Royale Energy, Inc. is an independent oil and natural gas producer based in the United States, operating mainly in Texas and California with a focus on exploration, development, and sale of hydrocarbons.

# Royale Energy, Inc. - Business Summary

## Company Overview
- **Type:** Independent oil and natural gas producer
- **Incorporation:** Delaware (2017); successor to Royale Energy Funds, Inc. (California, 1983)
- **Employees:** 11 full-time employees (as of December 31, 2024)
- **Business Focus:** Production and sale of oil and natural gas, acquisition of lease interests and proved reserves, drilling exploratory and development wells, and selling fractional working interests in wells.

## Geographic Operations
- **Main Locations:**
  - Mitchell County and Ector County, Texas
  - Sacramento Basin and San Joaquin Basin, California
  - Oklahoma
  - Overriding royalty interest in Alaska

## Revenue and Financials
- **2024 Revenue:** $2,164,241 from the sale of oil and natural gas (97% of total revenue)
- **2023 Revenue:** $2,114,026 (98% of total revenue)
- **Net Income:** Not explicitly provided
- **Reserves:** Approximately 1.8 BCFE (billion cubic feet equivalent) as of December 31, 2024
- **Net Reserve Value:** ~$11.0 million (as of December 31, 2024)
- **Disclosed Reserve Prices:** 
  - Natural gas: $2.13 per MCF
  - Oil (WTI): $76.32 per barrel
- **Standardized PV-10 (Discounted Future Net Cash Flows):** ~$4.39 million

## Business Activities
- **Exploration & Development:** Participated in drilling 4 gross (0.0722 net) wells in 2024, all producing
- **Production:** 
  - 2024 Oil: 26,573 barrels (net)
  - 2024 Gas: 22,399 MCF (net)
  - 2024 Equivalent: 116,406 MCFE (net)
- **Production Prices:** 
  - Oil: ~$72.83 per barrel
  - Gas: ~$1.94 per MCF
- **Drilling & Operations:** Uses turnkey contracts; records gains when funds received exceed costs incurred; maintains operational control of some wells; hires contractors for drilling, testing, and completing wells.

## Assets
- **California:** Owns interests in 9 gas fields, operates 10 wells, and has interests in 13 non-operated gas wells and 8 non-operated oil wells.
- **Texas:** Owns and operates 26 oil wells, with additional interests in 6 non-operated oil wells in Permian Basin and 3 non-operated gas wells (in Texas and Oklahoma).
- **Leasehold Acreage (2024):** 
  - California: 2,401.02 gross acres (1,784.84 net; developed) and 3,097.25 acres (996.80 net; undeveloped)
  - All others (primarily Texas and Oklahoma): 7,465 gross acres (all owned)

## Drilling & Reserve Development
- **2023:** Drilled 4 developmental wells (interest in some fractional wells)
- **2024:** Drilled 4 developmental wells, all productive (interest of 0.0722 net wells)
- **Reserves:** 
  - Oil (Proved): 238,740 BBL total
  - Natural Gas (Proved): 392,770 MCF total
  - Increased reserves in 2024 mainly from drilling locations

## Key Strategies
- Diversifying investments through sale of fractional working interests
- Reducing capital exposure by sharing drilling risks
- Focus on acquiring lease interests and developing properties mainly in Texas and California
- Maintaining regulatory compliance and adapting to evolving environmental and state laws

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*Note: Financial and operational data are based on reports for the year ending December 31, 2024.*

Royale Energy, Inc. is an independent oil and natural gas producer engaged in the exploration, production, and sale of oil and gas, primarily operating in Texas and California.

# Summary of Royale Energy, Inc.

## Company Overview
Royale Energy, Inc. is an independent oil and natural gas producer based in Delaware, formed in 2017 as a successor by merger to Royale Energy Funds, Inc., established in 1983 in California. As of December 31, 2023, the company employs 10 full-time staff members.

## Business Operations
- **Principal Activities**:
  - Production and sale of oil and natural gas.
  - Acquisition of oil and gas lease interests and proved reserves.
  - Drilling of exploratory and development wells.
  - Sale of fractional working interests in wells.

- **Geographical Focus**:
  - **Texas**: Main areas include Mitchell County and Ector County.
  - **California**: Operations primarily in the Sacramento Basin and San Joaquin Basin.
  - **Oklahoma**: Holds interests in natural gas wells.
  - **Alaska**: Owns an overriding royalty interest in a discovery.

- **Revenue Generation**:
  - The company sells working interests in wells to accredited investors, allowing for diversified investment opportunities.
  - Approximately 98% of the company's revenue in 2023 came from oil and natural gas sales, totaling **$2,114,026**. This is a decrease from the revenue of **$2,611,222** in 2022.

## Financial Performance
- **Total Reserves** (as of December 31, 2023):
  - Estimated total reserves: approximately **1.8 BCFE**.
  - Proved developed and undeveloped reserves valued at approximately **$10.7 million**.
  - Standardized measure of discounted future net cash flows estimated at **$4,471,896**.

- **Turnkey Drilling Gains**:
  - Reported a gain on turnkey drilling of **$2,107,500** for the year ended December 31, 2023, an increase from **$1,726,414** in 2022.

## Production Statistics (2023)
- **Oil Production**: 
  - Volume: **22,399 BBL**
  - Average sales price: **$74.27**
  
- **Natural Gas Production**: 
  - Volume: **128,160 MCF**
  - Average sales price: **$3.47**
  
- **Total MCFE**: **262,554**

- **Production Costs**: Total net production costs and taxes amounted to **$1,731,670**.

## Summary of Wells Owned (as of December 31, 2023)
- **Gross and Net Productive Wells**:
  - Total wells: **66** (28 natural gas and 38 oil).
  - Net wells: **31.7057** (10.8831 natural gas and 20.8226 oil).

## Drilling Activities
- The company drilled and completed one well while participating in the drilling of three wells in 2023 (two were commercially productive, and one was a dry hole).

## Market Environment
- Royale competes with larger oil and gas producers in a highly competitive market.
- Market prices and demand for oil and natural gas can fluctuate widely based on global events and local legislation, impacting Royale's operations.

## Regulatory Environment
- The company's operations are influenced by federal and state regulations, particularly in California, where new laws have been instituted that affect drilling and production locations.

## Conclusion
In summary, Royale Energy, Inc. operates in the oil and natural gas sector, focusing on diversified drilling projects primarily in Texas and California. The company's financial performance has seen some fluctuations, but it continues to actively participate in oil and gas production and exploration to enhance its revenue streams. As of the end of 2023, it controls a modest number of wells and has faced various market and regulatory challenges.

Royale Energy, Inc.

10-K / April 9, 2025

10-K / April 12, 2024

10-K / April 9, 2025

Royale Energy, Inc. - Business Summary

Company Overview

Geographic Operations

Revenue and Financials

Business Activities

Assets

Drilling & Reserve Development

Key Strategies