Company: TPET
Filing Date: 2025-09-12
Form Type: 10-Q
Source: 0001493152-25-013189
Chunk: 187

Company: Trio Petroleum Corp.
Filing Date: 2025-09-12
Form: 10-Q
Item: Part I, Item 8
Chunk 187
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 in the previous quarter, which resulted in a lower expense allocation for the current nine-month period.

Accretion
expense

We
have an Asset Retirement Obligation (“ARO”) recorded that is associated with its oil and natural gas properties in the SSP;
the fair value of the ARO was recorded as a liability and is accreted over time until the date the ARO is to be paid. For the nine months
ended July 31, 2025, accretion expenses remained consistent with that of the prior year period.

Other
expenses, net

For
the nine months ended July 31, 2025, other expenses, net decreased by approximately $1.2 million when compared to the prior year period.
This decline was primarily driven by (i) an approximate $1.3 million reduction in non-cash interest expense resulting from lower debt
levels in the current period (non-cash interest expense is recognized as debt discounts on financings are amortized), as well as (ii)
an approximate $0.6 million decrease in the loss on a note conversion recorded in the prior period, which stemmed from principal payments
made via conversion shares under the October 2023 Securities Purchase Agreement. These reductions were partially offset by a $0.6 million
loss incurred in the current period due to the abandonment of oil and gas properties.

Liquidity
and Capital Resources

Working
Capital (Deficiency)

A
comparison of our working capital deficiency is presented below:

    July 31, 2025  
    October 31, 2024 
  
    Current assets 
    $876,550  
    $565,219 
  
    Current liabilities 
     1,556,279  
     2,590,699 
  
    Working capital (deficiency) 
    $(679,729) 
    $(2,025,480)

Current
assets increased primarily due to a $3.4 million rise in cash, driven by proceeds from the sale of common shares under the
Company’s at-the-market (ATM) offering agreement during the fiscal quarter ended January 31, 2025. Current liabilities decreased overall, reflecting
reductions in promissory notes (approximately $0.7 million), notes payable to related parties ($0.2 million), and other current
liabilities ($0.3 million). These decreases were partially offset by an increase in accounts payable of approximately $0.4
million.

Cash
Flows

Our