Acquisitions	12 Months Ended
Jun. 30, 2024
Acquisitions
Acquisitions	Note 3. Acquisitions SCOOP/STACK Acquisitions On February 12, 2024, the Company closed the acquisitions of certain non-operated oil and natural gas assets in the SCOOP and STACK plays in central Oklahoma (the "SCOOP/STACK Acquisitions") from Red Sky Resources III, LLC, Red Sky Resources IV, LLC, and Coriolis Energy Partners I, LLC. After taking into account customary closing adjustments and an effective date of November 1, 2023, total combined cash consideration for the SCOOP/STACK Acquisitions was approximately $39.2 million, which includes $43.9 million paid at closing less purchase price adjustments totaling approximately $4.7 million related to net cash flows received on the properties subsequent to closing. The Company accounted for these transactions as asset acquisitions and allocated all of the combined purchase price (including $0.3 million of transaction costs) to proved oil and natural gas properties. In addition, the Company recognized $0.1 million in non-cash asset retirement obligations, the estimated net present value of future net retirement costs. The transactions were funded with cash on hand and $42.5 million in borrowings under the Company’s Senior Secured Credit Facility. The acquired assets consist of an average net working interest of approximately 2.6%, in 253 producing wells in the SCOOP and STACK plays of the Anadarko Basin in Oklahoma. Chaveroo Oilfield Participation Agreement On September 12, 2023, the Company entered into a Participation Agreement with PEDEVCO for the joint development of a portion of PEDEVCO’s Permian Basin property in the Chaveroo oilfield, located in Chaves and Roosevelt Counties, New Mexico. In accordance with the Participation Agreement, the Company will have the right, but not the obligation, to elect to participate and acquire a 50% working interest share in certain development blocks at a fixed price of $450 per net acre for up to a total of approximately 16,000 gross acres. The Participation Agreement does not include any of PEDEVCO’s existing vertical or horizontal wells. As of June 30, 2024, the Company incurred approximately $0.8 million in exchange for a 50% working interest share in the existing leases associated with five development blocks. As of June 30, 2024, the Company has participated in the drilling and completion of the first development block, consisting of three gross wells (1.5 net wells). In accordance with the FASB’s authoritative guidance on asset acquisitions, the Company allocated the cost of the above acquisitions to the assets acquired and liabilities assumed based on a relative fair value basis of the assets acquired and liabilities assumed, with no recognition of goodwill or bargain purchase gain recorded. Incremental legal and professional fees related directly to the acquisitions were capitalized as part of the acquisition cost. The fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Fair value measurements also utilize market assumptions of market participants.

Acquisitions

12 Months Ended

Jun. 30, 2024

Note 3. Acquisitions

SCOOP/STACK Acquisitions

On February 12, 2024, the Company closed the acquisitions of certain non-operated oil and natural gas assets in the SCOOP and STACK plays in central Oklahoma (the "SCOOP/STACK Acquisitions") from Red Sky Resources III, LLC, Red Sky Resources IV, LLC, and Coriolis Energy Partners I, LLC. After taking into account customary closing adjustments and an effective date of November 1, 2023, total combined cash consideration for the SCOOP/STACK Acquisitions was approximately $39.2 million, which includes $43.9 million paid at closing less purchase price adjustments totaling approximately $4.7 million related to net cash flows received on the properties subsequent to closing. The Company accounted for these transactions as asset acquisitions and allocated all of the combined purchase price (including $0.3 million of transaction costs) to proved oil and natural gas properties. In addition, the Company recognized $0.1 million in non-cash asset retirement obligations, the estimated net present value of future net retirement costs. The transactions were funded with cash on hand and $42.5 million in borrowings under the Company’s Senior Secured Credit Facility.

The acquired assets consist of an average net working interest of approximately 2.6%, in 253 producing wells in the SCOOP and STACK plays of the Anadarko Basin in Oklahoma.

Chaveroo Oilfield Participation Agreement

On September 12, 2023, the Company entered into a Participation Agreement with PEDEVCO for the joint development of a portion of PEDEVCO’s Permian Basin property in the Chaveroo oilfield, located in Chaves and Roosevelt Counties, New Mexico. In accordance with the Participation Agreement, the Company will have the right, but not the obligation, to elect to participate and acquire a 50% working interest share in certain development blocks at a fixed price of $450

per net acre for up to a total of approximately 16,000 gross acres. The Participation Agreement does not include any of PEDEVCO’s existing vertical or horizontal wells.

As of June 30, 2024, the Company incurred approximately $0.8 million in exchange for a 50% working interest share in the existing leases associated with five development blocks. As of June 30, 2024, the Company has participated in the drilling and completion of the first development block, consisting of three gross wells (1.5 net wells).

In accordance with the FASB’s authoritative guidance on asset acquisitions, the Company allocated the cost of the above acquisitions to the assets acquired and liabilities assumed based on a relative fair value basis of the assets acquired and liabilities assumed, with no recognition of goodwill or bargain purchase gain recorded. Incremental legal and professional fees related directly to the acquisitions were capitalized as part of the acquisition cost. The fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Fair value measurements also utilize market assumptions of market participants.