Company: TPET
Filing Date: 2025-01-17
Form Type: 10-K
Source: 0001493152-25-002760
Chunk: 2449

Company: Trio Petroleum Corp.
Filing Date: 2025-01-17
Form: 10-K
Item: Item 11
Chunk 2449
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 LLC (“Trio LLC”) an approximate 82.75% working interest (which
was subsequently increased to an approximate 85.775% working interest in April 2023), in the large, approximately 9,300-acre South Salinas
Project that is located in Monterey County, California, and subsequently partner with certain members of Trio LLC’s management
team to develop and operate those assets. In September 2021, the Company entered into a Purchase and Sale Agreement (“Trio LLC
PSA”) with Trio LLC to acquire the purchased percentage of the South Salinas Project’s leases, wells and inventory in exchange
for $300,000 cash, a non-interest-bearing note payable of $3,700,000 and 245,000 shares of the Company’s $0.0001 par value common
stock (which constituted 45% of the total number of issued shares of the Company at that time). The Company accounted for the purchase
as an asset acquisition, as prescribed in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification
(“ASC”) 805 – Business Combinations. The assets and associated asset retirement obligations (“ARO”)
were recorded based on relative fair value at the estimated fair value of the consideration paid. The Company holds an approximate 68.62%
interest after the application of royalties (“net revenue interest”) in the South Salinas Project, while Trio LLC holds an
approximate 3.8% working interest in the South Salinas Project; the Company and Trio LLC are separate and distinct companies.

There
are two contiguous areas of notable oil/gas accumulations in the South Salinas Project; the first is the Humpback Area that occurs in
the northern part of the project and the second is the Presidents Area (“Presidents Oil Field”) that occurs in the southern
part of the project. As October 31, 2024 and 2023, there were no proved reserves attributable to the approximate 9,300 acres of the property.
Since it was returned to production in March 2024, the HV-3A well at the South Salinas Project has been producing oil with a generally
favorable oil-water ratio; the Company expects to take steps to improve oil production from this well in the third or fourth calendar
quarter of 2024 and expects to receive the first revenue from oil produced from the well in the third calendar quarter of 2024.

Initial
Public Offering

The
Company’s Registration Statement (Amendment No.