Investor FAQs

December 2020

Yes, until November 15, 2023 when the first acquisition was completed.

Yes. HNRA is listed on NYSE American and our ticker symbol is “HNRA”

Houston, Texas

Continental Stock Transfer and Trust Company

HNRA is an independent upstream energy company with oil and gas properties in the Permian Basin.

The investor deck posted on our website has a wealth of information on the company.  Additionally, current filings like our 10-K have more in-depth information that is worth reviewing.

We are always open to acquisitions at the appropriate time and fit for the company. Our long-term vision is an energy company, so other energy business lines.  At this time, we see other similar oil field properties best fit into our current organization.

The Northwest Shelf of the Permian Basin in Eddy County, New Mexico

On about 13,700 contiguous acres which facilitates operations and controls costs

There are on 20 federal and 3 state leases

The wells are in the Seven Rivers, Queen, Grayburg and San Andres intervals that range from as shallow as 1,500 feet to 4,000 feet in depth

550 wells where there are 342 producing wells, 207 injection wells, and 1 water source well

Yes. The infrastructure is in and the wells have responded and are producing. 

Production is approximately 85% crude oil and 15% natural gas

The use of waterflooding has been successful the Permian Basin.  We have almost 4 years of history with successful and good responses.

Yes.  We recycle our water and we have a contract to take and be paid from adjacent property.  As a back-up, we have a water source well that can provide enough water to satisfy the water requirements if needed.

Hydraulic fracturing, also known as fracing, is a well stimulation technique used to extract oil and natural gas from rock formations.  The process involves injecting a mixture of water, sand, and chemicals into the well. The high pressure forces the rock to crack, releasing oil or gas that can be sold or refined. Without fracing, this oil and gas is not recoverable economically.  This is a proven recovery and stimulation method and has been used since the late 1940’s.

Our reserve reports are prepared by our third-party engineer, William H. Cobb and Associates, Inc. (“Cobb”).

The proven reserves as of December 31, 2023 are 15.4 million barrels of oil and 3.5 billion cubic feet of natural gas, which includes 4.0 million barrels of PDP oil reserves.

• There are 247 legacy patterns
• There are 95 active waterflood patterns (PDP) completed after 2020
• There are an additional 158 patterns planned (PDNP + PUD)

The report has an estimated increase in production of 2 ½ times over the next 3 years

Yes. We plan to follow the Cobb reserve report to develop the property.

The cap-ex plan is approximately $93 million over the next 3 years

The plan is a combination of current cash flow and the ELOC that is in place

Yes there is ability to downsize the area of coverage and increase production

In the leasehold is approximately 876 million barrels of oil in the Grayburg and San Andres intervals and 80 million barrels in the Seven Rivers interval for a total OOIP of approximately 956 million barrels of oil.

Yes.  Our primary production and proven reserves are currently from the Seven Rivers zone.  In addition to proven reserves, the Company believes we may access an additional 34 million barrels of oil by adding perforations in the Grayburg and San Andres formations. 

The HNRA team took control of managing the company and operations after the acquisition closing

The management staff names and profiles can be found under the “Our Team” section of the company website under the “About Us” page.  The Board of Directors can be found under the “Governance” section on the “Investor Relations” page.

Yes. They all will have equity interest either through purchases or incentives

The operations team in the field stayed with the company following the acquisition.  The team is experienced and very knowledgeable about the property and wells.

As of December 31, 2013, there were 5.2 million shares of Class A common stock and 1.8 million shares of Class B common stock outstanding.  The Class B common stock has voting rights only and can be converted on a one-for-one basis for Class A common stock

Yes. There is $15 million of preferred stock that automatically converts to common stock in two years based on a formula. There is no cash obligation to the Company.

First International Bank and Trust (“FIBT”) provided at $28 million Reserve Based Loan (“RBL”) at acquisition closing.  The debt has a five-year amortization schedule with maturity in three years, and an interest rate of 15 percent.

Yes. There is a $15 million note issued to the Seller at closing, and $3.5 million of private loans as of December 31, 2023.