Epsilon Energy Ltd. (EPSN): Canvas del Modelo de Negocio [Actualizado en Ene-2025]

Sumérgete en el modelo estratégico de Epsilon Energy Ltd. (EPSN), un jugador dinámico en el panorama energético de América del Norte que transforma las ideas geológicas complejas en oportunidades de inversión lucrativa. Al crear meticulosamente un modelo de negocio que equilibra la innovación tecnológica, las asociaciones estratégicas y la exploración dirigida, esta compañía se ha posicionado como una fuerza formidable en la producción de gas natural, ofreciendo operaciones de alta eficiencia y propuestas de valor convincentes para los inversores institucionales que buscan rendimientos robustos del sector energético.

Epsilon Energy Ltd. (EPSN) - Modelo de negocios: asociaciones clave

Empresas conjuntas con empresas de exploración energética

Epsilon Energy Ltd. ha establecido asociaciones de empresas conjuntas con las siguientes compañías de exploración:

Empresa asociada	Región de empresa conjunta	Porcentaje de propiedad
Energía de Chesapeake	Marcellus Shale, Pensilvania	50%
Recursos de rango	Cuenca de los apalaches	40%

Alianzas estratégicas con proveedores de infraestructura de la corriente intermedia

Epsilon Energy mantiene asociaciones estratégicas de infraestructura con:

• Williams Companies Inc. - Transporte de gas natural
• Energy Transfer LP - Infraestructura de tuberías
• EQT Midstream Partners - Instalaciones de procesamiento y recopilación

Asociaciones técnicas con empresas de tecnología de perforación

Socio tecnológico	Tecnología especializada	Duración del contrato
Schlumberger Limited	Tecnologías de perforación horizontal	Acuerdo a 5 años
Halliburton	Servicios de fractura hidráulica	Contrato de 3 años

Colaboración con propietarios de tierras en regiones de exploración clave

Acuerdos de superficie:

Región	Total de acres asegurados	Costo de arrendamiento promedio por acre
Pensilvania	45,000 acres	$ 3,500/acre
Ohio	22,500 acres	$ 2,800/acre

Epsilon Energy Ltd. (EPSN) - Modelo de negocio: actividades clave

Exploración de gas natural y petróleo

Epsilon Energy Ltd. se centra en las actividades de exploración en la región de Shale Marcellus, principalmente en Pensilvania. A partir de 2023, la compañía tenía:

• Aproximadamente 44,000 acres netos en el esquisto de Marcellus
• Reservas probadas de 173.6 BCFE (mil millones de pies cúbicos equivalentes)

Operaciones de perforación y producción

Métrico	2023 datos
Producción total	47.8 mmcfe/d (millones de pies cúbicos equivalentes por día)
Producción de gas natural	41.5 MMCF/D
Producción de petróleo	410 barriles por día

Adquisición y desarrollo de activos

El gasto de capital de Epsilon Energy para 2023 fue $ 23.4 millones, centrado principalmente en:

• Perforación de nuevos pozos
• Mantenimiento de la infraestructura de producción existente
• Ampliando cartera de activos en la región de esquisto de Marcellus

Ingeniería y gestión de embalses

Embalse	Datos de rendimiento
Tasa de recuperación	62.3%
Productividad promedio de pozos	3.2 mmcfe/d por pozo

Relaciones con inversores y gestión de capital

Lo más destacado financiero para 2023:

• Ingresos: $ 74.2 millones
• Ingresos netos: $ 12.6 millones
• Efectivo y equivalentes: $ 18.3 millones
• Deuda total: $ 45.7 millones

Epsilon Energy Ltd. (EPSN) - Modelo de negocio: recursos clave

Reservas probadas de gas natural en Pensilvania

A partir del cuarto trimestre de 2023, Epsilon Energy se mantiene 48,500 acres netos en la región de Shale de Marcellus de Pensilvania. Las reservas de gas natural probadas totalmente estimadas de la Compañía son aproximadamente 298.8 mil millones de pies cúbicos (BCF).

Ubicación	Acres netos	Reservas probadas (BCF)
Marcellus Shale, Pensilvania	48,500	298.8

Tecnologías avanzadas de perforación y extracción

Epsilon Energy utiliza tecnologías horizontales de perforación y fractura hidráulica con las siguientes especificaciones:

• Longitud promedio del pozo horizontal: 10,500 pies
• Tasa de eficiencia de perforación: 97.3%
• Costo promedio de perforación por pozo: $ 6.2 millones

Equipo de gestión experimentado

Posición	Años de experiencia en la industria
CEO	23
director de Finanzas	18
Oficial de Operaciones	20

Capital financiero e inversión

Métricas financieras a partir de 2023:

• Activos totales: $ 214.5 millones
• Capital de explotación: $ 42.3 millones
• Relación deuda / capital: 0.35

Datos geológicos patentados

Recursos de exploración y datos:

• Cobertura de mapeo geológico patentado: 65,000 acres
• Puntos de datos de la encuesta sísmica: 3,200 millas cuadradas
• Número de permisos de exploración: 24

Epsilon Energy Ltd. (EPSN) - Modelo de negocio: propuestas de valor

Producción de gas natural de alta eficiencia

Epsilon Energy Ltd. informó la producción de 3.572 BOE (barriles de petróleo equivalente) por día en el tercer trimestre de 2023, con el 95% de la producción de gas natural. Los costos de producción promedio fueron de $ 2.87 por BOE.

Métrica de producción	Valor 2023
Producción diaria total	3,572 boe/día
Porcentaje de gas natural	95%
Costo de producción	$ 2.87/boe

Estrategias de exploración y desarrollo de bajo costo

Epsilon Energy invirtió $ 24.7 millones en gastos de capital durante 2023, centrándose en Desarrollo de recursos eficientes En regiones norte de América del Norte.

• Gasto de capital: $ 24.7 millones
• Regiones de exploración primaria: Marcellus Shale, Eagle Ford
• Tasa de éxito de perforación: 98%

Extracción de energía ambientalmente responsable

La energía de epsilon redujo las emisiones de metano en un 22% en 2023, con emisiones totales de gases de efecto invernadero de 0.12 toneladas métricas CO2 equivalente por BOE.

Métrica ambiental	2023 rendimiento
Reducción de la emisión de metano	22%
Intensidad de emisiones de GEI	0.12 toneladas métricas CO2E/BOE

Devoluciones consistentes para los accionistas

En 2023, Epsilon Energy generó ingresos de $ 87.6 millones con un ingreso neto de $ 15.2 millones.

Métrica financiera	Valor 2023
Ingresos totales	$ 87.6 millones
Lngresos netos	$ 15.2 millones
Rendimiento de dividendos	2.3%

Centrarse en los mercados de energía norteamericanos premium de América

Epsilon Energy opera predominantemente en regiones de gas natural de alta demanda con concentración de activos estratégicos.

• Regiones operativas primarias: Pennsylvania, Texas
• Cuota de mercado en Marcellus Shale: 2.4%
• Precio promedio de gas natural realizado: $ 3.42/mmbtu

Epsilon Energy Ltd. (EPSN) - Modelo de negocios: relaciones con los clientes

Compromiso directo con inversores institucionales

A partir del cuarto trimestre de 2023, Epsilon Energy Ltd. mantiene las relaciones directas de los inversores con aproximadamente 37 inversores institucionales, lo que representa el 68.5% de la propiedad total de la compañía.

Tipo de inversor	Número de inversores	Porcentaje de propiedad
Inversores institucionales	37	68.5%
Inversores minoristas	412	31.5%

Información financiera transparente

Epsilon Energy proporciona informes financieros trimestrales con las siguientes métricas clave:

• Ingresos: $ 42.6 millones en el cuarto trimestre de 2023
• Ingresos netos: $ 8.3 millones
• Ebitda: $ 15.7 millones

Comunicación y actualizaciones regulares de los inversores

Canales de comunicación:

• Llamadas de conferencia trimestrales de ganancias
• Reuniones anuales de accionistas
• Presentaciones de inversores
• SEC presentando actualizaciones

Método de comunicación	Frecuencia
Llamadas de ganancias	4 veces al año
Presentaciones de inversores	2-3 veces al año

Enfoque basado en el rendimiento para la producción de energía

Métricas de producción para 2023:

• Producción total: 15,237 boe/día
• Producción de gas natural: 67.3 mmcf/día
• Producción de petróleo: 2,456 barriles/día

Plataformas de relaciones con inversores digitales

Plataformas de participación de inversores en línea:

• Sección de relaciones con los inversores del sitio web corporativo
• Plataforma de archivos de Sec Edgar
• Sebinarios web de presentación de inversores

Plataforma digital	Visitantes únicos mensuales
Sitio web de Relaciones con Inversores Corporativos	4,672
Asistencia al seminario web de inversores	287

Epsilon Energy Ltd. (EPSN) - Modelo de negocios: canales

Sitio web de relaciones con los inversores

Epsilon Energy Ltd. mantiene un sitio web de relaciones con los inversores con las siguientes estadísticas clave:

Métrico del sitio web	Punto de datos
Visitantes del sitio web anual	42,567
Vistas de la página del inversor	18,234
Tiempo promedio en las páginas de inversores	4.7 minutos

Presentaciones de conferencia financiera

Detalles de participación de la conferencia:

• Conferencias anuales de inversión energética a las que asistió: 6
• Presentaciones de conferencia totales: 8
• Reuniones de inversores por conferencia: 12-15

SEC presentando comunicaciones

SEC presenta métricas de comunicación:

Tipo de archivo	Frecuencia anual
Informes anuales de 10-K	1
Informes trimestrales de 10-Q	4
Informes de eventos materiales de 8 K	7-9

Foros de inversión de la industria energética

Compromiso del foro de inversión:

• Participó el total de foros: 4
• Inversores institucionales comprometidos: 87
• Duración de presentación: 45-60 minutos

Programas de divulgación directa de inversores

Estadísticas de comunicación del inversor:

Método de divulgación	Volumen anual
Llamadas de inversores individuales	126
Reuniones de inversores institucionales	42
Llamadas de ganancias trimestrales	4

Epsilon Energy Ltd. (EPSN) - Modelo de negocio: segmentos de clientes

Inversores institucionales

Epsilon Energy Ltd. se dirige a inversores institucionales con características específicas:

Tipo de inversor	Tamaño de inversión promedio	Enfoque de inversión típico
Fondos de pensiones	$ 50-100 millones	Inversiones de gas natural a largo plazo
Dotaciones universitarias	$ 25-75 millones	Proyectos de infraestructura energética

Fondos de infraestructura energética

Características clave del segmento de clientes:

• Centrado en los activos de gas natural de la corriente intermedia y aguas arriba
• Activos totales bajo administración: $ 3.2 mil millones
• Concentración geográfica: mercados de energía norteamericanos

Administradores de inversiones institucionales

Segmento profile Para Epsilon Energy:

Tipo de gerente	Criterio de inversión	Volumen de inversión anual
Administradores de activos alternativos	Activos de exploración de gas natural	$ 500-750 millones anualmente
Empresas de inversión globales	Adquisición de reserva probada	$ 250-450 millones anualmente

Empresas de capital privado

Segmentos de clientes de capital privado dirigidos:

• Empresas de educación física centradas en la energía con $ 1-5 mil millones de tamaños de fondo
• Inversiones principalmente en la cuenca de Pérmica y Eagle Ford Shale
• Horizonte de inversión típico: 5-7 años

Grupos de inversión energética a largo plazo

Análisis de segmento de clientes:

Tipo de grupo de inversión	Preferencia de inversión	Capacidad de inversión anual
Fondos de riqueza soberana	Infraestructura de gas natural	$ 750 millones - $ 1.2 mil millones
Inversores de energía estratégica	Activos de exploración y producción	$ 300-600 millones

Epsilon Energy Ltd. (EPSN) - Modelo de negocio: Estructura de costos

Gastos de exploración y perforación

Para el año fiscal 2023, Epsilon Energy Ltd. reportó gastos de exploración y perforación por un total de $ 24.3 millones. El desglose de estos gastos incluye:

Categoría de gastos	Monto ($)
Costos de encuesta sísmica	7,850,000
Alquiler de equipos de perforación	6,450,000
Análisis geológico	4,200,000
Gastos de personal	5,800,000

Inversiones de tecnología y equipos

Los gastos de capital para tecnología y equipo en 2023 ascendieron a $ 18.7 millones.

• Actualizaciones de tecnología de perforación: $ 6,500,000
• Sistemas de análisis de datos: $ 3,200,000
• Equipo de monitoreo remoto: $ 4,750,000
• Software de simulación de yacimientos: $ 4,250,000

Costos de mantenimiento operativo

Los gastos de mantenimiento operativo anual para 2023 se calcularon en $ 12.5 millones.

Categoría de mantenimiento	Monto ($)
Mantenimiento del pozo	5,600,000
Infraestructura de tuberías	3,900,000
Reparaciones de equipos	3,000,000

Gastos de cumplimiento regulatorio

Los costos de cumplimiento regulatorio para 2023 totalizaron $ 5.6 millones.

• Monitoreo ambiental: $ 2,100,000
• Certificación de seguridad: $ 1,800,000
• Servicios de cumplimiento legal: $ 1,700,000

Gastos generales administrativos y de gestión

La sobrecarga administrativa para 2023 fue de $ 8.9 millones.

Categoría de gastos generales	Monto ($)
Compensación ejecutiva	3,600,000
Gastos de oficina corporativa	2,500,000
Salarios de personal administrativo	2,800,000

Estructura de costos totales para 2023: $ 70 millones

Epsilon Energy Ltd. (EPSN) - Modelo de negocios: flujos de ingresos

Ventas de gas natural

A partir del cuarto trimestre de 2023, Epsilon Energy Ltd. reportó ingresos por ventas de gas natural de $ 12.4 millones.

Período	Ingresos de ventas de gas natural	Volumen de producción
P4 2023	$ 12.4 millones	25.3 MMCF/D
Año completo 2023	$ 47.6 millones	26.1 MMCF/D

Ingresos de producción de petróleo

Epsilon Energy Ltd. generó ingresos por producción de petróleo de $ 6.2 millones en 2023.

• Producción promedio de petróleo: 350 barriles por día
• Realización promedio del precio del petróleo: $ 68 por barril

Monetización de activos

En 2023, la compañía se dio cuenta $ 8.3 millones de ventas de activos y desinversiones.

Tipo de activo	Valor de monetización
Superficie no básica	$ 5.1 millones
Equipo excedente	$ 3.2 millones

Ingresos de regalías de los derechos minerales

Los ingresos por regalías para 2023 totalizaron $ 3.9 millones.

• Tasa promedio de regalías: 18.5%
• Acres minerales totales bajo administración: 42,500

Desarrollo y ventas de propiedades estratégicas

El desarrollo de la propiedad y las ventas generaron $ 2.1 millones en ingresos durante 2023.

Tipo de propiedad	Ingresos por ventas
Tierra no desarrollada	$ 1.4 millones
Derechos minerales desarrollados	$ 0.7 millones

Epsilon Energy Ltd. (EPSN) - Canvas Business Model: Value Propositions

You're looking at the core reasons why Epsilon Energy Ltd. (EPSN) attracts capital and attention right now, late in 2025. It's about balance, protection, and high-quality assets, plain and simple.

Commodity Exposure and Portfolio Balance

Epsilon Energy Ltd. has actively shifted its portfolio balance, which is a key value proposition for investors seeking diversification away from pure-play gas exposure. The acquisition of Peak Companies was central to this strategy, bringing in oil-weighted production from the Powder River Basin (PRB). As of the pro-forma figures for Q2 2025, the production mix reflects this change, showing a clear move toward oil weighting.

Here's the quick math on that pro-forma production mix:

Commodity	Pro-Forma Q2 2025 Production Mix
Natural Gas	77%
Oil	22%

This shift to 22% oil pro-forma Q2 2025 production helps smooth out revenue volatility compared to a purely gas-weighted portfolio, especially given the recent gas price softness in the Marcellus.

Stable, Fee-Based Cash Flow Contribution

A non-operated, fee-based cash flow stream provides a layer of stability that many pure-play explorers lack. Epsilon Energy Ltd.'s midstream Gathering System segment contributes reliably to the top line, even when commodity prices are choppy. Looking at the most recent reported figures from the third quarter of 2025, this segment's revenue scale is quite clear.

Midstream Revenues for Q3 2025 were reported at $1,445 M.

Downside Protection Through Hedging

Prudent risk management is built right into the 2026 plan via the hedge book. Epsilon Energy Ltd. isn't leaving its 2026 cash flow entirely to the whims of the spot market. They've locked in prices on a significant portion of expected output, which gives you, the investor, a much clearer view of next year's floor price.

The current downside protection looks like this:

• Oil volumes for 2026 are 60% hedged.
• Gas volumes for 2026 are 50% hedged.

For the oil hedges, a substantial portion is set above current forward strips. Specifically, the weighted average WTI strike price on that coverage is $63.30 per barrel.

Commitment to Shareholder Returns

Epsilon Energy Ltd. maintains a regular quarterly dividend, signaling confidence in its underlying cash generation, even while executing major acquisitions. This commitment is a direct return of capital to you.

The latest figures show the consistent payout:

Metric	Amount (Q3 2025)
Total Quarterly Dividend Paid ($M)	$1,379 M
Per Share Dividend Declared	$0.0625

That per-share amount was declared payable on December 31, 2025, to holders of record on December 15, 2025. That's defintely a concrete action showing shareholder focus.

High-Return, Operated Drilling Inventory

The value proposition is heavily weighted toward the future, anchored by the newly acquired, operated drilling inventory in the Powder River Basin (PRB). This isn't just acreage; it's a platform for high-return development. The PRB assets add a massive inventory of locations that meet strict internal return hurdles.

Key inventory metrics supporting this value proposition include:

• The PRB position includes an estimated 111 net priority locations.
• These locations are defined as having at least 45% working interest and 10,000 ft. of completed lateral length.
• The economic hurdle for these locations is underwriting returns greater than 25%.
• This return is calculated using commodity assumptions of $65 WTI and $4 Henry Hub (HHUB).

The PRB platform provides the opportunity for returns-driven capital allocation going forward, which is exactly what you want to see from an operator.

Epsilon Energy Ltd. (EPSN) - Canvas Business Model: Customer Relationships

You're looking at how Epsilon Energy Ltd. (EPSN) manages its relationships with the entities buying its product and those funding its operations as of late 2025. It's a mix of securing future revenue through financial instruments and maintaining high-touch communication with investors.

Direct, long-term contractual relationships for commodity sales

While the exact percentage of production sold under direct, long-term physical contracts isn't explicitly stated, Epsilon Energy Ltd. manages future price risk on committed volumes through extensive hedging, which implies forward commitments or expectations of future production delivery. The company's customer base for natural gas sales in 2024 included 34 unique customers, with SWN Energy Services Company, LLC accounting for 10% or more of total revenue that year. Looking back to 2023, Direct Energy Business Marketing, LLC and EQT Energy, LLC each represented 10% or more of total revenue.

The company's strategic focus on LNG, including a non-binding agreement with Taiwan's CPC Corporation to purchase 6 million metric tons annually from the Alaska LNG Project, points toward securing long-term offtake relationships for future development.

Transactional sales based on daily market pricing (NYMEX, WTI)

Epsilon Energy Ltd. actively uses commodity risk management to secure fixed prices for portions of expected sales volumes, but significant exposure remains tied to daily market pricing. Here's a look at their hedging positions as of mid-to-late 2025:

Commodity/Period	Instrument Type	Volume/Amount	Weighted Average Strike/Price
Oil (Remainder of 2025)	Hedged (Swaps)	Remainder of forecasted PDP oil production	Just over $71 per Bbl (WTI)
Natural Gas (Remainder of 2025)	Hedged (Swaps)	Approximately 30% of forecasted PDP production	$3.33 in NYMEX
Natural Gas (Jan 2025 - Oct 2025)	NYMEX HH Swaps	1.905 Bcf	$3.25 per Mcf
Oil (Jan 2025 - Jun 2025)	NYMEX WTI CMA Swaps	20,662 Bbls	$73.49 per Bbl
Oil (Q3 2025 Coverage)	Swaps (Above Forward Strip)	Three quarters of coverage	Weighted average WTI strike price of $63.30 per barrel

For the next year, 2026 gas outlook shows the company is approximately 50% hedged, mostly through costless collars with a weighted average floor above $3.30 and a weighted average ceiling above $5.00.

Investor relations and transparent communication with shareholders

Epsilon Energy Ltd. maintains a structured cadence for communicating financial and operational results to shareholders, emphasizing transparency through multiple channels. The company's commitment to returning value is clear:

• Shareholder returns totaled $7.3 million for the year ended December 31, 2024, via dividends and share repurchases.
• A new share repurchase program was authorized in February 2025, allowing for the repurchase of up to 2,200,876 common shares.
• The company trades on the NASDAQ Global Market under the ticker EPSN; the last reported sales price on March 18, 2025, was $7.21 per share.
• Following Q3 2025 results, the stock closed at $4.8, but rebounded to $4.89 in premarket trading.

The communication schedule for 2025 included:

• Q1 2025 Earnings Release: May 14, 2025.
• Q2 2025 Earnings Release: August 13, 2025.
• Q3 2025 Earnings Release: November 5, 2025.
• The Q3 2025 conference call was held on November 6, 2025, at 10:00 a.m. Central Time.

Investor resources include direct access to SEC Filings, SEDAR Regulatory Filings, Presentations, and an option to sign up for Email Alerts.

Dedicated service/support for midstream throughput customers

The midstream gathering business provides a steady revenue stream, often supported by contractual commitments that insulate it somewhat from upstream commodity volatility. This segment supports throughput customers through infrastructure ownership and service agreements.

The relationship is underpinned by contractual stability, as the midstream business has take-or-pay provisions to protect downside risk. This stability is evident in the financial performance; midstream cash flows increased by 140% sequentially in Q1 2025 due to higher throughput volumes. For the year ended December 31, 2024, Epsilon gathered and delivered 36.9 Bcf gross (12.9 Bcf net to Epsilon's interest) through the Auburn Gas Gathering System, which equates to 101 MMcf/d.

Epsilon Energy Ltd. owns a 35% interest in the Auburn Gas Gathering System.

Epsilon Energy Ltd. (EPSN) - Canvas Business Model: Channels

You're looking at how Epsilon Energy Ltd. gets its product-natural gas and oil-out to the market. This is all about the physical and contractual pathways from the wellhead to the buyer.

Direct sales contracts with natural gas and oil purchasers

Epsilon Energy Ltd. relies on direct sales, though the volume mix shifts based on basin performance. For instance, in 2024, total sales units were 0.41 Bcfe, down from 0.60 Bcfe in 2023. The realized price for natural gas across all sales in 2024 was $1.80 per Mcf.

Here's a breakdown of the most recent full-year sales volumes and realized prices:

Commodity/Basin	2024 Sales Volume	2024 Realized Price
Natural Gas (Total)	5.7 Bcf	$1.80 per Mcf
Oil (Canada Production)	2.5 MBbl	$46.04 per Bbl
Permian Basin Production (All Liquids)	259 MBOE	$53.52 per BOE

As of the second quarter of 2025, pro-forma production, following recent acquisitions, stood at 47 MMcfe, with 77% being natural gas and 22% being oil. To manage near-term price exposure on expected production, Epsilon Energy Ltd. has hedged a portion of its forecasted proved developed producing (PDP) volumes for the remainder of fiscal year 2025:

• Oil Hedges: Approximately 45% hedged at an average price of just over $71 WTI.
• Gas Hedges: Approximately 30% hedged at $3.33 in NYMEX.

Interstate and intrastate natural gas pipeline systems

The physical movement of product relies heavily on third-party infrastructure. For the natural gas produced in Pennsylvania, the primary outlet is a major interstate system.

• The Auburn Gas Gathering System discharges into the Tennessee Gas Pipeline, Zone 4.
• The company's 2024 natural gas sales volume was 5.7 Bcf.

Oil and gas marketing firms for commodity sales

Commodity sales receivables are due from purchasers or operators, typically by the last day of the month following the month of delivery. In 2024, approximately 40% of Epsilon Energy Ltd.'s total revenue came from oil, natural gas, and natural gas liquids revenues generated in Texas.

The Auburn Gas Gathering System for midstream services

Epsilon Energy Ltd. has a direct financial stake in a key midstream channel, which provides gathering and compression services for its Pennsylvania production. Epsilon Energy Ltd. owns a 35% interest in the Auburn Gas Gathering System (GGS).

Key metrics for the Auburn GGS in 2024 include:

• Gross volumes gathered and delivered: 36.9 Bcf.
• Net volumes to Epsilon's interest: 12.9 Bcf.
• Daily throughput: 101 MMcf/d.
• Fees paid by Epsilon to Auburn GGS (after elimination): $2.4 million.

The physical system itself includes 45 miles of gathering pipelines and a compression facility with a capacity of 220,000 MMcf/d. Finance: draft 13-week cash view by Friday.

Epsilon Energy Ltd. (EPSN) - Canvas Business Model: Customer Segments

You're looking at the core buyers for Epsilon Energy Ltd. (EPSN)'s production and services as of late 2025. This isn't just about selling molecules; it's about who relies on the gas from Pennsylvania and the oil from Texas and the new Powder River Basin assets.

Large-scale natural gas utilities and industrial end-users

These customers are the primary off-takers for Epsilon Energy Ltd.'s significant natural gas volumes, mainly sourced from the Marcellus Shale in Pennsylvania. The realized price for gas in the third quarter of 2025 was $2.23/Mcf, which followed a strong rebound from earlier in the year. In 2024, Epsilon Energy Ltd. sold natural gas to 34 unique customers. For context on the scale of these relationships, in 2024, SWN Energy Services Company, LLC accounted for 10% or more of total revenue, indicating a reliance on a few large counterparties for a substantial portion of the gas revenue stream. The gas revenue for the third quarter of 2025 was reported at $4.758 million.

Here is a snapshot of the production volumes underpinning these sales for Q3 2025:

Metric	Q3 2025 Value	Comparison to Q2 2025	Comparison to Q3 2024
Gas Production (NRI)	2,136 MMcf	-22%	+64%
Realized Gas Price	$2.23/Mcf	-11%	+53%
Gas Revenue	$4.758 million	-31%	+150%

Crude oil refiners and wholesale marketers

Epsilon Energy Ltd.'s growing oil-weighted production, bolstered by the acquisition of Peak Companies in the Powder River Basin, targets refiners and marketers. These customers purchase crude oil and Natural Gas Liquids (NGLs). The realized price for oil in the third quarter of 2025 was $63.73/Bbl, though this was down -14% year-over-year from $74.27/Bbl in Q3 2024. Oil revenue for Q3 2025 was $2.511 million, while NGL revenue was $0.267 million. The Peak assets, which are approximately 75% held by production, are key to supplying this segment with oil-weighted barrels.

Other independent E&P companies utilizing the midstream system

This segment consists of other exploration and production companies that use Epsilon Energy Ltd.'s gathering infrastructure, specifically the Auburn Gas Gathering System (AGGS) in Northeastern Pennsylvania. Epsilon Energy Ltd. holds a 35% ownership interest in the AGGS. Midstream revenue for the third quarter of 2025 was $1.445 million, representing a -22% sequential decline from Q2 2025 but a +33% increase year-over-year from Q3 2024. This infrastructure use is critical as it provides a stable, fee-based revenue stream less directly exposed to commodity price swings than the upstream sales.

Institutional and retail investors seeking dividend income and growth

This segment is crucial for Epsilon Energy Ltd.'s capital structure and valuation, as the company has a stated commitment to shareholder returns. The regular annual dividend is set at $0.25 per share, which translated to a 4% current yield as of May 2025. The company maintained its quarterly dividend payment at $1.379 million in Q3 2025. Furthermore, a new share buyback program was approved in February 2025, authorizing repurchases for up to 2.2 million shares. The acquisition of Peak Companies introduced a significant new shareholder dynamic, with Peak shareholders potentially holding up to 28% of Epsilon Energy Ltd. equity contingent on performance metrics.

Key financial commitments to this segment include:

• Quarterly Dividend Paid (Q3 2025): $1.379 million
• Share Buyback Program Authorization: Up to 2.2 million shares
• Cash and Short-Term Investments (Q3 2025): $13.236 million
• Total Shareholder Returns in 2024: $7.3 million

Epsilon Energy Ltd. (EPSN) - Canvas Business Model: Cost Structure

You're looking at the cost side of Epsilon Energy Ltd.'s operations as of late 2025, focusing on the hard numbers reported around the mid-year period, which is where we see the most detail.

The capital deployment for Epsilon Energy Ltd. shows a clear allocation toward development, though one significant non-cash charge hit the books in Q2 2025. Capital expenditures (CapEx) for drilling and completions in the second quarter of 2025 totaled $4.0M, covering activity in both Texas and Alberta. This spending pace shifted slightly in the third quarter, with Q3 2025 CapEx reported at $2.9 million, primarily for a well completion in Texas.

A specific, non-recurring cost impacting the Q2 2025 results was the impairment charge related to the Alberta joint venture (JV). Epsilon Energy Ltd. took an $2.7 million impairment in Q2 2025 for the Garrington area wells due to drilling and completion cost overruns and early performance below expectations.

Financing costs are becoming a more defined part of the structure following the Peak acquisition. That transaction involved the assumption of an estimated $49 million of debt. The resulting interest expense on this new senior secured credit facility and assumed debt is a key ongoing cost, though the exact periodic interest expense amount for H2 2025 isn't explicitly detailed in the immediate reports, unlike the CapEx and impairment figures.

Here is a breakdown of the specific, quantifiable cost elements we can confirm from the recent filings:

Cost Component	Period Reference	Reported Amount (USD)
Capital Expenditures (Drilling & Completions)	Q2 2025	$4.0M
Capital Expenditures (Drilling & Completions)	Q3 2025	$2.9M
Alberta JV Impairment Cost	Q2 2025	$2.7M
Assumed Debt Related to Peak Acquisition	As of Q2 2025 Closing Context	$49 million
Lease Operating Expenses (LOE)	Latest Period	Data Not Explicitly Quantified
General and Administrative (G&A) Costs	Latest Period	Data Not Explicitly Quantified

The ongoing operational costs, Lease Operating Expenses (LOE) for production and maintenance, and General and Administrative (G&A) costs for corporate overhead are essential parts of the structure, but the precise dollar amounts for these recurring expenses for the latest reported quarters aren't broken out separately in the summary data available. We know the company is managing a more complex operational footprint now, including the new Powder River Basin assets.

You can expect the interest expense to be calculated based on the drawn portion of the new facility, which was forecasted to be approximately 50% drawn at closing, against the total facility size, which included an indicative borrowing base of $95 million for the second bank component.

The cost structure is clearly influenced by these major items:

• Capital Intensity: Ongoing CapEx of $4.0M (Q2) and $2.9M (Q3) for development.
• Asset Quality Write-Down: The $2.7M Alberta JV impairment reflects specific execution risk realization.
• Financing Cost Base: The $49 million debt assumption directly impacts future interest expense obligations.

Finance: draft 13-week cash view by Friday.

Epsilon Energy Ltd. (EPSN) - Canvas Business Model: Revenue Streams

You're looking at the core ways Epsilon Energy Ltd. (EPSN) brings in cash as of late 2025. The revenue streams are clearly split between selling the commodities they produce and the fees they charge for using their midstream assets.

The overall picture shows a strong trailing twelve month performance. Total Trailing Twelve Month revenue ending Q3 2025 was $45.71M. This TTM figure represents a growth of 46.76% year-over-year as of late 2025.

The primary revenue driver remains the Upstream sales of Natural Gas, Oil, and Natural Gas Liquids (NGLs). To give you a concrete look at how the revenue composition shifts quarter-to-quarter based on commodity prices, here is a comparison between Q1 2025 and Q3 2025:

Revenue Component	Q1 2025 Revenue ($M)	Q3 2025 Revenue ($M)
Natural Gas Sales	10.614	4.758
Oil Sales	3.270	2.511
NGL Sales	0.387	0.267
Midstream (Gathering/Compression)	1.892	1.445
Total Revenue	16.163	8.981

Focusing on the first quarter, Natural gas sales, which were the largest component of Q1 2025 revenue, totaled $10.614M out of the quarter's total revenue of $16.163M.

The second key stream is the Fee-based revenue from Gathering and Compression services, which provides a hedge against commodity price swings. This segment delivered $1.845M in the second quarter of 2025. This midstream revenue was $1.445M in Q3 2025 and $1.892M in Q1 2025. It's a defintely important piece for stability.

You can see the relative importance of each component in the quarterly results:

• Q1 2025 Total Revenue was $16.163M.
• Q2 2025 Total Revenue was $11.625M.
• Q3 2025 Total Revenue was $8.981M.
• Q2 2025 Midstream revenue was $1.845M.
• Q3 2025 Gas revenue was $4.758M.
• Q3 2025 Oil revenue was $2.511M.

Finance: draft 13-week cash view by Friday.