Annual report pursuant to Section 13 and 15(d)

ORGANIZATION, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

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ORGANIZATION, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
12 Months Ended
Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Schedule of Depletion and Depletion Rate per Barrel of Oil Equivalents The following table shows total depletion and the depletion per barrel-of-oil-equivalent rate, for the years ended December 31, 2023, 2022, and 2021.
For the Years Ended December 31,
2023 2022 2021
Depletion $ 87,442,546  $ 55,029,956  $ 36,735,070 
Depletion rate, per barrel-of-oil-equivalent (Boe) $ 13.22  $ 12.19  $ 11.82 
Schedule of Property Plant and Equipment Estimated Useful Lives
Depreciation of buildings, equipment, software, leasehold improvements, automobiles, buildings and structures is calculated using the straight-line method based upon the following estimated useful lives:
Leasehold improvements
3‑5 years
Office equipment and software
3‑7 years
Equipment
5‑10 years
Automobiles 4 years
Buildings and structures
7 years
Accounts Receivable, Allowance for Credit Loss The following table indicates the Company's provisions for bad debt expense associated with its joint interest billing receivables during the years ended December 31, 2023, 2022, and 2021.
For the Years Ended December 31,
2023 2022 2021
Bad debt expense
$134,007
$242,247
$0
Schedule of Accounts, Notes, Loans and Financing Receivable
The following table reflects the Company's joint interest billing receivables and allowance for credit losses as of December 31, 2023 and 2022.
2023 2022
Joint interest billing receivables $ 2,480,843  $ 1,226,049 
Allowance for credit losses (58,569) (242,247)
Joint interest billing receivables, net
$ 2,422,274  $ 983,802 
Property, Plant and Equipment
The following table provides information on the Company's depreciation expense for the years ended December 31, 2023, 2022, and 2021.
For the Years Ended December 31,
2023 2022 2021
Depreciation expense
$364,024
$205,600
$124,961
Schedule of Accounts Payable and Trade Accounts Payable
The following table summarizes the Company's components of its current accounts payable balance presented in its Balance Sheets at December 31, 2023 and 2022:
2023 2022
Trade accounts payable
$ 37,626,348  $ 40,480,684 
Revenues payable 44,348,938  43,807,208 
Accrued expenses 22,088,838  27,110,376 
Accounts payable
$ 104,064,124  $ 111,398,268 
Trade accounts payable – The following table summarizes the Company's current trade accounts payable at December 31, 2023 and 2022:
2023 2022
Accounts payable related to vendors $ 36,944,263  $ 36,586,007 
Other 682,085  3,894,677 
Trade accounts payable
$ 37,626,348  $ 40,480,684 
Schedule of Revenues Payable
Revenues payable – The following table summarizes the Company's current revenues and royalties payable at December 31, 2023 and 2022:
2023 2022
Revenue held in suspense $ 31,592,825  $ 30,180,940 
Revenues and royalties payable 12,756,113  13,626,268 
Revenues payable
$ 44,348,938  $ 43,807,208 
Schedule of Accrued Expenses
Accrued expenses – The following table summarizes the Company's current accrued expenses at December 31, 2023 and 2022:
2023 2022
Accrued capital expenditures $ 7,518,603  $ 9,624,985 
Accrued lease operating expenses 6,798,548  6,450,356 
Accrued interest 3,684,378  3,222,864 
Accrued general and administrative expense 4,047,095  4,076,699 
Other 40,214  3,735,472 
Accrued expenses
$ 22,088,838  $ 27,110,376 
Reclassification out of Accumulated Other Comprehensive Income The following table shows interest paid related to notes payable for the years ended December 31, 2023, 2022, and 2021. This interest is included within "Interest (expense)" in the Statements of Operations.
For the Years Ended December 31,
2023 2022 2021
Interest paid for notes payable
$ 49,734  $ 25,579  $ 17,824 
Summary of Income Tax Benefits (Provisions) The Company recorded the following federal and state income tax benefits (provisions) for the years ended December 31, 2023, 2022, and 2021.
For the Years Ended December 31,
2023 2022 2021
Deferred federal income tax benefit (provision) $ 901,522  $ (6,437,680) $ — 
Current state income tax provision (72,213) —  — 
Deferred state income tax provision (954,551) (1,971,044) (90,342)
Provision for Income Taxes $ (125,242) $ (8,408,724) $ (90,342)
For the years ended December 31, 2023, 2022, and 2021, components of our provision for income taxes are as follows:
Provision for Income Taxes:
2023 2022 2021
Federal deferred tax $ (901,522) $ 6,437,680  $ — 
State current tax
72,213  —  — 
State deferred tax 954,551  1,971,044  90,342 
Provision for Income Taxes
$ 125,242  $ 8,408,724  $ 90,342 
Schedule of Effective Income Tax Rate Reconciliation
The Company’s overall effective tax rates (calculated as Provision for Income Taxes divided by Income Before Provision for Income Taxes) for the years ended December 31, 2023, 2022, and 2021 were as follows.

For the Years Ended December 31,
2023 2022 2021
Effective tax rate
0.1  % 5.7  % 2.6  %
The following is a reconciliation of income taxes computed using the U.S. federal statutory rate to the provision for income taxes:
Rate Reconciliation:
2023 2022 2021
Pre-tax book income (1)
$ 104,917,670  $ 147,043,749  $ 3,413,234 
Tax at federal statutory rate $ 22,032,711  $ 30,879,187  $ 716,779 
Excess tax benefit from stock option exercises and restricted stock vesting 478,304  (312,268) (175,187)
Adjust prior estimates to tax return (474,617) 214,740  2,938,948 
States taxes, net of federal benefit 1,122,782  1,443,145  430,654 
Valuation allowance (24,182,975) (24,151,242) (3,827,194)
Non-deductible expenses and other 1,149,037  335,162  6,342 
Provision for Income Taxes $ 125,242  $ 8,408,724  $ 90,342 
(1) Amount represents pre-tax book income, net of income taxes paid.
Schedule Of Noncash Share-Based Payment Arrangements The following table summarizes the Company's share-based compensation, included with General and administrative expense within our Statements of Operations, incurred for the years ended December 31, 2023, 2022, and 2021.
For the Years Ended December 31,
2023 2022 2021
Share-based compensation
$8,833,425
$7,162,231
$2,418,323