BKV Corporation Reports Fourth Quarter and Full Year 2025 Results

DENVER--( BUSINESS WIRE)--BKV Corporation (NYSE: BKV) (“BKV” or the “Company”), today reported financial and operational results for the fourth quarter and full year 2025, as well as provided guidance for the first quarter and full year 2026.

Fourth Quarter 2025 Highlights

Full Year 2025 Highlights

“2025 marked our first full year as a public company and a pivotal step forward in executing BKV’s closed-loop strategy,” said Chris Kalnin, Chief Executive Officer of BKV. “We delivered on our promises by achieving several key milestones, including closing our CCUS joint venture with Copenhagen Infrastructure Partners, completing the Bedrock acquisition, expanding our ownership in the Power JV, and strengthening our balance sheet through our inaugural bond offering and first follow-on equity issuance.”

“As we look ahead to 2026, we remain focused on delivering disciplined growth across our platform, with an emphasis on continued meaningful progress toward a power purchase agreement,” continued Kalnin. “By leveraging our assets across the energy value chain, we are well positioned to capitalize on key energy megatrends, deliver differentiated solutions to our customers, and create risk-adjusted, long-term value for our shareholders.”

Financial Results

Fourth Quarter 2025

For the three months ended December 31, 2025, total revenues and other operating income for BKV were $330.1 million (including realized hedging losses of $18.8 million and unrealized hedging gains of $89.0 million) and losses from the Power JV were $5.7 million. Net income attributable to BKV for the period was $70.4 million, or $0.75 per diluted share. For the three months ended December 31, 2025, Adjusted Net Income was $26.6 million, Adjusted EBITDAX was $94.8 million, Combined Adjusted EBITDAX attributable to BKV was $109.3 million and Adjusted Free Cash Flow attributable to BKV was negative $18.2 million.

Average realized natural gas price for the fourth quarter of 2025 was $2.86/MMBtu, excluding the impact of derivatives. Including the impact of cash settled hedges, average realized price was $2.56/MMBtu. Average realized NGL price for the fourth quarter of 2025 was $17.51/Bbl, excluding the impact of derivatives. Including the impact of cash settled hedges, average realized NGL price was $18.36/Bbl. On a natural gas equivalent basis, average realized price in the fourth quarter of 2025 was $2.88/Mcfe, excluding the impact of derivatives. Including the impact of cash settled hedges, average natural gas equivalent realized price was $2.67/Mcfe.

Full Year 2025

For the year ended December 31, 2025, total revenues and other operating income for BKV were $1.0 billion (including realized hedging losses of $8.1 million and unrealized hedging gains of $113.2 million) and earnings from the Power JV were $14.9 million. Net income attributable to BKV for the period was $173.1 million, or $1.98 per diluted share. For the year ended December 31, 2025, Adjusted Net Income was $121.6 million, Adjusted EBITDAX was $328.9 million, Combined Adjusted EBITDAX attributable to BKV was $390.0 million and Adjusted Free Cash Flow attributable to BKV was $1.3 million.

Average realized natural gas price for the year ended December 31, 2025 was $2.78/MMBtu, excluding the impact of hedges. Including the impact of cash settled hedges, average realized price was $2.75/MMBtu. Average realized NGL price for the year ended December 31, 2025 was $17.00/Bbl, excluding the impact of derivatives. Including the impact of cash settled hedges, average realized NGL price was $16.84/Bbl. On a natural gas equivalent basis, average realized price for the year ended December 31, 2025 was $2.81/Mcfe, excluding the impact of derivatives. Including the impact of cash settled hedges, average natural gas equivalent realized price was $2.79/Mcfe.

Three Months Ended

December 31,

Year Ended

December 31,

($ Millions, except EPS and Adjusted Free Cash Flow Margin) (1)

2025

2024

2025

2024

Net income (loss) attributable to BKV

70.4

(57.5

)

173.1

(142.9

)

Adjusted Net Income (Loss), non-GAAP

26.6

(4.9

)

121.6

(24.1

)

Adjusted EBITDAX, non-GAAP

94.8

71.9

328.9

231.8

Combined Adjusted EBITDAX attributable to BKV, non-GAAP

109.3

72.4

390.0

265.7

Net income (loss) per common share attributable to BKV, diluted

0.75

(0.68

)

1.98

(2.00

)

Adjusted EPS, non-GAAP

0.29

(0.06

)

1.40

(0.34

)

Adjusted Free Cash Flow attributable to BKV, non-GAAP

(18.2

)

5.4

1.3

91.6

Adjusted Free Cash Flow Margin attributable to BKV, non-GAAP

(7.0

3.1

0.1

14.9

Net income (loss)

71.1

(57.5

)

174.8

(142.9

)

Net cash provided by operating activities

69.4

43.8

242.7

118.5

Adjusted Free Cash Flow, non-GAAP

(25.0

)

5.4

(21.9

)

91.6

Adjusted Free Cash Flow Margin, non-GAAP

(9.6

3.1

(2.4

14.9

Earnings (losses) from the Power JV

(11.3

)

(34.1

)

29.8

21.1

Capital expenditures (accrued)

Development (2)

78.4

43.4

244.6

82.0

CCUS and other

23.7

16.9

73.9

35.6

Total capital expenditures (accrued)

102.1

60.3

318.5

117.6

“2025 was a year of disciplined growth for BKV, as we grew production, advanced our CCUS platform, and funded our strategic priorities while maintaining a strong balance sheet,” said David Tameron, Chief Financial Officer of BKV. “We exited the year with substantial liquidity and healthy leverage, reflecting both strong operational execution and prudent capital management.”

“During the year, we also successfully executed two major capital markets transactions—our inaugural $500 million bond offering and our first follow-on equity issuance—further strengthening our capital structure and expanding our float,” continued Tameron. “These actions position us well as we enter 2026 with the capacity to support continued growth and long-term value creation.”

Operational Results

Fourth Quarter and Full Year 2025

Power JV

Three Months Ended

December 31,

Year Ended

December 31,

($ Millions)

2025

2024

2025

2024

Total revenues, net

110.3

67.0

523.5

459.9

Depreciation and amortization

9.6

9.5

38.3

38.0

Operating expenses

98.0

74.8

399.2

331.4

Income (loss) from operations

2.7

(17.4

)

86.1

90.5

Interest expense

(15.3

)

(17.5

)

(63.3

)

(72.9

)

Other income (loss)

1.2

0.8

7.0

3.5

Net income (loss)

(11.3

)

(34.1

)

29.8

21.1

Power JV Adjusted EBITDA

30.6

0.9

126.5

67.9

On January 30, 2026, BKV closed the acquisition of an additional 25% interest in the Power JV, increasing its ownership in the JV to 75%. The increased ownership position will allow BKV to consolidate the Power JV’s financial results providing enhanced visibility to investors. The transaction aligns with BKV’s power growth aspirations, strategically positioning the company to take advantage of significant power demand growth in the ERCOT market.

During the quarter, the Power JV remained focused on optimizing operations at Temple I and II to enhance cash flow and improve capacity utilization. The Company has engaged an advisor and is actively evaluating potential power purchase agreement proposals, with discussions ongoing with multiple prospective counterparties.

For the fourth quarter 2025, the Temple I and II power plants reported capacity factors of 56.1% and 58.4%, respectively, with total power generation of 1,864 GWh. Average power pricing was $49.69/MWh and average natural gas cost was $3.55/MMBtu, resulting in an average spark spread of $24.54/MWh.

For the full year ended December 31, 2025, the Temple I and II power plants reported total power generation of 7,611 GWh, for a combined annual capacity factor of 59.0%. Average power pricing was $48.86/MWh and average natural gas cost was $3.31/MMbtu, resulting in an average spark spread of $25.36/MWh for the year.

The fourth quarter 2025 weather in Texas was characterized by moderate October and November temperatures, as expected for the shoulder season, but strong cold weather events in December drove favorable pricing as compared to forecast. Outperformance in December resulted in Power JV Adjusted EBITDA above the high end of the guidance range for the quarter.

BKV’s implied proportionate share of the Power JV’s net losses for the three months ended December 31, 2025 was $5.7 million, compared to loss of $17.2 million for the three months ended December 31, 2024, and earnings of $14.9 million for the year ended December 31, 2025, compared to earnings of $10.4 million for the year ended December 31, 2024.

BKV’s implied proportionate share of Power JV Adjusted EBITDA was $15.3 million for the three months ended December 31, 2025 compared to $0.5 million for the three months ended December 31, 2024, and $63.3 million for the year ended December 31, 2025, compared to $34.0 million for the year ended December 31, 2024.

BKV remains confident in long-term power market fundamentals, driven by accelerating demand from AI and data center development, and views execution of a power purchase agreement as a natural next step following the consolidation of the Power JV into its financial results in the first quarter of 2026.

Three Months Ended

December 31,

Year Ended

December 31,

2025

2024

2025

2024

Temple I capacity factor

56.1

44.0

59.2

58.1

Temple II capacity factor

58.4

30.9

58.7

55.1

Total power generation (GWh)

1,864

1,228

7,611

7,360

Average power price ($/MWh)

49.69

36.90

48.86

37.76

Average natural gas cost

3.55

2.50

3.31

2.26

Average spark spread

24.54

19.37

25.36

21.96

Carbon Capture Utilization and Sequestration (“CCUS”)

The Barnett Zero Project sequestered approximately 25,100 and 138,300 metric tons of CO 2 during the three months ended December 31, 2025 and the year ended December 31, 2025, respectively. Since start-up in November 2023, the project has sequestered approximately 311,600 metric tons of CO 2 through December 31, 2025.

The Eagle Ford and Cotton Cove Projects remain on schedule, with first injection still targeted for 1Q26 and 1H26 respectively. These projects are expected to achieve sequestration rates of approximately 90,000 and 32,000 metric tons per year of CO₂, respectively, and have received EPA approval of their monitoring, reporting, and verification (MRV) plans. For additional information regarding key assumptions and risks associated with our CCUS business, please see the “Risk Factors” section of our Annual Report on Form 10-K.

The East Texas Project reached an internal final investment decision (FID) on December 11, 2025. This milestone reflects completion of key commercial, technical, and internal alignment work and positions the project to advance into execution planning. BKV forecasts that approximately 70,000 metric tons per year of CO₂ could be captured from the project. The East Texas Project is the second CCUS project BKV is developing with a leading diversified midstream company and would represent the fourth project in the Company’s current modular line of identified potential natural gas processing-related CCUS projects, following the previously announced Eagle Ford Project, subject to execution of definitive agreements on acceptable terms and timelines.

In addition, on February 24, 2026, BKV executed definitive agreements with Comstock Resources to advance the previously announced CCUS projects at Comstock’s Bethel and Marquez natural gas processing facilities in the Western Haynesville. The projects are expected to include the development of CCUS injection wells designed to permanently sequester carbon dioxide associated with Comstock’s natural gas production operations in East Texas, combining BKV’s proven carbon capture capabilities with Comstock’s leading Haynesville position. The execution of these agreements represents another important step in accelerating deployment of our CCUS portfolio and scaling the business toward our targeted 1.5 million tons per annum injection run-rate by 2028.

The Company’s previously announced Class VI well permit applications remain under regulatory review.

BKV is also continuing Front-End Engineering Design (FEED) studies regarding CO 2 capture from combined cycle natural gas turbines, like those at our Temple location, to further delineate capital and operating costs of such facilities. These studies are expected to be completed in 2026 and are intended to further inform potential power-related CCUS development opportunities across the Company’s portfolio.

Upstream & Midstream

Total hydrocarbon production for the three months ended December 31, 2025 was 939.7 MMcfe/d, which consisted of 81% natural gas and 19% NGLs. This is compared to total production for the three months ended December 31, 2024 of 774.5 MMcfe/d, which consisted of 79% natural gas and 21% NGLs. Fourth quarter production exceeded the previously guided range of 885-935 MMcfe/d due to several factors, including continued efficiency gains on the D&C program and less winter downtime than forecast.

For the year ended December 31, 2025, total hydrocarbon production was 835.5 MMcfe/d, which consisted of 80% natural gas and 20% NGLs. This is compared to total hydrocarbon production of 788.0 MMcfe/d for the year ended December 31, 2024, which consisted of 79% natural gas and 21% NGLs.

The increase in production volumes for the fourth quarter and full year 2025 compared to the same periods in 2024 was primarily driven by the closing of the Bedrock acquisition in the third quarter of 2025 and increased development activity. The increased development activity during 2025 reflected the Company’s response to an improved commodity price environment.

Three Months Ended

December 31,

Year Ended

December 31,

2025

2024

2025

2024

Production

Net production per day (MMcfe/d)

939.7

774.5

835.5

788.0

Natural gas (MMcf)

70,159

56,469

242,935

228,682

NGL (MBbls)

2,683

2,443

10,181

9,858

Oil (MBbls)

159

Total (MMcfe)

86,455

71,253

304,975

288,406

Natural Gas Pricing ($/Mcf)

Average NYMEX Henry Hub price

3.55

2.79

3.43

2.27

Differential

(0.69

)

(0.69

)

(0.65

)

(0.58

)

Average realized prices, excluding derivatives

2.86

2.10

2.78

1.69

Average realized prices, including derivatives (1)

2.56

2.23

2.75

2.10

NGLs ($/Bbl)

Average realized prices, excluding derivatives

17.51

17.76

17.00

16.79

Average realized prices, including derivatives (1)

18.36

17.30

16.84

17.19

Oil ($/Bbl)

Average realized prices

52.61

61.33

59.50

68.81

Average Operating Cash Costs ($/Mcfe)

Lease operating and workover

0.54

0.49

0.50

0.47

Taxes other than income

0.18

0.04

0.17

0.12

Gathering and transportation costs

0.81

0.80

0.82

0.77

Total

1.53

1.33

1.49

1.36

Capital Expenditures

Accrued capital expenditures in the fourth quarter of 2025 were $102.1 million, which included $78.4 million for development capital and $23.7 million for CCUS and other expenditures. Accrued capital expenditures for the same period in 2024 were $60.3 million, which included $43.4 million for development capital and $16.9 million for CCUS and other expenditures.

Accrued capital expenditures for the year ended December 31, 2025 were $318.5 million, which included $244.6 million for development capital and $73.9 million for CCUS and other expenditures. Accrued capital expenditures for the same period in 2024 were $117.6 million, which included $82.0 million for development capital and $35.6 million for CCUS and other expenditures.

Liquidity

As of December 31, 2025, BKV had cash and cash equivalents of $199.4 million.

Total debt as of December 31, 2025 was $500 million, which was made up of the 2030 Senior Notes. Net debt as of December 31, 2025 was $300.6 million, and net leverage ratio was 0.92x.

As of December 31, 2025, total liquidity for BKV was $984.4 million, which consists of $199.4 million in cash and cash equivalents and $785.0 million available under the Company’s RBL. RBL availability as of December 31, 2025, is based on the elected commitment amount of $800.0 million, less $15.0 million of letters of credit.

2026 Guidance

Q1 2026

FY 2026

Accrued Capital Expenditures and Net Production ($ Millions)

Development (1)

$70 - $100

$200 - $280

Power - Strategic & Maintenance (1), (2)

$0 - $10

$120 - $160

CCUS and other (2)

$15 - $30

$90 - $120

Total capital expenditures

$85 - $140

$410 - $560

Net production (MMcfe/d)

900 - 930

915 - 955

Per Unit Operating Costs ($/Mcfe)

Lease operating and workover

$0.50 - $0.54

$0.49 - $0.53

Gathering, compression, processing, and transport (GCPT)

$0.80 - $0.84

Upstream general and administrative (excl. stock comp)

$0.20 - $0.25

Other General and Administrative Costs

General and administrative (Power, CCUS, & Other)

$15 - $18

$53 - $63

General and administrative (stock comp)

$4 - $6

$15 - $25

Commodity Prices

Average natural gas differential (3), (4)

$(1.05) - $(1.25)

$(0.65) - $(0.85)

NGL % of WTI

~ 27%

~ 24%

Power ($ Millions)

Power JV Adjusted EBITDA

$25 - $35

$135 - $175

Full Year and Fourth Quarter 2025 Earnings Conference Call

The Company plans to host a conference call to discuss results today, February 25, 2026 at 10 AM EST. To access the conference call, participants may dial (877) 407-0779 (US) or (201) 389-0914 (international). Participants can also listen to a live webcast of the call by going to the Investors section on the BKV website at ir.bkv.com. A replay will be available shortly after the live conference call and can be accessed on the Company’s website or by dialing (844) 512-2921 (US) or (412) 317-6671 (international). The passcode for the replay is 13757549. The replay will be available for 30 days after the call.

About BKV Corporation

BKV Corporation (NYSE: BKV) is a forward-thinking, growth-driven energy company focused on the sustainable development and delivery of low-carbon energy solutions and baseload power. As the largest natural gas producer by gross operated volume in the Barnett Shale, BKV is strategically expanding an end-to-end value chain that leverages its assets in upstream production, midstream infrastructure, natural gas-fired power generation and carbon capture, utilization and storage (CCUS). Through this innovative, closed-loop approach, BKV solves customers’ toughest energy challenges, meeting growing power demand and enabling sustainable growth for the future. Headquartered in Denver, Colorado, BKV is committed to driving long-term, risk adjusted shareholder value by optimizing and scaling our closed-loop energy platform for a carbon neutral future. For more information, visit the BKV website at www.bkv.com.

Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements, which are not historical facts, include statements regarding BKV’s strategy, future operations, financial position, estimated revenue and losses, projected costs, prospects, plans and objectives of management, and often contain words such as “expect,” “project,” “estimate,” “believe,” “anticipate,” “intend,” “budget,” “plan,” “seek,” “aspire,” “envision,” “forecast,” “target,” “predict,” “may,” “should,” “would,” “could,” “will,” and similar expressions. Actual results including financial and operating performance, and future events could differ materially from those anticipated in such statements, and such forward-looking statements may not prove to be accurate. Such forward-looking statements include, but are not limited to, statements about the amount and timing of capital expected to be contributed to our joint ventures by our joint venture partners, the anticipated benefits, opportunities and results with respect to the BKV-BPP Power Joint Venture Transaction and the Bedrock Acquisition, including any expected value creation from the BKV-BPP Power Joint Venture Transaction or the Bedrock Acquisition, and any reserves additions, midstream opportunities and other anticipated impacts from the Bedrock Acquisition, anticipated efficiencies, power plant reliability, and strategic growth and power purchase agreement opportunities relating to the BKV-BPP Power Joint Venture and the BKV-BPP Power Joint Venture Transaction, as well as guidance, projected or forecasted financial and operating results, future liquidity, leverage, results in certain basins, objectives, project timing, expectations and intentions, regulatory and governmental actions and other statements that are not historical facts. All forward-looking statements, expressed or implied, in this press release are based only on information currently available to BKV and speak only as of the date on which they are made. BKV undertakes no obligation to release publicly any update to any of these forward-looking statements except as required by federal securities laws. Forward-looking statements are based on management’s current views and assumptions and involve risks and uncertainties that could cause actual results to differ materially from historical experience or our present expectations, including but not limited to assumptions, risks and uncertainties regarding significant transaction costs associated with the Company’s acquisitions, including the Power JV transaction and the Bedrock acquisition; the risk of litigation and/or regulatory actions related to the Company’s acquisitions, including the Power JV transaction and the Bedrock acquisition; our ability to successfully fund, pursue and develop our CCUS business; expected increase in demand for power generation, and our ability to serve that demand from our power business, our ability to develop, market and sell our carbon sequestered gas product; and management's outlook guidance or forecasts of future events, including projected capital expenditures, production volumes, operating costs, pricing differentials, and Power JV Adjusted EBITDA. For further discussions of risks and uncertainties applicable to forward-looking statements, you should refer to BKV’s filings with the Securities and Exchange Commission (the “SEC”), including the “Risk Factors” section of BKV’s most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q.

CONSOLIDATED BALANCE SHEETS

($ thousands, except per share amounts)

(Unaudited)

December 31,

2025

2024

Assets

Current assets

Cash and cash equivalents

199,412

14,868

Accounts receivable, net

100,459

50,478

Accounts receivable, related parties

11,559

15,371

Prepaid expenses

6,419

7,638

Inventory

6,072

6,255

Commodity derivative assets, current

61,782

—

Other current assets

2,176

—

Total current assets

387,879

94,610

Natural gas properties and equipment

Developed properties

2,965,638

2,315,167

Undeveloped properties

13,182

10,757

Midstream assets

277,974

276,644

Accumulated depreciation, depletion, and amortization

(849,464

)

(714,287

)

Total natural gas properties, net

2,407,330

1,888,281

Other property and equipment, net

137,739

97,300

Goodwill

18,417

Investment in the Power JV

130,068

115,173

Commodity derivative assets

26,432

—

Other noncurrent assets

21,842

17,307

Total assets

3,129,707

2,231,088

Liabilities, mezzanine equity, and equity

Current liabilities

Accounts payable and accrued liabilities

206,934

121,366

Contingent consideration payable

—

20,000

Income taxes payable to related party

810

1,438

Commodity derivative liabilities

—

20,277

Other current liabilities

10,147

3,124

Total current liabilities

217,891

166,205

Asset retirement obligations

230,372

198,795

Commodity derivative liabilities

5,767

47,357

Deferred tax liability, net

123,355

88,688

Long-term debt, net

486,777

165,000

Other noncurrent liabilities

5,223

5,469

Total liabilities

1,069,385

671,514

Commitments and contingencies

Mezzanine equity

Noncontrolling interest

12,951

—

Stockholders' equity

Common stock, $0.01 par value; 500,000 authorized shares; 96,872 and 84,600 shares issued and outstanding as of December 31, 2025 and 2024, respectively

1,635

1,512

Treasury stock, shares at cost; 214 shares as of December 31, 2025 and 2024

(6,663

)

(6,663

)

Additional paid-in capital

1,754,930

1,447,671

Retained earnings

288,764

117,054

Total stockholders' equity

2,038,666

1,559,574

Noncontrolling interest

8,705

—

Total equity

2,047,371

1,559,574

Total liabilities, mezzanine equity, and equity

3,129,707

2,231,088

BKV CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

($ thousands, except per share amounts)

(Unaudited)

Three Months Ended

December 31,

Year Ended

December 31,

2025

2024

2025

2024

Revenues and other operating income

Natural gas, NGL, and oil sales

249,307

163,077

857,597

557,570

Midstream revenues

2,364

2,392

10,456

12,560

Derivative gains (losses), net

70,174

(58,295

)

105,081

(34,152

)

Marketing revenues

2,797

1,963

12,304

10,668

Gain on sale of business

—

7,080

Gains (losses) on sales of assets, net

(33

)

3,819

(1,805

)

3,523

Related party revenues

462

451

1,760

3,080

Section 45Q tax credits

2,131

3,767

11,752

14,021

Other

2,885

2,608

11,664

6,631

Total revenues and other operating income

330,087

119,782

1,008,809

580,981

Operating expenses

Lease operating and workover

46,722

34,763

152,873

136,991

Taxes other than income

15,493

3,106

50,762

35,009

Gathering and transportation

70,208

56,765

250,849

222,391

Depreciation, depletion, amortization, and accretion

41,568

48,688

157,464

217,533

General and administrative

37,846

30,930

124,355

104,473

Other

17,628

1,799

54,893

19,385

Total operating expenses

229,465

176,051

791,196

735,782

Income (loss) from operations

100,622

(56,269

)

217,613

(154,801

)

Other income (expense)

Gains (losses) on contingent consideration liabilities

—

(297

)

—

9,676

Earnings (losses) from equity affiliate

(5,658

)

(17,179

)

14,895

10,423

Loss on early extinguishment of debt

—

(13,877

)

Interest expense

(11,661

)

(5,139

)

(28,646

)

(45,582

)

Interest expense, related party

—

(5,181

)

Interest income

991

253

1,576

3,859

Other income

3,493

7,639

4,837

9,008

Income (loss) before income taxes

87,787

(70,992

)

210,275

(186,475

)

Income tax benefit (expense)

(16,725

)

13,535

(35,431

)

43,605

Net income (loss)

71,062

(57,457

)

174,844

(142,870

)

Less: net income attributable to noncontrolling interest

686

—

1,712

—

Net income (loss) attributable to BKV

70,376

(57,457

)

173,132

(142,870

)

Net income (loss) per common share attributable to BKV:

Basic

0.76

(0.68

)

1.98

(2.00

)

Diluted

0.75

(0.68

)

1.98

(2.00

)

Weighted average number of common shares outstanding:

Basic

92,071

84,387

86,581

71,288

Diluted

92,671

84,387

86,823

71,288

BKV CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

($ thousands)

(Unaudited)

Year Ended

December 31,

2025

2024

Cash flows from operating activities:

Net income (loss)

174,844

(142,870

)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation, depletion, amortization, and accretion

158,952

217,892

Equity-based compensation expense

12,845

16,316

Deferred income tax (benefit) expense

36,435

(44,811

)

Unrealized (gains) losses on derivatives, net

(113,164

)

146,679

Gains on contingent consideration liabilities

—

(9,676

)

Settlement of contingent consideration

(20,000

)

(20,000

)

Proceeds from the sale of call options

—

23,502

Payments for the purchase of put options

(16,206

)

—

Write-off of capitalized software costs

5,643

—

Gain on sale of business

—

(7,080

)

(Gains) losses on sale of assets, net

1,805

(3,523

)

Transaction costs from sale of business

—

(3,461

)

Earnings from equity affiliate

(14,895

)

(10,423

)

Loss on early extinguishment of debt

—

13,877

Other, net

3,692

(3,874

)

Changes in operating assets and liabilities:

Accounts receivable, net

(35,462

)

(4,652

)

Accounts receivable, related party

3,812

(14,812

)

Accounts payable and accrued liabilities

46,720

(32,165

)

Other changes in operating assets and liabilities

(2,314

)

(2,381

)

Net cash provided by operating activities

242,707

118,538

Cash flows from investing activities:

Asset acquisition

(272,096

)

—

Cash acquired in consolidation of BKV-BPP Cotton Cove

2,077

—

Capital expenditures

(300,165

)

(100,916

)

Proceeds from sale of business

—

132,571

Proceeds from sales of assets

6,876

5,060

Other investing activities, net

(1,595

)

(649

)

Net cash provided by (used in) investing activities

(564,903

)

36,066

Cash flows from financing activities:

Proceeds from issuance of common stock in initial public offering, net of underwriting discounts and commissions

—

265,661

Proceeds from the issuance of common stock, net of underwriting discounts and commissions

170,635

—

Proceeds on long-term debt

500,000

—

Payments on notes payable to related party

—

(75,000

)

Proceeds under RBL Credit Agreement

577,000

580,000

Payments on RBL Credit Agreement

(742,000

)

(415,000

)

Payment on term loan agreement

—

(456,000

)

Payment of debt issuance costs

(15,869

)

(8,054

)

Proceeds from draws on credit facilities

—

44,000

Payments on credit facilities

—

(171,000

)

Payments of deferred offering costs

—

(3,879

)

Debt extinguishment costs

—

(10,213

)

Net share settlements, equity-based compensation

(1,619

)

(53,239

)

Cash distributions to noncontrolling interest

(1,225

)

—

Cash contributions from noncontrolling interest

19,818

—

Other financing activities

—

(2,081

)

Net cash provided by (used in) financing activities

506,740

(304,805

)

Net increase (decrease) in cash, cash equivalents, and restricted cash

184,544

(150,201

)

Cash, cash equivalents, and restricted cash, beginning of period

14,868

165,069

Cash, cash equivalents, and restricted cash, end of period

199,412

14,868

Proved Reserves

SEC Pricing

As of December 31, 2025, the Company reported total proved reserves of 5,921 Bcfe, an increase of 2,789 Bcfe, or 89%, compared to December 31, 2024, primarily driven by higher commodity prices and changes in planned drilling activity that resulted in upward revisions, as well as the acquisition of BKV Barnett II (formerly known as Bedrock Production, LLC). As of December 31, 2025, proved undeveloped reserves were estimated at 1,714 Bcfe, an increase of 1,451 Bcfe, or 553% compared to December 31, 2024.

The following table presents the Company’s reserves at SEC pricing, standardized measure of discounted future net cash flow (the “Standardized Measure”), and PV-10:

December 31, 2025

SEC pricing (1)

Proved Developed

Proved Undeveloped

Total

Reserves (Bcfe)

4,207

1,714

5,921

PV-10 (millions) (2)

2,788

Present value of future income taxes discounted at 10%

(443

)

Standardized Measure (millions)

2,345

NYMEX Pricing

As of December 31, 2025, the Company reported total proved reserves of approximately 5,974 Bcfe, an increase of 1,056 Bcfe, or 21% compared to December 31, 2024. Reserves using NYMEX pricing increased primarily due to the acquisition of BKV Barnett II.

The following table presents the Company’s reserves at NYMEX pricing:

December 31, 2025

NYMEX pricing (1)

Proved Developed

Proved Undeveloped

Total

Reserves (Bcfe)

4,268

1,705

5,973

PV-10 (millions) (2)

3,082

Present value of future income taxes discounted at 10%

(508

)

Standardized Measure (millions)

2,574

Volume of Derivative Activities

As of December 31, 2025, the Company’s derivative activities based on volume and contract prices, categorized by primary underlying risk and related commodity, by year, were as follows:

The following table represents natural gas commodity derivatives indexed to NYMEX Henry Hub pricing:

MMBtu

Weighted

Average

Price (USD)

Weighted

Average

Price Floor

Weighted

Average

Price

Ceiling

Fair Value as of

December 31, 2025

($ thousands)

2026

Swap

154,460,650

3.86

35,268

2027

Swap

79,825,383

4.03

11,938

Collars

37,662,319

3.57

4.00

(3,225

)

Call options

36,500,000

5.00

(9,372

)

Put options

36,500,000

3.00

7,014

2028

Swap

51,995,323

3.93

11,480

The following table represents natural gas basis derivatives based on the applicable basis reference price listed below:

Instrument

Basis Reference Price

MMBtu

Weighted

Average Basis

Differential

Fair Value as of

December 31, 2025

($ thousands)

2026

Swap

Transco Leidy Basis

43,800,000

(0.80

)

238

Swap

HSC Basis

54,750,000

(0.32

)

7,408

Swap

Transco St 85 (Z4) Basis

36,500,000

0.62

4,225

Swap

NGPL TXOK Basis

47,521,249

(0.36

)

3,384

2027

Swap

Transco Leidy Basis

7,300,000

(0.77

)

Swap

HSC Basis

7,300,000

(0.25

)

458

Swap

NGPL TXOK Basis

16,965,270

(0.31

)

(93

)

2028

Swap

HSC Basis

10,980,000

(0.17

)

289

The following table represents natural gas liquids commodity derivatives for contracts, by contract type, expiring through December 31, 2027 based on the applicable index listed below:

Commodity Reference Price

Gallons

Weighted

Average

Price

(USD)

Fair Value as of

December 31, 2025

($ thousands)

2026

Swap

OPIS Purity Ethane Mont Belvieu

142,691,481

0.25

468

Swap

OPIS IsoButane Mont Belvieu Non-TET

10,075,218

0.83

185

Swap

OPIS Normal Butane Mont Belvieu Non-TET

16,928,342

0.80

836

Swap

OPIS Propane Mont Belvieu Non-TET

59,163,120

0.69

4,359

Swap

OPIS Natural Gasoline Mont Belvieu Non-TET

25,835,930

1.37

5,411

2027

Swap

OPIS Purity Ethane Mont Belvieu

79,965,970

0.28

935

Swap

OPIS IsoButane Mont Belvieu Non-TET

2,732,077

0.76

Swap

OPIS Normal Butane Mont Belvieu Non-TET

4,873,274

0.74

Swap

OPIS Propane Mont Belvieu Non-TET

15,478,884

0.64

309

Swap

OPIS Natural Gasoline Mont Belvieu Non-TET

6,777,531

1.26

783

Supplemental Non-GAAP Financial Measures

This release includes the non-GAAP financial measures described below. These non-GAAP measures are intended to provide additional information only and should not be considered as alternatives to, or more meaningful than, net income attributable to BKV, diluted EPS, net income (loss), net cash provided by operating activities, or any other measure calculated in accordance with GAAP.

As a result of C Squared Solutions, Inc.’s noncontrolling equity interest in the BKV-CIP Joint Venture that commenced on May 8, 2025, the Company has adjusted its non-GAAP measures of Combined Adjusted EBITDAX, Adjusted Free Cash Flow, and Adjusted Free Cash Flow Margin. Beginning in the second quarter of 2025, such non-GAAP measures will be adjusted to exclude the proportionate share of Adjusted EBITDAX and Adjusted Free Cash Flow attributable to the noncontrolling interested held by C Squared Solutions, Inc., and will be referred to as Combined Adjusted EBITDAX attributable to BKV, Adjusted Free Cash Flow attributable to BKV, and Adjusted Free Cash Flow Margin attributable to BKV. Such non-GAAP measures have been presented in this release for the comparative period have been calculated based on the updated definitions.

Adjusted Net Income (Loss) and Adjusted EPS

The Company defines Adjusted Net Income (Loss) as net income (loss) attributable to BKV before (i) non-cash derivative gains (losses), (ii) gains (losses) on contingent consideration liabilities, (iii) certain equity-based compensation expense, (iv) the portion of settlements paid (received) for early-terminated derivative contracts that relate to future periods, (v) other nonrecurring transactions, and (vi) the tax impact on these adjustments using a 23% statutory rate. The Company defines Adjusted EPS as Adjusted Net Income (Loss) divided by diluted weighted average common shares outstanding.

We believe Adjusted Net Income (Loss) and Adjusted EPS are useful performance measures because they allow us to effectively evaluate our operating performance and results of operations from period to period and against our peers, without regard to our financing methods, corporate form, capital structure, or one-time events. We exclude the items listed above from net income (loss) in arriving at Adjusted Net Income (Loss) and Adjusted EPS because these amounts can vary substantially from company to company within our industry depending upon accounting methods and book values of assets, capital structures, and the method by which the assets were acquired. Our presentation of Adjusted Net Income (Loss) and Adjusted EPS should not be construed as an inference that our results will be unaffected by unusual or non-recurring items. Other companies, including other companies in our industry, may not use Adjusted Net Income (Loss) and Adjusted EPS or may calculate this measure differently than as presented in this release, limiting its usefulness as a comparative measure.

The table below presents a reconciliation of Adjusted Net Income (Loss) to net income, our most directly comparable GAAP financial measure for the periods indicated.

Three Months Ended

December 31,

Year Ended

December 31,

($ Thousands, except EPS)

2025

2024

2025

2024

Net income (loss) attributable to BKV

70,376

(57,457

)

173,132

(142,870

)

Adjustment to net income (loss) attributable to BKV:

Net unrealized (gains) losses on derivatives

(89,021

)

64,537

(113,164

)

146,679

Forward month gas settlement (1)

21,417

9,858

11,217

9,543

Change in contingent consideration liabilities

—

297

—

(9,676

)

Release of legal claims

—

(5,269

)

—

(5,269

)

Acceleration of equity-based compensation due to IPO

—

10,508

Gain on sales of non-operated interest in proved reserves

—

(1,112

)

—

(6,563

)

Impairment of asset held for sale

—

2,446

—

Loss on extinguishment of debt

—

13,877

Other nonrecurring transactions

10,747

—

32,573

—

Early settlement of derivative contracts (2)

—

(13,250

)

Early settlements of derivative contracts related to the current period (3)

—

8,350

Total adjustments before taxes

(56,857

)

68,311

(66,928

)

154,199

Tax effect of adjustments

13,077

(15,712

)

15,393

(35,466

)

Total adjustments after taxes

(43,780

)

52,599

(51,535

)

118,733

Adjusted Net Income (Loss)

26,596

(4,858

)

121,597

(24,137

)

Adjusted Net Income (Loss) per basic share

0.29

(0.06

)

1.40

(0.34

)

Adjusted Net Income (Loss) per diluted share

0.29

(0.06

)

1.40

(0.34

)

Basic weighted-average shares of common stock outstanding

92,071

84,387

86,581

71,288

Add dilutive effects of TRSUs (4)

325

—

173

—

Add dilutive effects of PRSUs (4)

275

—

Diluted weighted-average common shares outstanding

92,671

84,387

86,823

71,288

Adjusted EBITDAX and Combined Adjusted EBITDAX attributable to BKV

The Company defines Adjusted EBITDAX as net income (loss) before (i) non-cash derivative gains (losses), (ii) depreciation, depletion, amortization, and accretion, (iii) exploration and impairment expense, (iv) gains (losses) on contingent consideration liabilities, (v) interest expense, (vi) interest expense, related party, (vii) income tax benefit (expense), (viii) equity-based compensation expense, (ix) earnings (losses) from the Power JV, (x) the portion of settlements paid (received) for early-terminated derivative contracts that relate to future periods and (xi) other nonrecurring transactions. Combined Adjusted EBITDAX attributable to BKV is defined as Adjusted EBITDAX less Adjusted EBITDAX attributable to noncontrolling interest plus BKV’s 50% proportionate share of Power JV Adjusted EBITDA. Adjusted EBITDAX attributable to noncontrolling interest is defined as C Squared Solutions, Inc.’s 47% proportionate share of Adjusted EBITDAX attributable to the BKV-CIP Joint Venture for the applicable period.

The Company excludes the items listed above from Net Income (Loss) in arriving at Adjusted EBITDAX because these amounts can vary substantially from company to company within our industry depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired. Adjusted EBITDAX should not be considered as an alternative to, or more meaningful than, net income (loss) determined in accordance with GAAP. Certain items excluded from Adjusted EBITDAX are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax burden, as well as the historic costs of depreciable assets, none of which are reflected in Adjusted EBITDAX. Our presentation of Adjusted EBITDAX should not be construed as an inference that our results will be unaffected by unusual or non-recurring items. Other companies, including other companies in our industry, may not use Adjusted EBITDAX or may calculate this measure differently than as presented in this release, limiting its usefulness as a comparative measure.

Adjusted EBITDAX and Combined Adjusted EBITDAX attributable to BKV are supplemental non-GAAP financial measures that are used by our management and external users of our consolidated financial statements, such as industry analysts, investors, lenders, rating agencies and others to more effectively evaluate our operating performance and results of operations from period to period and against our peers. We believe Adjusted EBITDAX, and Combined Adjusted EBITDAX attributable to BKV are useful performance measures because they allow us to effectively evaluate our operating performance and results of operations from period to period and against our peers, without regard to our financing methods, corporate form or capital structure.

The table below presents a reconciliation of Adjusted EBITDAX and Combined Adjusted EBITDAX attributable to BKV to net income (loss), our most directly comparable GAAP financial measure for the periods indicated.

Three Months Ended

December 31,

Year Ended

December 31,

($ Thousands)

2025

2024

2025

2024

Net income (loss)

71,062

(57,457

)

174,844

(142,870

)

Add back (subtract):

Net unrealized derivative (gains) losses

(89,021

)

64,537

(113,164

)

146,679

Forward month gas settlement (1)

21,417

9,858

11,217

9,543

Depreciation, depletion, amortization, and accretion

42,776

48,781

158,952

217,892

Change in contingent consideration

—

297

—

(9,676

)

Release of legal claims

—

(5,269

)

—

(5,269

)

Interest expense

11,661

5,139

28,646

45,582

Interest expense, related party

—

5,181

Loss on early extinguishment of debt

—

13,877

Income tax expense (benefit)

16,725

(13,535

)

35,431

(43,605

)

Equity-based compensation expense

3,765

3,497

12,845

16,316

Gain on sales of non-operated interest in proved reserves

—

(1,112

)

—

(6,563

)

Impairment of asset held for sale

—

2,446

—

(Earnings) losses from equity affiliate

5,658

17,179

(14,895

)

(10,423

)

Other nonrecurring transactions

10,747

—

32,573

—

Early settlement of derivative contracts (2)

—

(13,250

)

Early settlements of derivative contracts related to the current period (3)

—

8,350

Adjusted EBITDAX

94,790

71,915

328,895

231,764

Less: Adjusted EBITDAX attributable to noncontrolling interest (4)

(817

)

—

(2,204

)

—

Plus: 50% Power JV Adjusted EBITDA (4)

15,310

461

63,273

33,950

Combined Adjusted EBITDAX Attributable to BKV

109,283

72,376

389,964

265,714

Adjusted EBITDAX Attributable to Noncontrolling Interest

We consolidate our noncontrolling interest in the BKV-CIP Joint Venture. The table below reconciles the Adjusted EBITDAX attributable to noncontrolling interest to the net income (loss) attributable to noncontrolling interest, the most comparable financial measure in accordance with GAAP.

Three Months Ended

December 31,

Year Ended

December 31,

($ Thousands)

2025

2024

2025

2024

Net income attributable to noncontrolling interest

686

—

1,712

—

Add back (subtract):

Depreciation and amortization (1)

131

—

492

—

Adjusted EBITDAX attributable to noncontrolling interest

817

—

2,204

—

Adjusted Free Cash Flow, Adjusted Free Cash Flow Attributable to BKV, Adjusted Free Cash Flow Margin, and Adjusted Free Cash Flow Margin Attributable to BKV

We define Adjusted Free Cash Flow as net cash provided by operating activities, excluding cash paid for contingent consideration, nonrecurring cash transactions, and changes in operating assets and liabilities, less total cash paid for capital expenditures (excluding leasehold costs and acquisitions). Adjusted Free Cash Flow attributable to BKV is defined as Adjusted Free Cash Flow less Adjusted EBITDAX attributable to noncontrolling interest, plus net contributions from noncontrolling interest.

Adjusted Free Cash Flow is not a measure of net cash flow provided by or used in operating activities as determined by GAAP. Adjusted Free Cash Flow is a supplemental non-GAAP financial measure that is used by our management and other external users of our financial statements, such as industry analysts, investors, lenders, rating agencies and others to assess our ability to internally fund our capital program, service or incur additional debt and to pay dividends. We believe Adjusted Free Cash Flow is a useful liquidity measure because it allows us and others to compare cash flow provided by operating activities across periods and to assess our ability to internally fund our capital program (including acquisitions), to reduce leverage, fund acquisitions and pay dividends to our stockholders. We define Adjusted Free Cash Flow Margin as the ratio of Adjusted Free Cash Flow for any period to total revenues, excluding derivative gains and losses, for such period. We use this metric to assess our liquidity relative to our revenues. Adjusted Free Cash Flow Margin illustrates the efficiency with which the Company generates Adjusted Free Cash Flow. We define Adjusted Free Cash Flow Margin attributable to BKV as the ratio of Adjusted Free Cash Flow attributable to BKV for any period to total revenues attributable to BKV, excluding derivative gains and losses and the 47% proportionate share of Adjusted Free Cash Flow attributable to C Squared Solutions, Inc.’s noncontrolling interest in the BKV-CIP Joint Venture. Adjusted Free Cash Flow should not be considered as an alternative to, or more meaningful than, net income (loss) or net cash provided by (used in) operating activities determined in accordance with GAAP. Other companies, including other companies in our industry, may not use Adjusted Free Cash Flow or may calculate this measure differently than as presented in this release, limiting its usefulness as a comparative measure.

The table below presents our reconciliation of Adjusted Free Cash Flow and Adjusted Free Cash Flow attributable to BKV to net cash provided by operating activities, our most directly comparable GAAP financial measure for the periods indicated.

Three Months Ended

December 31,

Year Ended

December 31,

($ Thousands)

2025

2024

2025

2024

Net cash provided by operating activities

69,389

43,762

242,707

118,538

Cash paid for contingent consideration (1)

—

20,000

Other nonrecurring cash transactions

10,747

—

25,848

—

Change in operating assets and liabilities

(16,347

)

9,824

(12,756

)

54,010

Cash paid for capital expenditures (excl. leasehold costs, acquisitions)

(88,771

)

(48,142

)

(297,740

)

(100,916

)

Adjusted Free Cash Flow (2)

(24,982

)

5,444

(21,941

)

91,632

Add back (subtract):

Adjusted EBITDAX attributable to noncontrolling interest

(817

)

—

(2,204

)

—

Net contributions from noncontrolling interest

7,554

—

25,490

—

Adjusted Free Cash Flow attributable to BKV (2)

(18,245

)

5,444

1,345

91,632

Total revenue, excluding derivative gains and losses

259,913

178,077

903,728

615,133

Adjusted Free Cash Flow Margin (2)

(9.6

3.1

(2.4

14.9

Total revenue attributable to BKV, excluding derivative gains and losses, and the 47% proportionate share of revenue from the noncontrolling interest in the BKV-CIP Joint Venture

258,801

178,077

900,119

615,133

Adjusted Free Cash Flow Margin attributable to BKV (2)

(7.0

3.1

0.1

14.9

Power JV Adjusted EBITDA

We define Power JV Adjusted EBITDA as net income (loss) of the Power JV before (i) unrealized derivative gains/losses, (ii) depreciation and amortization, and (iii) interest expense.

The items listed above are excluded from the Power JV’s net income (loss) in arriving at Power JV Adjusted EBITDA because these amounts can vary substantially from company to company within the power industry depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired. Power JV Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net income (loss) determined in accordance with GAAP. Other companies, including other companies in the power industry, may not use Adjusted EBITDA or may calculate this measure differently than as presented in this release, limiting its usefulness as a comparative measure.

Power JV Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by our management and external users of our consolidated financial statements, such as industry analysts, investors, lenders, rating agencies and others to more effectively evaluate our and the Power JV’s operating performance and results of operations from period to period and against our peers. We believe our investment in the Power JV is a strategic differentiator for BKV’s integrated energy solutions model. Investors in BKV may be interested in the results of the Power JV and the respective impact to BKV’s financial results. We believe Power JV Adjusted EBITDA is a useful performance measure because it allows us to effectively evaluate the Power JV’s operating performance and results of operations from period to period and against peers, without regard to financing methods, corporate form or capital structure.

The table below presents our reconciliation of Power JV Adjusted EBITDA to the Power JV’s net income (loss), the most directly comparable GAAP financial measure for the periods indicated.

Three Months Ended

December 31,

Year Ended

December 31,

($ Thousands)

2025

2024

2025

2024

Net income (loss)

(11,317

)

(34,119

)

29,789

21,085

Add back (subtract):

Net unrealized (gains) losses on derivatives

17,115

7,992

(4,810

)

(64,061

)

Depreciation and amortization

9,563

9,528

38,273

37,967

Interest expense

15,258

17,521

63,293

72,908

Power JV Adjusted EBITDA

30,619

922

126,545

67,899

50% Power JV Adjusted EBITDA (BKV’s proportionate share)

15,310

461

63,273

33,950

PV-10

PV-10 refers to the estimated future gross revenue to be generated from the production of proved reserves, net of estimated production and future development costs, using prices and costs in effect at the determination date, without giving effect to non-property related expenses such as general and administrative expenses, debt service and future income tax expense or to depreciation, depletion and amortization, discounted using an annual discount rate of 10%. PV-10 is not a financial measure calculated in accordance with GAAP because it does not include the effects of income taxes on future net revenues. PV-10 is derived from the Standardized Measure, which is the most directly comparable GAAP financial measure. Neither PV-10 nor Standardized Measure represent an estimate of the fair market value of our oil and natural gas properties. We believe that the presentation of PV-10 is relevant and useful to investors because it presents the discounted future net cash flows attributable to our estimated net proved reserves prior to taking into account future corporate income taxes, and it is a useful measure for evaluating the relative monetary significance of our oil and gas properties. It is not intended to represent the current market value of our estimated reserves. PV-10 should not be considered in isolation or as a substitute for the Standardized Measure reported in accordance with GAAP, but rather should be considered in addition to the Standardized Measure.