Empire Petroleum increased Q2 2026 product revenue 27% to $11.1 million despite a 23% decline in net equivalent sales volumes, while adjusted EBITDA improved to positive $365,000 from a loss of $1.18 million a year earlier.
Net equivalent sales averaged 1,825 Boe per day compared with 2,357 Boe per day, while oil sales declined 14% to 1,278 barrels per day. Empire attributed the lower oil volume mainly to natural decline and North Dakota wells offline for steam-unit performance enhancement projects.
Higher realized pricing helped overcome the lower production base. Empire said the revenue increase primarily reflected higher realized oil pricing from broader market conditions, partially offset by lower production. Its average oil price excluding the effect of derivative settlements was $94.72 per barrel during Q2.
Operating costs also moved lower. Lease operating expense declined to about $5 million from $6.4 million, reflecting lower production and cost-reduction efforts. Net loss narrowed to $1.9 million from $5.1 million.
Empire is simultaneously investing in the physical infrastructure intended to rebuild production. In Texas, gas-compression capacity increased to approximately 700% of its initial level, bringing system throughput capacity to approximately 9.5 MMcf per day. Five wells were placed online through reactivations, recompletions and well-deepening, while four more advanced toward first production.
The company’s deeper Texas program has also expanded the number of potential producing intervals. Empire re-entered and evaluated the Wakefield-Harrison GU B #1 to 21,006 feet, and management says recent work opens nine potential reservoir intervals. Its first two development phases are designed to leverage more than 100 existing Fort Trinidad wellbores and associated infrastructure.
In North Dakota, Empire plans to initiate steam injection from a retrofitted thermal unit during Q3 and monitor the response through the remainder of 2026. The company also acquired approximately 1,200 gross acres through three federal oil and gas leases between January and July.
Empire raised about $10 million through a March rights offering and finished June with about $3.1 million in cash and another $2 million available under its credit facility.
KEY QUOTES:
“Empire’s focus in the second quarter was about converting ongoing project work into measurable operational progress and turning the corner financially. In Texas, additional wells were brought online and system upgrades continued to improve deliverability, supporting steady increases in oil and gas volumes as the program grows. In North Dakota, we advanced a key retrofit under our second-generation thermal recovery program and continued targeted well work that positions the field for additional oil production as thermal operations progress. Our recent acquisitions provide us with the ability to access acreage that was previously off-limits, creating new opportunities for development. In Louisiana, drilling and logging across the three-well program confirmed substantial sand development and reinforced the scale of the resource, giving us a clearer view of the field’s potential as we prepare for completions and revenue later this year. Each asset is moving forward in sequence, and the recent work our team has completed strengthens our operating foundation as we prepare for the next phases of development.”
Mike Morrisett, President & CEO of Empire Petroleum
