US Energy Corp director resigns, board to downsize

U.S. Energy Corp (NASDAQ:USEG), a $37 million market cap company operating in the crude petroleum and natural gas sector, announced the departure of director Joshua Batchelor from its Board of Directors. The notification came ahead of the company’s Annual Meeting of Stockholders scheduled for May 16, 2025, and just days before its upcoming earnings release on May 8. According to InvestingPro analysis, the company currently maintains a conservative balance sheet with more cash than debt, though it faces operational challenges.

Batchelor, who served on the Operations Committee, made his decision to not stand for re-election known on April 16, 2025, and subsequently resigned effective immediately on April 21, 2025. His resignation and decision to not seek re-election were attributed to his fund management responsibilities at Sage Road Capital, and not due to any disagreements with the company’s operations, policies, or practices. This leadership change comes as the company faces significant headwinds, with InvestingPro data showing a 36% year-over-year revenue decline and analysts anticipating further sales challenges in the current year.

The Board is set to reduce its size from seven to six members at the upcoming Annual Meeting. Batchelor’s departure follows an Amended and Restated Nominating and Voting Agreement dated September 16, 2022. Banner (NASDAQ:BANR) Oil & Gas, LLC, Woodford Petroleum, LLC, and Llano Energy LLC, who had rights to nominate Batchelor as per the agreement, are not expected to propose a new nominee at this time.

This shift in board composition comes at a time when corporate governance and the strategic direction of energy companies are under heightened scrutiny. The information regarding these changes was sourced from a recent SEC filing by U.S. Energy Corp.

In other recent news, U.S. Energy Corporation reported a significant miss in its fourth-quarter 2024 earnings, with an earnings per share (EPS) of -0.96 compared to the forecast of -0.07. Despite this, the company exceeded revenue expectations, reporting $20.62 million against a forecast of $5.49 million. The company remains debt-free, supported by a strong cash position and recent asset sales. In strategic developments, U.S. Energy has expanded its carbon capture capabilities through the acquisition of 2,300 net acres in Montana’s Kevin Dome area, which includes CO2 rights and an active Class II injection well. This acquisition is part of the company’s broader strategy to enhance its carbon capture and storage operations. Furthermore, U.S. Energy is focusing on helium production, aligning with market demand trends, and plans to initiate workover operations on two wells in April 2025. The company is also exploring offtake agreements in the latter half of 2025 to expand its helium production capabilities. Analysts from Zacks Wellcap Research and Johnson Rice have shown interest in the company’s development plans, especially regarding its industrial gas and helium production initiatives.

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