Company: TPET
Filing Date: 2025-01-17
Form Type: 10-K
Source: 0001493152-25-002760
Chunk: 2234

Company: Trio Petroleum Corp.
Filing Date: 2025-01-17
Form: 10-K
Item: Item 9C
Chunk 2234
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 long-lived assets.

Asset
Retirement Obligations

ARO
consists of future plugging and abandonment expenses on oil and natural gas properties. In connection with the South Salinas Project
(“SSP”) acquisition described above, the Company acquired the plugging and abandonment liabilities associated with six non-producing
wells. The fair value of the ARO was recorded as a liability in the period in which the wells were acquired with a corresponding increase
in the carrying amount of oil and natural gas properties not subject to impairment. The Company plans to utilize the six wellbores acquired
in the SSP acquisition in future exploration, production and/or disposal (i.e., disposal of produced water or CO2 by injection) activities.
The liability is accreted for the change in its present value each period based on the expected dates that the wellbores will be required
to be plugged and abandoned. The capitalized cost of ARO is included in oil and gas properties and is a component of oil and gas property
costs for purposes of impairment and, if proved reserves are found, such capitalized costs will be depreciated using the units-of-production
method. The asset and liability are adjusted for changes resulting from revisions to the timing or the amount of the original estimate
when deemed necessary. If the liability is settled for an amount other than the recorded amount, a gain or loss is recognized.

Components
of the changes in ARO for the years ended October 31, 2023 and 2024 are shown below:

 SCHEDULE
OF COMPONENTS OF CHANGES IN ARO

    ARO,
    ending balance – October 31, 2022 
    $48,313 
  
    Accretion
    expense 
     2,778 
  
    ARO,
    ending balance – October 31, 2023 
     51,091 
  
    Accretion
    expense 
     2,778 
  
    ARO,
    ending balance – October 31, 2024 
     53,869 
  
    Less:
    ARO – current 
     2,778 
  
    ARO,
    net of current portion – October 31, 2024 
    $51,091 

    F-9

Related
Parties

Related
parties are directly or indirectly related to the Company, through one or more intermediaries and are in control, controlled by, or under
common control with the Company. Related parties also