Note 3 - Acquisition and Dispositions

BKV-BPP Power Joint Venture Transaction

On January 30, 2026, pursuant to the BKV-BPP Power Purchase Agreement, the Company completed the BKV-BPP Power Joint Venture Transaction, which consisted of $115.1 million in cash and 5,315,390 shares of Company common stock. The shares were subject to a 180-day lock-up that expired on July 29, 2026. The aggregate purchase price was equal to (x) $376.0 million, less (y) 25% of BKV-BPP Power’s net indebtedness at closing, payable 50% in cash and 50% in shares of the Company’s common stock. BKV-BPP Power’s net indebtedness was $582.9 million as of the closing date and the number of shares issued was determined by dividing the 50% of the aggregate purchase price by $21.6609, which represents the volume-weighted average price of the Company’s common stock during the 20 consecutive trading day period ended October 28, 2025. The Company funded the cash consideration for the transaction with a combination of cash on hand and the net proceeds from the 2025 Equity Offering. Following the closing of the transaction, the Company and BPPUS own 75% and 25% of the BKV-BPP Power Joint Venture, respectively.

The Company’s consolidated financial statements include $15.8 million of costs associated with the BKV-BPP Power Joint Venture Transaction. Of this amount, $9.3 million related to the 2025 Equity Offering, and was recorded as a reduction of additional paid-in capital. Transaction costs of $6.5 million were expensed during the year ended December 31, 2025, and included in other operating expenses on the consolidated statements of operations.

The BKV-BPP Power Joint Venture Transaction was accounted for as an acquisition of a business between entities under common control (see Note 1 - Business and Basis of Presentation for further information). Accordingly, the consolidated financial statements prior to the acquisition date were retrospectively recast to include the BKV-BPP Power Joint Venture’s historical results,

including reflecting BPPUS’s interest as a noncontrolling interest of 25%. The Company previously accounted for BKV-BPP Power as an equity method investment and recognized 50% of its earnings.

The following table represents a summary of the retrospective adjustments to the consolidated statements of operations for the years ended December 31, 2025, 2024, and 2023 to conform to the current presentation due to the BKV-BPP Power Joint Venture Transaction.

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This retrospective presentation is an accounting convention and does not alter the legal ownership interests in the BKV-BPP Power, or the related rights to BKV-BPP Power’s income and net assets that existed before the closing date of the BKV-BPP Power Joint Venture Transaction.

The retrospective combination of BKV-BPP Power therefore does not imply that the Company or the holders of its common shares other than Banpu and its affiliates had legal or economic rights to the additional 25% interest before January 30, 2026. Prior to the closing date of the BKV-BPP Power Joint Venture Transaction, Banpu’s indirect economic interest in the additional 25% interest was held through BPPUS rather than through the Company. Accordingly, for periods before January 30, 2026, the BKV-BPP Power Joint Venture’s net income and net assets were attributed based on the legal ownership interests in effect during those periods. For purposes of the retrospective earnings per share presentation, the per share amounts applicable to common shares held, directly or indirectly, by Banpu reflect Banpu’s historical economic interest in the transferred 25% interest. The per share amounts applicable to the Company’s other common shareholders reflect only the economic interests held through the Company during those periods.

Accordingly, for the year ended December 31, 2025, both basic and diluted earnings per common share were $2.11 for common shares held by Banpu and $1.98 for common shares held by the Company’s other shareholders. For the year ended December 31, 2024, both basic and diluted earnings per common share were $(1.92) for common shares held by Banpu and $(2.02) for common shares held by the Company’s other shareholders. For the year ended December 31, 2023, basic and diluted earnings per common share were $2.04 and $1.92, respectively, for common shares held by Banpu and $1.90 and $1.79, respectively, for common shares held by the Company’s other shareholders. Beginning on January 30, 2026, earnings associated with the acquired 25% interest are available to all of the Company’s common shares. The tables below summarize these attribution principles.

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As a result of the consolidation of BKV-BPP Power, the Company determined that the manner in which its Chief Executive Officer, identified as the Chief Operating Decision Maker (“CODM”), evaluates operating performance and allocates resources has changed. Accordingly, BKV-BPP Power, the Company’s power generation business, meets the criteria to be presented as a reportable segment. See Note 19 - Reportable Segments.

Asset Acquisition

Bedrock Acquisition

On September 29, 2025 in connection with the Bedrock Acquisition, the Company paid a portion of the purchase price consisting of (i) a $37.0 million deposit retained as a holdback for any Company indemnification claims until released on the terms and conditions contained in the Bedrock Purchase Agreement, (ii) $179.5 million in cash to repay certain indebtedness of BKV Barnett II, and (iii) the issuance to the Seller of approximately 5.2 million shares of BKV Corporation common stock with such number of shares having been determined as of the date of execution of the Bedrock Purchase Agreement. On December 31, 2025, the remaining purchase price consideration paid was $50.0 million, subject to the terms and conditions of the Bedrock Purchase Agreement. The Bedrock Purchase Agreement has an economic effective date of July 1, 2025.

The Company funded the cash consideration paid at the closing of the Bedrock Acquisition, and expects to fund the remainder of the consideration payable, with proceeds from the 2030 Senior Notes, borrowings under the RBL Credit Agreement, and cash on hand. Refer to Note 4 - Debt for further information.

As a result of the Bedrock Acquisition, the Company acquired approximately 96,000 net acres and gas gathering lines, 1,121 producing locations with low 1- and 5-year base decline rates of approximately 7%, and nearly 1 Tcfe of proved reserves (>70% PDP reserves) using NYMEX strip pricing. The Bedrock Acquisition is expected to increase the Company’s low-declining PDP reserves by over 100 MMcfe/d and enhance its inventory in the Barnett Shale, aligning with the Company’s strategic position in the Fort Worth Basin.

Allocation of Purchase Price. The Bedrock Acquisition was accounted for as an asset acquisition as the fair value of substantially all the assets acquired were concentrated in a group of similar assets. Transaction costs incurred to acquire the assets, which amounted to $3.8 million, were capitalized and included in the cost basis of the acquired assets. The Company completed the purchase price assessment on December 31, 2025, and paid the remaining $50.0 million adjusted purchase price consideration in accordance with the Bedrock Purchase Agreement. The stock consideration paid to the Seller for the Bedrock Acquisition was valued at $124.3 million on

the date of issuance (at closing) resulting in an aggregate value of consideration paid to the Seller of $394.6 million, subject to customary adjustments, including, but not limited to estimated fair value of assets acquired and liabilities assumed. See Note 13 - Stockholders’ Equity and Mezzanine Equity for further detail on the issuance of BKV’s common stock to the Seller.

Below is a reconciliation of the assets acquired and liabilities assumed (in thousands):

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Temple II Acquisition

On July 10, 2023, BKV-BPP Power acquired CXA Temple 2, LLC, the owner of 100% of the interests in Temple II, a combined-cycle gas turbine and steam turbine power plant located on the same site as Temple I in the ERCOT North Zone in Temple, Texas, for a purchase price of $460.0 million. Temple II began commercial operation in May 2015 and is equipped with modern, flexible and efficient combined-cycle turbines and advanced emissions-control technology. Temple II provides enough energy to power 750,000 homes across central Texas.

In order to complete the purchase, BKV-BPP Power entered into the Temple Credit Facilities with an aggregate principal amount not to exceed $560.0 million. See Note 4 - Debt for further discussion.

The acquisition qualified as an asset acquisition as the fair value of substantially all the assets acquired were concentrated in a group of similar assets. Transaction costs incurred to acquire the assets, which amounted to $9.5 million were capitalized and included in the cost basis of the assets acquired. The total consideration of Temple II amounted to $475.4 million, which included the purchase price of $460.0 million, the transaction cost of $9.5 million, and net working capital of $5.9 million.

The consideration from the Temple II acquisition was allocated to the assets acquired and liabilities assumed as follows:

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Dispositions

On June 14, 2024, the Company sold its wholly-owned subsidiary, Chaffee, representing a non-operated interest in approximately 9,800 net acres and 116.0 gross (24.2 net) wells and 122 Bcfe of proved reserves in the Marcellus Shale in the Appalachian Basin of NEPA, as well as the Company’s interest in the Repsol Oil and Gas operated midstream system, for $107.8 million. The Company recognized a gain on the sale of $7.1 million, net of transaction costs of $3.5 million, which is included in the gain on sale of business in the consolidated statements of operations.

On June 28, 2024, Chelsea sold certain of its non-operated upstream assets, including interest in approximately 6,800 net acres and 214.0 gross (15.4 net) wells and 35 Bcfe of proved reserves in NEPA, for a purchase price of $24.8 million and transaction costs of $0.5 million. Due to the immateriality of the upstream assets sold, the Company utilized the practical expedient to account for the sale of Chelsea’s non-operated upstream assets sold as a normal retirement with no gain or loss recognized as sale of these assets did not significantly impact the depletion rate with respect to the total reserves retained in NEPA.