately on the Company’s consolidated statement of operations. There are no other significant segment expenses or other segment items that would require disclosure.

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">4.</td><td style="text-align: justify">OIL AND NATURAL GAS PROPERTIES</td> </tr></table> The following table presents the capitalized costs for oil and natural gas properties of the Company: Schedule of Oil and Natural Gas Properties <table cellpadding="0" cellspacing="0" id="xdx_30E_134_zkCzFd97EaHb" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 80%" summary="xdx: Disclosure - OIL AND NATURAL GAS PROPERTIES (Details)"> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: center"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" id="xdx_493_20251231_zvA8U3qvrOTa" style="border-bottom: Black 1pt solid; white-space: nowrap; text-align: center">December 31, 2025</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" id="xdx_495_20241231_zvXkC57RBM58" style="border-bottom: Black 1pt solid; white-space: nowrap; text-align: center">December 31, 2024</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: center"> </td><td> </td> <td colspan="2" style="white-space: nowrap; text-align: center"> </td><td> </td><td> </td> <td colspan="2" style="white-space: nowrap; text-align: center"> </td><td> </td></tr> <tr id="xdx_40B_ecustom--CapitalizedCostsEvaluatedCostsSubjectToAmortization_iI_maCzYa9_z84Y0k1pqHab" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; text-indent: -8.65pt; padding-left: 8.65pt">Evaluated costs subject to amortization</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">-</td><td style="white-space: nowrap; text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">-</td><td style="white-space: nowrap; text-align: left"> </td></tr> <tr id="xdx_407_ecustom--CapitalizedCostsUnevaluatedCosts_iI_maCzYa9_zPCvwX5bzYXb" style="vertical-align: bottom; background-color: White"> <td style="width: 54%; text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 8.65pt">Unevaluated costs</td><td style="width: 3%; padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; width: 1%; text-align: left"> </td><td style="border-bottom: Black 1pt solid; width: 8%; text-align: right">5,373,207</td><td style="white-space: nowrap; width: 1%; padding-bottom: 1pt; text-align: left"> </td><td style="width: 3%; padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; width: 1%; text-align: left"> </td><td style="border-bottom: Black 1pt solid; width: 8%; text-align: right">569,551</td><td style="white-space: nowrap; width: 1%; padding-bottom: 1pt; text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--CapitalizedCostsOilAndGasProducingActivitiesGross_iTI_mtCzYa9_maCzVnp_zNMP2fsakPzc" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; text-indent: -8.65pt; padding-left: 34.6pt">Total capitalized costs</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5,373,207</td><td style="white-space: nowrap; text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">569,551</td><td style="white-space: nowrap; text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--CapitalizedCostsAccumulatedDepreciationDepletionAmortizationAndValuationAllowanceForRelatingToOilAndGasProducingActivities_iI_msCzVnp_z44WcIJTxVgc" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; text-indent: -8.65pt; padding-left: 8.65pt">Less accumulated depreciation, depletion and amortization</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">-</td><td style="white-space: nowrap; text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">-</td><td style="white-space: nowrap; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 8.65pt">Less accumulated impairment</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(5,373,207</td><td style="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">-</td><td style="white-space: nowrap; padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: right; text-indent: -8.65pt; padding-left: 8.65pt"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="white-space: nowrap; text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="white-space: nowrap; text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--OilAndGasPropertyFullCostMethodNet_iTI_mtCzVnp_zeKlo3yWU4Af" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt; text-indent: -8.65pt; padding-left: 34.6pt">Total oil and natural gas properties</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">-</td><td style="white-space: nowrap; padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">569,551</td><td style="white-space: nowrap; padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> The Company periodically adjusts for the separation of evaluated versus unevaluated costs within its full cost pool to recognize the value impairment related to the expiration of, or changes in market value, of unevaluated leases. The impact of reclassifications as they become necessary is to increase the basis for calculation of future period’s depletion, depreciation and amortization which effectively recognizes the impairment on the consolidated statement of operations over future periods. Reclassified costs also become evaluated costs for purposes of ceiling tests, and which may cause recognition of increased impairment expense in future periods. There were no remaining cumulative unevaluated costs which had been reclassified within the Company’s full cost pool totals as of December 31, 2025, or December 31, 2024, since the Company had no proved reserve value associated with our properties. Due to the volatility of commodity prices, should oil and natural gas prices decline in the future, it is possible that a write-down could occur. Proved reserves are estimated quantities of crude oil, natural gas, and NGLs, which geological and engineering data demonstrate with reasonable certainty to be recoverable from known reservoirs under existing economic and operating conditions. The independent engineering estimates include only those amounts considered to be proved reserves and do not include additional amounts which may result from new discoveries in the future, or from application of secondary and tertiary recovery processes where facilities are not in place or for which transportation or marketing contracts are not in place. Estimated reserves to be developed through secondary or tertiary recovery processes are classified as unevaluated properties. Current Projects The Company is an energy company engaged in the acquisition, exploration, exploitation and/or development of oil and natural gas properties in the United States. The Company is primarily focused on the acquisition of early-stage projects, the development and delineation of these projects, and then the monetization of those assets once these activities are completed. As of December 31, 2025, the Company had interests in three oil and natural gas projects: the Hazel Project in Sterling, Tom Green, and Irion Counties, Texas (seven wells), two wells in Central Oklahoma and unevaluated mineral leases in Louisiana. During the fourth quarter of 2025 Magnetar began development on the initial test well on the Valentine mineral acreage in Louisiana held by our subsidiary Wildcat–Valentine LLC which included a $600,000 spud fee to the Company. The Company declined to exercise its option to participate in the drilling project. Magnetar has granted the Company a nominal net 0.8% working interest in the initial test well being developed. The net amount of the spud fee ($360,000 after payment to project consultants) has been recorded as other income in the accompanying financial statements since the Company has no continuing interest or capitalized costs in the Valentine mineral leases. The Louisiana unevaluated mineral leases were fully impaired as of December 31, 2025. Hazel Project in the Midland Basin in West Texas Effective April 4, 2016, TEI acquired from MPC a 66.66% working interest in approximately 12,000 acres in the Midland Basin. A back-in after payout of a 25% working interest was retained by MPC and another unrelated working interest owner. In October 2016, the holders of all of Torchlight’s then-outstanding shares of Series C Preferred Stock (which were issued in July 2016) elected to convert into a total 33.33% working interest in our Hazel Project, reducing TEI’s ownership from 66.66% to a 33.33% working interest. Acquisition of Additional Interests in Hazel Project On January 30, 2017, Torchlight entered into and closed an Agreement and Plan of Reorganization and a Plan of Merger with an entity which was wholly owned by Mr. McCabe, which resulted in the acquisition of approximately 40.66% working interest in the 12,000 gross acres, 9,600 net acres, in the Hazel Project. Also on January 30, 2017, Torchlight entered into and closed a Purchase and Sale Agreement with Wolfbone. Under the agreement, Torchlight acquired certain of Wolfbone’s Hazel Project assets, including its interest in the Flying B Ranch #1 well and the 40-acre unit surrounding the well. Upon the closing of the transactions, the Torchlight working interest in the Hazel Project increased by 40.66% to a total ownership of 74%. Effective June 1, 2017, Torchlight acquired an additional 6% working interest from unrelated working interest owners increasing its working interest in the Hazel project to 80%, and an overall net revenue interest of 75%. Seven test wells have been drilled on the Hazel Project to capture and document the scientific base in support of demonstrating the production potential of the property. Two of the wells were plugged and abandoned in the fourth quarter of 2025 at a gross cost of $106,284 which was partially offset by $30,995 of accreted cost from the Asset Retirement Obligation. Option Agreement with Masterson Hazel Partners, LP On August 13, 2020, the Company’s subsidiaries TEI and Torchlight Hazel (collectively, “Torchlight Subs”) entered into an option agreement (the “Option Agreement”) with Masterson Hazel Partners, LP (“MHP”) and MPC. Under the agreement, MHP was obligated to drill and complete, or cause to be drilled and completed, at its sole cost and expense, a new lateral well (the “Well”) on the Hazel Project, sufficient to satisfy Torchlight Subs’s continuous development obligations on the southern half of the prospect no later than September 30, 2020. MHP has satisfied this drilling obligation. MHP paid Torchlight Subs $1,000 as an option fee at the time of execution of the Option Agreement. MHP is entitled to receive, as its sole recourse for the recoupment of drilling costs, the revenue from production of the Well attributable to the Torchlight Subsidiary’s interest until such time as it has recovered its reasonable costs and expenses for drilling, completing, and operating the well. In exchange for MHP satisfying the above drilling obligations, Torchlight Subs granted to MHP the exclusive right and option to perform operations, at MHP’s sole cost and expense, on the Hazel Project sufficient to satisfy Torchlight Subsidiary’s continuous development obligations on the northern half of the prospect. MHP declined to exercise its option to purchase the entire Hazel Project. Full impairment of the historical cost incurred in prior periods for the Hazel Project has been previously recognized. Hunton Play, Central Oklahoma As of December 31, 2025, the Company was producing from one well in the Viking Area of Mutual Interest and one well in Prairie Grove. Full impairment of the historical cost incurred in prior periods for the Oklahoma properties has been previously recognized. The McCabe Contribution Agreement On July 25, 2023, the Company entered into a Contribution Agreement among the Company, Mr. McCabe, and MPC, an entity exclusively owned and operated by Mr. McCabe (the “McCabe Contribution Agreement”). MPC has committed to contribute up to one hundred percent (100%) of the interest currently held by MPC in the drilling project located on over 1,150 acres in Vermillion Parish, Louisiana (the “Bronco Prospect”). In July 2024 the Company agreed to participate in the cost of seismic data for the Bronco project to preserve its option to receive an assignment from MPC on the acreage with the intention of developing it at some time in the future, and with the understanding that discussions were ongoing between MPC and unrelated parties for them to potentially acquire the Bronco. In the event the Bronco was sold to an unrelated party, the Company would receive all cash and/or working interest equity retained in the sale. McCabe would only retain his overriding royalty interest as previously disclosed and will not receive any additional compensation. The Company has paid $474,103 toward the seismic data collection and other costs related to maintain the Bronco leases through December 31, 2025 which it recorded as a prepayment toward either a future assignment of the Bronco, or as having an interest in the proceeds of a sale of the Bronco by Mr. McCabe to an unrelated party. These costs have been reclassified as of December 31, 2025 as “Other assets – related party”.

The following table presents the capitalized costs for oil and natural gas properties of the Company: Schedule of Oil and Natural Gas Properties <table cellpadding="0" cellspacing="0" id="xdx_30E_134_zkCzFd97EaHb" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 80%" summary="xdx: Disclosure - OIL AND NATURAL GAS PROPERTIES (Details)"> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: center"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" id="xdx_493_20251231_zvA8U3qvrOTa" style="border-bottom: Black 1pt solid; white-space: nowrap; text-align: center">December 31, 2025</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" id="xdx_495_20241231_zvXkC57RBM58" style="border-bottom: Black 1pt solid; white-space: nowrap; text-align: center">December 31, 2024</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td style="white-space: nowrap; text-align: center"> </td><td> </td> <td colspan="2" style="white-space: nowrap; text-align: center"> </td><td> </td><td> </td> <td colspan="2" style="white-space: nowrap; text-align: center"> </td><td> </td></tr> <tr id="xdx_40B_ecustom--CapitalizedCostsEvaluatedCostsSubjectToAmortization_iI_maCzYa9_z84Y0k1pqHab" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; text-indent: -8.65pt; padding-left: 8.65pt">Evaluated costs subject to amortization</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">-</td><td style="white-space: nowrap; text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">-</td><td style="white-space: nowrap; text-align: left"> </td></tr> <tr id="xdx_407_ecustom--CapitalizedCostsUnevaluatedCosts_iI_maCzYa9_zPCvwX5bzYXb" style="vertical-align: bottom; background-color: White"> <td style="width: 54%; text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 8.65pt">Unevaluated costs</td><td style="width: 3%; padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; width: 1%; text-align: left"> </td><td style="border-bottom: Black 1pt solid; width: 8%; text-align: right">5,373,207</td><td style="white-space: nowrap; width: 1%; padding-bottom: 1pt; text-align: left"> </td><td style="width: 3%; padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; width: 1%; text-align: left"> </td><td style="border-bottom: Black 1pt solid; width: 8%; text-align: right">569,551</td><td style="white-space: nowrap; width: 1%; padding-bottom: 1pt; text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--CapitalizedCostsOilAndGasProducingActivitiesGross_iTI_mtCzYa9_maCzVnp_zNMP2fsakPzc" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; text-indent: -8.65pt; padding-left: 34.6pt">Total capitalized costs</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5,373,207</td><td style="white-space: nowrap; text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">569,551</td><td style="white-space: nowrap; text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--CapitalizedCostsAccumulatedDepreciationDepletionAmortizationAndValuationAllowanceForRelatingToOilAndGasProducingActivities_iI_msCzVnp_z44WcIJTxVgc" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; text-indent: -8.65pt; padding-left: 8.65pt">Less accumulated depreciation, depletion and amortization</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">-</td><td style="white-space: nowrap; text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">-</td><td style="white-space: nowrap; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 8.65pt">Less accumulated impairment</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(5,373,207</td><td style="white-space: nowrap; padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">-</td><td style="white-space: nowrap; padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: right; text-indent: -8.65pt; padding-left: 8.65pt"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="white-space: nowrap; text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="white-space: nowrap; text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--OilAndGasPropertyFullCostMethodNet_iTI_mtCzVnp_zeKlo3yWU4Af" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt; text-indent: -8.65pt; padding-left: 34.6pt">Total oil and natural gas properties</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">-</td><td style="white-space: nowrap; padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">569,551</td><td style="white-space: nowrap; padding-bottom: 2.5pt; text-align: left"> </td></tr> </table>

5373207 569551

5373207

569551

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">5.</td><td style="text-align: justify">RELATED PARTY BALANCES</td> </tr></table> The 2021 Note and Loan Agreement On October 1, 2021, the Company entered into a note payable with Meta, its former parent, to borrow up to $15 million which bears interest at 8% per annum, computed on the basis of a 360-day year (the “2021 Note”). The 2021 Note was initially to mature on March 31, 2023 (the “2021 Note Maturity Date”). If an event of default has occurred and is continuing, interest on the 2021 Note may accrue at the default rate of 12% per annum. The 2021 Note includes a restrictive covenant that, subject to certain exceptions and qualifications, restricts the Company’s ability to merge or consolidate with another person or entity, or sell or transfer all or substantially all of its assets, unless the Company is the surviving entity, or the successor entity assumes all of obligations under the 2021 Note. The 2021 Note was originally collateralized by certain shares of common stock in Meta held by one of Meta’s stockholders, Mr. McCabe. On September 2, 2022, the Company entered into a loan agreement with Meta, as lender (the “Loan Agreement”) that would govern prior loan amounts advanced to the Company from Meta. As of August 11, 2022, and August 29, 2022, the Company borrowed an additional $1.2 million and $1.46 million, respectively, representing the remaining amount available for borrowing under the Loan Agreement and resulting in a total of $5 million principal amount outstanding related to the Loan Agreement, the proceeds of which were used for working capital and general corporate purposes. The term loans under the Loan Agreement bear interest at a per annum rate equal to 8% and were to mature on March 31, 2023 (the “Maturity Date”). The Loan Agreement includes customary representations and covenants that, subject to exceptions and qualifications, restrict our ability to do certain things, such as: engage in mergers, acquisitions, and asset sales; transact with affiliates; undergo a change in control; incur additional indebtedness; incur liens; make loans and investments; declare dividends or redeem or repurchase equity interests; and enter into certain restrictive agreements. In addition, the Loan Agreement contains customary events of default, mandatory prepayment events and affirmative covenants, including, without limitation, covenants regarding the payment of taxes and other obligations, maintenance of insurance, maintenance of our material properties, reporting requirements, compliance with applicable laws and regulations, and formation or acquisition of new subsidiaries. Under the terms of the Arrangement Agreement that governed the merger transaction between Torchlight and Meta in June 2021, the oil and natural gas assets were to be sold or spun out from Meta and the costs of any sale or spin-off incurred by Meta were to be borne the then-existing shareholders of Torchlight. The amount of the reimbursement payable to Meta in connection with the Spin-Off was $2.59 million which was added to the principal amount of the Loan Agreement for a principal balance outstanding of $7.59 million as of March 31, 2023. Concurrently with the amendment to the Loan Agreement, the Company made a prepayment of $1 million to reduce the principal balance to $6.59 million. On August 7, 2023, Mr. McCabe and Meta entered into a Loan Sale Agreement whereby Mr. McCabe purchased from Meta (i) the 2021 Note and (ii) all outstanding loans made to the Company by Meta pursuant to the Loan Agreement (the “Loan Purchase”). As a result of the Loan Purchase, Mr. McCabe replaced Meta as the lender and secured party under the 2021 Note and the Loan Agreement. The Company’s obligations and responsibilities under the 2021 Note and the Loan Agreement remain unchanged. The combined balance on the 2021 Note and the Loan Agreement as of December 31, 2025 was $21.22 million. As of December 31, 2025, the combined total accrued and unpaid interest under the 2021 Note and the Loan Agreement was $6.46 million. The maturity dates of the 2021 Note and Loan Agreement have been extended several times. An amendment to the 2021 Note and Loan Agreement entered into on June 30, 2025 includes an automatic renewal provision, and the maturity date of both is presently extended to March 31, 2026. On December 22, 2022, the Company issued an unsecured promissory note in the principal amount of up to $20 million in favor of Mr. McCabe (the “2022 Note”), which bears interest at 5% per annum, computed on the basis of a 365-day year. As of December 31, 2025, the Company had $24.63 million in principal amount outstanding under the 2022 Note. As of December 31, 2025, the Company had $2.92 million in accrued but unpaid interest on the 2022 Note. The maturity dates of the 2022 Note has been extended several times. An amendment to the 2022 Note entered into on June 30, 2025 includes an automatic renewal provision, and the maturity date of both is presently extended to March 31, 2026. MPC has also advanced $97,027 for advance lease payments related to the “Bronco Project” which is pending transfer to the Company as of December 31, 2025. The Company is accounting for the advances as accounts payable and prepaid costs until the transfer of the project is completed. The prepaid costs have been reclassified as of December 31, 2025 as “Other assets – related party”.

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">6.</td><td style="text-align: justify">COMMITMENTS AND CONTINGENCIES</td> </tr></table> Legal Matters On March 15, 2024, a securities class action captioned Targgart v. Next Bridge Hydrocarbons, Inc., et al., No. 24-cv-1927, was filed in the U.S. District Court for the Eastern District of New York. The action is brought on behalf of a putative class of persons or entities that acquired the Company’s shares in connection with the Company’s spin-off from Meta Materials, Inc., in December 2022. The complaint names as defendants the Company and certain of its current and former officers and directors. The complaint asserts claims under Sections 11 and 15 of the Securities Act, alleging that the Form S-1 that the Company filed with the SEC on July 14, 2022, which became effective on November 18, 2022, contained untrue statements or omissions. The complaint seeks, among other things, unspecified statutory and compensatory damages. On August 12, 2024, the case was transferred to the Northern District of Texas. On September 9, 2024, plaintiffs filed an amended complaint that added a Section 12(a)(2) claim against the Company. On July 3, 2025, the District Court granted Defendants’ Motion to Dismiss and dismissed the case with prejudice. Final Judgment was entered that same day. On July 29, 2025, the plaintiffs filed a Notice of Appeal to appeal the case to the U.S. Court of Appeals for the Fifth Circuit. This appeal is still pending. On December 9, 2024, a pro se plaintiff brought claims against the Company in the United States District Court, Western District, Midland Division under a lawsuit captioned Matthew J. Pease v. Securities & Exchange Commission, Financial Industry Regulatory Authority, Depository Trust & Clearing Corporation, OTC Markets Group, Inc., John Brda, Gregory McCabe, Next Bridge Hydrocarbons, Inc., which claims include: (i) violations of Sarbanes-Oxley Act; (ii) violation of Regulation FD; (iii) negligent and intentional infliction of emotional distress; (iv) conspiracy to commit fraud; and (iv) antitrust violations under the Sherman Act. The Company filed a motion to dismiss, which was granted on February 25, 2026, and all claims against the Company were dismissed with prejudice. Since dismissal, the plaintiff has filed a notice of appeal which is still pending. On December 6, 2024, a pro se plaintiff brought claims against the Company in the United States District Court, Western District, Midland Division under a lawsuit captioned Danielle Spears v. Next Bridge Hydrocarbons, Inc., Gregory McCabe, John Brda, Roger N. Wurtele, Kenneth Rice, Joseph DeWoody, Clifton Dubose and Jane Doe 1/20, John Doe 1-20, which claims include allegations of numerous violations of federal securities law, including: (i) violations of the Securities Exchange Act of 1934; (ii) negligence; (iii) failure to resolve the FINRA U3 halt, with reference to Section 10(b); (iv) unjust enrichment; (v) conspiracy to commit fraud; and (vi) emotional distress (negligent or intentional infliction). The Company filed a motion to dismiss, which was granted on February 24, 2026, and all claims against the Company were dismissed with prejudice. Since dismissal, the plaintiff has filed a notice of appeal, which is still pending. On December 6, 2024, a pro se plaintiff brought claims against the Company in the United States District Court, Western District, Midland Division under a lawsuit captioned Contique Willcot v. Securities & Exchange Commission, GTS Securities, LLC, Ari Rubinstein, Next Bridge Hydrocarbons, Inc., John Brda, Gregory McCabe, Financial Industry Regulatory Authority, which claims include allegations of numerous violations of federal securities law, including: (i) violations of the Securities Exchange Act of 1934; (ii) violation of the Sherman Antitrust Act and the Clayton Act; (iii) negligence; and (iv) unjust enrichment. The Company filed a Motion to Dismiss, which was granted on March 16, 2026, and all claims against the Company were dismissed with prejudice. Since dismissal, the plaintiff has filed a notice of appeal, which is still pending. Environmental Matters The Company is subject to contingencies as a result of environmental laws and regulations. Present and future environmental laws and regulations applicable to the Company’s operations could require substantial capital expenditures or could adversely affect its operations in other ways that cannot be predicted at this time. As of December 31, 2025, and December 31, 2024, no amounts had been recorded because no specific liability has been identified that is reasonably probable of requiring the Company to fund any future material amounts.

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">7.</td><td style="text-align: justify">MEZZANINE EQUITY</td> </tr></table> Series A Preferred Stock On August 20, 2025, the Company entered into and closed a transaction with Panther Bridge, LLC, a Texas limited liability company (“Panther Bridge”), under which Panther Bridge loaned $6,000,000 to the Company, see note 10. The transaction was effective through a Subscription Agreement that was entered into between the two parties, under which the Company sold to Panther Bridge an 18% Unsecured Promissory Note in the original principal amount of $6,000,000.00 (the “Panther Bridge Note”), along with 3,000,000 shares of Series A Redeemable Preferred Stock, par value of $0.0001 per share (the “Preferred Stock”) for $0. The Series A Preferred Stock is recorded at the fair value at the time of issuance of $4,843 in the Company’s Consolidated Financial Statements. Mezzanine Classification The Series A Preferred Stock is redeemable in the event of certain change of control events involving the Company. S99-3A(2) of the SEC’s Accounting Series Release No. 268 (“ASR 268”) requires preferred securities that are redeemable for cash or other assets to be classified outside of permanent equity if they are redeemable (i) at a fixed or determinable price on a fixed or determinable date, (ii) at the option of the holder, or (iii) upon the occurrence of an event that is not solely within the control of the issuer. Preferred securities that are mandatorily redeemable are required to be classified by the issuer as liabilities whereas under ASR 268 guidance an issuer should classify a preferred security whose redemption is contingent on an event not entirely in control of the issuer as mezzanine equity. The Series A Preferred Stock is not mandatorily redeemable, however, a change in control is not solely in control of the Company, accordingly, the Company determined that mezzanine treatment is appropriate for the Series A and has presented it as such in our Consolidated Financial Statements as of and for the year ended December 31, 2025. Liquidation Preference The Series A Preferred Stock will rank senior to the Company’s common stock, (the “Common Stock”), with respect to dividend rights and rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company. Dividends Holders of the Series A Preferred Stock are entitled to a dividend at the rate of 18.0% per annum, compounding quarterly, paid in cash, at the Company’s election. For any quarter in which the Company elects not to pay the dividend in cash, such dividend will become part of the redemption price of each share of Series A Preferred Stock as of the applicable dividend payment date. During the year ended December 31, 2025, the Company did not declare or pay dividends. Dividends will accrue at the discretion of the Board of Directors. Voting The Series A Preferred Stock will not be entitled to vote with the holders of the Common Stock. Redemption At any time, the Company may redeem, ratably, in whole, the shares of Series A Preferred Stock of any holder outstanding at such time at a redemption price per share of Series A Preferred Stock equal to the following: sum of (i) $1.00 plus (ii) all unpaid dividends (whether or not declared) on such share accrued from (and including) the immediately preceding dividend payment date to (but not including) the redemption date. Change in Control Redemption In the event of any change in control transaction occurring after the original issuance date, each holder of shares of Series A Preferred Stock outstanding immediately prior to the consummation of such change in control transaction shall be entitled to have all, but not less than all, of the shares of Series A Preferred Stock be redeemed at the redemption price upon the consummation of such change in control transaction. As of December 31, 2025, the Series A Preferred Stock is not probable of becoming redeemable.

3000000

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">8.</td><td style="text-align: justify">STOCKHOLDERS’ EQUITY</td> </tr></table> The Company has 500,000,000 authorized shares of common stock, par value of $0.0001 per share and 50,000,000 authorized shares of preferred stock, par value of $0.0001 per share. 3,000,000 shares of preferred stock have been issued in connection with Mezzanine Equity discussed in Note 7 above. On February 29, 2024, we entered into a consulting agreement with an individual, under which the consultant agreed to provide analysis and advisory services to us for consideration of $10,000 per month and the issuance to him of 500,000 shares of common stock, under the terms and conditions of the consulting agreement. On March 28, 2024, the Company we entered into and closed a Contribution Agreement with Wildcat Partners SPV, LLC, a Delaware limited liability company (“Wildcat”), under which Wildcat transferred to us 100% of the issued and outstanding membership interests in each of (a) Wildcat Cowboy, LLC, a Texas limited liability company (“Cowboy”), (b) Wildcat Packer, LLC, a Texas limited liability company (“Packer”), (c) Wildcat Panther, LLC, a Texas limited liability company (“Panther”) and (d) Wildcat Valentine, LLC, a Texas limited liability company (“Valentine”). As consideration, we issued 2,500,000 shares of our common stock, under the terms and conditions of the Contribution Agreement. On April 2, 2024, the Company issued 100,000 shares of common stock in connection with a consulting agreement under which the consultant has agreed to provide advisory services. Effective December 30, 2024, the Company issued 8,432,047 shares of common stock to the Participants in the Johnson Project. On October 6, 2023, the Company and certain investor participants (each a “Participant” and collectively the “Participants”) entered into twenty-five separate Participation Agreements (the “Participation Agreements”) to conduct drilling of wells in the Company’s approximately 17,000 acre Johnson Prospect in Hudspeth County, Texas. Within a specified period following drilling of the initial five wells, pursuant to the Participation Agreement, each Participant had the right to elect to transfer and assign all its interests to the Company in exchange for the issuance of shares of common stock. All 25 participants elected to exercise that right effective December 30, 2024, requiring the issuance of common stock. On December 31, 2024, the Company authorized issuance of 3,000,000 shares of common stock to directors, an officer, and a consultant for services. On March 10, 2025, the Company authorized issuance of 1,025,000 shares of common stock valued at par value of $103 to directors, an officer, and a consultant for services. On September 25, 2025, the Company authorized issuance of 250,000 shares of common stock valued at par value of $25 to a consultant for services. Stock Based Compensation In 2022, the Company’s board of directors adopted, and the stockholders approved, the 2022 Equity Incentive Plan (the “2022 Plan”). The 2022 Plan permits the Company to grant stock options, restricted stock, restricted stock units, performance shares awards and any one or more of the foregoing, for up to a maximum of 58,273,612 shares following an automatic increase to the number of shares reserved under the 2022 Plan on January 1, 2023. During the year ended December 31, 2023, the Company granted 35,856,521 stock options in the first and second quarters of 2023 as authorized under the 2022 Plan. Upon the resignations by certain of the Company’s employees in the second quarter, 2023, 6,618,889 of the options granted to those employees in March, 2023. were forfeited, canceled, and returned to the option pool available under the 2022 Plan. As of December 31, 2025 and 2024, 29,237,632 options were outstanding. Vesting was subject to continued service with the Company for up to one year with provisions for earlier vesting subject to the attainment of events outlined in the Plan. All options outstanding were fully vested as of December 31, 2023. Inputs to the Black-Scholes Model are as follows: Schedule of Share-Based Compensation Arrangements by Share-Based Payment Award <table cellpadding="0" cellspacing="0" id="xdx_30E_134_z0Mop1wLythh" style="font: 10pt Times New Roman, Times, Serif; width: 60%; border-collapse: collapse" summary="xdx: Disclosure - STOCKHOLDERS' EQUITY (Details)"> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif"></td> <td id="xdx_496_20250101__20251231_zk2pXjbnYJCi" style="font: 10pt Times New Roman, Times, Serif; text-align: center"></td></tr> <tr id="xdx_404_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardFairValueAssumptionsRiskFreeInterestRate_dp_uPure_zT2PqlJSTRj6" style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif; width: 48%">Risk-free interest rate</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center; width: 12%">4.00%</td></tr> <tr id="xdx_403_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardFairValueAssumptionsExpectedVolatilityRate_dp_uPure_z5k3r6zthYsh" style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: white"> <td style="font: 10pt Times New Roman, Times, Serif">Expected volatility of common stock</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center">125.39%</td></tr> <tr id="xdx_407_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardFairValueAssumptionsExpectedDividendRate_dp_zpgiVjRr18K9" style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif">Dividend yield</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center">0.00%</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: white"> <td style="font: 10pt Times New Roman, Times, Serif">Discount due to lack of marketability</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center">0%</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif">Expected life of option</td> <td id="xdx_986_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardFairValueAssumptionsExpectedTerm1_dxH_c20250101__20251231_z6anbvzhVTA6" style="font: 10pt Times New Roman, Times, Serif; text-align: center" title="::XDX::P5Y6M">5.5 Years</td></tr> </table> A summary of stock options outstanding as of December 31, 2025, all of which expire in 2033, including the relevant exercise price is presented below: Schedule of Stock Options Outstanding <table cellpadding="0" cellspacing="0" id="xdx_301_134_zdeFao36bzp3" style="font: 10pt Times New Roman, Times, Serif; width: 60%; border-collapse: collapse" summary="xdx: Disclosure - STOCKHOLDERS' EQUITY (Details 2)"> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: bottom"> <td colspan="2" style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">Exercise</td> <td style="font: 10pt Times New Roman, Times, Serif"> </td> <td style="font: 10pt Times New Roman, Times, Serif"> </td> <td colspan="2" id="xdx_485_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iI_hcustom--OptionExpiryAxis__custom--Year2033Member_zOrZ7nV6zH2e" style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">Expiration</td> <td style="font: 10pt Times New Roman, Times, Serif"> </td> <td style="font: 10pt Times New Roman, Times, Serif"> </td> <td colspan="2" id="xdx_487_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iI_hcustom--OptionExpiryAxis__custom--Year2033Member_z6XdAiRaA2M1" style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center"> </td> <td style="font: 10pt Times New Roman, Times, Serif"> </td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: bottom"> <td colspan="2" style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">Price</td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">2033</td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">Total</td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td></tr> <tr id="xdx_41E_20251231__us-gaap--MeasurementInputTypeAxis__custom--ExercisePriceDollarOnePointTwoZeroFiveSixMember_zQyClNwefFIh" style="font: 10pt Times New Roman, Times, Serif; vertical-align: bottom; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif; width: 1%; padding-bottom: 1pt">$</td> <td style="font: 10pt Times New Roman, Times, Serif; width: 8%; padding-bottom: 1pt; text-align: right"><span id="xdx_909_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardPerShareWeightedAveragePriceOfSharesPurchased_iI_c20251231__us-gaap--MeasurementInputTypeAxis__custom--ExercisePriceDollarOnePointTwoZeroFiveSixMember_zbaG8KhGcXvl">1.2056</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; width: 1%; padding-bottom: 1pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; width: 3%; padding-bottom: 1pt"> </td> <td style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; width: 1%"> </td> <td style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; width: 8%; text-align: right">29,237,632</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; width: 1%; padding-bottom: 1pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; width: 3%; padding-bottom: 1pt"> </td> <td style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; width: 1%"> </td> <td style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; width: 8%; text-align: right">29,237,632</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; width: 1%; padding-bottom: 1pt"> </td></tr> <tr id="xdx_419_20251231_zvEBlfvS7xDk" style="font: 10pt Times New Roman, Times, Serif; vertical-align: bottom; background-color: white"> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.5pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.5pt; text-align: right"> </td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; padding-bottom: 2.5pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.5pt"> </td> <td style="border-bottom: black 2.25pt double; font: 10pt Times New Roman, Times, Serif"> </td> <td style="border-bottom: black 2.25pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">29,237,632</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; padding-bottom: 2.5pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.5pt"> </td> <td style="border-bottom: black 2.25pt double; font: 10pt Times New Roman, Times, Serif"> </td> <td style="border-bottom: black 2.25pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">29,237,632</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; padding-bottom: 2.5pt"> </td></tr> </table>

500000000

0.0001

50000000

0.0001

3000000

Inputs to the Black-Scholes Model are as follows: Schedule of Share-Based Compensation Arrangements by Share-Based Payment Award <table cellpadding="0" cellspacing="0" id="xdx_30E_134_z0Mop1wLythh" style="font: 10pt Times New Roman, Times, Serif; width: 60%; border-collapse: collapse" summary="xdx: Disclosure - STOCKHOLDERS' EQUITY (Details)"> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif"></td> <td id="xdx_496_20250101__20251231_zk2pXjbnYJCi" style="font: 10pt Times New Roman, Times, Serif; text-align: center"></td></tr> <tr id="xdx_404_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardFairValueAssumptionsRiskFreeInterestRate_dp_uPure_zT2PqlJSTRj6" style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif; width: 48%">Risk-free interest rate</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center; width: 12%">4.00%</td></tr> <tr id="xdx_403_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardFairValueAssumptionsExpectedVolatilityRate_dp_uPure_z5k3r6zthYsh" style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: white"> <td style="font: 10pt Times New Roman, Times, Serif">Expected volatility of common stock</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center">125.39%</td></tr> <tr id="xdx_407_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardFairValueAssumptionsExpectedDividendRate_dp_zpgiVjRr18K9" style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif">Dividend yield</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center">0.00%</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: white"> <td style="font: 10pt Times New Roman, Times, Serif">Discount due to lack of marketability</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center">0%</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif">Expected life of option</td> <td id="xdx_986_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardFairValueAssumptionsExpectedTerm1_dxH_c20250101__20251231_z6anbvzhVTA6" style="font: 10pt Times New Roman, Times, Serif; text-align: center" title="::XDX::P5Y6M">5.5 Years</td></tr> </table>

0.0400

1.2539

0.0000

A summary of stock options outstanding as of December 31, 2025, all of which expire in 2033, including the relevant exercise price is presented below: Schedule of Stock Options Outstanding <table cellpadding="0" cellspacing="0" id="xdx_301_134_zdeFao36bzp3" style="font: 10pt Times New Roman, Times, Serif; width: 60%; border-collapse: collapse" summary="xdx: Disclosure - STOCKHOLDERS' EQUITY (Details 2)"> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: bottom"> <td colspan="2" style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">Exercise</td> <td style="font: 10pt Times New Roman, Times, Serif"> </td> <td style="font: 10pt Times New Roman, Times, Serif"> </td> <td colspan="2" id="xdx_485_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iI_hcustom--OptionExpiryAxis__custom--Year2033Member_zOrZ7nV6zH2e" style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">Expiration</td> <td style="font: 10pt Times New Roman, Times, Serif"> </td> <td style="font: 10pt Times New Roman, Times, Serif"> </td> <td colspan="2" id="xdx_487_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iI_hcustom--OptionExpiryAxis__custom--Year2033Member_z6XdAiRaA2M1" style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center"> </td> <td style="font: 10pt Times New Roman, Times, Serif"> </td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: bottom"> <td colspan="2" style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">Price</td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">2033</td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; white-space: nowrap; text-align: center">Total</td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td></tr> <tr id="xdx_41E_20251231__us-gaap--MeasurementInputTypeAxis__custom--ExercisePriceDollarOnePointTwoZeroFiveSixMember_zQyClNwefFIh" style="font: 10pt Times New Roman, Times, Serif; vertical-align: bottom; background-color: #CCEEFF"> <td style="font: 10pt Times New Roman, Times, Serif; width: 1%; padding-bottom: 1pt">$</td> <td style="font: 10pt Times New Roman, Times, Serif; width: 8%; padding-bottom: 1pt; text-align: right"><span id="xdx_909_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardPerShareWeightedAveragePriceOfSharesPurchased_iI_c20251231__us-gaap--MeasurementInputTypeAxis__custom--ExercisePriceDollarOnePointTwoZeroFiveSixMember_zbaG8KhGcXvl">1.2056</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; width: 1%; padding-bottom: 1pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; width: 3%; padding-bottom: 1pt"> </td> <td style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; width: 1%"> </td> <td style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; width: 8%; text-align: right">29,237,632</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; width: 1%; padding-bottom: 1pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; width: 3%; padding-bottom: 1pt"> </td> <td style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; width: 1%"> </td> <td style="border-bottom: black 1pt solid; font: 10pt Times New Roman, Times, Serif; width: 8%; text-align: right">29,237,632</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; width: 1%; padding-bottom: 1pt"> </td></tr> <tr id="xdx_419_20251231_zvEBlfvS7xDk" style="font: 10pt Times New Roman, Times, Serif; vertical-align: bottom; background-color: white"> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.5pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.5pt; text-align: right"> </td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; padding-bottom: 2.5pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.5pt"> </td> <td style="border-bottom: black 2.25pt double; font: 10pt Times New Roman, Times, Serif"> </td> <td style="border-bottom: black 2.25pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">29,237,632</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; padding-bottom: 2.5pt"> </td> <td style="font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.5pt"> </td> <td style="border-bottom: black 2.25pt double; font: 10pt Times New Roman, Times, Serif"> </td> <td style="border-bottom: black 2.25pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">29,237,632</td> <td style="font: 10pt Times New Roman, Times, Serif; white-space: nowrap; padding-bottom: 2.5pt"> </td></tr> </table>

1.2056

29237632

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">9.</td><td style="text-align: justify">INCOME TAXES</td> </tr></table> The Company recorded no income tax provision at December 31, 2025 and December 31, 2024 because of anticipated losses for the 2026 fiscal year and actual losses incurred in 2025. The Company estimates its annual effective income tax rate in recording its provision for income taxes in the various jurisdictions in which it operates. Statutory tax rate changes and other significant or unusual items are recognized as discrete items in the quarter in which they occur. The Company recorded no income tax expense for the year ended December 31, 2025 because the Company incurred a tax loss in the current year. Similarly, no income tax expense was recognized for the year ended December 31, 2024. The Company had a gross deferred tax asset related to federal net operating loss carryforwards of $123,896,313 and $113,235,679 at December 31, 2025 and December 31, 2024, respectively. The federal net operating loss carryforward will begin to expire in 2036. Realization of the deferred tax asset is dependent, in part, on generating sufficient taxable income prior to expiration of the loss carryforwards. The Company has placed a 100% valuation allowance against the net deferred tax asset because future realization of these assets is not assured.

123896313

113235679

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">10.</td><td style="text-align: justify">NOTES PAYABLE</td> </tr></table> 2021 Note On October 1, 2021, we issued a secured, revolving promissory note in an original principal amount of up to $15 million, which was subsequently increased to $20 million, in favor of Meta (as amended to date, the “2021 Note”). The 2021 Note was fully drawn with a principal balance outstanding of $20 million, bears interest at 8% per annum, computed on the basis of a 360-day year. If an event of default has occurred and is continuing, interest on the 2021 Note may accrue at the default rate of 12% per annum. On August 7, 2023, following the Loan Purchase, Mr. McCabe replaced Meta as the lender and secured party under the 2021 Note but the Company’s obligations under the 2021 Note remain unchanged. On December 31, 2023, the Company and Mr. McCabe as successor in interest to Meta entered into an amendment to the 2021 Note and an amendment to the Loan Agreement extending the 2021 Note Maturity Date and the Maturity Date. Loan Agreement Additionally, we have an aggregate principal balance of $6,589,362 outstanding under the Loan Agreement with Mr. McCabe as successor-in-interest to Meta, which bears interest at a fixed rate of 8% per annum if no event of default exists, and at a fixed rate of 12% per annum if an event of default exists. On December 31, 2023, the Company and Mr. McCabe entered an amendment to the Loan Agreement extending the maturity date. An amendment to the Loan Agreement entered into on June 30, 2025 includes an automatic renewal provision, and the maturity date of the Loan Agreement is presently extended to March 31, 2026. The combined balance on the 2021 Note ($15 million) and the Loan Agreement ($6.2 million) as of September 30, 2025, was $21.22 million. As of December 31, 2025, the total accrued and unpaid interest under the 2021 Note and the Loan Agreement was $6.46 million. December 2022 Note In connection with the Merger, on December 22, 2022, the Company entered into an additional Note in the principal amount of up to $20 million in favor of Mr. McCabe. Mr. McCabe is the largest shareholder of the Company’s common stock and the chairman of the board of directors of the Company. As of September 30, 2025, the Company had a balance of $22.76 million and accrued and unpaid interest of $2.80 million due under the 2022 Note. An amendment to the 2022 Note entered into on June 30, 2025 includes an automatic renewal provision, and the maturity date of the 2022 Note is presently extended to March 31, 2026. An amendment was entered into on January 7, 2026 to increase the principal amount available for disbursement to the Company from $20 million to up to $25 million. As of December 31, 2025, Notes Payable – related party includes balances of the 2021 Note and Loan Agreement and the December 2022 Note, as detailed above, totaling $45.85 million, and additional borrowing and adjustment to the December 2022 note during the year ended December 31, 2025 totaling $2,888,000. Included in this amount, was $215,000 advanced by Mr. McCabe for settlement of an account payable. A portion of the advances from Mr. McCabe are not interest bearing. Imputed interest of $50,000 has been recorded on the -0-% portion of the note for the year ended December 31, 2025. An amendment to the Notes and Loan Agreement entered into on June 30, 2025 includes an automatic renewal provision to extend for an additional three months at each due date as needed. The maturity date of the Notes and Loan Agreement were extended to March 31, 2026 which are subject to the automatic renewal provisions. CAPCO Note February 2024 On February 29, 2024, CAPCO Holding, Inc., a Texas corporation (“Capco”), loaned us $2,000,000 under a 12% Secured Promissory Note (the “Capco Note”), which provides, among other things, that the loan will be due in one year, with us having the option to extend the loan by one additional year. The loan will bear interest at the rate of 12% per annum and will be payable in one balloon payment of principal and interest on the maturity date. If we elect to extend the loan for one year, we must pay all accrued interest for that first year, and thereafter, the loan will bear interest at a rate that is mutually agreeable to us and Capco, which rate will not exceed 18% per annum, and will be payable in one balloon payment of principal and interest on the extended maturity date. As part of the transaction, Gregory McCabe, our Chairman and Chief Executive Officer, entered into a Stock Pledge and Security Agreement with Capco under which he pledged 250,000 of his shares of common stock of the Company to secure our obligations under the Capco Note. Further, Mr. McCabe entered into a Subordination Agreement (the “Subordination Agreement”) with Capco and us under which Mr. McCabe agreed to subordinate all of the Company’s indebtedness and obligations owed to Mr. McCabe to the Capco Note, under the terms and conditions of the Subordination Agreement. The Note was paid in full in August 2025. The Panther Bridge LLC Note August 2025 On August 20, 2025, the Company entered into and closed a transaction with Panther Bridge, LLC, a Texas limited liability company (“Panther Bridge”), under which Panther Bridge loaned $6,000,000 to the Company. The transaction was effected through a Subscription Agreement that was entered into between the two parties, under which the Company sold to Panther Bridge an 18% Unsecured Promissory Note in the original principal amount of $6,000,000.00 (the “Panther Bridge Note”), along with 3,000,000 shares of Series A Redeemable Preferred Stock, par value of $0.0001 per share (the “Preferred Stock”), and an Assignment of Net Profits Interest and Irrevocable Option to Convert to Working Interest from the ownership in the Panther Prospect of the Company (the “Assignment”). Panther Bridge is managed by Gregory McCabe, Jr., the son of the Company’s Chairman and Chief Executive Officer, Gregory McCabe (“McCabe Sr.”). Neither of the McCabes have any economic interest in Panther Bridge. Panther Bridge has multiple outside investors, none of which are considered related persons to the Company. The Panther Bridge Note bears interest at the rate of 18% per annum with one balloon payment of principal and interest being due and payable on the maturity date of August 20, 2026. The proceeds of the $6,000,000 loan are to be used to pay off the 12% Secured Promissory Note held by CAPCO Holding, Inc. in the principal amount of $2,000,000, to pay any obligations of the Company for the Panther Prospect, and for general corporate purposes. None of proceeds were used for repayment of any debts owed to McCabe Sr. The Panther Prospect includes approximately 618 gross acres and 618 net acres of land situated in Acadia Parish, Louisiana. The Company has elected to participate as a non-operating working interest owner in the next well drilled on the Panther Prospect. As part of the loan transaction, the Company, Panther Bridge, and McCabe Sr. entered into a Subordination Agreement (the “Subordination Agreement”) under which McCabe Sr. agreed to subordinate all of the Company’s indebtedness and obligations owed to him to the indebtedness under the Panther Bridge Note, under the terms and conditions of the Subordination Agreement. The Panther well was declared to be a dry hole in November 2025. Also, as part of the loan transaction, the Company issued to Panther Bridge 3,000,000 shares of newly designated Series A Redeemable Preferred Stock. Reference Note 7. The designation, voting and other powers, preferences and relative, participating, optional or other rights of the shares of such series and the qualifications, limitations and restrictions of the Preferred Stock are set forth in a Certificate of Designations filed with the Secretary of State of Nevada. The holders of the Preferred Stock have no voting rights. At the Company’s option, it may redeem the Preferred Stock, in whole or from time to time in part, on any business day after the date of issuance, at a per share redemption price equal to $1.00 plus all accrued and unpaid dividends on such share, if any. The Preferred Stock begins accruing dividends on the first anniversary of the issuance date, August 20, 2026, at the rate of 18% per annum of the per share redemption/liquidation price ($1.00 plus all unpaid dividends on such share). Additionally, there are restrictions on the Company declaring or making any distribution on common stock while there are any accrued and unpaid dividends owed to holders of Preferred Stock. Holders of the Preferred Stock also have certain rights upon liquidation, dissolution or winding up of the Company or upon a change or control of the Company. Specifically, in the event of any liquidation, dissolution or winding up, holders of the Preferred stock will have liquidation preference over holders of common stock. Also, as part of the loan transaction, the Company granted to Panther Bridge an Assignment of Net Profits Interest and Irrevocable Option to Convert to Working Interest from the ownership in the Panther Prospect of the Company. Under the Assignment, the Company conveyed to Panther Bridge a 1/8th (12.50%) of 8/8ths Net Profits Interest (as defined below) in and to all the Company’s interests in the oil, gas and mineral leases and any future wells drilled thereon as described in “Annex A” to the Assignment (which the Company refers to as the Panther Prospect). The Assignment defines “Net Profits Interest” as the gross proceeds actually received by the Company from the sale of oil, gas, and other hydrocarbons produced and saved from the subject leases, less certain allowable costs, including actual and reasonable costs, expenses, and charges attributable to the subject leases that fall into certain categories (as further set forth in the Assignment). Panther Bridge also has the irrevocable one-time option, at any time, to convert any portion of the Net Profits Interest conveyed under the Assignment from a net profits interest to an undivided working interest of equal percentage to the amount of the Net Profits Interest converted, in the properties described in the Assignment. As of December 31, 2025 accrued and unpaid interest on the Panther Bridge note was $403,945.

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">11.</td><td style="text-align: justify">ASSET RETIREMENT OBLIGATIONS</td> </tr></table> The following is a reconciliation of the asset retirement obligations liability through December 31, 2025: Schedule of Asset Retirement Obligations Liability <table cellpadding="0" cellspacing="0" id="xdx_305_134_zvDNfwXLatVb" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 80%; margin-left: 0.5in" summary="xdx: Disclosure - ASSET RETIREMENT OBLIGATIONS (Details)"> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; padding-left: 8.65pt"></td><td style="padding-left: 8.65pt; text-indent: -8.65pt"></td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"></td><td style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"></td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"></td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; width: 67%; padding-left: 8.65pt">Asset retirement obligations – January 1, 2024</td><td style="padding-left: 8.65pt; width: 3%; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; width: 1%; text-align: left; text-indent: -8.65pt">$</td><td id="xdx_984_eus-gaap--AssetRetirementObligationsNoncurrent_iS_c20240101__20241231_z9JIbuXUlg8h" style="padding-left: 8.65pt; width: 8%; text-align: right; text-indent: -8.65pt">248,651</td><td style="padding-left: 8.65pt; white-space: nowrap; width: 1%; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: right; padding-left: 8.65pt"> </td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Accretion expense</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_98F_eus-gaap--AccretionExpense_c20240101__20241231_zquX99UtgHp4" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">806,381</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Estimated liabilities recorded</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_986_eus-gaap--AssetRetirementObligationRevisionOfEstimate_c20240101__20241231_zCIBsyGN3IT1" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">70,949</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Settlement of ARO obligation</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_988_ecustom--SettlementOfAROObligation_iN_di_c20240101__20241231_zUSPfBnEDF21" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">(26,670</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt">)</td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: right; padding-bottom: 1pt; padding-left: 8.65pt"> </td><td style="padding-left: 8.65pt; padding-bottom: 1pt; text-indent: -8.65pt"> </td> <td style="border-bottom: Black 1pt solid; padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td style="border-bottom: Black 1pt solid; padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; white-space: nowrap; padding-bottom: 1pt; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Asset retirement obligations –January 1, 2025</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt">$</td><td id="xdx_986_eus-gaap--AssetRetirementObligationsNoncurrent_iE_c20240101__20241231_z7LLPwK5D1Gi" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">1,099,311</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: right; padding-left: 8.65pt"> </td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Accretion expense</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_984_eus-gaap--AccretionExpense_c20250101__20251231_zL5G2H4Q4519" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">7,197</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Estimated liabilities recorded</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_988_eus-gaap--AssetRetirementObligationRevisionOfEstimate_d0_c20250101__20251231_zJVqaMreB6Zj" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">-</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Settlement of ARO obligation</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_98B_ecustom--SettlementOfAROObligation_iN_di_c20250101__20251231_zHo2qefLTw4" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">(30,995</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt">)</td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: right; padding-bottom: 1pt; padding-left: 8.65pt"> </td><td style="padding-left: 8.65pt; padding-bottom: 1pt; text-indent: -8.65pt"> </td> <td style="border-bottom: Black 1pt solid; padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td style="border-bottom: Black 1pt solid; padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; white-space: nowrap; padding-bottom: 1pt; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-bottom: 2.5pt; padding-left: 8.65pt">Asset retirement obligations –December 31, 2025</td><td style="padding-left: 8.65pt; padding-bottom: 2.5pt; text-indent: -8.65pt"> </td> <td style="border-bottom: Black 2.5pt double; padding-left: 8.65pt; text-align: left; text-indent: -8.65pt">$</td><td id="xdx_986_eus-gaap--AssetRetirementObligationsNoncurrent_iE_c20250101__20251231_zXOJoY4FM96b" style="border-bottom: Black 2.5pt double; padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">1,075,513</td><td style="padding-left: 8.65pt; white-space: nowrap; padding-bottom: 2.5pt; text-align: left; text-indent: -8.65pt"> </td></tr> </table> Accretion expense recorded in 2024 includes the results of the recalculation of the acceleration of the Asset Retirement Obligation connected to Orogrande properties for which the underlying mineral leases were not renewed by University Lands at their scheduled renewal date of December 31, 2024.

The following is a reconciliation of the asset retirement obligations liability through December 31, 2025: Schedule of Asset Retirement Obligations Liability <table cellpadding="0" cellspacing="0" id="xdx_305_134_zvDNfwXLatVb" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 80%; margin-left: 0.5in" summary="xdx: Disclosure - ASSET RETIREMENT OBLIGATIONS (Details)"> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; padding-left: 8.65pt"></td><td style="padding-left: 8.65pt; text-indent: -8.65pt"></td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"></td><td style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"></td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"></td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; width: 67%; padding-left: 8.65pt">Asset retirement obligations – January 1, 2024</td><td style="padding-left: 8.65pt; width: 3%; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; width: 1%; text-align: left; text-indent: -8.65pt">$</td><td id="xdx_984_eus-gaap--AssetRetirementObligationsNoncurrent_iS_c20240101__20241231_z9JIbuXUlg8h" style="padding-left: 8.65pt; width: 8%; text-align: right; text-indent: -8.65pt">248,651</td><td style="padding-left: 8.65pt; white-space: nowrap; width: 1%; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: right; padding-left: 8.65pt"> </td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Accretion expense</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_98F_eus-gaap--AccretionExpense_c20240101__20241231_zquX99UtgHp4" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">806,381</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Estimated liabilities recorded</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_986_eus-gaap--AssetRetirementObligationRevisionOfEstimate_c20240101__20241231_zCIBsyGN3IT1" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">70,949</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Settlement of ARO obligation</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_988_ecustom--SettlementOfAROObligation_iN_di_c20240101__20241231_zUSPfBnEDF21" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">(26,670</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt">)</td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: right; padding-bottom: 1pt; padding-left: 8.65pt"> </td><td style="padding-left: 8.65pt; padding-bottom: 1pt; text-indent: -8.65pt"> </td> <td style="border-bottom: Black 1pt solid; padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td style="border-bottom: Black 1pt solid; padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; white-space: nowrap; padding-bottom: 1pt; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Asset retirement obligations –January 1, 2025</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt">$</td><td id="xdx_986_eus-gaap--AssetRetirementObligationsNoncurrent_iE_c20240101__20241231_z7LLPwK5D1Gi" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">1,099,311</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: right; padding-left: 8.65pt"> </td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Accretion expense</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_984_eus-gaap--AccretionExpense_c20250101__20251231_zL5G2H4Q4519" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">7,197</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Estimated liabilities recorded</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_988_eus-gaap--AssetRetirementObligationRevisionOfEstimate_d0_c20250101__20251231_zJVqaMreB6Zj" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">-</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-left: 8.65pt">Settlement of ARO obligation</td><td style="padding-left: 8.65pt; text-indent: -8.65pt"> </td> <td style="padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td id="xdx_98B_ecustom--SettlementOfAROObligation_iN_di_c20250101__20251231_zHo2qefLTw4" style="padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">(30,995</td><td style="padding-left: 8.65pt; white-space: nowrap; text-align: left; text-indent: -8.65pt">)</td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-indent: -8.65pt; text-align: right; padding-bottom: 1pt; padding-left: 8.65pt"> </td><td style="padding-left: 8.65pt; padding-bottom: 1pt; text-indent: -8.65pt"> </td> <td style="border-bottom: Black 1pt solid; padding-left: 8.65pt; text-align: left; text-indent: -8.65pt"> </td><td style="border-bottom: Black 1pt solid; padding-left: 8.65pt; text-align: right; text-indent: -8.65pt"> </td><td style="padding-left: 8.65pt; white-space: nowrap; padding-bottom: 1pt; text-align: left; text-indent: -8.65pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-indent: -8.65pt; text-align: left; padding-bottom: 2.5pt; padding-left: 8.65pt">Asset retirement obligations –December 31, 2025</td><td style="padding-left: 8.65pt; padding-bottom: 2.5pt; text-indent: -8.65pt"> </td> <td style="border-bottom: Black 2.5pt double; padding-left: 8.65pt; text-align: left; text-indent: -8.65pt">$</td><td id="xdx_986_eus-gaap--AssetRetirementObligationsNoncurrent_iE_c20250101__20251231_zXOJoY4FM96b" style="border-bottom: Black 2.5pt double; padding-left: 8.65pt; text-align: right; text-indent: -8.65pt">1,075,513</td><td style="padding-left: 8.65pt; white-space: nowrap; padding-bottom: 2.5pt; text-align: left; text-indent: -8.65pt"> </td></tr> </table>

248651

806381

70949

26670

1099311

7197

-0

30995

1075513

<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 0in"></td><td style="width: 0.25in; text-align: left">12.</td><td style="text-align: justify">SUBSEQUENT EVENTS</td> </tr></table> None