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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of
the
Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): February 5, 2024
Prairie
Operating Co.
(Exact
name of registrant as specified in its charter)
Delaware |
|
001-41895 |
|
98-0357690 |
(State
or other jurisdiction
of
incorporation) |
|
(Commission
File
Number) |
|
(IRS
Employer
Identification
No.) |
602
Sawyer Street, Suite 710
Houston,
TX |
|
77007 |
(Address
of principal executive offices) |
|
(Zip
Code) |
Registrant’s
telephone number, including area code: (713) 424-4247
N/A
(Former
Name or Former Address, If Changed Since Last Report)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions (see General Instruction A.2. below):
☐ |
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
|
☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
|
☐ |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
|
☐ |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class |
|
Trading
Symbol(s) |
|
Name
of each exchange on which registered |
Common
Stock, par value $0.01 per share |
|
PROP |
|
The
Nasdaq Stock Market LLC |
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405)
or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2).
Emerging
Growth Company ☐
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item
7.01 Regulation FD Disclosure.
On
February 5, 2024, Prairie Operating Co. (the “Company”) issued a press release announcing it has acquired a number of permitted
oil and gas leases located in Weld County, Colorado. A copy of the press release is included as Exhibit 99.1 and is incorporated herein
by reference into this Item 7.01.
In
accordance with General Instruction B.2 of Form 8-K, the information furnished pursuant to Item 7.01 and the press release attached hereto
as Exhibit 99.1, respectively, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information
be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth
by specific reference in such a filing.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
|
Prairie
Operating Co. |
Date:
February 5, 2024 |
|
|
|
By: |
/s/
Daniel T. Sweeney |
|
|
Daniel
T. Sweeney
|
|
|
General
Counsel & Corporate Secretary |
Exhibit
99.1
Prairie
Operating Co. Expands Core Asset Base
Adds
1,280 Acre DSU and 2.6 MMBoe to Existing Denver Julesburg (“DJ”) Basin Portfolio
8
Drill Ready Permitted PUDs with Proven PV10 of ~ $40MM
HOUSTON,
TX, February 5, 2024 (GLOBE NEWSWIRE) — Prairie Operating Co. (Nasdaq: PROP; the “Company” or “Prairie”)
today announced that it has acquired a 1,280 acre drillable spacing unit (“DSU”) and eight fully permitted
proven undeveloped (“PUD”) drilling locations in the DJ Basin, from a private seller, for $900,000.
The
strategic acquisition of the 1,280 acre DSU and eight permitted PUDs, when added to the 62 PUDs the Company expects to
acquire from Nickel Road Operating LLC (“NRO”), would expand Prairie’s permitted drilling inventory to 70 wells.(1)
The oil and gas leases offset Prairie’s existing acreage position in northern Weld County, Colorado, adding over 2.6 MMboe
in reserves and approximately $40 million in PV10 value to Prairie’s existing DJ Basin portfolio.(2) The PUDs are also
liquids rich, offset by Niobrara developments yielding 75% oil / 85% liquids, and near existing midstream infrastructure.
“This
acquisition is a prime example of our commitment to disciplined and opportunistic growth” stated Ed Kovalik, Chairman and CEO.
“Adding additional drill ready locations expands our total proven reserves and creates immediate value for the Company.”
(1) | On
a pro forma basis following the closing of the NRO acquisition expected in the first half
of this year. |
(2) | According
to an independent, third-party reserve report of the newly acquired assets by Cawley, Gillespie
& Associates, Inc. (“CG&A”) using SEC pricing as of December 31, 2023
and an effective date of February 1, 2024 for the leasehold acquisition. |
About
Prairie Operating Co.
Prairie
Operating Co. (Nasdaq: PROP) is a Houston-based publicly traded independent energy company engaged in the development and acquisition
of proven, producing oil and natural gas resources in the United States. The Company’s assets and operations are concentrated in
the oil and liquids-rich regions of the Denver-Julesburg (DJ) Basin, with a primary focus on the Niobrara and Codell formations. The
Company is committed to the responsible development of its oil and natural gas resources and is focused on maximizing returns through
consistent growth, capital discipline, and sustainable cash flow generation. To learn more, visit www.prairieopco.com.
Non-GAAP
Financial Measures
PV10
is derived from the Standardized Measure of Discounted Future Net Cash Flows (“Standardized Measure”), which is the most
directly comparable GAAP financial measure for proved reserves. PV10 is a computation of the Standardized Measure on a pre-tax basis.
PV10 is equal to the Standardized Measure at the applicable date, before deducting future income taxes discounted at 10 percent. We believe
that the presentation of PV10 is relevant and useful to our investors as supplemental disclosure to the Standardized Measure, or after-tax
amount, because it presents the discounted future net cash flows attributable to our reserves before considering future corporate income
taxes and our current tax structure. While the standardized measure is dependent on the unique tax situation of each company, PV10 is
based on prices and discount factors that are consistent for all companies.
Forward-Looking
Statements
The
information included herein and in any oral statements made in connection herewith include “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
All statements, other than statements of present or historical fact included herein, are forward-looking statements. When used herein,
including any oral statements made in connection herewith, the words “could,” “should,” “will,” “may,”
“believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,”
the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking
statements contain such identifying words. These forward-looking statements are based on the Company’s current expectations and
assumptions about future events and are based on currently available information as to the outcome and timing of future events. Statements
concerning oil and gas reserves also may be deemed to be forward-looking statements in that they reflect estimates based on certain assumptions
that the resources involved can be economically exploited. Except as otherwise required by applicable law, the Company disclaims any
duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events
or circumstances after the date hereof. The Company cautions you that these forward-looking statements are subject to risks and uncertainties,
most of which are difficult to predict and many of which are beyond the control of the Company. These risks include, but are not limited
to, the ultimate outcome of the acquisition of NRO by the Company; the Company’s ability to consummate the proposed transaction
with NRO; the Company’s ability to finance the proposed transaction with NRO; the possibility that the Company may be unable to
achieve expected free cash flow accretion, production levels, drilling, operational efficiencies and other anticipated benefits within
the expected time-frames or at all and to successfully integrate NRO’s operations with those of the Company; that such integration
may be more difficult, time-consuming or costly than expected; that operating costs, customer loss and business disruption may be greater
than expected following the proposed transaction or the public announcement of the proposed transaction; uncertainties inherent in estimating
quantities of oil, natural gas and NGL reserves and projecting future rates of production and the amount and timing of development expenditures;
commodity price and cost volatility and inflation; general economic, financial, legal, political, and business conditions and changes
in domestic and foreign markets; the risks related to the growth of the Company’s business; and the effects of competition on the
Company’s future business. Should one or more of the risks or uncertainties described herein and in any oral statements made in
connection therewith occur, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those
expressed in any forward-looking statements. There may be additional risks not currently known by the Company or that the Company currently
believes are immaterial that could cause actual results to differ from those contained in the forward-looking statements. Additional
information concerning these and other factors that may impact the Company’s expectations can be found in the Company’s periodic
filings with the Securities and Exchange Commission (the “SEC”), including the Company’s Annual Report on Form 10-K
filed with the SEC on March 31, 2023, and any subsequently filed Quarterly Report and Current Report on Form 8-K. The Company’s
SEC filings are available publicly on the SEC’s website at www.sec.gov.
Reserve
Information
The
Company obtained the reserve report information referenced herein from CG&A with respect to the acquired reserves. The reserves were
calculated in accordance with SEC guidelines using the price of $76.97 per barrel for oil, $2.229 per MCF for gas, and $20.65 per barrel
for NGL. The base rates of oil of $78.22 bbl and gas of $2.637 per million British Thermal Units (MMBtu) were based upon WTI-Cushing
spot prices (EIA) during 2023 and upon Henry Hub spot prices (Platts Gas Daily) during 2023, respectively. The reserve classifications
and the economic considerations applied in the reserve report conform to the criteria set forth in the 2018 Petroleum Resources Management
System (PRMS) approved by the Society of Petroleum Engineers (SPE). All reserve estimates represent CG&A’s best judgment based
on data available at the time of preparation of the reserve report, and CG&A’s assumptions as to future economic and regulatory
conditions. It should be realized that the reserves are actually recovered, the revenue derived from, and the actual cost incurred could
be more or less than the estimated amounts.
Investor
Relations Contact:
Wobbe
Ploegsma
wp@prairieopco.com
832.274.3449
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