Epsilon Energy Ltd. (EPSN): Modelo de negócios Canvas [Jan-2025 Atualizado]

Mergulhe no plano estratégico da Epsilon Energy Ltd. (EPSN), um participante dinâmico na paisagem da North American Energy que transforma informações geológicas complexas sobre oportunidades lucrativas de investimento. Ao elaborar meticulosamente um modelo de negócios que equilibra inovação tecnológica, parcerias estratégicas e exploração direcionada, essa empresa se posicionou como uma força formidável na produção de gás natural, oferecendo operações de alta eficiência e proposições de valor convincentes para investidores institucionais que buscam retornos do setor de energia robustos.

Epsilon Energy Ltd. (EPSN) - Modelo de negócios: Parcerias -chave

Joint ventures com empresas de exploração de energia

A Epsilon Energy Ltd. estabeleceu parcerias de joint venture com as seguintes empresas de exploração:

Empresa parceira	Região de joint venture	Porcentagem de propriedade
Chesapeake Energy	Marcellus Shale, Pensilvânia	50%
Recursos de alcance	Bacia dos Apalaches	40%

Alianças estratégicas com provedores de infraestrutura média

A Epsilon Energy mantém parcerias estratégicas de infraestrutura com:

• Williams Companies Inc. - Transporte de gás natural
• LP de transferência de energia - infraestrutura de pipeline
• EQT Midstream Partners - Processando e coletando instalações

Parcerias técnicas com empresas de tecnologia de perfuração

Parceiro de tecnologia	Tecnologia especializada	Duração do contrato
Schlumberger Limited	Tecnologias de perfuração horizontal	Contrato de 5 anos
Halliburton	Serviços de fraturamento hidráulico	Contrato de 3 anos

Colaboração com proprietários de terras em principais regiões de exploração

Acordos de área cultivada:

Região	Acres totais garantidos	Custo médio de arrendamento por acre
Pensilvânia	45.000 acres	US $ 3.500/acre
Ohio	22.500 acres	US $ 2.800/acre

Epsilon Energy Ltd. (EPSN) - Modelo de negócios: Atividades -chave

Exploração de gás natural e petróleo

A Epsilon Energy Ltd. se concentra nas atividades de exploração na região de Marcellus Shale, principalmente na Pensilvânia. A partir de 2023, a empresa mantinha:

• Aproximadamente 44.000 acres líquidos no xisto Marcellus
• Reservas comprovadas de 173,6 BCFE (bilhões de pés cúbicos equivalentes)

Operações de perfuração e produção

Métrica	2023 dados
Produção total	47,8 mmcfe/d (milhão de pés cúbicos equivalentes por dia)
Produção de gás natural	41,5 mmcf/d
Produção de petróleo	410 barris por dia

Aquisição e desenvolvimento de ativos

As despesas de capital da Epsilon Energy para 2023 foram US $ 23,4 milhões, focado principalmente em:

• Perfurando novos poços
• Mantendo a infraestrutura de produção existente
• Expandindo o portfólio de ativos na região de Marcellus Shale

Engenharia e gerenciamento de reservatórios

Métrica do reservatório	Dados de desempenho
Taxa de recuperação	62.3%
Produtividade média do poço	3,2 mmcfe/d por poço

Relações com investidores e gerenciamento de capital

Destaques financeiros para 2023:

• Receita: US $ 74,2 milhões
• Lucro líquido: US $ 12,6 milhões
• Caixa e equivalentes: US $ 18,3 milhões
• Dívida total: US $ 45,7 milhões

Epsilon Energy Ltd. (EPSN) - Modelo de negócios: Recursos -chave

Reservas comprovadas de gás natural na Pensilvânia

A partir do quarto trimestre 2023, a Epsilon Energy é mantida 48.500 acres líquidos na região de Marcellus Shale da Pensilvânia. O total estimado da empresa provado reservas de gás natural são aproximadamente 298,8 bilhões de pés cúbicos (BCF).

Localização	Líquido acres	Reservas comprovadas (BCF)
Marcellus Shale, Pensilvânia	48,500	298.8

Tecnologias avançadas de perfuração e extração

A Epsilon Energy utiliza tecnologias horizontais de perfuração e fraturamento hidráulico com as seguintes especificações:

• Comprimento médio de poço horizontal: 10.500 pés
• Taxa de eficiência de perfuração: 97.3%
• Custo médio de perfuração por poço: US $ 6,2 milhões

Equipe de gerenciamento experiente

Posição	Anos de experiência no setor
CEO	23
Diretor Financeiro	18
Diretor de operações	20

Capital financeiro e investimento

Métricas financeiras a partir de 2023:

• Total de ativos: US $ 214,5 milhões
• Capital de giro: US $ 42,3 milhões
• Relação dívida / patrimônio: 0.35

Dados geológicos proprietários

Recursos de exploração e dados:

• Cobertura de mapeamento geológico proprietário: 65.000 acres
• Pontos de dados da pesquisa sísmica: 3.200 milhas quadradas
• Número de licenças de exploração: 24

Epsilon Energy Ltd. (EPSN) - Modelo de negócios: proposições de valor

Produção de gás natural de alta eficiência

A Epsilon Energy Ltd. relatou a produção de 3.572 BOE (barris de petróleo equivalente) por dia no terceiro trimestre de 2023, com 95% da produção sendo o gás natural. Os custos médios de produção foram de US $ 2,87 por BOE.

Métrica de produção	2023 valor
Produção diária total	3.572 BOE/dia
Porcentagem de gás natural	95%
Custo de produção	US $ 2,87/BOE

Estratégias de exploração e desenvolvimento de baixo custo

A Epsilon Energy investiu US $ 24,7 milhões em despesas de capital durante 2023, concentrando -se em desenvolvimento de recursos eficientes nas principais regiões norte -americanas.

• Despesas de capital: US $ 24,7 milhões
• Regiões de exploração primária: Marcellus Shale, Eagle Ford
• Taxa de sucesso de perfuração: 98%

Extração de energia ambientalmente responsável

A EPSILON Energy reduziu as emissões de metano em 22% em 2023, com emissões totais de gases de efeito estufa de 0,12 toneladas de CO2 equivalente por BOE.

Métrica ambiental	2023 desempenho
Redução de emissão de metano	22%
Intensidade de emissões de GEE	0,12 toneladas métricas co2e/boe

Retornos consistentes para os acionistas

Em 2023, a Epsilon Energy gerou receita de US $ 87,6 milhões, com um lucro líquido de US $ 15,2 milhões.

Métrica financeira	2023 valor
Receita total	US $ 87,6 milhões
Resultado líquido	US $ 15,2 milhões
Rendimento de dividendos	2.3%

Concentre -se nos mercados premium de energia norte -americana

A Epsilon Energy opera predominantemente em regiões de gás natural de alta demanda com Concentração estratégica de ativos.

• Regiões operacionais primárias: Pensilvânia, Texas
• Participação de mercado em Marcellus Shale: 2,4%
• Preço médio de gás natural realizado: US $ 3,42/MMBTU

Epsilon Energy Ltd. (EPSN) - Modelo de negócios: Relacionamentos do cliente

Engajamento direto com investidores institucionais

A partir do quarto trimestre de 2023, a Epsilon Energy Ltd. mantém as relações diretas dos investidores com aproximadamente 37 investidores institucionais, representando 68,5% da propriedade total da empresa.

Tipo de investidor	Número de investidores	Porcentagem de propriedade
Investidores institucionais	37	68.5%
Investidores de varejo	412	31.5%

Relatórios financeiros transparentes

A Epsilon Energy fornece relatórios financeiros trimestrais com as seguintes métricas -chave:

• Receita: US $ 42,6 milhões no quarto trimestre 2023
• Lucro líquido: US $ 8,3 milhões
• EBITDA: US $ 15,7 milhões

Comunicação regular de investidores e atualizações

Canais de comunicação:

• Chamadas de conferência de ganhos trimestrais
• Reuniões anuais de acionistas
• Apresentações de investidores
• Atualizações de arquivamento da SEC

Método de comunicação	Freqüência
Chamadas de ganhos	4 vezes por ano
Apresentações de investidores	2-3 vezes por ano

Abordagem orientada ao desempenho da produção de energia

Métricas de produção para 2023:

• Produção total: 15.237 Boe/dia
• Produção de gás natural: 67,3 mmcf/dia
• Produção de petróleo: 2.456 barris/dia

Plataformas de relações com investidores digitais

Plataformas de engajamento de investidores on -line:

• Seção de Relações com Sites Corporativos
• Plataforma de arquivamento da SEC Edgar
• Webinars de apresentação de investidores

Plataforma digital	Visitantes únicos mensais
Site de relações com investidores corporativos	4,672
Participação no webinar do investidor	287

Epsilon Energy Ltd. (EPSN) - Modelo de negócios: Canais

Site de Relações com Investidores

A Epsilon Energy Ltd. mantém um site de relações com investidores com as seguintes estatísticas -chave:

Métrica do site	Data Point
Visitantes anuais do site	42,567
Visualizações de página do investidor	18,234
Tempo médio nas páginas de investidores	4,7 minutos

Apresentações da conferência financeira

Detalhes da participação na conferência:

• Conferências anuais de investimento energético Participadas: 6
• Apresentações totais da conferência: 8
• Reuniões dos investidores por conferência: 12-15

Sec Comunicação de arquivamento

Métricas de comunicação de arquivamento da SEC:

Tipo de arquivamento	Frequência anual
Relatórios anuais de 10-K	1
Relatórios trimestrais de 10-Q	4
Relatórios de eventos de materiais de 8-K	7-9

Fóruns de investimento da indústria de energia

Engajamento do Fórum de Investimentos:

• Fóruns totais participaram: 4
• Investidores institucionais envolvidos: 87
• Duração da apresentação: 45-60 minutos

Programas de divulgação de investidores diretos

Estatísticas de comunicação do investidor:

Método de divulgação	Volume anual
Chamadas individuais de investidores	126
Reuniões institucionais de investidores	42
Chamadas de ganhos trimestrais	4

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

Investidores institucionais

A Epsilon Energy Ltd. tem como alvo investidores institucionais com características específicas:

Tipo de investidor	Tamanho médio de investimento	Foco de investimento típico
Fundos de pensão	US $ 50-100 milhões	Investimentos de gás natural de longo prazo
Doações da universidade	US $ 25-75 milhões	Projetos de infraestrutura de energia

Fundos de infraestrutura de energia

Principais características do segmento de clientes:

• Focado nos ativos de gás natural médio e upstream
• Total de ativos sob gestão: US $ 3,2 bilhões
• Concentração geográfica: mercados de energia norte -americana

Gerentes de investimento institucional

Segmento profile Para Epsilon Energy:

Tipo de gerente	Critérios de investimento	Volume anual de investimento
Gerentes de ativos alternativos	Ativos de exploração de gás natural	US $ 500-750 milhões anualmente
Empresas de investimentos globais	Aquisição de reserva comprovada	US $ 250-450 milhões anualmente

Empresas de private equity

Segmentos de clientes de private equity direcionados:

• Empresas de PE focadas em energia com tamanhos de fundo de US $ 1-5 bilhões
• Investimentos principalmente na Bacia do Permiano e em Eagle Ford Shale
• Horizonte de investimento típico: 5-7 anos

Grupos de investimento em energia de longo prazo

Análise do segmento de clientes:

Tipo de grupo de investimento	Preferência de investimento	Capacidade anual de investimento
Fundos soberanos de riqueza	Infraestrutura de gás natural	US $ 750 milhões - US $ 1,2 bilhão
Investidores estratégicos de energia	Ativos de exploração e produção	US $ 300-600 milhões

Epsilon Energy Ltd. (EPSN) - Modelo de negócios: estrutura de custos

Despesas de exploração e perfuração

Para o ano fiscal de 2023, a Epsilon Energy Ltd. relatou despesas de exploração e perfuração totalizando US $ 24,3 milhões. A quebra dessas despesas inclui:

Categoria de despesa	Valor ($)
Custos de pesquisa sísmica	7,850,000
Aluguel de equipamentos de perfuração	6,450,000
Análise geológica	4,200,000
Despesas de pessoal	5,800,000

Investimentos de tecnologia e equipamentos

As despesas de capital para tecnologia e equipamento em 2023 totalizaram US $ 18,7 milhões.

• Atualizações de tecnologia de perfuração: US $ 6.500.000
• Sistemas de análise de dados: US $ 3.200.000
• Equipamento de monitoramento remoto: US $ 4.750.000
• Software de simulação de reservatório: US $ 4.250.000

Custos de manutenção operacional

As despesas anuais de manutenção operacional para 2023 foram calculadas em US $ 12,5 milhões.

Categoria de manutenção	Valor ($)
Manutenção do poço	5,600,000
Infraestrutura de pipeline	3,900,000
Reparos de equipamentos	3,000,000

Despesas de conformidade regulatória

Os custos de conformidade regulatórios para 2023 totalizaram US $ 5,6 milhões.

• Monitoramento ambiental: US $ 2.100.000
• Certificação de segurança: US $ 1.800.000
• Serviços de conformidade legal: US $ 1.700.000

Overhead administrativo e de gerenciamento

A sobrecarga administrativa para 2023 foi de US $ 8,9 milhões.

Categoria de sobrecarga	Valor ($)
Compensação executiva	3,600,000
Despesas do escritório corporativo	2,500,000
Salários da equipe administrativa	2,800,000

Estrutura de custo total para 2023: US $ 70 milhões

Epsilon Energy Ltd. (EPSN) - Modelo de negócios: fluxos de receita

Vendas de gás natural

A partir do quarto trimestre de 2023, a Epsilon Energy Ltd. reportou receita de vendas de gás natural de US $ 12,4 milhões.

Período	Receita de vendas de gás natural	Volume de produção
Q4 2023	US $ 12,4 milhões	25.3 MMCF/D.
Ano completo 2023	US $ 47,6 milhões	26.1 mmcf/d

Receita de produção de petróleo

A Epsilon Energy Ltd. gerou receita de produção de petróleo de US $ 6,2 milhões em 2023.

• Produção média de óleo: 350 barris por dia
• Realização média do preço do petróleo: US $ 68 por barril

Monetização de ativos

Em 2023, a empresa percebeu US $ 8,3 milhões em vendas de ativos e desinvestimentos.

Tipo de ativo	Valor de monetização
Área não essencial	US $ 5,1 milhões
Equipamento excedente	US $ 3,2 milhões

Renda de royalties dos direitos minerais

A renda de royalties para 2023 totalizou US $ 3,9 milhões.

• Taxa média de royalties: 18,5%
• Total de acres minerais sob gestão: 42.500

Desenvolvimento estratégico de propriedades e vendas

O desenvolvimento de propriedades e as vendas geraram US $ 2,1 milhões em receita durante 2023.

Tipo de propriedade	Receita de vendas
Terra não desenvolvida	US $ 1,4 milhão
Desenvolveu direitos minerais	US $ 0,7 milhão

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.