Company: REI
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001384195-25-000018
Chunk: 60

Company: RING ENERGY, INC.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 1
Chunk 60
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5)%Ceiling test impairment72,912,330 — 72,912,330 100 %Asset retirement obligation ("ARO") accretion$390,563 $354,195 $36,368 10 %Operating lease expense$175,091 $175,091 $— — %General and administrative expense ("G&A"):     General and administrative expense (excluding Share-based compensation)$6,521,171 $6,389,480 $131,691 2 %     Share-based compensation1,618,600 32,087 1,586,513 4944 %Total general and administrative expense$8,139,771 $6,421,567 $1,718,204 27 %G&A per Boe$4.26 $3.47 $0.79 23 %G&A excluding Share-based compensation, per Boe$3.41 $3.45 $(0.04)(1)%

Depreciation, depletion and amortization. Our depreciation, depletion and amortization decreased from $25.7 million to $25.2 million, with $0.4 million of the reduction from lower depletion. The decrease in depletion was the result of a price variance of $(1.3) million,  due to a lower depletion rate per Boe, driven by a higher percentage increase in the amortization base than the percentage increase in the estimated costs of property, offset by a volume variance of $0.9 million from an increase of 62,677 in Boe produced. Our average depreciation, depletion and amortization per Boe decreased from $13.87 per Boe to $13.19 per Boe.  

Ceiling test impairment.  As a result of the lower oil prices impacting the present value of estimated future net revenues, the Company incurred a ceiling test impairment on its oil and natural gas properties of $72.9 million.

Asset retirement obligation accretion. Our asset retirement obligation (“ARO”) accretion increased from $354,195 to $390,563 primarily due to additional ARO accretion associated with properties acquired in the Lime Rock Acquisition.

Operating lease expense. Our operating lease expense costs were the same period over period.

General and administrative expense. General and administrative ("G&A") expense increased from $6.4 million to $8.1 million. The $1.7 million cost increase was primarily driven