EON Resources Inc. (AMEX:EONR) Q3 2025 Earnings Call Transcript

EON Resources Inc. (AMEX:EONR) Q3 2025 Earnings Call Transcript November 18, 2025

Operator: Welcome to the EON Resources Inc. announces Third Quarter 2025 Earnings Call. [Operator Instructions] It is now my pleasure to turn the floor over to your host, David Smith. Sir, the floor is yours.

David M. Smith, Esq.: Good afternoon to everyone. I’m David Smith. I’m General Counsel for the company. Glad to join you this afternoon. I need to, as we get started, go to review our safe harbor statement regarding today’s conference call. Please note that on this call, we will be making forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on current expectations and assumptions, which are subject to risks and uncertainties. These statements reflect our views only as of today. They should not be relied upon as representative of views as of any subsequent date, and we undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, in light of new information or future events.

These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations. Further information regarding these and other risks and uncertainties, are included in the company’s annual report on Form 10-K for the fiscal year ended December 31, 2024, and in other documents filed with the U.S. Securities and Exchange Commission. Today, I would like to introduce our presenters, the executive management staff of the company. You’ll see on the slide, if you’re participating in the webcast, Dante Caravaggio, he is our CEO; Mitchell Trotter, our Chief Financial Officer; myself; and Jesse Allen, who is our Vice President of Operations. To get started and to kick this off, I’d like to make a few points about the third quarter.

It was a remarkable quarter. We had record net income of $5.6 billion. We retired all $41 million of senior and seller debt. We retired all preferred shares that had a redemption value of $27 million, and we increased shareholder equity by $22.7 million. In addition, we acquired a 10% override with the original seller group who had retained it when we purchased the Grayburg-Jackson Field and the company that owned it. Additionally, we were able to Farmout the San Andres formation for a Horizontal Well Drilling Program in which we retain a 35% working interest throughout that program. This is in addition to the retention and continued development of the formations other than the San Andres, which includes our current wells and producing programs.

So those are unaffected by this drilling program, that will kick off next year. The thing to really note is this was all done and closed on September 9, and we took on absolutely no debt to achieve these results. So a remarkable time. The drilling program that I described will be over the next 5 years. We expect to drill as many as 92 wells under that program. We will continue to [ maintain ] that 35% working interest in that development. And there are multiple pay zones throughout our acreage, not just the San Andres, so we’re going to continue to develop all that we can, in that respect. Our current production is typically out of the Seven River formation and our waterflood. We’re seeing results already from our balance sheet being cleaned up with this transaction.

Our ability to raise capital has really been enhanced — it’s really the look of a new company. Our phone has been ringing off the hook with opportunities. We’re looking at acquisitions. We’re always looking at enhancing reserves. But of course, throughout all of this, our main focus is to get the stock price up. That drives us every day. Those are the highlights. That’s what strikes me in my role here as General Counsel as to what we’re doing. I’m very excited about the future and really pleased to introduce Dante Caravaggio now to take it up from where I’ve described. Dante, go ahead.

Dante Caravaggio: Well, thank you, David. And I’ll just start off by saying happy Thanksgiving and Merry Christmas because this, I believe, is our last shareholder earnings call until next year, and I think the main thought we want to leave with everybody is, let’s get the party started. So we really had a mountain to climb. We wanted to fulfill all the promises and commitments that we made to our shareholders. And really, as David said, on September 9, we really did that, and we didn’t leave a mess. So the balance sheet is clean. The debt story is a good one. So we’re attractive for investors that will help us raise capital, buy new properties and kind of off we go. And I think the other thought I’ll leave you with is inventory.

This deal we did with Virtus, we’ve got in there the potential of drilling 92 horizontal wells. You have to really look hard at a lot of oil companies much larger than us to find 92 drillable wells in inventory. Well, we’ve got them, and these are going to be big wells. The other thing we’ve got, again, I’ll use that word inventory. We’ve got 350 producers sitting there at Grayburg-Jackson, waiting for us to stimulate them, perforate them and make them do better than they’re doing. And we’re now in a position where the cash is there, we can invest in these things and get that to go, and our primary focus with regard to that is conversion of another 150 SVR waterflood patterns. And by way of history, this field at one point was down to 300 barrels a day.

It made it up to over 1,000 barrels a day primarily by converting current wells to SVR injectors and producers. Well, we’re going to continue doing that same thing. The other thing we added to, I’ll say, inventory of workovers, is the purchase of the South Justis field. So that field was down to 50 barrels a day. It’s got 200 wells on it. We’re going to activate those wells, and those wells, on average, make double or triple on a per well basis, the oil per day that Grayburg-Jackson does. So if I recap this, yes, we raised $45 million. We cleaned up the balance sheet with that. We sold an interest to Virtus to do some drilling in the San Andres, included in that is a $2 million fund, to do some experimental workovers to test their theory of completions in the San Andres.

So that’s going to give us a near-term kick in production. The Farmout, I think we discussed that, and then going forward from that, we’ve got an awful lot of work just to increase production, I believe, by 500 barrels a day without drilling over the next 6 to 9 months, not counting what Virtus is going to be, and that includes completing the water injection line, you’re going to hear Jesse talk about that, continuing to bring on wells that are offline by using the 4 rigs that are running and then through stimulations. So with that, I’m going to turn it over first to Mitchell Trotter to talk about the finances.

Mitchell Trotter: All right. Please advance to the financing highlights. Good. Well, thank you, Dante, and hello, I am Mitchell Trotter, the CFO, and I thank all of you for attending today. And as Dante and David so articulated, the September 9 funding resulted in major improvements to our Q3 financials. This highlight slide, it’s the same one, that’s in the funding call deck. We’ve been through it before. I have it there mainly for reference so that you have the deck, and it can help you understand as I go through the parts of the financials. The sources of the $40.5 million of volumetric/ORRI funding and the $5 million from the Farmout agreement, they have many parts with different GAAP treatments. So we’ll kind of go through that a little bit, and the same thing for the uses where we retired the senior debt, we acquired the seller ORRI, and we retired those preferred shares, all those major impacts flew through the balance sheet and some of the income statement.

So let’s move on to the balance sheet slide, and then let me kind of show where some of the big parts are, on that. Again, this is a major improvement. I can’t say it more times. But the slide you have here is a condensed version of what’s actually in the 10-Q, and it best illustrates the impacts. So how do we clean up the balance sheet with respect to debt, which has by far the largest impact. Again, we retired $21 million of senior debt, and with that, we have a $1.5 million reduction in the debt that you will see comes through as a gain on the income statement, and I’ll explain that in a little bit. We also retired that senior debt of $15 million with the seller, and it also eliminated a $5 million accrued interest, and we did all that for $7 million, thus creating a $13 million gain that you’ll also see when we go through the income statement in a minute.

Do note that the convertible notes, they’re still there, but we reduced them to $5.4 million from the original $9.8 million that was private loans and warrant obligations by the end of the quarter. So the end result of all of this cleaning up of debt is, we only have $1 million left of current debt and the other $4.4 million is long-term debt, and we have a huge drop in our accrued liabilities. So that was all good. Now shareholder equity, that’s also been transformed as well. The preferred shares, as David stated, that had a $27 million redemption value and it was retired for only 1.5 million common shares, that we announced back on September 9. And this eliminated all the minority interest. So our equity is cleaned up with respect to all the miscellaneous things.

The end result of our shareholder equity, the end result of the financing, the elimination of the debt instruments, the related gains and all of that flowing through, our shareholder equity went up by over $22 million from Q2 to Q3. So with that, let’s go ahead and move on to the income statement slide, please. And then this, too, is a condensed version, just like the balance sheet to hopefully let you see things a little bit better. And this, again, is a reset of our P&L going forward. The Q3 net income was the highest level to date of $5.6 million for the quarter. While most of that net income came from below the line, those gains were definitely earned by all the hard work we did. And David did a really good job of articulating how we got there.

So what does that mean below the line? There’s that $13.4 million of gain. That’s a combination of the seller note reduction, how the various ORRIs and all the related costs relating to that are recorded for GAAP purposes. And then there’s that $1.8 million gain, and that comes from the senior debt retirement plus a gain from settling an old fee. Now offsetting these gains, there’s $1.1 million of onetime expenses that GAAP has us, include up in the G&A versus down below the line. GAAP retired required this grouping of the $1.1 million onetime charges in G&A, which personally I think is misleading, but that’s where it is. The actual recurring G&A expenses continue to decline quarter-over-quarter, and that’s a huge improvement. That’s what we’ve been talking about all year long, and we’re pleased to say that.

Another cost reduction, as we stated on the Funding Call, is a decrease of interest expense of up to $500,000 a month. Most of the interest for September was eliminated with the September 9 funding, and you can see that in the reduction of about $1.7 million down to $1.2 million interest expense for the quarter. And as always, I will tell you, we’ll take questions at the end of this presentation and willing to have individual discussions as well. With that, reach out to Mike Porter, our Investment Relations guy, and we’ll do that. We’ve done that plenty of times with many of you. So with that, I do want to move on to Jesse to review operations. So please advance to Jesse’s slide.

Jesse Allen: Thank you. Yes. Good afternoon. I’m Jesse Allen, VP of Operations. And today, I’ll talk about some of the third quarter highlights from an operations viewpoint, in other words, our daily operations. And then I’ll make a few comments about the San Andres Farmout to Virtus and some of those details. So with that, safety. That’s always foremost one of our — the most important things that we can do is make sure that all our employees are safe. And as a matter of fact, we’ve had no reportable incidents in this quarter, and we’ve not had any reportable incidents since we took over operations back in November of 2023. Combined production remains consistent above 1,000 gross barrels of oil per day in the 2 fields, the Grayburg-Jackson field and our South Justis field.

Currently, we have 4 well service rigs operating across both fields. We have 3 rigs in the Grayburg-Jackson field, which is just outside Loco Hills, New Mexico, and then 1 rig in the South Justice field area, which is just outside of Jal, New Mexico. One of the big projects that has been ongoing is the installation of 2 miles of injection pipeline. We’re in the pressure testing mode right now and hooking up of the injection wells and each of the injection well headers. And so that’s ongoing currently. And then we get to the biggie here, which is the San Andres Farmout to Virtus, which we can’t say enough it was a really good deal for both parties. We signed that on the 9th of September of 2025. A few of the really big highlights are that horizontal drilling is scheduled to begin there in 2026, and depending on the length of time it takes to get the BLM permits, that would be the Federal Drilling Permits, we think it will probably be in the second quarter of 2026.

Now I need to let you all know that on our website, which is eon-r.com, you can find our horizontal drilling package or deck that details a little bit of what I’m going to talk about today. And on our site, you go, first, on the home page, you click on operations, then click the Grayburg-Jackson Field and then page down to the Horizontal Operations and then click on Horizontal Drilling, and that will get you that presentation. But a few of those highlights. As a result of our Farmout to Virtus, we got a cash consideration of $5 million. The post-deal working interest will be 65% Virtus and 35% for EON. The plan is to drill 10 to 20 wells per year for the next 5 years. Initial production from those wells will be in the range of 300 to 500 barrels of oil per day per well.

That’s what we anticipate, and the cost of each of those wells will be in the $3.5 million to $4 million range. So with that, I’ll turn the call back over to Dante Caravaggio, our CEO and President.

Dante Caravaggio: Yes. Thanks, Jesse. So what’s next? Some of you may ask, are we a one-trick pony? Is this third quarter going to repeat? Was that a onetime deal? And the answer is no. We have not rested on our laurels, since we got the deal done, and maybe sometimes we got to get some stuff out of David, so we would sit on them. So I have to work that out there, and we’re not happy with our costs. We want to cut about $200,000 a month out of our lease operating expense and another $200,000 a month out of the G&As. And as Mitch said, we had a lot of onetime charges that hit us in Q3 that caused those costs to kind of go up and they’re gone. And you might say, what was it? Well, we had a lot of help. We had a lot of brokers.

We had a lot of attorneys, and they did a fabulous job. But now they’re gone. They’re off the payroll. So back to what’s next? And it’s back to the inventories that I talked about before. We got 92 wells we believe we can drill between the 2 fields we’ve got. We’ve got 500 producers that we can do workovers on, and we can’t get that all done in 1 year or even 2 years. But over 3 years, we’re going to be busy. And what that does is, increases production, and a lot of oil fields are in a decline mode. And people will use the term, you’re buying a melting ice cube. And it’s hot. It’s hot here today in Houston, Texas, but we’re not that. We are a company rich with opportunity, and we are raising money to make sure we get this and get it going, and every quarter, we expect to see increased production in an increasing amount.

And so one of my slides here, my top bullet says, “We’re going to improve financials with increased production through 2026”. Well, we can see all the way to 2030. These numbers are just going to keep going up well beyond 2030. That’s the magic, I think, of what we’ve got. Near-term production increase, we got to get the waterline energized. Jesse talked about that. We think that within 90 days, we’re going to get a kick in oil production because our waterflood is [ water star ] because this 4-inch supply line is not running. And it’s been that way for a year. And frankly, you haven’t seen the effect of it because Jesse has been so good with stimulating wells, keeping them all going. You just haven’t seen that effect. When we kick that thing in, it’s going to be a real boost.

I’ve got here, we’re going to do a material acquisition the first half of next year. I’m just going to say we see big numbers without taking on debt and without selling any shares, where we can be creative to buy properties. And we are looking at these. We cannot tell you about it because it’s top, top secret, but I can tell you we’re working on it diligently to the point of how we’re going to operate, how we’re going to raise the funds, how do we do this without diluting shares, how do we do this without taking on debt? And we’ve got most of those questions answered. So it’s really going to be fun when we can talk about it. The horizontal drilling should commence in the second quarter of next year. That’s going to be a blast. You’re going to get a glimpse of that when Virtus does some workovers, and we expect those workovers to happen in the next 60 days, and we’ll do our best to report that, although that might be kept secret if it’s too good because these guys are — they’ve got something good and they’re under our hood.

So it’s actually a battle to share much of that with everybody. The downside, oil prices are weak. We’d like them to stay above $60, and we’re encouraging everybody out there to drive to your destination, fill it up with premium and stay under the speed limit and be safe. We’re mostly debt-free, that helps us weather the storm. If we’ve got low oil prices and lower income, we can offset that with a savings of close to $400,000 a month that we don’t pay an interest. So that expense is gone. We also can help that by just increasing production. So we’re in a good position, if the worst happens and oil prices drop. Gas prices are increasing. So that’s a good thing, but we struggle to sell all our gas. The midstream buyer has struggled keeping their plant running, and we’re looking at options.

And we’ve got some shareholders reaching out to us, which we thank, with regard to using gas-fired turbines to generate power that could save us $70,000 a month. We could also use the same turbines to power up data centers or to power up Bitcoin mining. So all those things are being done by our competitors. And we’re not — we really don’t have the funds to experiment, but we are going to piggyback a proven solution. So with that, I’m going to just wrap it up and say we’re excited about where we’re at. We’re no melting ice cube, and we’ve got great inventory to certainly carry us through the rest of this decade. And with that, I’ll turn it back over to David and Matt.

David M. Smith, Esq.: And this is David here. Thank you, if you will go forward with a question-and-answer period that we’ve arranged.

Operator: This is David here. If you will go forward with the question-and-answer period that we’ve arranged.

Q&A Session

Operator: [Operator Instructions] Your first question is coming from William Peters.

William Peters: Great balance sheet cleanup. Your stock seems to be [indiscernible] in the rough. My question was answered already, but I just wanted to reaffirm supplying energy to data centers, AI, mining, et cetera. It seems like a great future for the company, if they could form some type of affiliation with somebody. I know you said money was tight, but to have that correlation would be great for the future.

Dante Caravaggio: William. Yes, thank you. The only note I’d say there is we just don’t know enough yet. We’re dabbling in it. We don’t have a proposal, but we’re asking for proposals, for people who know how to take our gas and monetize it. So thank you for bringing that up.

Operator: [Operator Instructions] That concludes our verbal Q&A. [Operator Instructions] I will now turn the call over to Mitchell Trotter for remaining questions.

Mitchell Trotter: All right. Thank you, Matthew. The first two questions are very similar, and I think we’ve answered, but I am going to read through them or paraphrase them, so Dante can answer a little bit more, if needed. Just so the questions are to you, Dante. When do you expect the first horizontal drilling to start up? And with respect to the future and exploring the reserves that we’ve identified in the past and opportunities with this drill?

Dante Caravaggio: Yes. So once a month, Jesse or I are meeting with Lance Taylor and his team, and they’ve pretty much picked out the locations where they want to go, I’ll say the first dozen. So the steps they have to go through is, go ahead and get those permitted, and as a lot of folks know, the BLM was shut down and the Trump Administration is saying, he’s going to put the pedal to the metal to get drilling permits approved. But my best guess, and I base it on the feedback I have from my colleagues at Virtus is that the permitting should get into the Feds this year and then hopefully, it gets approved the end of first quarter and then maybe the end of second quarter next year, we’re drilling. We should see results, we think, in June or July of ’26.

And by the way, the plan is to drill 10 to 20 wells a year, starting out with maybe 6 wells start out, something like that. And these things are not decided yet. And we do want a healthy oil price above $60 a barrel, it’s a no-brainer. Below $60, we have to do some hard thinking. So that’s the best indication I can give you.

Mitchell Trotter: Thank you, Dante. The next question, I will say is for me. And the question is that EON warrants, they have two different expiration dates at two separate brokerage accounts. Any idea why? Well, there is only one expiration date, and that’s 5 years from when we became the public company in November. We have found that more than two brokers have, whatever they keyed in the wrong date into people’s accounts, as to when the expirations of the warrants go. So it is November of ’28. So we can’t control the brokers, but that’s what they’ve done. We’ve reached out to them.

Dante Caravaggio: Why don’t we do this on that one, Mitch, just because — that — I want to run that question by Matt, our SEC Attorney and just double check that because — and I’m just saying this from memory, and I apologize guys for thinking on a call like this. But — some warrants were available by investors before we went public, and I don’t know if the dates did cascade in their, depending where we bought them before we went public.

Mitchell Trotter: They’re all gone. This is the IPO warrants, all from the initial IPO. The brokerage accounts have admitted that they’ve got it wrong. So — but we will reconfirm the date, and I think that’s important…

Dante Caravaggio: Because I’m confused, and I think it’s an excellent question. Let’s just put it on the website so everybody knows, including me, because — yes, it’s not clear in my head. So I apologize, guys.

Mitchell Trotter: Yes. No, no, that’s fair. And just so everyone knows, we have an FAQ under our website on the Investor page. I think it’s under the Governance or the Documents that’s up on the right. We’ll just add that FAQ to it and so that we can then answer it there, so people can go look at it. Okay. Good point. So okay. I think, Dante, you’ve answered this one, but I’ll give it to you again. At what barrel price does EON Resources start making money?

Dante Caravaggio: Well, we make money now. I mean, really, if you look at what we’re doing, we’re in the red about $100,000. Mitch and I look at this. Today, we’re in the red about $100,000, and I’ve asked Mitch, who controls G&As and Jesse, who controls lease operating expense to each cut $200,000. So if we — and they’ve got a plan. So I believe we’re profitable right now at today’s oil price. Certainly, if we can get oil prices to go up to $65 or $70, then we don’t have to work so hard, and certainly, if we buy some additional acquisitions, especially ones that don’t cause the G&As to go up, which is what we believe is the case of what we’re looking at, then we really get a shot in the arm. So I’m looking at really high-quality, highly profitable properties that will help us, but we don’t really need anything to be profitable today.

We just need to be a little better at controlling our costs, and it’s well within our range. Remember, we got rid of a $700,000 principal in interest payment. So we’ve got lots of room to work, and we were still paying down debt. But sadly, we leaned too hard on the ELOC, which created more shares in circulation. So we are doing our best to not do that at all and make a go of it, with just the production coming out of the ground, controlling our costs and adding one or two acquisitions, hopefully, in the next 6 to 9 months, something like that. I hope that answers the question.

Mitchell Trotter: Thank you. And let me give this one to Jesse. What issues are you facing selling the gas?

Jesse Allen: Well, let’s see. We’re currently making about 600 to 700 Mcf per day or 700,000 standard cubic feet per day to a plant that’s — it’s an older plant, the Maljamar Plant, and they’ve been doing a lot of maintenance recently on their gas treating trains and then they’ve been putting in some new lines. So it’s not only us that are being curtailed. It’s also all the other operators that produce into that plant. The operator of the Maljamar Plant, they’ve actually got another plant that they just got online and they’re lining that out now. And so we anticipate that in the not-too-distant future, we shouldn’t have this issue of getting rid of all our gas, and I’m sure that the genesis of that question probably came from, well, once you start drilling the horizontal wells and you’re making a lot more gas, what are you going to do with that gas?

So that gas will go to that same plant. But by that time, they should have worked out all the maintenance issues that they’re having to perform. And then some of that gas will go to the new plant. And so we don’t anticipate in the future having any gas sales issues and getting rid of our gas. I hope that answers the question right there.

Mitchell Trotter: It sounds like it does. Okay. This one, Dante, is for you. Congratulations on the great third quarter with regards to the first 3 wells by Virtus. We’ll be drilling by mid-’26. In your agreement with them, are they required to drill at least these first 3 wells regardless of the oil price at the time?

Dante Caravaggio: It’s really their option when to drill. Those first 3 are solid gold to us because we call it a carry. We don’t have to pay a dime. They front all that money. But I believe they’re going to drill as long as oil prices are — as long as oil prices don’t collapse, I believe they’re going to drill. So I mean, it is $55 okay? Is $50 okay? Is $45 okay? I don’t know the answer to that, but they have 5 years to drill 18 wells to hold the rights to our San Andreas formation. And we just feel confident. I mean, I’ll just have to give my outlook on oil prices. If oil prices decline much below $60, it’s not attractive for anybody to drill. And so what happens is the drillers and the oil producers all shut down. And then what happens?

The fields just start declining. And so oil prices will start going up as oil production drops. So now oil production drops, oil prices go up, drilling starts picking up. So it’s kind of a self-controlling loop. If oil prices go down, drilling slows down, decrease in production increases, U.S. slows down producing oil, oil prices go back up. Then as it goes up, drilling picks back up, production goes back up, oil prices come down. So I think the search for equilibrium is what everybody is guessing. The number is probably going to be slightly above where people would drill. And people — frankly, they’re reluctant to drill at $60. Our formation is pretty good. So we feel we have healthy economics at $60. A lot of people can’t drill without $70.

So if you said, where will this sort of level out and where will it be? And how does all this stuff kind of work? I mean, I feel like oil prices are going to hang in there, $60 to $70 with some excursions below that range and above that range. And that’s the best I can tell you. I hope that answers your question.

Mitchell Trotter: Okay. We have time for a few more questions, a couple more, but let me — this one is for me. What convertible notes were redeemed and which have not been redeemed? And how did you decide which in the order to redeem. Going back in time, we’ve talked about converting the private loans and the warrant obligations into convertible notes all the way back into the end of ’24, and as we have been stating really every quarter, our intent is to try to clean up all of this by the end of this year, at least with respect to the non-insiders, and that’s what we’ve just about done. All of these private loans came from people that were close to us when we were a SPAC and had no source of income. So that’s what got us across the line to begin with.

So we have redeemed to date all now, all but $250,000 of non-insider in the last under $2 million is insiders, and we can’t do them right now anyway. So that’s kind of how we pick them and who’s redeemed and who’s not redeemed.

Dante Caravaggio: Yes. I want to add something to that. As a management team, we take great pride that nobody who has invested with us has lost a dime. And we view that as a sacred trust with our investors and shareholders. And for those that hold the shares, trust me, I’m one of those that paid north of $2 for these shares. And I’m not going to rest until this stock is really, Joe and I talked about it, $100 a share. Now am I going to get that done this year? Probably not. In fact, I almost bet I won’t get that done this year. But I think before the end of the decade, that’s my goal. I’m just going to say that.

Mitchell Trotter: Okay. I’ve got about three more questions that I think we have time for. The next one actually, next two will be for me, but the first one is very close to that. What is the dilution risk either from the current notes converting or other things? And on the $250,000 of shares, that’s — excuse me, convertible notes, that’s at $0.50 a day, that’s about 0.5 million shares. So it’s not huge in the grand scheme of things, though we are trying to — and as Dante had alluded to, we have the ELOC that we’ve talked about for — since October of ’22, and we use it very sparingly and small amounts not to drive anything. And so that’s kind of the dilution risk. And when we look at these acquisitions, and this is anything else, we look at acquisitions, we’re looking at the proper balance of debt whether its volumetric funding or equity, if it’s accretive, if it makes sense.

So like the mean 5 shares that we took out the preferred shares, that made sense because it took out $27 million of redemption value for really a minor amount of the number of shares that could have been converted, I mean. So that’s how we address that. The next one is also for me. What is the ’26 crude oil price value that you anticipate to hedge? We have hedged 1/4 of our production through the first quarter of ’26 at $62.50, and we watch it, and we’ll probably get up into the 50% max 70%. Now, if it goes crazy, we’ll get closer to 70% — oil price goes. But we watch it. I check it every day. And if the price goes up enough to lock in more over $62.50, I may, but I really want it to be much higher than that. But we’re going to have to watch it, the market, what’s going on at the time, what we’ve got going on at the time and to make certain that we are properly covered.

We don’t have any bank covenants or anything like that, that requires it. And so that’s where we are with respect to the hedging. And this will be a good one for you to finish, Dante. So this will be the last question, I believe. An acquisition by a big player, can that be considered?

Dante Caravaggio: I don’t understand the question. An acquisition by a big — can we be acquired by a big player?

Mitchell Trotter: I’m guessing that’s what it’s saying, but are we willing — I take it both ways. Are we to be swallowed or would we swallow somebody else?

Dante Caravaggio: Yes. Okay. I’ll handle that. I mean, for $1 trillion, we’ll sell for $1 trillion. The issue is the marketplace is very sophisticated. They’re not going to give us what we’re worth. And almost very few people will pay us what the value is of the oil in the ground. They will pay us for the value of the oil barrels coming out of the ground that have been doing so for the last, say, year or 2. So with us, where we have a huge inventory of drilling and workovers, nobody is going to pay us what we’re worth. So I don’t think — and we’re not going to sell unless somebody paid us what we’re worth. So I think the answer is for bargain basement hunter, we’re not for sale. For somebody that wants 92 wells to drill and wants 500 wells to work-over and a management team that knows how to do things without selling much stock and without taking on debt, yes, for the right price, sure.

But I think we’re way better off serving our shareholders by doing what we’ve been doing, keeping our promise, buy more quality assets with a lot of inventory baked in, paying them nothing for the inventory, paying them a fair price for their PDP producing, developed, producing proven reserves and getting a crazy good return on our money for our shareholders. So we think the future is bright, and we think there’s no better place to be. We’re all motivated. We’ve had almost no turnover in our management ranks. We think our employees are happy and they’re working safe. So you add all that up, and I think we’re a good bet. So I’ll turn it back over to Matthew to wrap it up, please.

Operator: Thank you. And everyone, this concludes today’s event. You may disconnect at this time, and have a wonderful day. Thank you for your participation.