Ring Energy, Inc. (NYSE: REI)

Ring Energy, Inc. is a growth oriented independent oil and natural gas exploration and production company headquartered in The Woodlands Texas. The company engages in the development production acquisition and exploration of oil and natural gas resources with a primary focus on the Permian Basin of Texas. Its drilling operations target oil and liquids rich producing formations in the Northwest Shelf and the Central Basin Platform within the Permian Basin. As of December 31 2025 Ring Energy held 111 714 gross acres (96 234 net acres) and had interests in 919 gross wells (758 net wells) that were producing. The company’s proved reserves totaled approximately 153.3 million barrels of oil equivalent of which it is the operator of about 99 percent. The reserve base is oil weighted with roughly 59 percent oil 19 percent natural gas and 22 percent natural gas liquids. Approximately 68 percent of the reserves are proved developed and 32 percent are proved undeveloped.

Ring Energy generates revenue primarily from the sale of crude oil natural gas and natural gas liquids produced from its Permian Basin assets. Oil prices are determined by major crude oil purchasers and commodities trading while natural gas prices reflect regional supply and demand conditions. The company believes it receives prices comparable to other producers operating in the same geographic area and views the risk of being unable to sell its production at prevailing prices as low. To mitigate exposure to downside commodity price movements Ring Energy maintains an active commodity hedging program designed to hedge a meaningful portion of its expected oil and gas production thereby protecting cash flow to meet debt obligations under its credit facility and to support liquidity for capital expenditures. In addition the company earns income from the gathering and transportation of its natural gas through existing third party systems and from the trucking of oil where pipeline access is not available. Lifting costs were reduced to $10.73 per barrel of oil equivalent in 2025 reflecting a focus on cost efficient operations.

Ring Energy competes in the highly competitive independent exploration and production sector of the oil and natural gas industry. Its competitive position is strengthened by a high quality asset base located in one of North America’s leading oil and gas producing regions characterized by relatively low decline rates and attractive margins. The company’s acreage position in the Permian Basin is de‑risked with a multi year drilling inventory of both horizontal and vertical development opportunities providing a clear path for future growth. Operational control over most of its production and development activities enables Ring Energy to execute its drilling programs efficiently and to respond swiftly to changing market conditions. An experienced and proven management team with deep technical and operational expertise further supports the company’s ability to identify and execute high return projects. Additionally Ring Energy’s commitment to cost efficient operations health safety environmental stewardship and community engagement provides a differentiator that appeals to investors and partners seeking sustainable returns.

The company sells its oil natural gas and natural gas liquids to a diverse set of purchasers including end users marketers and other entities with access to nearby pipeline facilities. In areas where pipeline connections are not practical oil is transported by truck to storage facilities. For the year ended December 31 2025 sales to three customers accounted for 89 percent of Ring Energy’s oil natural gas and NGL revenues while accounts receivable from those three customers represented 82 percent of total accounts receivable. The largest customer was Phillips 66 Company which contributed approximately 67 percent of revenue and 66 percent of receivables. Concord Energy LLC accounted for about 13 percent of revenue and 10 percent of receivables. NGL Crude Partners contributed roughly 9 percent of revenue and 6 percent of receivables. Ring Energy believes that the loss of any of these purchasers would not materially impact its business because it could readily find alternative buyers for its production.