Vital Energy, Inc. Unaudited Pro Forma Condensed Combined Financial Information

EXHIBIT 99.1

Vital Energy, Inc.

Unaudited Pro Forma Condensed Combined Financial Information

On May 11, 2023, Vital Energy, Inc., a Delaware corporation (“Vital” or the “Company”), and Northern Oil and Gas, Inc. (“NOG”, and together with Vital, “Purchaser”) entered into a purchase and sale agreement (the “Purchase Agreement”), with Forge Energy II Delaware, LLC, an Encap portfolio company (“Forge” or the “Seller”). Pursuant to the Purchase Agreement, Vital and NOG jointly agreed to acquire Forge’s oil and natural gas properties located in the Delaware Basin in Xxxx, Xxxxxx and Pecos Counties. The Company agreed to acquire an undivided 70% of Forge’s oil and natural gas properties, or 24,000 net acres (the “Assets” and the acquisition thereof, the “Forge Acquisition”) and NOG agreed to acquire an undivided 30% of Forge’s oil and natural gas properties. On June 30, 2023, Vital and NOG completed the Forge Acquisition pursuant to the Purchase Agreement.

Xxxxx and NOG agreed to purchase the Assets for total consideration of $540.0 million. The Company’s portion of the total consideration is $378.0 million and NOG’s is $162.0 million. The fair value of consideration paid to the seller on the close date of June 30, 2023 was $401.9 million. The purchase price was funded by $330.0 million in borrowings under the Company’s current senior secured credit facility, with the remaining portion funded with cash on hand. In addition, Vital will assume revenue suspense of $4.3 million and asset retirement obligations of $1.4 million, both based upon fair value as of June 30, 2023.

The Forge Acquisition was accounted for as an asset acquisition in accordance with Accounting Standards Codification Topic 805, Business Combinations (“ASC 805”). The fair value of the consideration paid by Xxxxx and the allocation of that amount to the underlying assets acquired is recorded on a relative fair value basis. Additionally, costs directly related to the Forge Acquisition are capitalized as a component of the purchase price. The unaudited pro forma condensed combined financial statements presented herein have been prepared to reflect the transaction accounting adjustments to Vital’s historical condensed consolidated financial information in order to account for the Forge Acquisition and include the assumption of liabilities as set forth in the Purchase Agreement.

As previously disclosed in its Current Report on Form 8-K filed on April 3, 2023 with the SEC, on April 3, 2023, Vital completed the acquisition ("Driftwood Acquisition") of the assets of Driftwood Energy Operating, LLC, a Delaware limited liability company (“Driftwood”). At the closing of the Driftwood Acquisition, among other things, Vital acquired interests in oil and natural gas leases and related property of Driftwood located in the Midland Basin, for aggregate consideration of approximately (i) $120.4 million in cash, after closing price adjustments, and (ii) 1,578,948 shares of the Company’s common stock, par value $0.01 per share.

The Driftwood Acquisition was accounted for as an asset acquisition in accordance with ASC 805. The fair value of the consideration paid by Xxxxx and the allocation of that amount to the underlying assets acquired was recorded on a relative fair value basis. Additionally, costs directly related to the Driftwood Acquisition were capitalized as a component of the purchase price. The operating results of Driftwood are consolidated in our financial statements beginning on the date of the closing of the Driftwood Acquisition.

The Unaudited Pro Forma Condensed Combined Balance Sheet as of March 31, 2023 gives effect to the Driftwood Acquisition and Forge Acquisition as if they had been completed on March 31, 2023. The Unaudited Pro Forma Condensed Combined Statements of Operations for the three months ended March 31, 2023 and the year ended December 31, 2022 give effect to the Driftwood Acquisition and Forge Acquisition as if they been completed on January 1, 2022. Assumptions and estimates underlying the pro forma adjustments are described in the accompanying notes, which should be read in conjunction with the unaudited pro forma condensed combined financial statements.

The unaudited pro forma condensed combined financial information is provided for illustrative purposes only and does not purport to represent what the actual consolidated results of operations or the consolidated financial position of Vital would have been had the Driftwood and Forge Acquisitions and related financing occurred on the dates noted above, nor are they necessarily indicative of future consolidated results of operations or consolidated financial position. Future results may vary significantly from the results reflected because of various factors. For income tax purposes, the Driftwood Acquisition and Forge Acquisition will be treated as an asset purchase such that the tax bases in the assets and liabilities will generally reflect the allocated fair value at closing. In Vital’s opinion, all adjustments that are necessary to present fairly the unaudited pro forma condensed combined financial information have been made.

The unaudited pro forma condensed combined financial information does not reflect the benefits of potential cost savings or the costs that may be necessary to achieve such savings, opportunities to increase revenue generation or other factors that may result from the Driftwood or Forge Acquisitions and, accordingly, does not attempt to predict or suggest future results.

The unaudited pro forma financial statements have been developed from and should be read in conjunction with:

•The audited financial statements and accompanying notes of Vital contained in Vital’s Annual Report on Form 10-K for the year ended December 31, 2022;

•The unaudited condensed financial statements and accompanying notes contained in Vital’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023;

•The audited financial statements and related notes of Forge as of December 31, 2022 and 2021 and for the years then ended, which are incorporated by reference from Exhibit 99.1 to Vital's Current Report on Form 8-K/A filed with the SEC on July 13, 2023;

•The unaudited condensed financial statements and related notes of Forge as of March 31, 2023, and for the three month periods ended March 31, 2023 and 2022, which are incorporated by reference from Exhibit 99.2 to Vital's Current Report on Form 8-K/A filed with the SEC on July 13, 2023;

•The audited consolidated financial statements and related notes of Driftwood Energy Partners, LLC and its wholly-owned subsidiaries, Driftwood Energy Operating, LLC, Driftwood Energy Management, LLC and Driftwood Energy Intermediate, LLC (collectively, the "Driftwood Entities") as of December 31, 2022 and 2021 and for the years then ended, which are incorporated by reference from Exhibit 99.1 to Vital’s Current Report on Form 8-K/A filed with the SEC on June 15, 2023;

•The unaudited condensed consolidated financial statements and related notes of the Driftwood Entities as of March 31, 2023, and for the three month periods ended March 31, 2023 and 2022, which are incorporated by reference from Exhibit 99.2 to Vital’s Current Report on Form 8-K/A filed with the SEC on June 15, 2023; and

•The unaudited pro forma condensed combined financial information of Vital as of March 31, 2023 and for the three month period ended March 31, 2023 and the year ended December 31, 2022, which are incorporated by reference from Exhibit 99.3 to Vital’s Current Report on Form 8-K/A filed with the SEC on June 15, 2023.

Vital Energy, Inc.

Pro forma condensed combined balance sheets

As of March 31, 2023

(in thousands)

(Unaudited)

						Historical												Transaction accounting adjustments
						Vital (adjusted for acquisition of Driftwood)						Forge						Conforming and reclass						Forge Acquisition						Pro forma combined
Assets
Current assets:
Cash and receivables, net						$	170,387					$	48					$	(48)		(a)			$	(391,586)		(c)			$	103,145
																								(5,656)			(f)
																								330,000			(g)
Accounts receivable – Oil and natural gas sales						—						21,265						(21,265)			(a)			—						—
Contingent consideration receivable						—						1,042						(1,042)			(a)			—						—
Other receivables						—						3,000						(3,000)			(a)			—						—
Derivatives						39,109						282						(282)			(a)									39,109
Inventory						—						1,438						(1,438)			(a)			—						—
Other current assets						15,804						—						—						—						15,804
Total current assets						225,300						27,075						(27,075)						(67,242)						158,058
Property and equipment:
Oil and natural gas properties:
Evaluated properties – full cost method						9,945,763						—						—						238,476			(d)			10,195,594
																								5,656			(f)
																								1,376			(e)
																								4,323			(h)
Unevaluated properties not being     depleted – full cost method						50,142						—						—						153,110			(d)			203,252
Oil and natural gas properties, successful efforts method of accounting						—						533,760						(533,760)			(b)			—						—
Less: accumulated depletion and     impairment						(7,401,480)						—						—						—						(7,401,480)
Less: accumulated depletion and depreciation						—						(68,112)						68,112			(b)			—						—
Oil and natural gas properties, net						2,594,425						465,648						(465,648)						402,941						2,997,366
Midstream and other fixed assets, net						128,012						—						—						—						128,012
Property and equipment, net						2,722,437						465,648						(465,648)						402,941						3,125,378
Other property and equipment, net						—						32,561						(32,561)			(a)			—						—
Contingent consideration, non-current						—						2,255						(2,255)			(a)			—
Derivatives						26,448						—						—						—						26,448
Debt financing costs, net						—						865						(865)			(a)			—						—
Operating lease right-of-use assets						138,513						—						—						—						138,513
Other noncurrent assets, net						36,384						—						—						—						36,384
Accounts receivable, related parties, non-current						—						10,799						(10,799)			(a)			—						—
Total assets						$	3,149,082					$	539,203					$	(539,203)					$	335,699					$	3,484,781
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable and accrued liabilities						$	91,688					$	—					$	—					$	—					$	91,688
Accrued liabilities						—						34,306						(34,306)			(a)			—						—
Accrued capital expenditures						67,221						—						—						—						67,221
Undistributed revenue and royalties						148,672						—						—						4,323			(h)			152,995
Derivatives						5,118						3,617						(3,617)			(a)			—						5,118
Operating lease liabilities						48,434						—						—						—						48,434
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						Historical												Transaction accounting adjustments
						Vital (adjusted for acquisition of Driftwood)						Forge						Conforming and reclass						Forge Acquisition						Pro forma combined
Other current liabilities						34,279						—						—						—						34,279
Total current liabilities						395,412						37,923						(37,923)						4,323						399,735
Long-term debt, net						1,283,807						—						—						330,000			(g)			1,613,807
Line-of-credit						—						74,536						(74,536)			(a)			—						—
Asset retirement obligations						72,328						9,906						(9,906)			(a)			1,376			(e)			73,704
Accounts payable, related parties						—						57,776						(57,776)			(a)			—						—
Operating lease liabilities						87,301						—						—						—						87,301
Derivative liabilities						845						—						—						—						845
Other noncurrent liabilities						3,953						—						—						—						3,953
Total liabilities						1,843,646						180,141						(180,141)						335,699						2,179,345
Commitments and contingencies
Stockholders' equity:
Preferred stock						—						—						—						—						—
Common stock						186						—						—						—						186
Additional paid-in capital						2,834,817						—						—						—						2,834,817
Accumulated deficit						(1,529,567)						—						—						—						(1,529,567)
Members' equity						—						359,062						(359,062)			(a)			—						—
Total stockholders' equity						1,305,436						359,062						(359,062)						—						1,305,436
Total liabilities and stockholder’s equity						$	3,149,082					$	539,203					$	(539,203)					$	335,699					$	3,484,781

2

Vital Energy, Inc.

Pro forma condensed combined statements of operations

For the three months ended March 31, 2023

(in thousands, except per share data)

(Unaudited)

						Historical												Transaction accounting adjustments
						Vital (adjusted for acquisition of Driftwood)						Forge						Conforming and reclass						Forge Acquisition						Pro forma combined
Revenues:
Oil sales						$	286,902					$	59,443					$	—					$	(17,833)		(h)			$	328,512
NGL sales						34,188						5,243						—						(1,573)			(h)			37,858
Natural gas sales						20,501						140						—						(42)			(h)			20,599
Sales of purchased oil						13,851						—						—						—						13,851
Other operating revenues						845						—						107			(a)			(32)			(h)			920
Other revenue						—						107						(107)			(a)			—						—
Total revenues						356,287						64,933						—						(19,480)						401,740
Costs and expenses:
Lease operating expenses						54,304						12,276						2,442			(e)			(4,416)			(h)			64,606
Production and ad valorem taxes						21,529						3,684						—						(1,105)			(h)			24,108
Transportation and marketing expenses						10,915						—						—						—						10,915
Workover expenses						—						2,442						(2,442)			(e)			—						—
Costs of purchased oil						14,167						—						—						—						14,167
General and administrative						26,814						452						—						(136)			(h)			27,130
Depletion, depreciation and amortization						92,476						—						10,967			(d)			(3,290)			(h)			103,687
																								3,534			(k)
Depletion and depreciation						—						10,967						(10,967)			(d)			—						—
Accretion expense						—						119						(119)			(f)			—						—
Other operating expenses, net						1,512						—						119			(f)			(36)			(h)			1,550
																								(45)			(k)
Total costs and expenses						221,717						29,940						—						(5,494)						246,163
Gain on disposal of assets, net						237						—						—						—						237
Operating income						134,807						34,993						—						(13,986)						155,814
Non-operating income (expense):
Gain on derivatives, net						23,457						—						3,422			(g)			(1,027)			(h)			25,852
Gain on realized derivatives						—						328						(328)			(g)			—						—
Gain on unrealized derivatives						—						3,094						(3,094)			(g)			—						—
Interest expense						(30,770)						(1,509)						1,509			(c)			(6,582)			(i)			(37,352)
Gain on unrealized fair value of contingent consideration						—						52						—						(52)			(l)			—
Other income, net						854						—						—						—						854
Total non-operating income (expense), net						(6,459)						1,965						1,509						(7,661)						(10,646)
Income before income taxes						128,348						36,958						1,509						(21,647)						145,168
Income tax expense:
Current						(1,331)						—						—						—			(j)			(1,331)
Deferred						(276)						—						—						—						(276)
Total income tax expense						(1,607)						—						—						—						(1,607)
Net income						$	126,741					$	36,958					$	1,509					$	(21,647)					$	143,561
Net income per common share:
Basic						$	7.04																				(m)			$	7.97
Diluted						$	6.99																				(m)			$	7.92
Weighted-average common shares outstanding:
Basic						18,010																					(m)			18,010
Diluted						18,124																					(m)			18,124

3

Vital Energy, Inc.

Pro forma condensed combined statements of operations

For the twelve months ended December 31, 2022

(in thousands, except per share data)

(Unaudited)

						Historical												Transaction accounting adjustments
						Vital (adjusted for acquisition of Driftwood)						Forge						Conforming and reclass						Forge Acquisition						Pro forma combined
Revenues:
Oil sales						$	1,424,422					$	245,169					$	—					$	(73,551)		(h)			$	1,596,040
NGL sales						241,105						26,593						—						(7,978)			(h)			259,720
Natural gas sales						214,532						17,598						—						(5,279)			(h)			226,851
Sales of purchased oil						119,408						—						—						—						119,408
Other operating revenues						7,014						—						456			(a)			(137)			(h)			7,333
Other revenue						—						456						(456)			(a)			—						—
Total revenues						2,006,481						289,816						—						(86,945)						2,209,352
Costs and expenses:
Lease operating expenses						184,436						36,021						1,691			(e)			(11,313)			(h)			210,835
Geological and geophysical expenses						—						144						(144)			(b)			—						—
Production and ad valorem taxes						115,754						17,282						—						(5,185)			(h)			127,851
Transportation and marketing expenses						53,692						—						—						—						53,692
Workover expenses						—						1,691						(1,691)			(e)			—						—
Costs of purchased oil						122,118						—						—						—						122,118
General and administrative						71,415						1,576						—						(473)			(h)			72,518
Organizational restructuring expenses						10,420						—						—						—						10,420
Depletion, depreciation and amortization						330,847						—						45,273			(d)			(13,582)			(h)			369,324
																								6,786			(k)
Depletion and depreciation						—						45,273						(45,273)			(d)			—						—
Accretion expense						—						481						(481)			(f)			—						—
Impairment expense						40						—						—						—						40
Other operating expenses, net						8,695						—						481			(f)			(144)			(h)			8,846
																								(186)			(k)
Total costs and expenses						897,417						102,468						(144)						(24,097)						975,644
Loss on disposal of assets, net						(1,079)						—						—						—						(1,079)
Operating income						1,107,985						187,348						144						(62,848)						1,232,629
Non-operating income (expense):
Gain on sale of oil and natural gas properties						—						132						(132)			(b)			—						—
Loss on derivatives, net						(313,370)						—						(24,844)			(g)			7,453			(h)			(330,761)
Loss on realized derivatives						—						(41,892)						41,892			(g)			—						—
Gain on unrealized derivatives						—						17,048						(17,048)			(g)			—						—
Interest expense						(133,983)						(2,865)						2,865			(c)			(26,327)			(i)			(160,310)
Gain on unrealized fair value of contingent consideration						—						183						—						(183)			(l)			—
Loss on extinguishment of debt, net						(1,459)						—						—						—						(1,459)
Other income, net						2,155						—						—						—						2,155
Total non-operating income (expense), net						(446,657)						(27,394)						2,733						(19,057)						(490,375)
Income before income taxes						661,328						159,954						2,877						(81,905)						742,254
Income tax expense:
Current						(6,121)						—						—						—			(j)			(6,121)
Deferred						619						—						—						—						619
Total income tax expense						(5,502)						—						—						—						(5,502)
Net income						$	655,826					$	159,954					$	2,877					$	(81,905)					$	736,752
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						Historical												Transaction accounting adjustments
						Vital (adjusted for acquisition of Driftwood)						Forge						Conforming and reclass						Forge Acquisition						Pro forma combined
Net income per common share:
Basic						$	35.93																				(m)			$	40.37
Diluted						$	35.55																				(m)			$	39.94
Weighted-average common shares outstanding:
Basic						18,251																					(m)			18,251
Diluted						18,446																					(m)			18,446

5

Vital Energy, Inc.

Notes to Unaudited Pro Forma Condensed Combined Financial Information

1. Basis of Presentation

The accompanying unaudited pro forma condensed combined financial statements were prepared based on the historical consolidated financial statements of Vital, Forge and the Driftwood Entities. The Forge Acquisition has been accounted for as an asset acquisition in accordance with ASC 805. The fair value of the consideration paid by Xxxxx and allocation of that amount to the underlying assets acquired, on a relative fair value basis, will be recorded on Vital’s books as of the date of the closing of the Forge Acquisition. Additionally, costs directly related to the Forge Acquisition are capitalized as a component of the purchase price. Certain of Forge’s historical amounts have been reclassified to conform to the financial statement presentation of Vital. Additionally, adjustments have been made to Forge’s historical financial information to remove certain assets and liabilities retained by Forge.

The Unaudited Pro Forma Condensed Combined Statements of Operations for the Three Months Ended March 31, 2023 and the Year Ended December 31, 2022 were prepared assuming the Forge and Driftwood Acquisitions occurred on January 1, 2022. The Unaudited Pro Forma Condensed Combined Balance Sheet as of March 31, 2023 was prepared as if the Forge and Driftwood Acquisitions had occurred on March 31, 2023.

The unaudited pro forma condensed combined financial information and related notes are presented for illustrative purposes only. If the Forge and Driftwood Acquisitions and other transactions contemplated herein had occurred in the past, the Company’s operating results might have been materially different from those presented in the unaudited pro forma condensed combined financial information. The unaudited pro forma condensed combined financial information should not be relied upon as an indication of operating results that the Company would have achieved if the Forge and Driftwood Acquisitions and other transactions contemplated herein had taken place on the specified date. In addition, future results may vary significantly from the results reflected in the unaudited pro forma condensed combined financial statement of operations and should not be relied upon as an indication of the future results the Company will have after the contemplation of the Forge and Driftwood Acquisitions and the other transactions contemplated by the unaudited pro forma condensed combined financial information. In Vital’s opinion, all adjustments that are necessary to present fairly the unaudited pro forma condensed combined financial information have been made.

2.Consideration and Purchase Price Allocation

The preliminary allocation of the total purchase price in the Forge Acquisition is based upon management’s estimates and assumptions related to the fair value of assets to be acquired and liabilities to be assumed as of the closing date of the transaction using currently available information and market data. Because the unaudited pro forma condensed combined financial information has been prepared based on these preliminary estimates, the final purchase price allocation and the resulting effect on financial position and results of operations may differ significantly from the pro forma amounts included herein.

The preliminary purchase price allocation is subject to change due to several factors, including but not limited to changes in the estimated fair value of assets acquired and liabilities assumed as of the closing date of the transaction, which could result from changes in future oil and natural gas commodity prices, reserve estimates, interest rates, as well as other factors.

6

The consideration transferred and the relative fair value of assets acquired and liabilities assumed by Vital are as follows (in thousands, except share amounts and share stock price):

Consideration:
Cash consideration			$	378,000
Closing adjustments			13,586
Total cash consideration			$	391,586
Direct transaction costs			5,656
Total Consideration			$	397,242
Relative fair value of assets acquired:
Oil and natural gas properties:
Evaluated properties – full cost method			249,831
Unevaluated properties not being depleted – full cost method			153,110
Amount attributable to assets acquired			$	402,941
Fair value of liabilities assumed:
Asset retirement obligations			1,376
Undistributed revenue and royalties			4,323
Amount attributable to liabilities assumed			$	5,699

The fair value measurements of assets acquired and liabilities assumed are based on inputs that are not observable in the market and therefore represent Level 3 inputs. The fair value of oil and natural gas properties and asset retirement obligations were measured using the discounted cash flow technique of valuation.

Significant unobservable inputs included future commodity prices adjusted for differentials, projections of estimated quantities of recoverable reserves, forecasted production based on decline curve analysis, estimated timing and amount of future operating and development costs, and a weighted average cost of capital.

3.Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet and Unaudited Pro Forma Condensed Combined Statements of Operations

The unaudited pro forma condensed combined financial information has been compiled in a manner consistent with the accounting policies adopted by Xxxxx. Actual results may differ materially from the assumptions and estimates contained herein.

The pro forma adjustments are based on currently available information and certain estimates and assumptions that Xxxxx believes provide a reasonable basis for presenting the significant effects of the Forge Acquisition. General descriptions of the pro forma adjustments are provided below.

7

Unaudited Pro Forma Condensed Combined Balance Sheet

The following adjustments were made in the preparation of the Unaudited Pro Forma Condensed Combined Balance Sheet as of March 31, 2023:

(a)Adjustment to remove assets and liabilities not acquired as part of the Forge Acquisition.                                                    

(b)Adjustment to eliminate the historical book value and accumulated depreciation, depletion and amortization of Forge's oil and natural gas properties as of March 31, 2023.                                                    

(c)Adjustment to reflect the total cash consideration paid for the Forge Acquisition.                                                                

(d)Adjustment to reflect cash paid for the oil and natural gas properties acquired of Forge, on a relative fair value basis.                                                                                             

(e)Adjustment to reflect asset retirement obligations assumed with the Forge Acquisition.                                                    

(f)Adjustment for the payment of transaction costs incurred for the Forge Acquisition.                                                    

(g)Adjustment to record new borrowings under the Company's senior secured credit facility related to the cash consideration used in the Forge Acquisition.

(h)Adjustment to reflect revenues in suspense assumed with the Forge Acquisition.

8

Unaudited Pro Forma Condensed Combined Statements of Operations

The following adjustments were made in the preparation of the Unaudited Pro Forma Condensed Combined Statements of Operations for the Three Months Ended March 31, 2023, and the Year Ended December 31, 2022:

(a)Adjustments to conform Forge’s revenue presentation to the presentation of revenues for Vital.                                        

(b)Adjustment to remove geological and geophysical expense and gain on sale of oil and natural gas properties to align the presentation by Forge with the full cost method of accounting utilized by Vital.                                     

(c)Adjustment to remove Forge's historical interest expense prior to the Forge acquisition.                                                        

(d)Adjustments to conform Forge’s depletion and depreciation expense presentation to the presentation of depletion, depreciation and amortization expense for Vital.                                                         

(e)Adjustments to align the presentation of lease operating and workover expenses for Forge to the presentation by Xxxxx.

(f) Adjustment to conform Forge's historical accretion expense to the presentation by Xxxxx.

(g)Adjustment to conform Forge's historical realized loss on derivatives and unrealized gain on derivatives to the presentation by Vital.

(h)Adjustments necessary to remove the historical revenues, gains, expenses and losses associated with the 30% undivided interest acquired by NOG in the oil and natural gas properties of Forge.                                        

(i)Adjustment to reflect the estimated interest expense in the periods presented with respect to the incremental borrowings necessary to finance the Forge Acquisition. The interest rate utilized as of June 30, 2023, was 7.978% for incremental borrowings. A one-eighth percent increase or decrease in the interest rate would have changed interest expense by $0.1 million and $0.4 million, respectively, for the three months ended March 31, 2023 and year ended December 31, 2022.

(j)Vital has not reflected any estimated tax impact related to the Forge Acquisition in the accompanying unaudited pro forma condensed combined statement of operations for the three months ended March 31, 2023 and year-end December 31, 2022 as it does not anticipate the impact to be material due to the Company’s net operating loss carryforwards. As of March 31, 2023, and December 31, 2022, the Company had a full valuation allowance against its federal and Oklahoma net deferred tax assets.                                                         

(k)Represents depreciation, depletion, and amortization expense resulting from the change in basis of property and equipment acquired and accretion expense from new asset retirement obligations recognized as a result of the Forge Acquisition. The depletion expense adjustment was calculated using the unit-of-production method under the full cost method of accounting using estimated proved reserves and production volumes attributable to the acquired assets.                                                        

(l)Adjustment to remove the gain on unrealized fair value of contingent consideration, which was not acquired as part of the Driftwood Acquisition.

(m)Table provides reconciliation between basic and diluted net income for the three months ended March 31, 2023 and year ended December 31, 2022.

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						Three Months Ended												Year Ended
						March 31, 2023												December 31, 2022
						Vital (adjusted for acquisition of Driftwood)						Pro-Forma						Vital (adjusted for acquisition of Driftwood)						Pro-Forma
Net income						$	126,741					$	143,197					$	655,826					$	735,502
Weighted-average common shares     outstanding:
Basic						18,010						18,010						18,251						18,251
Dilutive non-vested restricted stock						114						114						183						183
Dilutive non-vested performance awards						—						—						12						12
Diluted						18,124						18,124						18,446						18,446
Net income per share
Basic						$	7.04					$	7.95					$	35.93					$	40.30
Diluted						$	6.99					$	7.90					$	35.55					$	39.87

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Supplemental Unaudited Pro Forma Combined Oil and Natural Gas Reserves and Standardized Measure Information

The following tables set forth information with respect to the historical and pro forma combined estimated oil and natural gas reserves as of December 31, 2022 for Vital, Forge and the Driftwood Entities. The reserve information of Vital, Forge and the Driftwood Entities have been prepared by independent petroleum engineers Xxxxx Xxxxx Company, L.P. and Netherland, Xxxxxx & Associates, Inc., respectively. The following unaudited pro forma combined proved reserve information is not necessarily indicative of the results that might have occurred had the Forge and Driftwood Acquisitions taken place on January 1, 2022, nor is it intended to be a projection of future results. The accuracy of any reserve estimate is a function of the quality of available data and of engineering and geological interpretation and judgment. Periodic revisions or removals of estimated reserves and future cash flows may be necessary as a result of a number of factors, including reservoir performance, new drilling, crude oil and natural gas prices, changes in costs, technological advances, new geological or geophysical data, changes in business strategies, or other economic factors. Accordingly, proved reserve estimates may differ significantly from the quantities of crude oil and natural gas ultimately recovered. For Vital, Forge and Driftwood, the reserve estimates shown below were determined using the average first day of the month price for each of the preceding 12 months for oil and natural gas for the year ended December 31, 2022.

Estimated oil and natural gas reserves
						As of December 31, 2022
						Vital (adjusted for acquisition of Driftwood)						Forge						Transaction Adjustment1						Pro forma combined
Estimated proved developed reserves:
Oil (MBbl)						77,654						18,500						(5,550)						90,604
Natural gas (MMcf)						481,907						38,900						(11,670)						509,137
Natural gas liquids (MBbl)						79,659						6,065						(1,820)						83,904
Total equivalent reserves (Mboe)2						237,631						31,048						(9,315)						259,364
Estimated proved undeveloped reserves:
Oil (MBbl)						54,118						29,362						(8,809)						74,671
Natural gas (MMcf)						102,916						43,186						(12,956)						133,146
Natural gas liquids (MBbl)						22,659						7,444						(2,233)						27,870
Total equivalent reserves (Mboe)2						93,930						44,004						(13,201)						124,733
Estimated proved reserves:
Oil (MBbl)						131,772						47,862						(14,359)						165,275
Natural gas (MMcf)						584,823						82,086						(24,626)						642,283
Natural gas liquids (MBbl)						102,318						13,509						(4,053)						111,774
Total equivalent reserves (Mboe)2						331,561						75,052						(22,516)						384,097

______________________________________________________________________________

(1)Adjustment necessary to remove the historical reserves associated with the 30% undivided interest acquired by NOG in the oil and natural gas properties of Forge.

(2)BOE is calculated using a conversion rate of six Mcf per one Bbl.

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The following table presents the standardized measure of discounted future net cash flows relating to the proved crude oil and natural gas reserves of Vital and of the properties acquired in the Forge and Driftwood Acquisitions on a pro forma combined basis as of December 31, 2022. The pro forma combined standardized measure shown below represents estimates only and should not be construed as the market value of either Forge and Driftwood’s crude oil and natural gas reserves or the acquired crude oil and natural gas reserves attributable to the Forge and Driftwood Acquisitions.

Standardized measure of discounted future cash flows
(in thousands)
						As of December 31, 2022
						Vital (adjusted for acquisition of Driftwood)						Forge						Transaction Adjustment1						Pro forma combined
Oil and natural gas producing activities:
Future cash inflows						$	18,180,656					$	5,312,733					$	(1,593,820)					$	21,899,569
Future production costs						(4,548,992)						(1,558,892)						467,668						(5,640,216)
Future development costs						(1,581,734)						(718,183)						215,455						(2,084,462)
Future income tax expense						(1,597,322)						(27,892)						8,367						(1,616,847)
Future net cash flows						10,452,608						3,007,766						(902,330)						12,558,044
10% discount for estimated timing of cash flows						(5,102,640)						(1,625,916)						487,775						(6,240,781)
Standardized measure of discounted future net cash flows						$	5,349,968					$	1,381,850					$	(414,555)					$	6,317,263

______________________________________________________________________________

(1)Adjustment necessary to remove the historical reserves associated with the 30% undivided interest acquired by NOG in the oil and natural gas properties of Forge.

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The following table sets forth the changes in the standardized measure of discounted future net cash flows attributable to estimated net proved crude oil and natural gas reserves of Vital, Forge and Driftwood on a pro forma combined basis for the year ending December 31, 2022:

Changes in standardized measure of discounted future net cash flows
(in thousands)
						As of December 31, 2022
						Vital (adjusted for acquisition of Driftwood)						Forge						Transaction Adjustment1						Pro forma combined
Standardized measure of discounted future net cash flows, beginning of year						$	3,761,476					$	755,289					$	(226,587)					$	4,290,178
Changes in the year resulting from:
Sales, less production costs						(1,539,420)						(237,004)						71,101						(1,705,323)
Revisions of previous quantity estimates						(100,821)						137,551						(41,265)						(4,535)
Extensions, discoveries and other additions						932,840						128,465						(38,540)						1,022,765
Net change in prices and production costs						2,644,586						568,672						(170,602)						3,042,656
Changes in estimated future development costs						(182,371)						(80,028)						24,008						(238,391)
Previously estimated development incurred capital expenditures during the period						275,721						60,780						(18,234)						318,267
Acquisitions of reserves in place						—						13,061						(3,918)						9,143
Divestitures of reserves in place						(122,501)						—						—						(122,501)
Accretion of discount						405,513						76,314						(22,894)						458,933
Net change in income taxes						(420,556)						(5,411)						1,623						(424,344)
Timing differences and other						(304,499)						(35,839)						10,753						(329,585)
Standardized measure of discounted future net cash flows, end of year						$	5,349,968					$	1,381,850					$	(414,555)					$	6,317,263

______________________________________________________________________________

(1)Adjustment necessary to remove the historical reserves associated with the 30% undivided interest acquired by NOG in the oil and natural gas properties of Forge.

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