Company: TPET
Filing Date: 2025-01-17
Form Type: 10-K
Source: 0001493152-25-002760
Chunk: 943

Company: Trio Petroleum Corp.
Filing Date: 2025-01-17
Form: 10-K
Item: Item 3
Chunk 943
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 with an estimated cost of $5,000,000
for roads, pads, drilling, and above ground steam and storage facilities, and thereafter the parties anticipate working together to fund
further well development based on their proportionate ownership thereof.

On
or around the date the parties entered into the Asphalt Ridge Option Agreement, HSO entered into a Leasehold Acquisition and Development
Option Agreement (the “LEC Option”) with Lafayette Energy Corp (“LEC”), of which Michael Peterson, Trio’s
former Chief Executive Officer and director, is also the Chief Executive Officer and director. The LEC Option has similar terms as the
Asphalt Ridge Option Agreement, except that it allows LEC to obtain a 30% interest in the Asphalt Ridge Leases and requires LEC to pay
certain equity compensation to HSO.

The
Company and HSO further agreed that, to the extent LEC does not fully exercise the LEC Option, the Company has the right to acquire up
to all 30% of the rights set forth in the LEC Option (or such lesser amount which LEC has not exercised), from HSO, for $3,000,000 cash.

61

The
exercise of the Asphalt Ridge Option is contingent, unless waived by the Company, upon the following: (a) HSO providing the Company the
statements of revenues and direct operating expenses for the prior two years for the asset and the unaudited stub period for 2023, through
the date of closing; (b) satisfactory due diligence review by the Company of HSO, the leases, the property and other information; (c)
the negotiating of a mutually-acceptable joint operations agreement or other development and operations agreement(s) as agreed by the
parties; and (d) HSO providing the Company an updated independent reserves report including proved undeveloped reserves (PUDs) and an
estimate of gross valuation and discounted net present values, and indicating best estimate original oil-in-place (OOIP) volumes and
gross (100%) contingent oil resources, as of a date no earlier than August 31, 2023, for discoveries located in Northwest Asphalt Ridge,
Uinta Basin, Utah.

The
Company previously exercised the Asphalt Ridge Option for a 2.25% working interest in the Asphalt Ridge Leases and has until February
10, 2025 to pay HSO an additional $1,775,000 to exercise an option for the remaining 17.75% working interest in the Asphalt Ridge Le