Company: REI
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001384195-25-000018
Chunk: 36

Company: RING ENERGY, INC.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 1
Chunk 36
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 will be 0% from such hedge testing date to the next succeeding hedge testing date and (b) if the borrowing base utilization percentage is equal to or greater than 25%, but less than 50% and the Leverage Ratio is not greater than 1.25 to 1.00, the required hedging percentage for months 13 through 24 of the rolling 24 month period provided for will be 25% from such hedge testing date to the next succeeding hedge testing date.As of September 30, 2025, $428 million was outstanding on the Credit Facility and the Company was in compliance with all covenants in the Credit Agreement.Under the Credit Agreement, the applicable percentage for the unused commitment fee is 0.5% per annum for all levels of borrowing base utilization. As of September 30, 2025, the Company's unused line of credit was approximately $157.0 million, which was calculated by subtracting the outstanding Credit Facility balance of $428 million and standby letters of credit of $35,000 in total ($10,000 with a federal agency and $25,000 with an insurance company for New Mexico state surety bonds) from the $585 million borrowing base.

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NOTE 9 — ASSET RETIREMENT OBLIGATIONThe Company records the obligation to plug and abandon oil and gas wells at the dates properties are either acquired or the wells are drilled. The asset retirement obligation is adjusted each quarter for any liabilities incurred or settled during the period, accretion expense and any revisions made to the costs or timing estimates. The asset retirement obligation is incurred using an annual credit-adjusted risk-free discount rate at the applicable dates. A reconciliation for the asset retirement obligation during the nine months ended September 30, 2025 is as follows:Balance, December 31, 2024$26,382,517 Liabilities acquired2,721,571 Liabilities incurred77,323 Liabilities sold(65,129)Liabilities settled(218,254)Accretion expense1,099,363 Balance, September 30, 2025$29,997,391 The following table presents the Company's current and non-current asset retirement obligation balances as of the periods specified.September 30, 2025December 31, 2024Asset retirement obligations, current$418,526 $517,674 Asset retirement obligations, non-current29,578,865 25,864,843 Asset retirement obligations$