U.S. Energy Corp. Announces Acreage Acquisition and CCUS Development Update

Rhea-AI Summary

U.S. Energy Corp (NASDAQ: USEG) has completed a strategic acquisition for $0.2 million, enhancing its industrial gas and carbon capture platform in Montana. The deal includes approximately 2,300 net acres with CO2 rights adjacent to its Kevin Dome structure position and an active Class II injection well.

The acquired well, permitted by the EPA under the Safe Drinking Water Act's Underground Injection Control Program, will be used to sequester CO2 from the company's upcoming industrial gas processing facility. U.S. Energy plans to submit a Monitoring, Reporting, and Verification (MRV) plan to the EPA for the Class II well during Q2 2025.

This acquisition strengthens U.S. Energy's CCUS-ready infrastructure and advances its strategy to develop scalable, low-emission industrial gas operations while positioning itself as a U.S.-based supplier of clean helium and other critical gases.

Positive

• Strategic acquisition completed for only $0.2 million
• Acquired EPA-permitted Class II injection well accelerates CCUS capabilities
• Added 2,300 net acres of CO2 rights adjacent to existing assets
• Strengthens position in helium-rich Kevin Dome structure

Negative

• Additional regulatory approvals needed for MRV plan
• Industrial gas processing facility not yet operational
• Integration costs and risks associated with newly acquired assets

Insights

Energy Industry Analyst

U.S. Energy's $0.2 million acquisition represents strategic value disproportionate to its modest price tag. The addition of 2,300 net acres with CO₂ rights strengthens their contiguous position in Montana's Kevin Dome, known for helium-rich gas systems. The transaction's most valuable component is the included active Class II injection well with existing EPA permits—a significant regulatory advantage that bypasses lengthy permitting processes.

This acquisition effectively accelerates U.S. Energy's CCUS implementation timeline by providing ready-to-use infrastructure essential for CO₂ sequestration from their planned industrial gas processing facility. By securing permitted injection capabilities, the company can advance more rapidly toward their dual objectives of producing clean helium while managing carbon emissions.

At just 0.5% of their market capitalization, this targeted acquisition represents efficient capital allocation that enhances their competitive positioning in the industrial gas sector. The permitted well infrastructure immediately strengthens their operational readiness while expanding their potential for industrial gas development.

The company's planned submission of a Monitoring, Reporting, and Verification plan to the EPA in Q2 2025 indicates they're moving expeditiously toward operational implementation. This positions U.S. Energy to capitalize on increasing demand for domestically-sourced industrial gases with lower carbon intensity—particularly important for helium, which faces supply constraints and growing demand from technology manufacturing and healthcare sectors.

Environmental Policy Expert

The acquisition's regulatory component carries significant value that transcends the $0.2 million purchase price. The included Class II injection well with active permits under the EPA's Underground Injection Control Program represents a substantial regulatory milestone already achieved—enabling U.S. Energy to bypass a permitting process that typically involves extensive technical reviews, public comments, and potential delays.

The company's planned Q2 2025 submission of a Monitoring, Reporting, and Verification plan indicates they're pursuing a comprehensive carbon management strategy that aligns with evolving regulatory frameworks for carbon sequestration. This positions U.S. Energy advantageously as regulatory requirements for carbon management continue to develop.

From a carbon management perspective, integrating capture capabilities into their industrial gas operations demonstrates implementation of the full CCUS value chain—capturing CO₂ from gas processing operations rather than venting it, then permanently sequestering it underground. This vertical integration of carbon capture with industrial gas production represents an efficiency-driven approach to emissions reduction.

The transaction bolsters U.S. Energy's environmental credentials while simultaneously advancing their commercial objectives, exemplifying how companies can align business strategy with environmental goals. By securing permitted sequestration infrastructure, they've effectively reduced both regulatory risk and implementation timelines for their industrial gas platform while enhancing their environmental positioning in the marketplace.

HOUSTON, April 16, 2025 (GLOBE NEWSWIRE) -- U.S. Energy Corporation (NASDAQ: USEG, “U.S. Energy” or the “Company”) today announced the closing of a strategic acquisition (the “Acquisition”) from a privately held company for $0.2 million, strengthening its industrial gas and carbon capture platform in Montana. As part of the Acquisition, U.S. Energy acquired approximately 2,300 net acres with carbon dioxide (CO₂) rights that are highly contiguous to its existing position across Montana’s Kevin Dome structure. Additionally, the Acquisition includes an active Class II injection well to sequester CO₂ captured from U.S. Energy’s upcoming industrial gas processing facility. The permitted well advances the Company’s carbon capture, utilization, and storage (“CCUS”) initiatives within its industrial gas development platform.

The Class II injection well is a critical component of U.S. Energy’s plan to securely store CO₂ captured from its upcoming industrial gas processing facility. The well maintains active permits approved by the U.S. Environmental Protection Agency (“EPA”) and issued under the Safe Drinking Water Act’s Underground Injection Control Program (“UIC”), ensuring compliance with federal and state regulations for safe and permanent CO₂ storage.

The Acquisition expands U.S. Energy’s CCUS-ready infrastructure and reflects the Company’s broader strategy to develop scalable, low-emission industrial gas operations while positioning itself as a U.S.-based supplier of clean helium and other critical gases.

MANAGEMENT COMMENTARY

“This Acquisition marks a meaningful milestone forward in our efforts to integrate carbon sequestration into our industrial gas platform,” said Ryan Smith, Chief Executive Officer of U.S. Energy. “The addition of permitted injection infrastructure and strategic acreage strengthens our position across the Kevin Dome and accelerates our ability to deliver clean, domestically sourced helium while sequestering CO₂ at scale. We are committed to executing a responsible growth strategy that aligns with global demand for lower-carbon energy solutions.”

PROJECT OVERVIEW

The Acquisition enhances U.S. Energy’s control of a highly contiguous acreage block within the Kevin Dome, a geologic structure known for its helium-rich and CO₂-dominated gas systems. The Company intends to submit a Monitoring, Reporting, and Verification (“MRV”) plan to the EPA for the Class II well during the second quarter of 2025. The CCUS-enabled infrastructure will support the Company’s planned industrial gas processing facility and broader environmental goals, positioning U.S. Energy as a leading U.S.-based industrial gas and carbon management platform.

ABOUT U.S. ENERGY CORP.

We are a growth company focused on consolidating high-quality assets in the United States with the potential to optimize production and generate free cash flow through low-risk development while maintaining an attractive shareholder returns program. We are committed to being a leader in reducing our carbon footprint in the areas in which we operate. More information about U.S. Energy Corp. can be found at www.usnrg.com. 

INVESTOR RELATIONS CONTACT

Mason McGuire
IR@usnrg.com
(303) 993-3200
www.usnrg.com

FORWARD-LOOKING STATEMENTS

Certain of the matters discussed in this communication which are not statements of historical fact constitute forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995, that involve a number of risks and uncertainties. Words such as “strategy,” “expects,” “continues,” “plans,” “anticipates,” “believes,” “would,” “will,” “estimates,” “intends,” “projects,” “goals,” “targets” and other words of similar meaning are intended to identify forward-looking statements but are not the exclusive means of identifying these statements.

Important factors that may cause actual results and outcomes to differ materially from those contained in such forward-looking statements include, without limitation, risks associated with the integration of the recently acquired assets; the Company’s ability to recognize the expected benefits of the acquisitions and the risk that the expected benefits and synergies of the acquisition may not be fully achieved in a timely manner, or at all; the amount of the costs, fees, expenses and charges related to the acquisitions; the Company’s ability to comply with the terms of its senior credit facilities; the ability of the Company to retain and hire key personnel; the business, economic and political conditions in the markets in which the Company operates; fluctuations in oil and natural gas prices, uncertainties inherent in estimating quantities of oil and natural gas reserves and projecting future rates of production and timing of development activities; competition; operating risks; acquisition risks; liquidity and capital requirements; the effects of governmental regulation; adverse changes in the market for the Company’s oil and natural gas production; dependence upon third-party vendors; economic uncertainty relating to increased inflation and global conflicts; the lack of capital available on acceptable terms to finance the Company’s continued growth; the review and evaluation of potential strategic transactions and their impact on stockholder value; the process by which the Company engages in evaluation of strategic transactions; the outcome of potential future strategic transactions and the terms thereof; and other risk factors included from time to time in documents U.S. Energy files with the Securities and Exchange Commission, including, but not limited to, its Form 10-Ks, Form 10-Qs and Form 8-Ks. Other important factors that may cause actual results and outcomes to differ materially from those contained in the forward-looking statements included in this communication are described in the Company’s publicly filed reports, including, but not limited to, the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. These reports and filings are available at www.sec.gov.

The Company cautions that the foregoing list of important factors is not complete. All subsequent written and oral forward-looking statements attributable to the Company or any person acting on behalf of any Sale Agreement Parties are expressly qualified in their entirety by the cautionary statements referenced above. Other unknown or unpredictable factors also could have material adverse effects on U.S. Energy’s future results. The forward-looking statements included in this press release are made only as of the date hereof. U.S. Energy cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. Finally, U.S. Energy undertakes no obligation to update these statements after the date of this release, except as required by law, and takes no obligation to update or correct information prepared by third parties that are not paid for by U.S. Energy. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements. 

FAQ

What assets did U.S. Energy Corp (USEG) acquire in its latest Montana acquisition?

USEG acquired 2,300 net acres with CO2 rights and an active Class II injection well for $0.2 million, located in Montana's Kevin Dome structure.

When will USEG submit the MRV plan for the newly acquired Class II well?

U.S. Energy plans to submit the Monitoring, Reporting, and Verification (MRV) plan to the EPA during the second quarter of 2025.

How does the acquisition align with USEG's carbon capture strategy?

The acquisition provides CCUS-ready infrastructure and permitted injection well capacity to sequester CO2 from USEG's upcoming industrial gas processing facility.

What is the strategic importance of the Kevin Dome location for USEG?

Kevin Dome is a geologic structure known for its helium-rich and CO2-dominated gas systems, making it valuable for USEG's industrial gas and carbon management platform.