Empire Petroleum Announces Full Subscription of Rights Offering

Rhea-AI Summary

Empire Petroleum (NYSE American: EP) announced the full subscription of its Rights Offering, which expired on October 24, 2024. The offering was oversubscribed with more than 100% of available shares requested. Stockholders will receive their basic subscription rights, with remaining shares allocated pro-rata among oversubscribing stockholders. The company's Chairman Phil E. Mulacek and largest shareholder Energy Evolution Master Fund fully participated in both basic and over-subscription rights. The offering is expected to generate approximately $10 million in gross proceeds, which will fund drilling activities in North Dakota and New Mexico, workovers in Texas, land purchases, and enhanced oil recovery facilities in the Starbuck field.

Positive

• Successfully raised $10 million through fully subscribed rights offering
• Strong investor confidence demonstrated by over 100% subscription rate
• Major shareholders demonstrated commitment by fully participating in the offering

Negative

• Potential dilution of existing shareholders' equity due to new share issuance

Insights

Financial Analyst

The successful completion of Empire Petroleum's $10 million rights offering demonstrates strong shareholder confidence and provides important capital for operational expansion. The full subscription, particularly with major stakeholders' participation, strengthens the company's financial position and signals positive insider sentiment. The capital allocation strategy focuses on high-potential areas including drilling activities in North Dakota and New Mexico, along with enhanced oil recovery facilities in the Starbuck field, which could drive production growth and revenue expansion. Key positives:

• Strategic capital deployment across multiple revenue-generating initiatives
• Strong insider participation indicating management confidence
• Diversified operational footprint across five states providing risk mitigation

The oversubscription indicates robust investor interest, though the pro-rata allocation may result in some dilution for existing shareholders.

TULSA, Okla.--(BUSINESS WIRE)-- Empire Petroleum Corporation (NYSE American: EP) ("Empire" or the "Company"), an oil and gas company with current producing assets in New Mexico, North Dakota, Montana, Texas, and Louisiana, announced today that its previously announced rights offering (the “Rights Offering”) was fully subscribed. The subscription period for the Rights Offering expired at 5:00 p.m., New York City time, on October 24, 2024.

The Company received subscriptions for more than 100% of the shares available in the Rights Offering. Accordingly, stockholders will receive their basic subscription rights. However, since there are not enough shares to satisfy all oversubscriptions, remaining shares will be allocated pro-rata, after eliminating all fractional shares, among oversubscribing stockholders.

As previously indicated, our largest stockholders Phil E. Mulacek, Chairman of the Board of the Company, and Energy Evolution Master Fund, Ltd., a Cayman Islands exempted company and the Company’s largest stockholder, participated in the Rights Offering and fully subscribed to the shares of common stock corresponding to their subscription rights, as well as exercised their over-subscription rights to purchase their pro rata share of the underlying securities related to the rights offering that remain unsubscribed.

The Rights Offering is expected to result in gross proceeds, before expenses, to the Company of approximately $10 million. The Company will use the proceeds from the Rights Offering for previous, current and future drilling activity in North Dakota and New Mexico, workovers and recompletions in Texas, land and lease purchases, and the completion of the initial stage of enhanced oil recovery facilities in the Starbuck field.

The Rights Offering is more fully described in the prospectus supplement filed with the Securities and Exchange Commission (“SEC”) on October 1, 2024, as supplemented by the prospectus supplement filed with the SEC on October 10, 2024.

About Empire Petroleum

Empire Petroleum Corporation is a publicly traded, Tulsa-based oil and gas company with current producing assets in New Mexico, North Dakota, Montana, Texas, and Louisiana. Management is focused on organic growth and targeted acquisitions of proved developed assets with synergies with its existing portfolio of wells. More information about Empire can be found at www.empirepetroleumcorp.com.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements involve a wide variety of risks and uncertainties, and include, without limitations, statements with respect to the Company’s estimates, strategy and prospects. Such statements are subject to certain risks and uncertainties which are disclosed in the Company’s reports filed with the SEC, including its Form 10-K for the fiscal year ended December 31, 2023, and its other filings with the SEC. Readers and investors are cautioned that the Company’s actual results may differ materially from those described in the forward-looking statements due to a number of factors, including, but not limited to, the Company’s ability to acquire productive oil and/or gas properties or to successfully drill and complete oil and/or gas wells on such properties, general economic conditions both domestically and abroad, and other risks and uncertainties related to the conduct of business by the Company. Other than as required by applicable securities laws, the Company does not assume a duty to update these forward-looking statements, whether as a result of new information, subsequent events or circumstances, changes in expectations, or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241025652381/en/

Empire Petroleum Corporation:

Mike Morrisett, President and CEO

539-444-8002

info@empirepetrocorp.com

Kali Carter

Communications & Investor Relations Manager

918-995-5046

IR@empirepetrocorp.com

Source: Empire Petroleum Corporation

FAQ

How much did Empire Petroleum (EP) raise in its 2024 rights offering?

Empire Petroleum raised approximately $10 million in gross proceeds before expenses through its rights offering that expired on October 24, 2024.

What will Empire Petroleum (EP) use the rights offering proceeds for?

The proceeds will fund drilling activities in North Dakota and New Mexico, workovers in Texas, land and lease purchases, and enhanced oil recovery facilities in the Starbuck field.

Was Empire Petroleum's (EP) 2024 rights offering successful?

Yes, the rights offering was fully subscribed with more than 100% of available shares requested, indicating strong investor interest.