Company: REI
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001384195-25-000018
Chunk: 132

Company: RING ENERGY, INC.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 8
Chunk 132
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 amounts are calculated by dividing our total lease operating expenses by our total volume sold, in Boe. Total LOE increased primarily due to an 3% increase in production of 62,677 Boe as a result of the increased production and well count from the Lime Rock Acquisition as well as new wells drilled and completed in our development program. The primary cost drivers for the period were an increase of $0.9 million in electricity, $0.6 million for environmental sustainability and cleanup, and $0.3 million for salt water disposal, offset by reductions of $1.2 million for workover costs and $0.3 million for pressure, vacuum, and hot oil truck costs.

Gathering, transportation and processing costs. Our total gathering, transportation and processing costs (“GTP”) increased from $102,420 to $126,569 and increased slightly on a per Boe basis from $0.06 to $0.07. Beginning May 1, 2022, due to a natural gas processing entity taking control of transportation at the wellhead, GTP costs were re-classified as a reduction to oil and natural gas sales revenues. However, one contract remains in place with a natural gas processing entity where point of control of gas dictates requiring the fees be recorded as an expense. The increase in GTP costs was primarily due to the higher natural gas Mcf and NGL barrels processed. 

Ad valorem taxes. Our total ad valorem taxes increased from $2.2 million to $2.4 million and increased on a per Boe basis from $1.17 to $1.28. Of the $0.3 million increase in ad valorem taxes, $0.8 million was for Andrews County tax estimates, primarily related to the Lime Rock Acquisition as well as  $0.1 million for Ector County tax estimates. This was offset by a decrease of $0.6 million for Yoakum County tax estimates.

Oil and natural gas production taxes. Oil and natural gas production taxes as a percentage of oil and natural gas sales were 4.71% for the three months ended September 30, 2024 and decreased to 4.67% for the three months ended September 30, 2025. Both percentages are in line with historical rates.

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Production Costs for the Nine Months Ended September 30, 2025 and 2024

For the Nine Months EndedSeptember 30, 2025September 30, 2024Change% ChangeLe