The Reserve Petroleum Company reported a significant turnaround in its financial performance for the fiscal year ending December 31, 2024, achieving a net income of $2,029,278 compared to a net loss of $55,648 in 2023. This resulted in a net income per share of $13.18, a substantial increase from a loss of $0.36 per share in the previous year. Operating revenues rose by 20% to $15,995,663, driven primarily by a 21% increase in oil and gas sales, which totaled $15,139,535, up from $12,490,047 in 2023.
The company experienced notable changes in its operational metrics, with production costs decreasing by 7% to $13,576,602, despite a 5% increase in production costs to $4,582,170. The decrease in overall operating costs was attributed to a reduction in water well drilling services expenses, which fell by 60% following the termination of a drilling agreement. Additionally, the company participated in the drilling of 19 development wells and 11 exploratory wells during the year, with 15 of the development wells completed as producers.
In terms of strategic developments, the company’s mineral property management continued to be a significant revenue source, contributing $3,460,997 in 2024, although this represented a slight decrease from $3,259,786 in 2023. The company holds non-producing mineral interests across 88,333 net acres in 12 states, with a concentration in Arkansas, Kansas, Oklahoma, South Dakota, and Texas. The company also reported a decrease in its equity securities, which fell by 6% to $2,501,194, reflecting a net decrease in market value.
Looking ahead, the company remains cautious about future market conditions, particularly regarding oil and gas prices, which are subject to significant fluctuations based on spot market pricing. Management emphasized the importance of retaining quality employees and controlling expenses to sustain operational performance. The company has no significant long-term sales contracts for oil or gas, which adds to the uncertainty of future revenues. Despite these challenges, the company plans to continue its exploration and development activities while managing its investment portfolio to mitigate risks associated with the volatile energy sector.
About RESERVE PETROLEUM CO
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