U.S. Energy Corp. Reports $3.1 Million Net Loss in Q1 2025, Revenue Declines to $2.2 Million

U.S. Energy Corp. reported a net loss of $3.1 million for the first quarter of 2025, a significant improvement compared to a net loss of $9.5 million in the same period of 2024. The company's total revenue for the quarter was $2.2 million, down from $5.4 million year-over-year, primarily due to a 57% decrease in production quantities and lower commodity prices. Oil sales contributed $1.8 million, while natural gas and liquids accounted for $423,000. The average sales price for oil decreased to $59.01 per barrel from $68.91, while the average price for natural gas and liquids increased to $4.14 per Mcfe from $2.69.

In terms of operational metrics, U.S. Energy Corp. produced 47,008 barrels of oil equivalent (BOE) during the first quarter, a decline from 109,800 BOE in the prior year. This reduction was attributed to divestitures of properties in Karnes County, East Texas, and the Mid-Continent regions, as well as natural production declines. The company reported a decrease in lease operating expenses to $1.6 million, down from $3.2 million, although the cost per BOE increased due to changes in the property mix.

Strategically, U.S. Energy Corp. made significant moves during the quarter, including the acquisition of 24,000 net operated acres in Montana from Synergy Offshore LLC for a total consideration of $4.7 million, which included cash and stock. The company also completed an underwritten offering of 4.9 million shares, generating approximately $11.9 million in net proceeds, which will be used for the development of the acquired properties and general corporate purposes. Additionally, the company repurchased 125,600 shares of its common stock during the quarter as part of its ongoing share repurchase program.

Looking ahead, U.S. Energy Corp. anticipates further challenges due to expected write-downs of oil and natural gas properties in the second quarter of 2025, potentially amounting to $7.0 million to $8.0 million, driven by lower commodity prices. The company plans to drill two additional wells targeting industrial gas zones and continue evaluating acquisition opportunities in the oil and natural gas sectors. Management remains focused on maintaining liquidity and capital resources to support its operational and strategic initiatives.