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What changed in AleAnna, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of AleAnna, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+431 added−414 removedSource: 10-K (2026-03-31) vs 10-K (2025-03-31)

Top changes in AleAnna, Inc.'s 2025 10-K

431 paragraphs added · 414 removed · 313 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

101 edited+16 added−26 removed156 unchanged
Biggest changeRenewable Natural Gas The permitting framework provided by the Legislative Decree No. 28/2011 requires for the construction and operation of biomethane production facilities and related modification projects: ● the “notification” to the competent authority for the modifications are non-substantial; ● the “Simplified Authorization Procedure” (“S.A.P.”): a) “for new facilities with a production capacity, as defined in accordance with Article 21, paragraph 2, not exceeding 500 standard cubic meters/hour; a-bis) for partial or complete reconversion to biomethane production of power generation facilities fueled by biogas, landfill gas or residual gas from purification processes; a-ter) for developments on operating biomethane production facilities that do not result in an increase in the area already subject to authorization, regardless of the resulting amount of biomethane fed into the grid as a result of such developments, subject to the following conditions: 1. in the case of grid-connected facilities, there is the willingness of the grid operator to inject the additional volumes resulting from the implementation of the developments; 2. the operations do not involve any changes in the types of matrices already authorized; 3. the nameplate of the upgrading system indicates the production capacity value resulting from the implementation of the developments; 4. any increase in areas dedicated to anaerobic digestion is no more than 50 percent of those already authorized.” ● the “Sole Authorization” (“S.A.”) in other cases.
Biggest changeRenewable Natural Gas The permitting framework provided by the Legislative Decree No. 190 of November 25, 2024 on “Regulation of administrative regimes for the production of energy from renewable sources, pursuant to Article 26, paragraphs 4 and 5, letters b) and d), of Law No. 118 of August 5, 2022.” requires for the construction and operation of biomethane production facilities and related modification projects: ● the “Simplified Authorization Procedure” (“S.A.P.”): a) “for new biomethane production facilities with a production capacity, not exceeding 500 standard cubic meters/hour; b) developments on operating biomethane production facilities that do not result in an increase in the area already modifications, including the strengthening, repowering, refurbishment, reactivation and reconstruction, even complete, of existing, authorized or licensed renewable energy plants for the production of electricity, with the exception of biomethane production plants, provided that they do not result in an increase in the area occupied by the existing plant of more than 20 percent; c) for partial or complete reconversion to biomethane production not exceeding 500 standard cubic meters/hour of power generation facilities fueled by biogas; d) for developments on operating biomethane production facilities that do not result in an increase in the area already subject to authorization, or in any changes in the types of matrices already authorized, subject to the following conditions: 1. the nameplate of the upgrading system indicates the production capacity value resulting from the implementation of the developments: in the case of grid-connected facilities, there is the willingness of the grid operator to inject the additional volumes resulting from the implementation of the developments; 2. in the case of grid-connected facilities, there is the willingness of the grid operator to inject the additional volumes resulting from the implementation of the developments; 3. the operations do not involve any changes in the types of matrices already authorized any increase in areas dedicated to anaerobic digestion is no more than 50 percent of those already authorized.” ● the “Sole Authorization” (“S.A.”) in other cases. 17 The application for the S.A. procedure, defined by article 9 of the Legislative Decree No. 190 of November 25, 2024, is submitted by the proponent to the competent region.
This system is based on the principle that network users have to balance their daily position, also in accordance with the timely information provided by the TSO about the daily gas consumption.
This system is based on the principle that network users have to balance their daily position, also in accordance with the timely information provided by the TSO about daily gas consumption.
In view of the above, we intend to pursue the above principles by committing to the following aims: ● manage activities in full compliance with current legislation and signed voluntary standards and agreements as well as national and international best practices, ensuring compliance obligations and assessment of risks and opportunities, consistent with the Code of Ethics, Corporate Model 231 and all HSE Policy regulations; ● ensure that each worker is aware of, responsible for, and participates in the company’s efforts to manage the aspects of occupational health and safety and environmental protection and quality assurance related to their activities, with the understanding that the responsible behavior of each person is a prerequisite for the success of the entire system; ● ensure the protection of workers’ health and safety by adopting the most advanced principles, national standards, organizational solutions, adopting safe and healthy working conditions, using materials and equipment with the least risk to health, safety and the environment for the elimination of hazards and minimization of risks, with a view to the prevention of accidents, injuries, occupational diseases and emergency situations; ● implement every effort in organizational, operational and technological terms to prevent water, air and soil pollution, minimizing, where technically possible, environmental impacts related to the company’s activities, with particular reference to the control of air emissions, water discharges, waste management, energy saving and recovery; ● support the conservation of natural resources with actions aimed at effective and efficient use of energy, minimizing the consumption of energy, water, and materials, also in the interest of future generations; ● involve and consult workers, including through their health, safety and environmental representatives; ● use qualified suppliers and promote their development according to the principles of this policy, committing them to maintain behavior consistent with it even when they operate outside the company; ● conduct periodic system audits, inspections, audits, and reviews to analyze performance, contextual factors, stakeholder needs, risks and opportunities, objectives, programs, and policy to assess their effectiveness and take consequent action to pursue the goal of continuous improvement; and ● putting in place actions to prevent any intentional or negligent event that may cause actual or potential harm to persons and tangible and intangible assets of the company. 19 Government Funding and Other Forms of Support Conventional Natural Gas Recently, due to the increased importance of energy security, the Italian Government adopted measures to promote domestic production and accelerate the increase of local gas production.
In view of the above, we intend to pursue the above principles by committing to the following aims: ● manage activities in full compliance with current legislation and signed voluntary standards and agreements as well as national and international best practices, ensuring compliance obligations and assessment of risks and opportunities, consistent with the Code of Ethics, Corporate Model 231 and all HSE Policy regulations; ● ensure that each worker is aware of, responsible for, and participates in the company’s efforts to manage the aspects of occupational health and safety and environmental protection and quality assurance related to their activities, with the understanding that the responsible behavior of each person is a prerequisite for the success of the entire system; ● ensure the protection of workers’ health and safety by adopting the most advanced principles, national standards, organizational solutions, adopting safe and healthy working conditions, using materials and equipment with the least risk to health, safety and the environment for the elimination of hazards and minimization of risks, with a view to the prevention of accidents, injuries, occupational diseases and emergency situations; ● implement every effort in organizational, operational and technological terms to prevent water, air and soil pollution, minimizing, where technically possible, environmental impacts related to the company’s activities, with particular reference to the control of air emissions, water discharges, waste management, energy saving and recovery; ● support the conservation of natural resources with actions aimed at effective and efficient use of energy, minimizing the consumption of energy, water, and materials, also in the interest of future generations; ● involve and consult workers, including through their health, safety and environmental representatives; ● use qualified suppliers and promote their development according to the principles of this policy, committing them to maintain behavior consistent with it even when they operate outside the company; ● conduct periodic system audits, inspections, audits, and reviews to analyze performance, contextual factors, stakeholder needs, risks and opportunities, objectives, programs, and policy to assess their effectiveness and take consequent action to pursue the goal of continuous improvement; and ● putting in place actions to prevent any intentional or negligent event that may cause actual or potential harm to persons and tangible and intangible assets of the company. 20 Government Funding and Other Forms of Support Conventional Natural Gas Recently, due to the increased importance of energy security, the Italian Government adopted measures to promote domestic production and accelerate the increase of local gas production.
On October 29, 2024, we entered into a Gas Sales Agreement (“GSA”) with Shell Energy Europe Ltd (“SEEL”), whereby SEEL became the exclusive buyer of our share of the natural gas produced from the Longanesi field net of (i) any consumption and/or losses incurred in the transport, treatment and compression of gas before delivery; (ii) any volume to be allocated for regulated royalties auctions, if applicable; and (iii) any other volume contractually allocated to other parties before August 31, 2022.
On October 29, 2024, we entered into a Gas Sales Agreement (“GSA”) with Shell Energy Europe Ltd, whereby SEEL became the exclusive buyer of our share of the natural gas produced from the Longanesi field net of (i) any consumption and/or losses incurred in the transport, treatment and compression of gas before delivery; (ii) any volume to be allocated for regulated royalties auctions, if applicable; and (iii) any other volume contractually allocated to other parties before August 31, 2022.
In this regard, we are committed to: ● carrying out our activities in compliance with current laws on occupational health and safety prevention, environment and current regulations with impact on quality aspects and voluntarily subscribed standards; ● promote activities that can directly or indirectly ensure: the protection and preservation of occupational health and safety, the environment, biodiversity and ecosystems, including in the interest of future generations; ● consider prevention in occupational health and safety and environment a goal of at least equal importance to profitability and productivity; ● protect the health and welfare and promote the occupational safety of all persons directly or indirectly involved in its operations; 18 ● pursue excellence in behavior and continuous improvement in occupational health and safety and accident prevention, in environmental protection and preservation; ● ensure the centrality of the individual by fostering consultation the participation of workers and other stakeholders and ensure the sharing of experience and knowledge; ● design, implement and manage each activity taking into account the need to ensure the protection of the health and safety of employees and third parties, the protection of the environment and public safety; ● promote the use of natural gas in a safe, efficient and environmentally friendly manner; and ● train staff and exchange information and knowledge, which are considered fundamental tools for achieving health, safety, environmental and public safety objectives, with a view to continuous improvement.
In this regard, we are committed to: ● carrying out our activities in compliance with current laws on occupational health and safety prevention, environment and current regulations with impact on quality aspects and voluntarily subscribed standards; ● promote activities that can directly or indirectly ensure: the protection and preservation of occupational health and safety, the environment, biodiversity and ecosystems, including in the interest of future generations; ● consider prevention in occupational health and safety and environment a goal of at least equal importance to profitability and productivity; 19 ● protect the health and welfare and promote the occupational safety of all persons directly or indirectly involved in its operations; ● pursue excellence in behavior and continuous improvement in occupational health and safety and accident prevention, in environmental protection and preservation; ● ensure the centrality of the individual by fostering consultation the participation of workers and other stakeholders and ensure the sharing of experience and knowledge; ● design, implement and manage each activity taking into account the need to ensure the protection of the health and safety of employees and third parties, the protection of the environment and public safety; ● promote the use of natural gas in a safe, efficient and environmentally friendly manner; and ● train staff and exchange information and knowledge, which are considered fundamental tools for achieving health, safety, environmental and public safety objectives, with a view to continuous improvement.
The regulation criteria for gas transportation tariffs in Italy have recently been redefined for the four-year period 2024-2027, but the re-definition of transportation tariffs criteria at pre-established deadlines, as well as the timely definition on an annual basis of the specific applicable tariff values, is an element that all European countries have in common and which in the future could determine impacts on logistic costs. 15 Moreover, the energy crisis scenario that materialized in 2022 has directed legislators, at European and individual country level, towards evolutions of the legislation and the consequent regulations that can impact the market dynamics, with the aim of containing prices for end customers and improve the security of supplies (e.g. possible obligations to reduce final consumption, caps on prices of derivatives on wholesale gas products traded on regulated markets, possible storage obligations, obligations of ex-ante notification to the European Commission concerning new supply contracts).
The regulation criteria for gas transportation tariffs in Italy have recently been redefined for the four-year period 2024-2027, but the re-definition of transportation tariffs criteria at pre-established deadlines, as well as the timely definition on an annual basis of the specific applicable tariff values, is an element that all European countries have in common and which in the future could determine impacts on logistic costs. 16 Moreover, the energy crisis scenario that materialized in 2022 has directed legislators, at European and individual country level, towards evolutions of the legislation and the consequent regulations that can impact the market dynamics, with the aim of containing prices for end customers and improve the security of supplies (e.g. possible obligations to reduce final consumption, caps on prices of derivatives on wholesale gas products traded on regulated markets, possible storage obligations, obligations of ex-ante notification to the European Commission concerning new supply contracts).
The certificate has a market value since fossil fuel marketers have to sell a minimum percentage of biofuels annually, for which they receive the same Certificates. In order to access to incentives, producers must comply with legal and technical regulations governing the quality and certification of the produced biomethane, verified by the competent Authority (Gestore dei Servizi Energetici, GSE).
The certificate has a market value since fossil fuel marketers have to sell a minimum percentage of biofuels annually, for which they receive the same certificates. In order to access to incentives, producers must comply with legal and technical regulations governing the quality and certification of the produced biomethane, verified by the competent Authority (Gestore dei Servizi Energetici SpA, GSE).
Our Longanesi, Trava and Gradizza wells are classified by DeGolyer as proved undeveloped reserves as such wells have not yet started production and require future investments to install production pipelines and production facilities prior to being fully completed and producible. On May 28, 2024, we reached a settlement agreement (the “Blugas Settlement Agreement”) with Blugas Infrastructure S.r.l.
Our Trava and Gradizza wells are classified by DeGolyer as proved undeveloped reserves as such wells have not yet started production and require future investments to install production pipelines and production facilities prior to being fully completed and producible. On May 28, 2024, we reached a settlement agreement (the “Blugas Settlement Agreement”) with Blugas Infrastructure S.r.l.
The reference legislation for issuing the exploration permit is the following: ● art. 8 “Granting of permits”, paragraph 1, of the Presidential Decree. 18 April 1994, n. 484 “Regulation governing the procedures for awarding prospecting or exploration and granting concessions for the production of hydrocarbons on land and at sea”; ● art. 6 “Awarding of the exploration permit, its dimensions and duration”, paragraph 4, of law 9 January 1991, n. 9 “Regulations for the implementation of the new national energy plan: institutional aspects, hydroelectric plants and power lines, hydrocarbons and geothermal energy, self-production and tax provisions”; ● for onshore, art. 1, paragraph 7, letter n) of law 239/2004 “Reorganization of the energy sector, as well as delegation to the Government for the reorganization of the provisions in force on energy”. ● The exploration permit is issued following a single procedure, governed by article 1 paragraphs 77 and 79 of law 23 August 2004, n. 239 and subsequent amendments.
The reference legislation for issuing the exploration permit is the following: ● art. 8 “Granting of permits”, paragraph 1, of the Presidential Decree. 18 April 1994, n. 484 “Regulation governing the procedures for awarding prospecting or exploration and granting concessions for the production of hydrocarbons on land and at sea”; ● art. 6 “Awarding of the exploration permit, its dimensions and duration”, paragraph 4, of law 9 January 1991, n. 9 “Regulations for the implementation of the new national energy plan: institutional aspects, hydroelectric plants and power lines, hydrocarbons and geothermal energy, self-production and tax provisions”; ● for onshore, art. 1, paragraph 7, letter n) of law 23 August 2004 n. 239 “Reorganization of the energy sector, as well as delegation to the Government for the reorganization of the provisions in force on energy”. ● The exploration permit is issued following a single procedure, governed by article 1 paragraphs 77 and 79 of law 23 August 2004, n. 239.
In addition to an initial three-year validation period, there are two possible extension periods of three years each. However, such periods may be subject to suspension for justified reasons. The exploration permit allows the acquisition of geophysical data as well as the permission to drill one or more exploratory wells.
In addition to an initial six-year validation period, there are two possible extension periods of three years each. However, such periods may be subject to suspension for justified reasons. The exploration permit allows the acquisition of geophysical data as well as the permission to drill one or more exploratory wells.
Periodically, our technical team meets with DeGolyer to review properties and discuss methods and assumptions used by us to prepare reserve estimates. DeGolyer is an independent petroleum engineering and geological services firm. The independent evaluation of reserves referenced herein has been supervised by Mr. Regnald A.
Periodically, our technical team meets with DeGolyer to review properties and discuss methods and assumptions used by us to prepare reserve estimates. 7 DeGolyer is an independent petroleum engineering and geological services firm. The independent evaluation of reserves referenced herein has been supervised by Mr. Regnald A.
Our workforce is concentrated in Texas and Italy (principally in the Rome and Milan areas). The working relationship for employees in Italy is regulated by the pertaining collective work agreement, which provides for the basic standard conditions applicable depending on the employee’s level of seniority. In Italy, levels of welfare and social security are guaranteed.
Our workforce is concentrated in Italy (principally in the Rome and Milan areas). The working relationship for employees in Italy is regulated by the pertaining collective work agreement, which provides for the basic standard conditions applicable depending on the employee’s level of seniority. In Italy, levels of welfare and social security are guaranteed.
Our Business Strategies Conventional Natural Gas Business We intend to leverage the technical and operational expertise of our management team, particularly with the use of 3D seismic and Direct Hydrocarbon Indicators (“DHIs”), to achieve attractive success rates and growth of reserves, production and cash flow.
Our Business Strategies Conventional Natural Gas Business We leverage the technical and operational expertise of our management team, particularly with the use of 3D seismic and Direct Hydrocarbon Indicators (“DHIs”), to achieve attractive success rates and growth of reserves, production and cash flow.
However, they can be taken into account if certified as low-ILUC risk ii) biomethane support schemes — as defined by the Ministerial Decree of March 2, 2018 — have been updated iii) Recycled Carbon Fuels count as renewable towards the general target, on the basis of the upcoming EU delegated acts and iv) confirms the use of some wastes as feedstock for the production of biofuels. 17 Occupational Health, Safety and Environment Legislation Our activity is subject to Italian and European legislation on environmental protection and safety in the workplace.
However, they can be taken into account if certified as low-ILUC risk (ii) biomethane support schemes — as defined by the Ministerial Decree of March 2, 2018 — have been updated (iii) Recycled Carbon Fuels count as renewable towards the general target, on the basis of the upcoming EU delegated acts and (iv) confirms the use of some wastes as feedstock for the production of biofuels. 18 Occupational Health, Safety and Environment Legislation Our activity is subject to Italian and European legislation on environmental protection and safety in the workplace.
We believe the following factors are key to achieving these goals: ● the use of industry-leading technologies and techniques to significantly increase the probability of drilling success; ● a robust natural gas price environment, with current takeaway prices of approximately $10-$15 per (10 3 ft 3 ), which are approximately 3-4 times the current Henry Hub spot price; ● geographically advantaged developments that are adjacent to a well-developed pipeline network containing large excess transport capacity; ● relatively low-cost, low-risk, onshore operations through which our natural gas can be brought to market at costs of approximately $1-3 per 10 3 ft 3 ; ● short expected payout periods and high expected rates of return on developments, supported by high quality, high flow rate, reservoirs, and a low combined federal and regional royalty regime (10%); ● nimble operating model with a focus on utilizing outsourced resources to control costs; and ● proactive relationships with larger enterprises (like Shell and Eni Ecofuels (“Eni”)) to further our marketing and potential hedging strategies, and to support our ongoing conventional natural gas exploration and development aspirations. 2 Renewable Natural Gas Business We intend to develop and grow our renewable natural gas business through the acquisition of operational Anaerobic Digesters (or “AD’s”) and their conversion to biomethane facilities.
We believe the following factors are key to achieving these goals: ● the use of industry-leading technologies and techniques to significantly increase the probability of drilling success; ● a robust natural gas price environment, with current takeaway prices of approximately $10-$15 per (10 3 ft 3 ), which are approximately 3-4 times the current Henry Hub spot price; ● geographically advantaged developments that are adjacent to a well-developed pipeline network containing large excess transport capacity; ● relatively low-cost, low-risk, onshore operations through which our natural gas can be brought to market at costs of approximately $1-3 per 10 3 ft 3 ; ● short expected payout periods and high expected rates of return on developments, supported by high quality, high flow rate, reservoirs, and a low combined federal and regional royalty regime (10%); ● nimble operating model with a focus on utilizing outsourced resources to control costs; and ● proactive relationships with larger enterprises (like Shell and Eni) to further our marketing and potential hedging strategies, and to support our ongoing conventional natural gas exploration and development aspirations. 2 Renewable Natural Gas Business We are working to develop and grow our renewable natural gas business through the acquisition of operational Anaerobic Digesters (or “AD’s”) and their conversion to biomethane facilities.
In addition, since February 2018 voluntary market making activity has been introduced in the spot section of the gas exchange MGAS: such activity is based on the service provided by some liquidity providers, in order to boost liquidity and trading activity on the same exchange, initially for the day-ahead market but with possible future extension to the within-day section and to the forward section of the MGAS. 14 In addition, a gas balancing regime has entered into force since October 2016 as an evolution of the one already in place and in compliance with the EU regulatory framework.
In addition, since February 2018 voluntary market making activity has been introduced in the spot section of the gas exchange MGAS: such activity is based on the service provided by some liquidity providers, in order to boost liquidity and trading activity on the same exchange, initially for the day-ahead market but with possible future extension to the within-day section and to the forward section of the MGAS. 15 In addition, a gas balancing regime has entered into force since October 2016 as an evolution of the one already in place and in compliance with the EU regulatory framework.
The Decrees provide incentives for biogas facilities that are converted to biomethane production. The incentive consists in an allocation of a Certificate (CIC) for every 10 Gcal of biomethane produced and partial subsidies on investments on biomethane facilities.
The Decrees provide incentives for biogas facilities that are converted to biomethane production. The incentive consists in an allocation of a certificate for every 10 Gcal of biomethane produced and partial subsidies on investments on biomethane facilities.
As per Legislative Decree No. 625 of November 25, 1996, subsequent modifications and integrations (the last modification was introduced by Law 160/2019 — Budget Law 2020, art. 1 par. 736 & 737) and Law Decree No. 83 of June 22, 2012, royalties are equal to 10% for gas and oil productions onshore, to 10% for gas and 7% for oil offshore, with exemptions only for on shore gas concessions with production lower than 10 Msmc/year and off shore gas concessions with production lower than 30 Msmc.
As per Legislative Decree No. 625 of November 25, 1996, subsequent modifications and integrations (the last modification was introduced by Law 160/2019 — Budget Law 2020, art. 1 par. 736 & 737) and Law Decree No. 83 of June 22, 2012, royalties are equal to 10% for gas and oil productions onshore, to 10% for gas and 7% for oil offshore, with exemptions only for on shore gas concessions with production lower than 10 MMsmc/year and off shore gas concessions with production lower than 30 MMsmc.
Overview AleAnna is a development-stage natural gas resource company focused on delivering critical natural gas supplies to Europe through both onshore conventional natural gas exploration and development and renewable natural gas development in Italy.
Overview AleAnna is a natural gas resource company focused on delivering critical natural gas supplies to Europe through both onshore conventional natural gas exploration and development and renewable natural gas development in Italy.
The Blugas Settlement Agreement was accounted for as an acquisition of the Blugas ORRI claim with a corresponding increase to the expected future cash flows from our reserves.
The Blugas Settlement was accounted for as an acquisition of the Blugas ORRI claim with a corresponding increase to the expected future cash flows from our reserves.
However, to date, these players have not competed as full owner-operators. Raw Materials and Suppliers Conventional Natural Gas AleAnna has access to numerous sources of oilfield supplies and services in Italy, and we will use specific vendors on each project based upon a combination of availability, cost-effectiveness, availability of specific equipment, and performance reputation.
However, to date, these players have not competed as full owner-operators. Raw Materials and Suppliers Conventional Natural Gas We have access to numerous sources of oilfield supplies and services in Italy, and we will use specific vendors on each project based upon a combination of availability, cost-effectiveness, availability of specific equipment, and performance reputation.
We also retain wholly-owned concessions, permits, and pending applications on other exploration and development prospects across Italy which are supported by proprietary modern 3D seismic reservoir imaging. In 2021, we launched a renewable natural gas development business focused on bringing to market carbon negative renewable natural gas derived from animal and agricultural waste.
We also retain wholly-owned concessions, permits, and pending applications on other exploration and development prospects across Italy which are supported by proprietary modern 3D seismic reservoir imaging. In 2023, we launched a renewable natural gas development business focused on bringing to market carbon negative renewable natural gas derived from animal and agricultural waste.
Reserve Information Preparation of Reserve Estimates Our reserve estimates as of December 31, 2024 and 2023 included herein are based on reports prepared by DeGolyer, our independent reserve engineer, in accordance with generally accepted petroleum engineering and evaluation principles and definitions and guidelines established by the SEC in effect at such time.
Reserve Information Preparation of Reserve Estimates Our reserve estimates as of December 31, 2025 and 2024 included herein are based on reports prepared by DeGolyer, our independent reserve engineer, in accordance with generally accepted petroleum engineering and evaluation principles and definitions and guidelines established by the SEC in effect at such time.
Our Operations Conventional Natural Gas Business We began studying Italian opportunities in 2007 and, over the last 15 years, have invested approximately $227 million to build a large asset base and exploration and development prospect inventory.
Our Operations Conventional Natural Gas Business We began studying Italian opportunities in 2007 and, over the last 15 years, have invested approximately $250 million to build a large asset base and exploration and development prospect inventory.
Until the plant assets are upgraded, the Company will actively source bio feedstocks for the assets in order to produce biomethane which will be processed through reciprocating generators in order to generate electricity which is then sold onto the grid through a metered interconnection.
Until the plant assets are upgraded, the Company will actively source bio feedstocks for the assets in order to produce biogas which will be processed through reciprocating generators in order to generate electricity which is then sold onto the grid through a metered interconnection.
See Note 17 to the financial statements included herein for further discussion of the preparation of, and year-over-year changes in, our reserves estimate and calculation of the standardized measure of estimated future net cash flows from natural gas and oil reserves .
See Note 16 to the financial statements included herein for further discussion of the preparation of, and year-over-year changes in, our reserves estimate and calculation of the standardized measure of estimated future net cash flows from natural gas and oil reserves .
Our Italian management team is housed in Rome, Italy-based offices. Our website is located at www.aleannainc.com. Leasing our facilities gives us the flexibility to expand or reduce our office space as appropriate.
Our Italian management team is housed in Rome and Milan, Italy-based offices. Our website is located at www.aleannainc.com. Leasing our facilities gives us the flexibility to expand or reduce our office space as appropriate.
The concession area that is functional for production and the research and development activities still to be carried out must also be duly taken into account, with the areas no longer functional being re-zoned.
The concession area that is functional for production and the exploration and development activities still to be carried out must also be duly taken into account, with the areas no longer functional being re-zoned.
As the cash outflows (costs) are no longer reflected as if paid to Blugas, such amounts are reflected in our December 31, 2024 reserve report as allocable to our unencumbered 33.5% working interest. 8 Present Value of Future Net Cash Flows Discounted at 10% The following table provides the estimated future net cash flows from proved reserves, the present value of those net cash flows discounted at a rate of 10% (PV-10) and the prices used in projecting net cash flows over the past two years.
As the cash outflows (costs) are no longer reflected as if paid to Blugas, such amounts are reflected in our December 31, 2025 reserve report as allocable to our unencumbered 33.5% working interest. 9 Present Value of Future Net Cash Flows Discounted at 10% The following table provides the estimated future net cash flows from proved reserves, the present value of those net cash flows discounted at a rate of 10% (PV-10) and the prices used in projecting net cash flows over the past two years.
Of the remaining $8.9 million, approximately $0.5 million represented prepaid directors and officers insurance premiums that were recorded to other assets in the consolidated balance sheeet, and $8.4 million represented legal, accounting, consulting and advisory fees that were recorded as Business Combination transaction expenses in the consolidated statement of operations and comprehensive loss.
Of the remaining $8.9 million, approximately $0.5 million represented prepaid directors and officers insurance premiums that were recorded to other assets in the consolidated balance sheet, and $8.4 million represented legal, accounting, consulting and advisory fees that were recorded as Business Combination transaction expenses in the consolidated statement of operations and comprehensive income (loss).
The two main types of mining titles are: (a) Exploration permits — exclusive mining titles that can be requested on areas with a maximum footprint of 750 km 2 . If multiple operators request the same area, MASE manages a competitive process to select the permit holder.
Mining titles are granted by a Decree of MASE. The two main types of mining titles are: (a) Exploration permits — exclusive mining titles that can be requested on areas with a maximum footprint of 750 km 2 . If multiple operators request the same area, MASE manages a competitive process to select the permit holder.
Once AleAnna initiates activation the respective net acres will have initial permit periods of six years. Upon each of the three-year extensions, 25% of the area under exploration must be relinquished to the State (only for initial acreage larger than 300 square kilometers).
Once we initiates activation the respective net acres will have initial permit periods of six years. Upon each of the three-year extensions, 25% of the area under exploration must be relinquished to the State of Italy (only for initial acreage larger than 300 square kilometers).
As a result, the EU has published very aggressive targets for biomethane development (with a goal of 30% of EU natural gas by 2030), and its member states, including Italy, are supporting development with high biomethane floor prices and capital investment incentive programs to aid in financing AD conversions to upgrade biogas production to biomethane. 6 Social and Environmental Preferences and Investor Pressures The effects of climate change, including extreme weather events, rising temperatures, and the increased health and socio-economic stability of at-risk populations, have emphasized the need to reduce GHGs and move toward reduced carbon energy solutions.
As a result, the EU has published very aggressive targets for biomethane development, and its member states, including Italy, are supporting development with high biomethane floor prices and capital investment incentive programs to aid in financing AD conversions to upgrade biogas production to biomethane. 6 Social and Environmental Preferences and Investor Pressures The effects of climate change, including extreme weather events, rising temperatures, and the increased health and socio-economic stability of at-risk populations, have emphasized the need to reduce GHGs and move toward reduced carbon energy solutions.
AleAnna is headquartered in Dallas, Texas, and has offices in Rome, Italy. 1 Business Combination On December 13, 2024, we consummated the previously announced business combination pursuant to the Merger Agreement, dated June 4, 2024, by and among Swiftmerge, HoldCo, Swiftmerge Merger Sub LLC, a Delaware limited liability company and wholly-owned subsidiary of HoldCo, and AleAnna Energy.
AleAnna is headquartered in Dallas, Texas, and has offices in Rome and Milan, Italy. 1 Business Combination On December 13, 2024, we consummated the previously announced business combination pursuant to the Agreement and Plan of Merger, as amended, dated June 4, 2024, by and among Swiftmerge, HoldCo, Swiftmerge Merger Sub LLC, a Delaware limited liability company and wholly-owned subsidiary of HoldCo, and AleAnna Energy.
Our portfolio is largely comprised of a group of three discoveries, one developed (Longanesi) and two currently awaiting regulatory approval (Gradizza, and Trava), surrounded by an additional 13 development and exploration prospects within the Longanesi and Ponte dei Grilli “Clusters” that are at various stages of permitting and are supported by proprietary 3D seismic surveys.
Our portfolio is largely comprised of a group of three discoveries, one developed (Longanesi), one currently awaiting regulatory approval (Trava), and one which recently received approval (Gradizza), surrounded by an additional 13 development and exploration prospects within the Longanesi and Ponte dei Grilli “Clusters” that are at various stages of permitting and are supported by proprietary 3D seismic surveys.
We have existing facilities and/or land under construction for renewable natural gas at the Campagnatico plant (Tuscany) and, following successful acquisition, in short order, we expect to begin upgrading construction on the Fattoria Delle Jersey plant (near Milan). Legal Proceedings We do not have any claims, lawsuits or proceedings currently pending against us, individually or in the aggregate.
We have existing facilities and/or land under construction for renewable natural gas at the Campagnatico plant (Tuscany) and, following a successful acquisition, we expect to begin upgrading construction on the Casalino (Fattoria Delle Jersey) plant near Milan. Legal Proceedings We do not have any claims, lawsuits or proceedings currently pending against us, individually or in the aggregate.
In addition, the fields in question must have the potential to produce a certain amount of gas reserves above a threshold of 500 mmscfd. 13 Regardless of the validity and the effects of PiTESAI, such plan did not entail any significant and adverse consequence on AleAnna’s development and producing activities in relation to its Italian concessions and concession applications.
In addition, the fields in question must have the potential to produce a certain amount of gas reserves above a threshold of 500 mmscfd. 14 Regardless of the validity and the effects of PiTESAI, such plan did not entail any significant and adverse consequence on our development and producing activities in relation to its Italian concessions and concession applications.
The initial duration of a production concession is 20 years, with the possibility of obtaining a ten-year extension and additional five-year extensions until the end of the field economic life. 12 These provisions had to be coordinated with a new law effective as of February 12, 2019 (Law 12/2019, conversion of Decree-Law 135/2008 — “D.L.
The initial duration of a production concession is up to 30 years, with the possibility of obtaining a ten-year extension and additional five-year extensions until the end of the field economic life. 13 These provisions had to be coordinated with a new law effective as of February 12, 2019 (Law 12/2019, conversion of Decree-Law 135/2008 — “D.L.
We are concentrating our acquisition efforts on Brownfield Facilities in the Po Valley of northern Italy, but will seek other profitable facilities, including Greenfields, as circumstances warrant. On March 20, 2024, we closed the acquisition of the Campagnatico Greenfield natural gas facility in Tuscany, Italy for €2,000,000, or approximately $2,150,000.
We are concentrating our acquisition efforts on Brownfield Facilities in the Po Valley of northern Italy, but will seek other profitable facilities, including greenfields, as circumstances warrant. On March 20, 2024, we closed the acquisition of the Campagnatico Greenfield natural gas facility in Tuscany, Italy for €2.0 million, or approximately $2.2 million.
According to our independent third-party reserve engineer, DeGolyer, these clusters contain approximately 17.6 (10 6 ft 3 ) of proved recoverable natural gas net to us primarily related to our working interest in the Longanesi field but do not include the additional development prospects we have identified and likely intend to drill in the near future.
According to our independent third-party reserve engineer, DeGolyer, these clusters contain approximately 25.8 (10 9 ft 3 ) of proved recoverable natural gas net to us primarily related to our working interest in the Longanesi field but do not include the additional development prospects we have identified and likely intend to drill in the near future.
Copies of the December 31, 2024 report is included as Exhibit 99.1 hereto. DeGolyer provides a variety of services to the oil and gas industry, including field studies, oil and gas reserve estimations, appraisals of oil and gas properties and exploration and development prospects and reserve reports for their clients.
A copy of the December 31, 2025 report is included as Exhibit 99.1 hereto. DeGolyer provides a variety of services to the oil and gas industry, including field studies, oil and gas reserve estimations, appraisals of oil and gas properties and exploration and development prospects and reserve reports for their clients.
However, the Italian government’s financial incentives and subsidies supporting these activities are set to expire in January 2025 absent additional government action and have been largely replaced by attractive biomethane capital and pricing incentives to stimulate conversion of these AD’s to the production of biomethane production.
However, the Italian government’s financial incentives and subsidies supporting these activities are set to expire in June 2027 absent additional government action and have been largely replaced by attractive biomethane capital and pricing incentives to stimulate conversion of these AD’s to the production of biomethane production.
Some permits where investments on exploration had been made were affected by the plan and part or all of their areas was declared incompatible. Since the PiTESAI was voided, AleAnna now hopes to be able to start again exploration activity on part of the areas declared incompatible by the PiTESAI.
Some permits where investments on exploration had been made were affected by the plan and part or all of their areas was declared incompatible. Since the PiTESAI was voided, we now hope to be able to start again exploration activity on part of the areas declared incompatible by the PiTESAI.
The volume-weighted average price attributable to the estimated proved reserves was $11.73 and $14.13 per thousand cubic feet of gas for the year ended December 31, 2024, and 2023, respectively. Future net cash flows represent projected revenues from the sale of proved reserves net of production and development costs (including transportation and gathering expenses, operating expenses and production taxes).
The volume-weighted average price attributable to the estimated proved reserves was $12.84 and $11.73 per thousand cubic feet of gas for the year ended December 31, 2025, and 2024, respectively. Future net cash flows represent projected revenues from the sale of proved reserves net of production and development costs (including transportation and gathering expenses, operating expenses and production taxes).
The initial duration of an exploration permit is six years, with the possibility of obtaining two three-year extensions and an additional one-year extension to complete activities underway. AleAnna has an active permit extension program in place.
The initial duration of an exploration permit is six years, with the possibility of obtaining two three-year extensions and an additional one-year extension to complete activities underway. We have an active permit extension program in place.
We believe that our highly experienced and credentialed management team, consisting of former executives of Shell, Eni, and Exxon, provides the company access to a best-in-class technology platform, an excellent in-country business development network, strong collaboration with Italian regulators, and experience with local regulatory processes.
We believe that our highly experienced and credentialed management team, consisting of former executives of Shell, Eni Ecofuels (“Eni”), Exxon, and other blue-chip companies, provides the company access to a best-in-class technology platform, an excellent in-country business development network, strong collaboration with Italian regulators, and experience with local regulatory processes.
Our year-end December 31, 2023 reserve quantities included the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ) allocable to the Blugas ORRI in its proved gas reserves. However, the required payments to Blugas associated with the sale of such quantities were reflected as cash outflows (costs) as if such amounts were paid to Blugas.
Our year-end December 31, 2024 reserve quantities included the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ) allocable to the Blugas ORRI in our proved gas reserves, however, the previously required payments to Blugas associated with the sale of such quantities are no longer reflected as cash outflows (costs) as if such amounts were paid to Blugas.
In the event that production is not established or if extensions are not granted by the Italian government, AleAnna’s permits will expire in December 31, 2026 and December 31, 2027. Applications are rights of mineral development controlled by AleAnna whose activation may be deferred. AleAnna has not yet initiated activation, but has the right to do so in the future.
In the event that production is not established or if extensions are not granted by the Italian government, our permits will expire on December 31, 2026 and December 31, 2027. Applications are rights of mineral development controlled by us whose activation may be deferred. we have not yet initiated activation, but has the right to do so in the future.
Productive Wells We did not have any productive wells as of December 31, 2024, 2023, or 2022. As of December 31, 2024, our Longanesi, Trava and Gradizza wells all required future investments to install production pipelines and production facilities prior to being fully completed and producible.
We did not have any productive wells as of December 31, 2024. As of December 31, 2025, our Trava and Gradizza wells all required future investments to install production pipelines and production facilities prior to being fully completed and producible.
Over the past 15 years, we have invested approximately $227 million in the acquisition and initial development of our properties, and we own a portfolio of conventional natural gas properties, including Longanesi, Gradizza, and Trava, containing approximately 17.6 (10 6 ft 3 ) net recoverable proved undeveloped natural gas reserves according to our independent third-party reserve engineer, DeGolyer & MacNaughton (“DeGolyer”).
Over the past 15 years, we have invested approximately $250 million in the acquisition and initial development of our properties, and we own a portfolio of conventional natural gas properties, including Longanesi, Gradizza, and Trava, containing approximately 25.8 (10 9 ft 3 ) net recoverable proved natural gas reserves according to our independent third-party reserve engineer, DeGolyer & MacNaughton (“DeGolyer”).
Prior to first production there are three major authorizations that must be obtained: (i) approval of the VIA by the Federal Ministry, (ii) authorization of the Production Concession from the Intesa, and (iii) authorization of the Production Concession from the Federal Ministry.
Prior to first production there are three major authorizations that must be obtained: (i) approval of the VIA by the Federal Ministry, (ii) authorization of the Production Concession by the Emilia Romagna Region (the “Intesa”), and (iii) authorization of the Production Concession from the Federal Ministry.
Royal Dutch Shell and Total remain significant producers of the legacy producing oils fields (principally Val’d Agri and Tempa Rossa in the southern part of the country) but are no longer active in Italian oil and gas exploration activities. 20 Renewable Natural Gas Competition in this rapidly emerging market space is not yet well-organized in Italy.
Royal Dutch Shell and Total remain significant producers of the legacy producing oils fields (principally Val’d Agri and Tempa Rossa in the southern part of the country) but are no longer active in Italian oil and gas exploration activities. 21 Renewable Natural Gas Competition in this rapidly emerging market space is still evolving in Italy.
Proved Undeveloped Reserves (10 6 ft 3 ) Balance at January 1, 2024 17,689 Revision of previous estimates Extensions, discoveries and other revisions (68 ) Balance at December 31, 2024 17,621 As of December 31, 2024 , we had no wells with proved undeveloped reserves that had remained undeveloped for more than five years from their time of booking.
Proved Undeveloped Reserves (10 6 ft 3 ) Balance at January 1, 2025 17,621 Revision of previous estimates Extensions, discoveries and other revisions (15,255 ) Balance at December 31, 2025 2,366 As of December 31, 2025 , we had no wells with proved undeveloped reserves that had remained undeveloped for more than five years from their time of booking.
Environmental laws and regulations and environmental permitting require significant investments from the company to ensure compliance with laws and regulations. This entails the need for a structure that constantly monitors compliance activities. Conventional Natural Gas Our operations are subject to stringent and complex laws and regulations governing environmental protection, human health and safety, and long-term “sustainability”.
This entails the need for a structure that constantly monitors compliance activities. Conventional Natural Gas Our operations are subject to stringent and complex laws and regulations governing environmental protection, human health and safety, and long-term “sustainability”.
Our PV-10 measure and the standardized measure of discounted future net cash flows do not purport to present the fair value of our oil and natural gas reserves. 9 The following table provides a reconciliation of the GAAP standardized measure of discounted future net cash flows to PV-10 (non-GAAP) at December 31, 2024 and 2023: Years Ended December 31, 2024 2023 (Thousands, unless otherwise noted) Standardized measure of discounted future net cash flows $ 89,033 $ 69,924 Present value of future income taxes discounted at a rate of 10% 18,169 32,748 Present value of net cash flows discounted at a rate of 10% (PV-10) $ 107,202 $ 102,672 Acreage The following table summarizes our acreage as of December 31, 2024 and 2023.
Our PV-10 measure and the standardized measure of discounted future net cash flows do not purport to present the fair value of our oil and natural gas reserves. 10 The following table provides a reconciliation of the GAAP standardized measure of discounted future net cash flows to PV-10 (non-GAAP) at December 31, 2025 and 2024: Years Ended December 31, 2025 2024 (Thousands, unless otherwise noted) Standardized measure of discounted future net cash flows $ 87,728 $ 89,033 Present value of future income taxes discounted at a rate of 10% 32,795 18,169 Present value of net cash flows discounted at a rate of 10% (PV-10) $ 120,523 $ 107,202 Acreage The following table summarizes our acreage as of December 31, 2025 and 2024.
Following settlement, our year-end December 31, 2024 reserve quantities continue to include the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ), however, the previously required payments to Blugas associated with the sale of such quantities are no longer reflected as cash outflows (costs) as if such amounts were paid to Blugas.
Our year-end December 31, 2024 reserve quantities included the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ) allocable to the Blugas ORRI in our proved gas reserves, however, the previously required payments to Blugas associated with the sale of such quantities are no longer reflected as cash outflows (costs) as if such amounts were paid to Blugas.
Future sales under the GSA are contingent upon the commencement of gas production. As of December 31, 2024, we have not derived revenue from its conventional natural gas business. Additionally, our renewable gas team has built a substantial backlog of acquisition targets we believe are poised to support rapid growth in the Italian bio-methane market.
Future sales under the GSA are contingent upon the commencement of gas production. As of December 31, 2025, we have derived $22.4 million of revenue from our conventional natural gas business. Additionally, our renewable gas team has built a substantial backlog of acquisition targets that we believe are poised to support rapid growth in the Italian biomethane market.
Examples of vendors we have used in the past and are likely to use for future operations include: Category Vendors Drilling rigs and laborers Pergemine SpA, LP Drilling Well logging and evaluation Schlumberger, Baker Hughes Well casing and cementing services Schlumberger, Baker Hughes Drill bits and downhole equipment Schlumberger, Baker Hughes Plant engineering and construction Saipem, Demont Srl Seismic acquisition Schlumberger, Doland Geophysical Purchase of existing Seismic Eni, CGG Seismic processing Tricon, CGG Seismic and well log interpretation software Schlumberger, S&P Global (IHS Markit) Drilling rigs and laborers Pergemine SpA, LP Drilling 21 Renewable Natural Gas AleAnna has had discussions with, and in some cases, entered into agreements with providers of investment opportunities, project developers, commodity traders for the supply of agricultural waste, bio-digester manufacturers, upgrading facility suppliers, and major marketing groups.
Examples of vendors we have used in the past and are likely to use for future operations include: Category Vendors Drilling rigs and laborers Pergemine SpA, LP Drilling Well logging and evaluation Schlumberger, Baker Hughes Well casing, cementing and completion services Schlumberger, Halliburton, Baker Hughes, Weatherford Drill bits and downhole equipment Schlumberger, Baker Hughes Plant engineering and construction Rosetti Marino, Max Streicher, Italfluid, TESI Seismic acquisition Geofizyka Torun, Geotec, Schlumberger, Doland Geophysical Purchase of existing Seismic Eni, CGG, Fugro Seismic processing Tricon, CGG Seismic and well log interpretation software Schlumberger, S&P Global (IHS Markit), GeoSoftware Well testing Schlumberger, Dajan, Italfluid, SMAPE 22 Renewable Natural Gas We have had discussions with, and in some cases, entered into agreements with providers of investment opportunities, project developers, commodity traders for the supply of agricultural waste, bio-digester manufacturers, upgrading facility suppliers, and major marketing groups.
As a result, as of December 31, 2024, our wells were classified by DeGolyer as proved undeveloped reserves as such wells had not yet started production. 10 Drilling Activities Our primary activities currently involve the tie-in of three Longanesi development wells together with our working interest partner, Padana.
As a result, as of December 31, 2025, five wells of Longanesi field were classified by DeGolyer as proved developed reserves. The remaining wells are classified as proved undeveloped reserves as such wells have not yet started production. Drilling Activities Our primary activities currently involve the tie-in of three Longanesi development wells together with our working interest partner, Padana.
Years Ended December 31, 2024 2023 (Thousands, unless otherwise noted) Future net cash flows (a) $ 130,333 $ 132,492 Present value of net cash flows discounted at a rate of 10% (b) 107,202 102,672 Prices Natural gas price ($/10 3 ft 3 ) (c) $ 11.73 $ 14.13 (a) Future net cash flows represent future cash flows which are reduced by estimated production costs, administrative costs, costs to develop and produce the proved reserves and abandonment costs, all based on current economic conditions at each year-end.
Years Ended December 31, 2025 2024 (Thousands, unless otherwise noted) Future net cash flows (a) $ 181,810 $ 130,333 Present value of net cash flows discounted at a rate of 10% (b) 120,523 107,202 Prices Natural gas price ($/103ft3) (c) $ 12.84 $ 11.73 (a) Future net cash flows represent future cash flows which are reduced by estimated production costs, administrative costs, costs to develop and produce the proved reserves and abandonment costs, all based on current economic conditions at each year-end.
Battery technology today can only support 4-6 hours of discharge, which then requires significant and costly capital expenditures on storage to mitigate intermittency. ● Recent advancements in Artificial Intelligence (“AI”) are leading to increased global power demand for data centers. The growth in European data center power demand may surpass the total annual power demand of some EU member states.
Battery technology today can only support 4-6 hours of discharge, which then requires significant and costly capital expenditures on storage to mitigate intermittency; and ● Recent advancements in Artificial Intelligence (“AI”) are leading to increased global power demand for data centers.
Examples of vendors we are currently engaged with include: Category Vendors Investment opportunities VLF Srl Project developers Renove Srl Commodity traders Rivecom Bio-digester manufacturers Rota Srl Biomethane upgrading facilities Prodeval Srl Marketing groups Shell Energy Europe Human Capital Resources As of December 31, 2024, we had seven full-time employees and engaged six contractors on a part-time basis, and one contractor on a full-time basis.
Examples of vendors we are currently engaged with include: Category Vendors Investment opportunities VLF Srl Project developers Renove Srl, MFZ Commodity traders Rivecom, HBA, Conages, Biological Care Bio-digester manufacturers Rota Srl, Micropower, Corradi e Ghisolfi, BTS Biomethane upgrading facilities Prodeval Srl, AB, Nippongases, Nordsol Marketing groups Shell Energy Europe, ENI Human Capital Resources As of December 31, 2025, we had nine full-time employees and engaged seven contractors on a part-time basis, and one contractor on a full-time basis.
December 31, 2024 December 31, 2023 Production Concessions (1) Total gross productive acreage — — Total net productive acreage — — Exploration Permits (2) Total gross productive acreage — — Total net productive acreage — — Applications (3) Total gross productive acreage — — Total net productive acreage — — Total gross productive acreage — — Total net productive acreage — — Production Concessions (1) Total gross undeveloped acreage 24,142 24,142 Total net undeveloped acreage 19,710 19,710 Exploration Permits (2) Total gross undeveloped acreage 682,802 682,802 Total net undeveloped acreage 682,802 682,802 Applications (3) Total gross undeveloped acreage 1,623,209 1,623,209 Total net undeveloped acreage 1,623,209 1,623,209 Total gross undeveloped acreage 2,330,153 2,330,153 Total net undeveloped acreage 2,325,721 2,325,721 (1) Encompasses three distinct production concession areas including Longanesi, Valle del Mezzano (Trava), and Gradizza.
December 31, 2025 December 31, 2024 Production Concessions (1) Total gross productive acreage 6,590 - Total net productive acreage 2,208 - Exploration Permits (2) Total gross productive acreage - - Total net productive acreage - - Applications (3) Total gross productive acreage - - Total net productive acreage - - Total gross productive acreage 6,590 - Total net productive acreage 2,208 - Production Concessions (1) Total gross undeveloped acreage 13,275 24,142 Total net undeveloped acreage 13,275 19,710 Exploration Permits (2) (3) Total gross undeveloped acreage 567,376 682,802 Total net undeveloped acreage 567,376 682,802 Applications (4) (5) Total gross undeveloped acreage 1,580,205 1,623,209 Total net undeveloped acreage 1,580,205 1,623,209 Total gross undeveloped acreage 2,160,856 2,330,153 Total net undeveloped acreage 2,160,856 2,325,721 (1) Encompasses three distinct production concession areas including Longanesi, Valle del Mezzano (Trava), and Gradizza.
Led by the renewable natural gas expertise and Italian networking capabilities of Giuseppe Perrone (ex-CEO of Eni), over the past approximately 18 months, we have built a significant backlog of potential acquisition opportunities (primarily consisting of existing, operational AD’s currently producing biogas for electricity generation).
Led by the renewable natural gas expertise and Italian networking capabilities of Giuseppe Perrone, our Executive Vice President of Renewable Natural Gas (previously the CEO of Ecofuel SpA and President of EniBioCH4in SpA, subsidiaries of Eni), over the past three years, we have built a significant backlog of potential acquisition opportunities (primarily consisting of existing operational AD’s currently producing biogas for electricity generation).
Reserve Data December 31, 2024 Natural Gas (10 6 ft 3 ) Estimated proved developed reserves — Estimated proved undeveloped reserves 17,621 Estimated total proved reserves 17,621 The following table summarizes our proved developed and undeveloped reserves using average first-day-of-the-month closing prices for the prior twelve months and disaggregated by discovery.
Reserve Data December 31, 2025 December 31, 2024 Natural Gas Natural Gas Percentage (10 6 ft 3 ) (10 6 ft 3 ) Change Change Estimated proved developed reserves 23,461 - 23,461 NM Estimated proved undeveloped reserves 2,366 17,621 (15,255 ) -86.6 % Estimated total proved reserves 25,827 17,621 8,206 46.6 % The following table summarizes our proved developed and undeveloped reserves using average first-day-of-the-month closing prices for the prior twelve months and disaggregated by discovery.
Once the documents have been verified, within 30 days the Region shall proceed to convene the “service conference” which is the meeting attended by all public bodies interested in the project to give opinions of competence or request clarifications from the proponent.
The authority granting the authorization shall proceed to convene the “service conference” which is the meeting attended by all public bodies interested in the project to give opinions of competence or request clarifications from the proponent.
The facility is fully permitted, and construction began in the fourth quarter of 2024. In 2025 we expect to begin upgrading construction activities at two sites: Casalino (formerly known as Fattoria Delle Jersey) a Brownfield facility (a conversion of an existing AD into a biomethane facility) and Campopiano which is also a Brownfield facility.
In 2026 we expect to begin upgrading construction activities at two sites: Casalino (formerly known as Fattoria Delle Jersey) a Brownfield facility (a conversion of an existing AD into a biomethane facility) and Campopiano which is also a Brownfield facility. We will then sequentially stage construction at each additional facility we acquire.
Following settlement, our year-end December 31, 2024 reserve quantities continue to include the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ), however, the previously required payments to Blugas associated with the sale of such quantities are no longer reflected as cash outflows (costs) as if such amounts were paid to Blugas.
As the cash outflows (costs) are no longer reflected as if paid to Blugas, such amounts are reflected in our December 31, 2024 reserve report as allocable to our unencumbered 33.5% working interest. Our year-end December 31, 2025 reserve quantities continue to include the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ).
Estimates of economically recoverable oil and natural gas and of future net revenues are based on a number of variables and assumptions, all of which may vary from actual results, including geologic interpretation, prices and future production rates and costs. 7 For all of our properties, our internally prepared reserve estimates and the reserve reports prepared by DeGolyer, are reviewed and approved by our Executive Director, William K.
Estimates of economically recoverable oil and natural gas and of future net revenues are based on a number of variables and assumptions, all of which may vary from actual results, including geologic interpretation, prices and future production rates and costs.
To support this conversion, Italy has implemented a government-backed biomethane floor price through the end of 2039 of €124 per MWh, equivalent, as of December 31, 2024 to $39.25 per 10 3 ft 3 .
To support this conversion, Italy has implemented a government-backed biomethane floor price through the end of 2039 of €124 per MWh, equivalent, as of December 31, 2025 to $39.25 per 10 3 ft 3 . The Italian government is expected to issue additional incentives in the first quarter of 2026 with similar economic conditions.
Following the liberalization of the natural gas sector introduced in the year 2000 by Decree No. 164, prices of natural gas in the wholesale market which includes industrial and power generation customers are freely negotiated. However, the ARERA retains a power of surveillance on this matter as per Law No. 481/1995 (establishing the ARERA) and Legislative Decree No. 164/2000.
Following the liberalization of the natural gas sector introduced in the year 2000 by Decree No. 164, prices of natural gas in the wholesale market, which includes industrial and power generation customers are freely negotiated.
It is the company’s intention to begin upgrading the sites to refine biomethane into renewable natural gas through upgrading units. Following the upgrade process to transition the assets to biomethane to renewable natural gas conversion, the Company expects to sell renewable natural gas to customer(s) by trucking or piping the renewable natural gas to the interstate pipeline system (SNAM).
Following the upgrade process to transition the assets to biogas to renewable natural gas conversion, the Company expects to sell renewable natural gas to customer(s) by trucking or piping the renewable natural gas to the interstate pipeline system (SNAM).
Our recent drilling activity consisted of the following: no activity during year-to-date December 31, 2024, drilling and completion of two gross Longanesi development wells (0.67 net wells to our interest) during the year ended December 31, 2022, and drilling and completion of one gross Longanesi development well and workover and completion of one additional Longanesi development well (0.335 net to our interest) during the year ended December 31, 2023.
The Company had no exploratory or development drilling activity during the year ended December 31, 2025, or 2024. The completion of the gross Longanesi development well and workover and the completion of one additional Longanesi development well (0.335 net to our interest) were completed during the year ended December 31, 2023.
Through the cash flow from Longanesi, Gradizza, and Trava once these latter two discoveries are brought on production, we plan to continue to grow both our conventional and renewable natural gas businesses.
Additionally, the infrastructure installed at the Longanesi field (the flow lines and the processing unit) is expected to benefit our future development and exploration prospects in the area. Through the cash flow from Longanesi, Gradizza, and Trava once these latter two discoveries are brought on production, we plan to continue to grow both our conventional and renewable natural gas businesses.
We and Padana achieved first production of the five wells in the Longanesi field in March 2025 through use of a temporary processing facility. The permanent processing facility is expected to be constructed over the course of 2025 and early 2026 and commissioned in mid-20 26.
We and Padana achieved first production of the five wells in the Longanesi field in March 2025 through use of a temporary processing facility. The permanent processing facility is under construction and is expected to be installed in phases during 2026, with completion and commissioning expected in early 2027.
We recognize provisions for claims or pending litigation when we determine that an un-favorable outcome is probable and the amount of loss can be reasonably estimated.
We recognize provisions for claims or pending litigation when we determine that an un-favorable outcome is probable and the amount of loss can be reasonably estimated. Due to the inherent uncertain nature of litigation, the ultimate outcome or actual cost of settlement may materially vary from estimates. 23
Trava Field: The discovery well, which will act as the production well, has been completed and tested and all commitments under the Exploration Permit have been finished. Application for the Production Concession has been made, and the required VIA is being finalized for submission to the Federal Ministry.
Application for the Production Concession has been made, and the required extension of the Environmental Impact Assessment (“VIA”) has been completed and submitted for approval. Trava Field: The discovery well, which will act as the production well, has been completed and tested and all commitments under the Exploration Permit have been finished.
We believe the following factors are key to achieving this goal: ● existing AD’s (“Brownfield Facilities”) are cheaper to acquire and have a lower risk profile than new-build opportunities (“Greenfield Facilities” or “Greenfield”) and their conversion to bio methane is relatively efficient and can be accomplished within a short time frame through installation of an “off-the-shelf” biogas upgrading unit; ● we believe we have unique regional overlap across our conventional and renewable natural gas businesses as our conventional focus area, Italy’s Po Valley, contains the majority of the existing Italian AD’s and is adjacent to a comprehensive natural gas pipeline network operated by the Italian-sponsored SNAM, which exists in close proximity to our conventional business and the Po Valley AD’s; ● as one of a few licensed Italian Exploration & Production (“E&P”) operators, we believe we have the means, mechanisms, and market relationships to bring biomethane to market, whereas those tasks are above the capabilities of most family farms and farm association who currently own and operated existing AD’s; ● the construction and operation of a biomethane facility is similar to the operation of a conventional natural gas facility, a capability which we already possess; ● by either including the family farm as a working-interest partner or entering into bespoke feedstock contracts, we believe we can enlist the farms’ support in creating necessary AD fuels and in the disposal of waste products from the AD (which are converted into fertilizer), without our business having to become proficient in farming; ● we believe that a combination of free cash flows from our conventional natural gas business, together with other cash on hand, and future project level debt financing will satisfy the near-term capital requirements of our renewable natural gas portfolio; and ● as discussed in more detail below, the Italian government’s 15-year guaranteed biomethane floor price of $39.30 per 103ft 3 substantially mitigates pricing risk from the renewable natural gas business and the Italian government as also implemented an investment aid, or capital expenditure reimbursement program, covering up to 40% of eligible investment costs.
(“SNAM”), Italy’s primary natural gas transmission system operator, which exists in close proximity to our conventional business and the Po Valley AD’s; ● as one of a few licensed Italian Exploration & Production (“E&P”) operators, we believe we have the means, mechanisms, and market relationships to bring biomethane to market, whereas those tasks are above the capabilities of most family farms and farm association who currently own and operated existing AD’s; ● by either including the family farm as a working-interest partner or entering into bespoke feedstock contracts, we believe we can enlist the farms’ support in creating necessary AD fuels and in the disposal of waste products from the AD (which are converted into fertilizer), without our business having to become proficient in farming; ● we believe that a combination of additional equity and project level debt financing will satisfy the near-term capital requirements of our renewable natural gas portfolio; and ● as discussed in more detail below, the Italian government’s 15-year guaranteed biomethane floor price of $39.30 per 10 3 ft 3 substantially mitigates pricing risk from the renewable natural gas business and the Italian government as also implemented an investment aid, or capital expenditure reimbursement program, covering up to 40% of eligible investment costs.
Dirks, a greater than 40-year industry veteran who has successfully explored, developed, and operated reserves in multiple global jurisdictions. The following table summarizes our proved developed and undeveloped natural gas reserves using average first-day-of-the-month closing prices for the prior 12 months and disaggregated by product.
The following table summarizes our proved developed and undeveloped natural gas reserves using average first-day-of-the-month closing prices for the prior 12 months and disaggregated by product.
On December 13, 2024, AleAnna, as requested by MASE, notified MASE of its willingness to reacquire the mining titles and permit applications with the original extension. AleAnna has filed appeals that are still pending with the administrative Courts to request payments of indemnity for loss of such areas. Royalties The Hydrocarbons’ Laws require the payment of royalties for hydrocarbon production.
On December 13, 2024, we, as requested by MASE, notified MASE of our willingness to reacquire the mining titles and permit applications with the original extension. Royalties The Hydrocarbons’ Laws require the payment of royalties for hydrocarbon production.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe cannot guarantee that we will be able to renew any feedstock supply contracts that expire in the future on commercial terms that are attractive to us or at all, and any failure to do so, or any other disruption in the relationship with any of the farm operators from whose farm sites our plants reside on, may have a material adverse effect on our business operations, prospects, financial condition and operational results.
Biggest changeTherefore, we may depend on contractual relationships with, and the cooperation of, the farm site owners and operators for our operations. We cannot guarantee that we will be able to renew any feedstock supply contracts that expire in the future on commercial terms that are attractive to us or at all.
Since we are a development-stage company with limited operating history and minimal revenue generation related to the production of natural gas assets, investors have a very limited basis to evaluate our ability to operate profitably as an E&P business. We are a development-stage company.
Since we are a development-stage company with limited operating history and minimal revenue generation related to the production of natural gas assets, investors have a very limited basis to evaluate our ability to operate profitably as an E&P business.
Many factors may curtail, delay or cancel our scheduled drilling projects, or the development schedule, including the following: ● delays imposed by or resulting from compliance with regulatory requirements, including limitations resulting from permitting, emission of greenhouse gases (“GHGs”), and other limitations and regulatory requirements; ● intervention by local or federal governments or a foreign sovereign, such as appropriation of assets or technology or imposition of a ban on exploration or production activities; 15 ● shortages of or delays in obtaining equipment, rigs, materials or qualified personnel; ● supply chain disruptions or labor shortage impacts; ● equipment failures, accidents or other unexpected operational events; ● lack of available capacity on interconnecting transportation pipelines; ● adverse weather conditions, such as flooding, droughts, freeze-offs, landslides, blizzards and ice storms; ● exposure to acts of terrorism or military or other armed conflict or political instability in regions that affect our business or operations; ● issues related to compliance with environmental regulations; ● environmental hazards; ● declines in natural gas market prices; 25 ● limited availability of financing at acceptable terms; ● ongoing litigation or adverse court rulings; ● public opposition to our operations; ● title, surface access, coal mining and right of way issues; and ● limitations in the market for natural gas.
Many factors may curtail, delay or cancel our scheduled drilling projects, or the development schedule, including the following: ● delays imposed by or resulting from compliance with regulatory requirements, including limitations resulting from permitting, emission of greenhouse gases (“GHGs”), and other limitations and regulatory requirements; ● intervention by local or federal governments or a foreign sovereign, such as appropriation of assets or technology or imposition of a ban on exploration or production activities; 25 ● shortages of or delays in obtaining equipment, rigs, materials or qualified personnel; ● supply chain disruptions or labor shortage impacts; ● equipment failures, accidents or other unexpected operational events; ● lack of available capacity on interconnecting transportation pipelines; ● adverse weather conditions, such as flooding, droughts, freeze-offs, landslides, blizzards and ice storms; ● exposure to acts of terrorism or military or other armed conflict or political instability in regions that affect our business or operations; ● issues related to compliance with environmental regulations; ● environmental hazards; ● declines in natural gas market prices; ● limited availability of financing at acceptable terms; ● ongoing litigation or adverse court rulings; ● public opposition to our operations; ● title, surface access, coal mining and right of way issues; and ● limitations in the market for natural gas.
These transactions may be required to the extent we utilize RBL financing in the future and such limit our potential gains if natural gas prices rise above the price established by the hedge, and we may be required to post cash collateral or letters of credit with our hedge counterparties to the extent our liability under the derivative contract exceeds specified thresholds, which would negatively impact our liquidity.
These transactions may be required to the extent we utilize RBL financing in the future and limit our potential gains if natural gas prices rise above the price established by the hedge, and we may be required to post cash collateral or letters of credit with our hedge counterparties to the extent our liability under the derivative contract exceeds specified thresholds, which would negatively impact our liquidity.
Additionally, AleAnna has not previously been required to establish and maintain the disclosure controls and procedures, and internal control over financial reporting applicable to a public company under U.S. federal securities laws, including the Sarbanes-Oxley Act. We may experience errors, mistakes and lapses in processes and controls, resulting in failure to meet requisite U.S. standards.
AleAnna has not previously been required to establish and maintain the disclosure controls and procedures, and internal control over financial reporting applicable to a public company under U.S. federal securities laws, including the Sarbanes-Oxley Act. We may experience errors, mistakes and lapses in processes and controls, resulting in failure to meet requisite U.S. standards.
If we are unable to utilize various government incentives to acquire additional renewable assets in the future, or the terms of such incentives are revised in a manner that is less favorable to us, we may suffer a material adverse effect on our business, financial condition, results of operations and cash flows.
If we are unable to utilize government incentives to acquire additional renewable assets in the future, or the terms of such incentives are revised in a manner that is less favorable to us, we may suffer a material adverse effect on our business, financial condition, results of operations and cash flows.
Further, our stock price could be subject to significant fluctuation or otherwise be adversely affected by the events, risks and uncertainties of any securities litigation and shareholder activism. 51 A substantial number of the Company’s Class A Common Stock are restricted securities and as a result, there may be limited liquidity for our Class A Common Stock.
Further, our stock price could be subject to significant fluctuation or otherwise be adversely affected by the events, risks and uncertainties of any securities litigation and shareholder activism. A substantial number of the Company’s Class A Common Stock are restricted securities and as a result, there may be limited liquidity for our Class A Common Stock.
Natural gas prices are affected by a number of factors beyond our control, including many of which that are unknown and cannot be anticipated, and we cannot predict with certainty future potential movements in the price for these commodities. Our primary business involves the exploration, production and sale of natural gas.
Natural gas prices are affected by a number of factors beyond our control, including many of which are unknown and cannot be anticipated, and we cannot predict with certainty future potential movements in the price for these commodities. Our primary business involves the exploration, production and sale of natural gas.
Changes to existing standards or changes in their interpretation may have an adverse effect on our reputation, business, financial position, and profit, or cause an adverse deviation from our revenue and operating profit target, which may negatively impact our financial results. We have previously identified material weaknesses in our internal control over financial reporting.
Changes to existing standards or changes in their interpretation may have an adverse effect on our reputation, business, financial position, and profit, or cause an adverse deviation from our revenue and operating profit target, which may negatively impact our financial results. We have identified material weaknesses in our internal control over financial reporting.
We do not have experience operating as a public company subject to U.S. federal securities laws and may not be able to adequately develop and implement the governance, compliance, risk management and control infrastructure and culture required for a public company, including compliance with the Sarbanes-Oxley Act.
We do not have extensive experience operating as a public company subject to U.S. federal securities laws and may not be able to adequately develop and implement the governance, compliance, risk management and control infrastructure and culture required for a public company, including compliance with the Sarbanes-Oxley Act.
Our plan includes the below: ● Designing and implementing a risk assessment process supporting the identification of risks facing AleAnna. ● Implementing controls to enhance our review of significant accounting transactions and other new technical accounting and financial reporting issues and preparing and reviewing accounting memoranda addressing these issues. ● Hiring additional experienced accounting, financial reporting and internal control personnel and changing roles and responsibilities of our personnel as we transition to being a public company and are required to comply with Section 404 of the Sarbanes-Oxley Act. ● Implementing controls to enable an accurate and timely review of accounting records that support our accounting processes and maintain documents for internal accounting reviews.
Our plan includes the below: ● Designing and implementing a risk assessment process supporting the identification of risks facing us. ● Implementing controls to enhance our review of significant accounting transactions and other new technical accounting and financial reporting issues and preparing and reviewing accounting memoranda addressing these issues. ● Hiring additional experienced accounting, financial reporting and internal control personnel and changing roles and responsibilities of our personnel as we transition to being a public company and are required to comply with Section 404 of the Sarbanes-Oxley Act. ● Implementing controls to enable an accurate and timely review of accounting records that support our accounting processes and maintain documents for internal accounting reviews.
If we are unable to replace our current and future production, the value of our reserves will decrease, and our business, financial condition and results of operations will be adversely affected. 27 Our proved reserves are estimates that are based on many assumptions that may prove to be inaccurate.
If we are unable to replace our current and future production, the value of our reserves will decrease, and our business, financial condition and results of operations will be adversely affected. Our proved reserves are estimates that are based on many assumptions that may prove to be inaccurate.
Due to the concentrated nature of our portfolio of properties, a number of our properties could experience any of the same conditions at the same time, resulting in a relatively greater impact on our results of operations than they might have on other companies that have a more diversified portfolio of properties.
Due to the concentrated geographic nature of our portfolio of properties, a number of our properties could experience any of the same conditions at the same time, resulting in a relatively greater impact on our results of operations than they might have on other companies that have a more diversified portfolio of properties.
Approximately 63,922,582 shares of Class A Common Stock are subject to registration rights in the Registration Rights Agreement. 45 Future sales and issuances of our Class A Common Stock could result in additional dilution of the percentage ownership of our stockholders and could cause our share price to fall.
Approximately 63,922,582 shares of Class A Common Stock are subject to registration rights in the Registration Rights Agreement. Future sales and issuances of our Class A Common Stock could result in additional dilution of the percentage ownership of our stockholders and could cause our share price to fall.
Our ability to acquire, develop and operate renewable natural gas plants, is subject to various risks, including: ● regulatory changes that affect the value of renewable natural gas, including revisions to government sponsored price floors and any potential inability to qualify or potential disqualification from such programs, which could have a significant effect on the financial performance of the number of potential plants with attractive economics; ● changes in energy commodity prices, such as natural gas and wholesale electricity prices, which could have a significant effect on our revenues and expenses; ● changes in pipeline gas quality standards or other regulatory changes that may limit our ability to transport renewable natural gas on pipelines for delivery to third parties or increase the costs of processing renewable natural gas to allow for such deliveries; ● changes in the broader waste collection industry, including changes affecting the waste collection and biogas potential of the farming industry, which could limit the renewable natural gas resource that we currently target for our plants; ● substantial construction risks, including the risk of delay, that may arise due to forces outside of our control, including those related to engineering and environmental problems, inclement weather and labor disruptions; ● In order to construct new commercial and modify existing production facilities, we typically face a potentially lengthy and variable design, fabrication, and construction development cycle that requires resource commitments and may create fluctuations in whether and when revenue is recognized; ● operating risks and the effect of disruptions on our business, including the effects of weather conditions, catastrophic events such as fires, explosions, earthquakes, droughts and acts of terrorism, and other force majeure events on us, our customers, suppliers, distributors and subcontractors; ● accidents involving personal injury or the loss of life, as a result of work conditions including, but not limited to, hazardous worksite site conditions and gas exposure; ● the ability to obtain financing for a project on acceptable terms or at all and the need for substantially more capital than initially budgeted to complete plants and exposure to liabilities as a result of unforeseen environmental, construction, technological or other complications; ● failures or delays in obtaining desired or necessary land rights, including ownership, leases, easements, zoning rights and building permits; ● a decrease in the availability, pricing and timeliness of delivery of raw materials and components necessary for the operation of plants; ● obtaining and keeping in good standing permits, authorizations and consents from governmental organizations; 34 ● unknown regulatory changes for renewable natural gas which may increase the transportation cost for delivering under contracts in place; ● the consent and authorization of local utilities or other energy development off-takers to ensure successful interconnection to energy grids to enable power and gas sales; and ● difficulties in identifying, obtaining and permitting suitable sites for new plants.
Our ability to acquire, develop and operate renewable natural gas plants, is subject to various risks, including: ● regulatory changes that affect the value of renewable natural gas, including revisions to government sponsored price floors and any potential inability to qualify or potential disqualification from such programs, which could have a significant effect on the financial performance of the number of potential plants with attractive economics; ● regulatory changes that imposed restrictions on the type of feedstock we are allowed to use; ● changes in energy commodity prices, such as natural gas and wholesale electricity prices, which could have a significant effect on our revenues and expenses; ● changes in pipeline gas quality standards or other regulatory changes that may limit our ability to transport renewable natural gas on pipelines for delivery to third parties or increase the costs of processing renewable natural gas to allow for such deliveries; ● changes in the broader waste collection industry, including changes affecting the waste collection and biogas potential of the farming industry, which could limit the renewable natural gas resource that we currently target for our plants; ● substantial construction risks, including the risk of delay, that may arise due to forces outside of our control, including those related to engineering and environmental problems, inclement weather and labor disruptions; ● in order to construct new commercial and modify existing production facilities, we typically face a potentially lengthy and variable design, fabrication, and construction development cycle that requires resource commitments and may create fluctuations in whether and when revenue is recognized; ● operating risks and the effect of disruptions on our business, including the effects of weather conditions, catastrophic events such as fires, explosions, earthquakes, droughts and acts of terrorism, and other force majeure events on us, our customers, suppliers, distributors and subcontractors; ● accidents involving personal injury or the loss of life, as a result of work conditions including, but not limited to, hazardous worksite site conditions and gas exposure; ● the ability to obtain financing for a project on acceptable terms or at all and the need for substantially more capital than initially budgeted to complete plants and exposure to liabilities as a result of unforeseen environmental, construction, technological or other complications; ● failures or delays in obtaining desired or necessary land rights, including ownership, leases, easements, zoning rights and building permits; 34 ● a decrease in the availability, pricing and timeliness of delivery of raw materials and components necessary for the operation of plants; ● obtaining and keeping in good standing permits, authorizations and consents from governmental organizations; ● unknown regulatory changes for renewable natural gas which may increase the transportation cost for delivering under contracts in place; ● the consent and authorization of local utilities or other energy development off-takers to ensure successful interconnection to energy grids to enable power and gas sales; and ● difficulties in identifying, obtaining and permitting suitable sites for new plants.
Concerns over global economic conditions, stock market volatility, energy costs, geopolitical issues (including continued hostilities between Russia and Ukraine as well as other conflicts, including in the Middle East), inflation and central bank interest rate increases in response thereto, the availability and cost of credit, and slowing of global economic growth and fears of a recession have contributed and may continue to contribute to increased economic uncertainty and diminished expectations for the global economy.
Concerns over global economic conditions, stock market volatility, energy costs, geopolitical issues (including continued hostilities between Russia and Ukraine as well as other conflicts, including in the Middle East), inflation and central bank interest rate fluctuations in response thereto, the availability and cost of credit, and slowing of global economic growth and fears of a recession have contributed and may continue to contribute to increased economic uncertainty and diminished expectations for the global economy.
Foreign Corrupt Practices Act of 1977, as amended, U.S. domestic bribery laws, and other anti-corruption and anti-money laundering laws in the countries in which we would conduct business.
Foreign Corrupt Practices Act of 1977, as amended, U.S. domestic bribery laws, and other anti-corruption and anti-money laundering laws in the countries in which we conduct business.
Risks related to acquiring existing plants, include: ● the purchase price we pay could significantly deplete our cash reserves; ● the acquired companies or assets may not produce as planned or may entail significant unexpected or unbudgeted costs; ● we may have difficulty integrating the operations and personnel of the acquired companies; ● key personnel and customers of the acquired companies may terminate their relationships with the acquired companies as a result of or following the acquisition; ● we may experience additional financial and accounting challenges and complexities in areas such as joint venture accounting, tax planning, and financial reporting; ● we may incur additional costs and expenses related to complying with additional laws, rules or regulations in new jurisdictions; ● we may assume or be held liable for risks and liabilities (including for environmental-related costs) as a result of our acquisitions, some of which we may not discover during our due diligence or adequately adjust for in our acquisition arrangements; ● our ongoing business and management’s attention may be disrupted or diverted by transition or integration issues and the complexity of managing geographically diverse enterprises; ● we may incur one-time write-offs or restructuring charges in connection with an acquisition; ● we may acquire goodwill and other intangible assets that are subject to amortization or impairment tests, which could result in future charges to earnings; and ● we may not be able to realize the expected cash flows or other financial benefits we anticipated. 35 Revenue from any renewable natural gas plants we complete may be adversely affected if there is a decline in public acceptance or support of renewable energy, or regulatory agencies, local communities, or other third parties delay, prevent, or increase the cost of constructing and operating our plants.
Risks related to acquiring existing plants, include: ● the acquired companies or assets may not produce as planned or may entail significant unexpected or unbudgeted costs; ● we may have difficulty integrating the operations and personnel of the acquired companies; ● key personnel and customers of the acquired companies may terminate their relationships with the acquired companies as a result of or following the acquisition; ● we may experience additional financial and accounting challenges and complexities in areas such as joint venture accounting, tax planning, and financial reporting; ● we may incur additional costs and expenses related to complying with additional laws, rules or regulations in new jurisdictions; ● we may assume or be held liable for risks and liabilities (including for environmental-related costs) as a result of our acquisitions, some of which we may not discover during our due diligence or adequately adjust for in our acquisition arrangements; ● our ongoing business and management’s attention may be disrupted or diverted by transition or integration issues and the complexity of managing geographically diverse enterprises; ● we may incur one-time write-offs or restructuring charges in connection with an acquisition; ● we may acquire goodwill and other intangible assets that are subject to amortization or impairment tests, which could result in future charges to earnings; and ● we may not be able to realize the expected cash flows or other financial benefits we anticipated. 35 Revenue from any renewable natural gas plants we complete may be adversely affected if there is a decline in public acceptance or support of renewable energy, or regulatory agencies, local communities, or other third parties delay, prevent, or increase the cost of constructing and operating our plants.
If we are unable to grow and manage the capacity that we expect from our plants in our anticipated timeframes, it could adversely affect our business, financial condition and results of operations. We may not be fully reimbursed for a portion of our renewable natural gas construction costs or may only receive payment on a delayed basis.
If we are unable to grow and manage the capacity that we expect from our plants in our anticipated timeframe, it could adversely affect our business, financial condition and results of operations. We may not be fully reimbursed for a portion of our renewable natural gas construction costs or may only receive payment on a delayed basis.
We make and expect to continue to make substantial capital expenditures for the development and acquisition of natural gas reserves, as well as related infrastructure. If these projects are undertaken, they may not be completed on schedule, at the budgeted cost or at all . To date, we have invested approximately and initial development of our properties.
We make and expect to continue to make substantial capital expenditures for the development and acquisition of natural gas reserves, as well as related infrastructure. If these projects are undertaken, they may not be completed on schedule, at the budgeted cost or at all . To date, we have invested approximately $250m in the initial development of our properties.
In addition, we may become subject to additional laws or regulations issued by federal or state government bodies, which are subject to influence resulting from frequent changes in political party control or changes to political priorities or policies. We may need to adapt compliance strategies and operation to meet new regulatory requirements, which can be costly and time-consuming.
In addition, we may become subject to additional laws or regulations issued by federal or state government bodies, which are subject to influence resulting from frequent changes in political party control or changes to political priorities or policies. We may need to adapt compliance strategies and operations to meet new regulatory requirements, which can be costly and time-consuming.
Certain persons, associations and groups could oppose renewable energy plants in general or our plants specifically, citing, for example, misuse of water resources, landscape degradation, land use, food scarcity or price increase and harm to the environment. Moreover, regulation may restrict the development of renewable energy plants in certain areas.
Certain persons, associations and groups could oppose renewable energy plants in general or our plants specifically, citing, for example, misuse of water resources, landscape degradation, land use, food scarcity or price increase and harm to the environment. Moreover, regulations may restrict the development of renewable energy plants in certain areas.
We face many of the risks commonly encountered by other new businesses, including the lack of an established operating history, need for additional capital and personnel, and competition. There is no assurance that our business will be successful or that we can ever operate profitably.
We face many of the risks commonly encountered by other new businesses, including the lack of an established operating history, need for additional capital and personnel, and competition. There is no assurance that our business will be successful or that we can operate profitably long-term.
This strategy depends on our ability to successfully identify and evaluate acquisition opportunities and complete acquisitions on favorable terms. However, we cannot assure you that we will be able to successfully identify new opportunities or consummate the acquisition of exi sting renewable natural gas plants, on favorable terms or at all.
This strategy depends on our ability to successfully identify and evaluate acquisition opportunities and complete acquisitions on favorable terms. However, we cannot assure you that we will be able to successfully identify new opportunities or consummate the acquisition of existing renewable natural gas plants, on favorable terms or at all.
The acquisition of existing renewable natural gas plants involves numerous risks, many of which may be indiscoverable through the due diligence process, including exposure to previously existing liabilities and unanticipated costs associated with the pre-acquisition period; difficulty in integrating the acquired plants into our existing business; and, if the plants are in new markets, the risks of entering markets where we have limited experience, less knowledge of differences in market terms for gas rights agreements and off-take arrangements.
The acquisition of existing renewable natural gas plants or conventional assets involves numerous risks, many of which may be undiscoverable through the due diligence process, including exposure to previously existing liabilities and unanticipated costs associated with the pre-acquisition period; difficulty in integrating the acquired plants into our existing business; and, if the plants are in new markets, the risks of entering markets where we have limited experience, less knowledge of differences in market terms for gas rights agreements and off-take arrangements.
Prolonged l ow, and/or significant or extended declines in, natural gas prices may adversely affect our revenues, operating income, cash flows, financial projections, and financial position, particularly if we are unable to control our development costs during periods of lower natural gas prices.
Prolonged low, and/or significant or extended declines in natural gas prices may adversely affect our revenues, operating income, cash flows, financial projections, and financial position, particularly if we are unable to control our development costs during periods of lower natural gas prices.
As a result, certain of our plants’ rights under these easements, leases or rights-of-way may be subject, and subordinate, to the rights of those third parties.
As a result, some of our plants’ rights under these easements, leases or rights-of-way may be subject, and subordinate, to the rights of those third parties.
We may not be able to effectively manage the demands required, such that we may be unable to implement our business plan or achieve profitability. Restrictions on drilling activities intended to protect the environment and the ecosystem may adversely affect our ability to conduct drilling activities areas where we operate.
We may not be able to effectively manage the demands required, such that we may be unable to implement our business plan. Restrictions on drilling activities intended to protect the environment and the ecosystem may adversely affect our ability to conduct drilling activities areas where we operate.
If we do not protect and enforce our intellectual property rights adequately and successfully, our competitive position may suffer, which could have a material adverse effect on our business, prospects, financial condition, and operating results. 33 Our strategic success and financial results depend on our ability to identify, acquire, develop and operate renewable natural gas plants.
If we do not protect and enforce our intellectual property rights adequately and successfully, our competitive position may suffer, which could have a material adverse effect on our business, prospects, financial condition, and operating results. 33 Risks Related to our Renewable Natural Gas Business and the Renewable Natural Gas Industry Our strategic success and financial results depend on our ability to identify, acquire, develop and operate natural gas plants.
However, the Italian government’s financial incentives and subsidies supporting these activities are set to expire in January 2025 absent additional government action, and are expected to be replaced by attractive biomethane incentives. Such incentives are designed to bring biomethane into the national pipeline transmission system in order to deliver the gas to higher efficiency, utility-scale, natural gas power generation stations.
However, the Italian government’s financial incentives and subsidies supporting these activities are set to expire in June 2027 absent additional government action and are expected to be replaced by attractive biomethane incentives. Such incentives are designed to bring biomethane into the national pipeline transmission system in order to deliver the gas to higher efficiency, utility-scale, natural gas power generation stations.
A failure to achieve the financial returns we expect when we acquire renewable natural gas plants could have a material adverse effect on our ability to implement our growth strategy and, ultimately, our business, financial condition, and results of operations.
A failure to achieve the financial returns we expect when we acquire renewable natural gas plants or conventional assets could have a material adverse effect on our ability to implement our growth strategy and, ultimately, our business, financial condition, and results of operations.
Additionally, we do not hold title to our properties in Italy, but hold exploration permits and exploitation concessions granted by the Italian government.
Additionally, we do not hold title to our properties, but hold exploration permits and exploitation concessions granted by the Italian government.
As a result, we are subject to all of the risks associated with establishing new drilling operations and business enterprises, including, among others: ● the need to obtain necessary environmental and other governmental approvals and permits, the timing and conditions of those approvals and permits, and litigation concerning those approvals and permits; ● the availability and cost of funds to finance the drilling and development of our properties; ● the timing and cost, which can be considerable, of the supporting infrastructure to our natural gas drilling and production operations; ● the ability to obtain midstream offtake capacity for our future natural gas production; ● drainage resulting from the development of offsetting properties from other operators in the area; ● commodity prices and our ability to find suitable customers for our future production; ● inflation and potential increases in costs of labor, power, supplies, services and other support; and ● the availability and retention of executives overseeing our operations and of skilled labor and equipment to support our drilling operations.
As a result, we are subject to all of the risks associated with establishing new drilling operations and business enterprises, including, among others: ● the need to obtain necessary environmental and other governmental approvals and permits, the timing and conditions of those approvals and permits, and litigation concerning those approvals and permits; ● the availability and cost of funds to finance the drilling and development of our properties; ● the timing and cost, which can be considerable, of the supporting infrastructure to our natural gas drilling and production operations; ● the ability to obtain midstream offtake capacity for our future natural gas production; ● drainage resulting from the development of offsetting properties from other operators in the area; ● commodity prices and our ability to find suitable customers for our future production; ● inflation and potential increases in costs of labor, power, supplies, services and other support; and ● the availability and retention of executives overseeing our operations and of skilled labor and equipment to support our drilling operations. 24 There is no assurance that our drilling activities will result in the successful production of natural gas.
Global economic conditions, geopolitical issues and inflation have constrained global and domestic supply chains, which may in the future impact our ability to develop our reserves in accordance with our drilling and completions schedule.
Global economic conditions, geopolitical issues and inflation have and may continue to constrain global and domestic supply chains, which may in the future impact our ability to develop our reserves in accordance with our drilling and completions schedule.
The exchange rate between the Euro and the U.S. dollar has fluctuated widely in recent years in response to international political conditions, general economic conditions, the European sovereign debt crisis and other factors beyond our control. Our financial statements, presented in U.S. dollars, may be affected by foreign currency fluctuations through both translation risk and transaction risk.
The exchange rate between the Euro and the U.S. dollar has fluctuated in recent years in response to international political conditions, general economic conditions, and other factors beyond our control. Our financial statements, presented in U.S. dollars, may be affected by foreign currency fluctuations through both translation risk and transaction risk.
Future resales of our Class A Common Stock may cause the market price of our Class A Common Stock to drop significantly, even if the Company’s business is doing well. AleAnna Energy’s pre-Business Combination equity holders hold the substantial majority of our outstanding Class A Common Stock.
Future resales of our Class A Common Stock may cause the market price of our Class A Common Stock to drop significantly, even if the Company’s business is doing well. AleAnna Energy’s pre-Business Combination equity holders hold the substantial majority of our outstanding Class A Common Stock as of December 31, 2025.
There are risks inherent in any strategic transaction, and such risks could negatively affect the benefits, outcomes and synergies anticipated to be obtained from executing such strategic transactions. 52 Item 1B. Unresolved Staff Comments None.
There are risks inherent in any strategic transaction, and such risks could negatively affect the benefits, outcomes and synergies anticipated to be obtained from executing such strategic transactions. Item 1B. Unresolved Staff Comments Not Applicable.
Further, throughout the central and southern EU (but primarily focused in Italy and Germany), member states’ interest in creating new sources of renewable energy has supported the construction of nearly 10,000 AD’s over the past 15 years.
Further, throughout the central and southern EU (but primarily focused in Italy and Germany), member states’ interest in creating new sources of renewable energy has supported the construction of nearly 10,000 biogas and biomethane production facilities over the past 15 years.
Therefore, our estimated PUDs may not ultimately be developed or produced. All of the reserves attributable to our properties are undeveloped. Development of proved undeveloped reserves may take longer and require higher levels of capital expenditures than we currently anticipate.
The development of our estimated PUDs may take longer and may require higher levels of capital expenditure than we currently anticipate. Therefore, our estimated PUDs may not ultimately be developed or produced. Most of the reserves attributable to our properties are undeveloped.
The implementation of these remediation measures is in the early stages and will require validation and testing of the design and operating effectiveness of the Company’s internal controls over a sustained period of financial reporting cycles and, as a result, the timing of when the Company will b e able to remediate the material weaknesses is uncertain and the Company may not remediate these material weaknesses during the year ended December 31, 2025.
The implementation of these remediation measures is in progress and will require further validation and testing of the design and operating effectiveness of the Company’s internal controls over a sustained period of financial reporting cycles and, as a result, the timing of when the Company will be able to remediate the material weaknesses is uncertain and the Company may not remediate these material weaknesses during the year ended December 31, 2026.
Effective internal controls are necessary to provide reliable financial reports and prevent fraud. AleAnna is a newly public company that is in the process of adding resources with the appropriate level of experience and technical expertise to oversee AleAnna’s business processes and controls.
Effective internal controls are necessary to provide reliable financial reports and prevent fraud. We are a relatively new public company that is in the process of adding resources with the appropriate level of experience and technical expertise to oversee our business processes and controls.
Similarly, our failure to obtain necessary government authorizations or the enactment of a legislative ban on exploration and production could result in indirect expropriation of our investment and assets. Drilling for and producing natural gas is a high-risk and costly activity with many uncertainties.
Similarly, the enactment of a legislative ban on exploration and production could result in indirect expropriation of our investment and assets. Drilling for and producing natural gas is a high-risk and costly activity with many uncertainties.
We achieved first production of five drilled and tested wells in the Longanesi field in March 2025, following the installation of the temporary processing facility. The permanent processing facility is expected to be constructed over the remainder of 2025 and early 2026 and commissioned in mid-2026. Natural gas exploration and production has a high degree of risk.
We achieved first production of five drilled and tested wells in the Longanesi field in March 2025, following the installation of the temporary processing facility. The permanent processing facility is expected to be constructed through 2026 and commissioned in 2027. Natural gas exploration and production have a high degree of risk.
While we expect to be able to fund our future growth primarily out of cash currently on AleAnna’s balance sheet, from cash flow from the Longanesi, Trava, and Gradizza developments, and through recycling of cash flow from future developments, we have not generated any revenue from our principal business activities to date and do not have available commitments from debt financing sources.
While we expect to be able to fund our future growth primarily out of cash currently on our balance sheet, from cash flow from the Longanesi, Trava, and Gradizza developments, and through recycling of cash flow from future developments, we do not have available commitments from debt financing sources.
Under Nasdaq Capital Market rules, a controlled company may elect not to comply with certain Nasdaq corporate governance requirements, including the requirements that: ● a majority of the Board consist of independent directors under Nasdaq Capital Market rules; ● the nominating and governance committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and ● the compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.
Under Nasdaq Capital Market rules, a controlled company may elect not to comply with certain Nasdaq corporate governance requirements, including the requirements that: ● a majority of the Board consist of independent directors under Nasdaq Capital Market rules; ● the nominating and governance committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and ● the compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities. 44 These requirements will not apply to us as long as we remain a controlled company.
Natural gas production is dependent upon a number of factors and significantly influenced by the technical skill of our operations personnel involved. The commercial viability of our possible future production is also dependent upon a number of factors which are beyond our control, including the quality of our natural gas, commodity prices, government policies and regulation, and environmental protection requirements.
The commercial viability of our possible future production is also dependent upon a number of factors which are beyond our control, including the quality of our natural gas, commodity prices, government policies and regulation, and environmental protection requirements.
Any decision to declare and pay dividends in the future will be made at the discretion of our Board and will depend on, among other things, our results of operations, financial condition, cash requirements, contractual restrictions and other factors that our Board may deem relevant.
We do not anticipate paying any regular cash dividends on our Class A Common. Any decision to declare and pay dividends in the future will be made at the discretion of our Board and will depend on, among other things, our results of operations, financial condition, cash requirements, contractual restrictions and other factors that our Board may deem relevant.
Increased attention to climate change, circular economy, and other ESG matters, as well as investor and societal expectations regarding voluntary ESG disclosures and consumer expectations regarding sustainability may result in increased costs, reduced demand for our products, or other adverse impacts on our business, results of operations, and financial condition.
Investor advocacy groups, certain institutional investors, investment funds and other influential investors have in the past increased attention to climate change, circular economy, and other ESG matters, as well as investor and societal expectations regarding voluntary ESG disclosures and consumer expectations regarding sustainability may result in increased costs, reduced demand for our products, or other adverse impacts on our business, results of operations, and financial condition.
Risks Related to our Renewable Natural Gas Business and the Renewable Natural Gas Industry Failure to protect our intellectual property, inability to enforce our intellectual property rights or loss of our intellectual property rights through costly litigation or administrative proceedings, could adversely affect our ability to compete and our business.
Failure to protect our intellectual property, inability to enforce our intellectual property rights or loss of our intellectual property rights through costly litigation or administrative proceedings, could adversely affect our ability to compete and our business.
We may expand our operations globally, which would subject us to additional anti-corruption, anti-bribery, anti-money laundering, trade compliance, economic sanctions and similar laws, and non-compliance with such laws may subject us to criminal or civil liability and harm our business, financial condition and/or results of operations.
We currently have global operations, including in Italy, which subjects us to additional anti-corruption, anti-bribery, anti-money laundering, trade compliance, economic sanctions and similar laws, and non-compliance with such laws may subject us to criminal or civil liability and harm our business, financial condition and/or results of operations.
In this case, we may not be able to collect all or a significant portion of amounts owed to us by the distressed entity or entities. During periods of falling commodity prices our hedge receivable positions increase, which increases our exposure.
In this case, we may not be able to collect all or a significant portion of amounts owed to us by the distressed entity or entities. During periods of falling commodity prices our hedge receivable positions increase, which increases our exposure. If the creditworthiness of our counterparties deteriorates and results in their nonperformance, we could incur a significant loss.
The loss of key personnel could adversely affect our ability to execute our strategic, operational and financial plans. Our operations are dependent upon key management and technical personnel, and one or more of these individuals could leave our employment. The unexpected loss of the services of one or more of these individuals could have a detrimental effect on us.
Our operations are dependent upon key management and technical personnel, and one or more of these individuals could leave our employment. The unexpected loss of the services of one or more of these individuals could have a detrimental effect on us.
Although we maintain property insurance, there can be no assurance that such coverage will be adequate or will cover any particular incident in the event of a catastrophe or significant disruption of our business, or that we will be able to obtain sufficient insurance coverage in the future.
Although we maintain property insurance, there can be no assurance that such coverage will be adequate or will cover any particular incident in the event of a catastrophe or significant disruption of our business, or that we will be able to obtain sufficient insurance coverage in the future. 26 We have limited control over the activities on properties we do not operate.
The estimation of renewable natural gas production volume is an inexact process and dependent on many site-specific conditions, including the estimated annual waste volume, composition of waste, regional climate and the capacity and construction of the farm.
The estimation of renewable natural gas production volume may be inaccurate and can lead to an inexact process and is dependent on many site-specific conditions, including the estimated annual waste volume, composition of waste, weather conditions and the capacity and construction of the farm.
If we fail to maintain compliance with the continued listing standards of Nasdaq, our securities may be delisted, which could negatively affect the market price and liquidity of our Class A Common Stock.
As a public company, we are subject to the reporting requirements and the rules and regulations of the applicable listing standards of Nasdaq. If we fail to maintain compliance with the continued listing standards of Nasdaq, our securities may be delisted, which could negatively affect the market price and liquidity of our Class A Common Stock.
Slow growth or a long-term reduction in overall demand for energy could have a material adverse effect on our business strategy and could, in turn, have a material adverse effect on our business, financial condition and results of operations. 37 A policy revision with respect to the Italian government sponsored renewable natural gas floor price and renewable natural gas capital expenditure reimbursements could have a material adverse effect on our long-term business prospects, financial condition and results of operations.
A policy revision with respect to the Italian government sponsored renewable natural gas floor price and renewable natural gas capital expenditure reimbursements could have a material adverse effect on our long-term business prospects, financial condition and results of operations.
These risks may include, among other things: ● loss of revenue, property and equipment as a result of hazards such as expropriation, war, insurrection and other political risks; ● increases in taxes, including VAT taxes and potential future energy tax measures and governmental royalties; ● renegotiation of contracts with governmental entities; ● failure of the government to provide necessary permits within the anticipated timeframe, or at all; ● changes in laws and policies governing operations of foreign-based companies; and ● currency restrictions and exchange rate fluctuations. 40 Our international operations may also be adversely affected by laws and policies of the United States affecting foreign trade and taxation.
All of our natural gas assets and renewable gas assets are currently located in the country of Italy with risks may include, among other things: ● loss of revenue, property and equipment as a result of hazards such as expropriation, war, insurrection and other political risks; ● increases in taxes, including VAT taxes and potential future energy tax measures and governmental royalties; ● renegotiation of contracts with governmental entities; ● failure of the government to provide necessary permits within the anticipated timeframe, or at all; ● changes in laws and policies governing operations of foreign-based companies; and ● currency restrictions and exchange rate fluctuations.
We may also be subject to governmental export and import controls that could impair our ability to compete in international markets or subject us to liability if we violate the controls. If we expand our operations globally, we would be subject to the U.S.
We may also be subject to governmental export and import controls that could impair our ability to compete in international markets or subject us to liability if we violate the controls. We currently have global operations, including in Italy, which subjects to the U.S.
For example, we limited the number of holders of Class C HoldCo Units, and the limited liability company agreement of HoldCo (the “A&R HoldCo LLC Agreement”), provides for certain limitations on the ability of holders of Class C HoldCo Units to transfer their Class C HoldCo Units and provides us, as the manager of HoldCo, with the right to prohibit the exercise of a HoldCo Holder Redemption Right if it determines (based on the advice of counsel) there is a material risk that HoldCo would be a publicly traded partnership as a result of such exercise. 43 If HoldCo were to become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes, significant tax inefficiencies might result for us and for HoldCo, including as a result of our inability to file a consolidated U.S. federal income tax return with HoldCo.
For example, we limited the number of holders of Class C HoldCo Units, and the limited liability company agreement of HoldCo (the “A&R HoldCo LLC Agreement”), provides for certain limitations on the ability of holders of Class C HoldCo Units to transfer their Class C HoldCo Units and provides us, as the manager of HoldCo, with the right to prohibit the exercise of a HoldCo Holder Redemption Right if it determines (based on the advice of counsel) there is a material risk that HoldCo would be a publicly traded partnership as a result of such exercise.
This could have a material adverse effect on our business, financial condition, results of operations and cash flows. Risks Related to Foreign Operations and Regulatory Matters Our primary operations are in another country and we are subject to political, economic and other uncertainties.
This could have a material adverse effect on our business, financial condition, results of operations and cash flows. Risks Related to Foreign Operations and Regulatory Matters Our primary operations are in Italy, making us vulnerable to risks associated with operating in one geographic area and we are subject to political, economic and other uncertainties.
If pricing of alternative energy sources becomes more favorable or the Italian government revises its energy policy to suspend or halt financial support of renewable natural gas, our business, financial condition and results of operations will be adversely affected.
If pricing of alternative energy sources becomes more favorable or the Italian government revises its energy policy to suspend or halt financial support of renewable natural gas, our business, financial condition and results of operations will be adversely affected. 37 We will face competition on the prices we receive for our renewable electricity and for rights to manage or develop renewable natural gas plants.
As a result, the amount of renewable natural gas actually produced by the farm sites from which our production facilities will collect renewable natural gas or the volume of electricity or renewable natural gas generated from those sites may in the future vary from our initial estimates, and those variations may be material. 38 In addition, the renewable natural gas available to our plants is dependent in part on the actions of other persons, such as farm operators.
As a result, the amount of renewable natural gas actually produced by the farm sites from which our production facilities will collect renewable natural gas or the volume of electricity or renewable natural gas generated from those sites may in the future vary from our initial estimates, and those variations may be material.
We do not currently utilize derivative instruments to manage these foreign currency risks. As a result, our consolidated earnings and cash flows may be impacted by movements in the exchange rates. Our results of operations, financial condition and cash flows could be adversely affected by changes in environmental laws and regulations.
We do not currently utilize derivative instruments to manage these foreign currency risks. As a result, our consolidated earnings and cash flows may be impacted by movements in the exchange rates. Our business may be affected by changes in applicable sanctions or export controls laws and regulations.
Such failures or delays could limit the amount of energy our operating facilities deliver or delay the completion of our construction plants, which may also result in adverse consequences under our gas rights agreements and off-take agreements.
Such failures or delays could limit the amount of energy our operating facilities deliver or delay the completion of our construction plants, which may also result in adverse consequences under our gas rights agreements and off-take agreements. Additionally, such failures, delays or increased costs could have a material adverse effect on our business, financial condition and results of operations.
Increased environmental standards, issues related to compliance with environmental regulations and decreased subsidies programs may curtail, delay or cancel our scheduled projects, or the development schedule. 42 Our business is and will be subject to issues related to compliance with environmental regulations, to environmental hazards, such as biomethane plant leaks, pipeline and tank ruptures, and unauthorized releases of toxic gases or other pollutants into the environment.
Our business is and will be subject to issues related to compliance with environmental regulations, to environmental hazards, such as biomethane plant leaks, pipeline and tank ruptures, and unauthorized releases of toxic gases or other pollutants into the environment.
Consequently, our revenue, profitability, future rate of growth, liquidity and financial position depend upon the market prices for natural gas in Italy. The prices for natural gas in Italy have historically been volatile and have been particularly volatile in recent years.
Consequently, our revenue, profitability, future rate of growth, liquidity and financial position depend upon the market prices for natural gas in Italy. The prices for natural gas in Italy have historically been volatile and have been particularly volatile in recent years. We expect commodity price volatility to continue in the future due to macroeconomic uncertainty and geopolitical tensions.
If we fail to promote and maintain our brand successfully, or if we incur substantial expenses in an unsuccessful attempt to promote and maintain our brand, we may fail to build a market presence and we may fail to be viewed as an attractive investment platform in which case our business and financial condition may be adversely affected.
If we fail to promote and maintain our brand successfully, or if we incur substantial expenses in an unsuccessful attempt to promote and maintain our brand, we may fail to build a market presence and we may fail to be viewed as an attractive investment platform in which case our business and financial condition may be adversely affected. 31 We also believe that the protection of our trademark rights is an important factor in protecting our brand and maintaining goodwill.
In addition, delays in the development of reserves could require us to reclassify our PUDs as unproved reserves. 23 While we have drilled and tested certain exploration and development wells, we have no history of converting the exploration and development wells to producing natural gas wells and there can be no assurance that we will successfully establish natural gas operations or profitably produce natural gas.
While we have drilled and tested certain exploration and development wells, we have no history of converting the exploration and development wells to producing natural gas wells and there can be no assurance that we will successfully establish natural gas operations or profitably produce natural gas.
These requirements will not apply to us as long as we remain a controlled company. We may utilize some or all of these exemptions. Accordingly, you may not have the same protections afforded to stockholders of companies that are subject to all of the corpor ate governance requirements of Nasdaq Capital Market.
We may utilize some or all of these exemptions. Accordingly, you may not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of Nasdaq Capital Market.
In addition, if we fail to achieve and maintain the adequacy of our internal controls, as such standards are modified, supplemented or amended from time to time, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act.
In addition, if we fail to achieve and maintain the adequacy of our internal controls, as such standards are modified, supplemented or amended from time to time, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act. 46 In addition, our independent registered public accounting firm will not be required to attest formally to the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act for as long as we qualify for scaled “smaller reporting company” disclosure under the Exchange Act.
Such restrictions could prohibit drilling in certain areas, require the implementation of expensive mitigation measures or could result in limitations on our exploration and production activities that could have a material adverse impact on our ability to develop and produce our reserves or find new reserves on our undeveloped lands and permits. 24 In 2015, the Italian government published the Law 208/2015 which prohibited research, prospection and exploitation in waters within a 12-mile limit of the Italian Peninsula.
Such restrictions could prohibit drilling in certain areas, require the implementation of expensive mitigation measures or could result in limitations on our exploration and production activities that could have a material adverse impact on our ability to develop and produce our reserves or find new reserves on our undeveloped lands and permits.
If a court were to find either exclusive-forum provision in our Certificate of Incorporation to be inapplicable or unenforceable in an action, it may incur further significant additional costs associated with resolving the dispute in other jurisdictions, all of which could harm our business. 50 The Company may redeem unexpired Public Warrants prior to their exercise at a time that is disadvantageous to the holder, thereby making the Public Warrants worthless .
If a court were to find either exclusive-forum provision in our Certificate of Incorporation to be inapplicable or unenforceable in an action, it may incur further significant additional costs associated with resolving the dispute in other jurisdictions, all of which could harm our business.
Redemption of the outstanding Public Warrants as described above could force holders to (i) exercise the Public Warrants and pay the exercise price therefor at a time when it may be disadvantageous for holders to do so, (ii) sell the Public Warrants at the then-current market price when holders might otherwise wish to hold the Public Warrants or (iii) accept the nominal redemption price which, at the time the outstanding Public Warrants are called for redemption, we expect would be substantially less than the market value of the Public Warrants.
Redemption of the outstanding Public Warrants as described above could force holders to (i) exercise the Public Warrants and pay the exercise price therefor at a time when it may be disadvantageous for holders to do so, (ii) sell the Public Warrants at the then-current market price when holders might otherwise wish to hold the Public Warrants or (iii) accept the nominal redemption price which, at the time the outstanding Public Warrants are called for redemption, we expect would be substantially less than the market value of the Public Warrants. 48 We have the ability to require holders of the Public Warrants to exercise such Public Warrants on a cashless basis, which will cause holders to receive fewer shares of Class A Common Stock upon their exercise of the Public Warrants than they would have received had they been able to exercise their Public Warrants for cash.
Therefore, any return on investment in our Class A Common Stock is solely dependent upon the appreciation of the price of our Class A Common Stock on the open market, which may not occur. 49 If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our Class A Common Stock adversely, the price and trading volume of our Class A Common Stock could decline.
If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our Class A Common Stock adversely, the price and trading volume of our Class A Common Stock could decline.
To the extent we face increased regulatory requirements, we may be required to expend significant additional resources to meet such requirements. 32 The unavailability or high cost of additional drilling rigs, completion services, equipment, supplies, personnel, and oilfield services could adversely affect our ability to execute our exploration and development plans within our budget and on a timely basis.
The unavailability or high cost of additional drilling rigs, completion services, equipment, supplies, personnel, and oilfield services could adversely affect our ability to execute our exploration and development plans within our budget and on a timely basis.
Brand promotion activities may not yield increased revenue, and even if they do, the increased revenue may not offset the expenses we incur in building and maintaining our brand and reputation.
To promote our brand, we need to incur increased expenses, such as the costs associated with attending trade conferences. Brand promotion activities may not yield increased revenue, and even if they do, the increased revenue may not offset the expenses we incur in building and maintaining our brand and reputation.
Our dependence on the operator and other working interest owners, including a joint venture participant, for these projects and our limited ability to influence or control the operation and future development of these properties could materially adversely affect the realization of our targeted returns on capital in drilling or acquisition activities and lead to unexpected future costs. 26 Our drilling locations are scheduled out over many years, making them susceptible to uncertainties that could materially alter the occurrence or timing of when they are drilled, if at all.
Our dependence on the operator and other working interest owners, including a joint venture participant, for these projects and our limited ability to influence or control the operation and future development of these properties could materially adversely affect the realization of our targeted returns on capital in drilling or acquisition activities and lead to unexpected future costs.
If our existing shareholders sell or indicate an intention to sell substantial amounts of our Class A Common Stock in the public market, the trading price of our Class A Common Stock could decline.
As such, short sales of our Class A Common Stock could have a tendency to depress the price of our Class A Common Stock, which could further increase the potential for short sales. 49 If our existing shareholders sell or indicate an intention to sell substantial amounts of our Class A Common Stock in the public market, the trading price of our Class A Common Stock could decline.
Such steps could include distributing such cash balances as dividends on our Class A Common Stock and reinvesting such cash balances in HoldCo for additional Class C HoldCo Units (with an accompanying stock dividend with respect to our Class A Common Stock or an adjustment to the one-to-one exchange ratio applicable to the exercise of the HoldCo Holder Redemption Right or a Mandatory Exchange).
Such steps could include distributing such cash balances as dividends on our Class A Common Stock and reinvesting such cash balances in HoldCo for additional Class C HoldCo Units (with an accompanying stock dividend with respect to our Class A Common Stock or an adjustment to the one-to-one exchange ratio applicable to the exercise of the HoldCo Holder Redemption Right or a Mandatory Exchange). 43 The tax distributions to the HoldCo unitholders may be substantial and may, in the aggregate, exceed the amount of taxes that HoldCo would have paid if it were a similarly situated corporate taxpayer.
Developments in the regulatory framework intended to increase the level of market liquidity or of deregulation or intended to reduce operators’ ability to transfer to customers cost increases in raw materials may negatively affect future sales margins of gas and electricity, operating results, and cash flow.
Developments in the regulatory framework intended to increase the level of market liquidity or of deregulation or intended to reduce operators’ ability to transfer to customers cost increases in raw materials may negatively affect future sales margins of gas and electricity, operating results, and cash flow. 40 All of our natural gas and renewable gas properties are located in the country of Italy, making us vulnerable to risks associated with operating in one geographic area.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe routinely assess material risks from cybersecurity threats, including any potential unauthorized attempts to access our information systems that may result in adverse effects on the confidentiality, integrity, or availability of those systems.
Biggest changeWe routinely assess material risks from cybersecurity threats, including any potential unauthorized attempts to access our information systems that may result in adverse effects on the confidentiality, integrity, or availability of those systems. 50 Despite these efforts, our policies and procedures may not be properly followed in every instance and may not always be effective.
Following these risk assessments, if necessary, we would re-design and implement reasonable additional safeguards to minimize identified risks and address any identified gaps in existing safeguards. Primary responsibility for assessing, monitoring, and managing our cybersecurity risks rests with our third-party IT service provider who reports to our Chief Accounting Officer, to manage the risk assessment and mitigation process.
Following these risk assessments, if necessary, we would re-design and implement reasonable additional safeguards to minimize identified risks and address any identified gaps in existing safeguards. Primary responsibility for assessing, monitoring, and managing our cybersecurity risks rests with our third-party IT service provider who reports to our Chief Financial Officer, to manage the risk assessment and mitigation process.
Item 1C. Cybersecurity Risk management and strategy We have established processes for assessing, identifying, and managing material risk from cybersecurity threats, and have integrated these processes into our overall risk management systems and processes.
Item 1C. Cybersecurity We have established processes for assessing, identifying, and managing material risk from cybersecurity threats, and have integrated these processes into our overall risk management systems and processes.
Our Chief Accounting Officer is primarily responsible for assessing and managing our material risks from cybersecurity threats with assistance from our third-party IT service provider. Our Chief Accounting Officer oversees our cybersecurity policies and processes, coordinating with our third-party IT service provider, which has over 20 years of experience and expertise in cybersecurity risk management.
Our Chief Financial Officer is primarily responsible for assessing and managing our material risks from cybersecurity threats with assistance from our third-party IT service provider. Our Chief Financial Officer oversees our cybersecurity policies and processes, coordinating with our third-party IT service provider, which has over 20 years of experience and expertise in cybersecurity risk management.
These risk assessments include identification of reasonably foreseeable internal and external risks, the likelihood and potential damage that could result from such risks, and the sufficiency of existing policies, procedures, systems, and safeguards in place to manage such risks.
Cyber Risk Management and Strategy Our cybersecurity assessments include identification of reasonably foreseeable internal and external risks, the likelihood and potential damage that could result from such risks, and the sufficiency of existing policies, procedures, systems, and safeguards in place to manage such risks.
Our Chief Accounting Officer will provide periodic briefings to the Executive Director, the Audit Committee and/or the Board of Directors as needed regarding any material cybersecurity risks or activities, including any recent cybersecurity incidents and related responses, based on information provided by the third-party service provider. 53
The third-party service provider is responsible for implementing cybersecurity measures and monitoring threats. Our Chief Financial Officer will provide periodic briefings to the Executive Director, the Audit Committee and/or the Board of Directors as needed regarding any material cybersecurity risks or activities, including any recent cybersecurity incidents and related responses, based on information provided by the third-party service provider. 51
Removed
The third-party service provider is responsible for implementing cybersecurity measures and monitoring for threats.
Added
Our risk factors, which can found be found in Part I, Item 1A. “Risk Factors,” include further detail about the material cybersecurity risks we face.
Added
We have had no cybersecurity incidents or other risks from cybersecurity threats to date that have materially affected, or are reasonably likely to materially affect, us, including our business strategy, results of operations, or financial condition.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties AleAnna is a corporation incorporated under the laws of Delaware. Our headquarters is currently in Dallas, Texas, and houses our US-based management team and certain support individuals. Our Italian management team is housed in Rome, Italy-based offices. Leasing our facilities gives us the flexibility to expand or reduce our office space as appropriate.
Biggest changeItem 2. Properties AleAnna is a corporation incorporated under the laws of Delaware. Our headquarters is currently in Dallas, Texas, and houses our US-based management team and certain support individuals. Our Italian management team is housed in Rome and Milan, Italy-based offices. Leasing our facilities gives us the flexibility to expand or reduce our office space as appropriate.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeDue to the inherent uncertain nature of litigation, the ultimate outcome or actual cost of settlement may materially vary from estimates. Blugas Settlement On May 28, 2024, we entered into the Blugas Settlement Agreement with Blugas, regarding Blugas’ retained interest in the physical volumes extracted from the Longanesi field.
Biggest changeDue to the inherent uncertain nature of litigation, the ultimate outcome or actual cost of settlement may materially vary from estimates. Item 4. Mine Safety Disclosures Not Applicable. 52 PART II
Removed
We contested the existence of Blugas’ right to receive the Blugas ORRI. Under the terms of the Blugas Settlement Agreement, we agreed to pay Blugas approximately €5 million, plus an additional €1.1 million in applicable VAT (a total of approximately $6.6 million in U.S. Dollars).
Removed
In exchange for such payment, Blugas agreed to irrevocably waive, among other things, the Blugas ORRI and release us from any future liability related to the Blugas ORRI. As a result of the transactions contemplated by the Blugas Settlement Agreement, our 33.5% working interest in the Longanesi field is now unencumbered except for normal government royalties (10%).
Removed
We accounted for the Blugas settlement as an acquisition of the Blugas ORRI claim with a corresponding increase to the expected future cash flows from our reserves. Our year-end December 31, 2024 reserve quantities included the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ) allocable to the Blugas ORRI in its proved gas reserves.
Removed
Our working interest (net revenue interest) as established under the terms of the Unified Operating Agreement arrangement originally signed between ENI and Grove and dated September 26, 2009, remains unchanged at 33.5%.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers We did not repurchase any Class A Common Stock or Public Warrants during the three months ended December 31, 2024.
Biggest changeIssuer Purchases of Equity Securities We did not repurchase any shares of our equity securities during the years ended December 31, 2025 or 2024.
Holders On March 31, 2025, there were 43 holders of record of our Class A Common Stock, one holder of record of our Class C Common Stock and one holder of record of our Public Warrants.
Holders On March 19, 2026, there were 43 holders of record of our Class A Common Stock, one holder of record of our Class C Common Stock and one holder of record of our Public Warrants.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information AleAnna Class A Common Stock and Public Warrants currently trade on Nasdaq under the trading symbols of “ANNA” and “ANNAW,” respectively, and on March 31, 2025, the Company had 40,584,455 shares of Class A Common Stock issued and outstanding, 25,994,000 shares of Class C Common Stock issued and outstanding and 11,225,969 Warrants issued and outstanding.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information AleAnna Class A Common Stock and Public Warrants currently trade on Nasdaq under the trading symbols of “ANNA” and “ANNAW,” respectively, and on March 19, 2026, the Company had 40,659,881 shares of Class A Common Stock issued and outstanding, 25,994,400 shares of Class C Common Stock issued and outstanding and 11,150,543 Warrants issued and outstanding.
In addition, the Company’s board of directors is not currently contemplating and does not anticipate declaring any stock dividends in the foreseeable future. Recent Sales of Unregistered Securities None other than as previously reported.
In addition, the Company’s board of directors is not currently contemplating and does not anticipate declaring any stock dividends in the foreseeable future.
Added
Recent Sales of Unregistered Securities There were no sales of unregistered securities during the year ended December 31, 2025 that were not previously reported on a Quarterly Report on Form 10-Q or a Current Report on Form 8-K.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThese shares were all exchanged for Class A and Class C common stock in connection with the Business Combination. 59 Results of Operations Comparison of the year ended December 31, 2024 and 2023: For the Year Ended December 31, Dollar Percentage 2024 2023 Change Change Revenues $ 1,420,030 $ - $ 1,420,030 NM Operating Expenses: Cost of revenues $ 1,043,174 $ - $ 1,043,174 NM General and administrative 6,264,087 5,634,150 629,937 11 % Depreciation 133,516 - 133,516 NM Accretion of asset retirement obligation 133,239 133,239 - 0 % Business Combination transaction expenses 8,398,653 - 8,398,653 NM Total Operating Expenses 15,972,669 5,767,389 10,205,280 177 % Other Income (Expense): Interest and other income (expense) 1,948,281 (102,041 ) 2,050,322 2009 % Change in fair value of derivative liability 173,177 708,869 (535,692 ) -76 % Total Other Income (Expense) 2,121,458 606,828 1,514,630 250 % Net loss $ (12,431,181 ) $ (5,160,561 ) $ (7,270,620 ) 141 % Deemed dividend to Class 1 Preferred Units redemption value (155,423,177 ) (53,219,200 ) (102,203,977 ) 192 % Noncontrolling interests in earnings of subsidiaries 87,511 - 87,511 NM Net loss attributable to Class A Common stockholders or holders of Common Member Units $ (167,766,847 ) $ (58,379,761 ) $ (109,387,086 ) 187 % Other Comprehensive Income (Loss) Currency translation adjustment (1,548,154 ) 218,908 (1,767,062 ) 807 % Comprehensive Loss $ (13,979,335 ) $ (4,941,653 ) $ (9,037,682 ) 183 % Revenues and Cost of Revenues During the year ended December 31, 2024, all of our revenue was earned through electricity generation and sales at the Casalino and Campopiano renewable natural gas plants that were purchased in July 2024.
Biggest changeConsolidated Results of Operations The following table shows our consolidated results of operations for the years ended December 31, 2025 and 2024: For the Year Ended December 31, Dollar Percentage 2025 2024 Change Change Revenues $ 25,035,737 $ 1,420,030 $ 23,615,707 1,663 % Operating expenses: Cost of revenues $ 6,195,475 $ 1,043,174 $ 5,152,301 494 % Lease operating expense 3,207,562 - 3,207,562 NM General and administrative 9,664,653 6,264,087 3,400,566 54 % Depreciation and depletion 2,933,481 133,516 2,799,965 2,097 % Accretion of asset retirement obligation 132,002 133,239 (1,237 ) -1 % Business combination transaction expenses - 8,398,653 (8,398,653 ) -100 % Total operating expenses 22,133,172 15,972,669 6,160,503 39 % Operating income (loss) 2,902,565 (14,552,639 ) 17,455,204 120 % Other income: Interest and other income 1,242,899 1,948,281 (705,382 ) -36 % Change in fair value of derivative liability - 173,177 (173,177 ) -100 % Total other income 1,242,899 2,121,458 (878,559 ) -41 % Income (loss) before income taxes 4,145,464 (12,431,181 ) 16,579,645 133 % Income tax expense (1,263,396 ) - (1,263,396 ) NM Net income (loss) 2,882,068 (12,431,181 ) 15,313,249 123 % Deemed dividend to Class 1 Preferred Units redemption value - (155,423,177 ) 155,423,177 100 % Net loss (income) attributable to noncontrolling interests (1,082,958 ) 87,511 (1,170,469 ) -1338 % Net income (loss) attributable to Class A Common stockholders or holders of Common Member Units $ 1,799,110 $ (167,766,847 ) $ 169,565,957 101 % Other comprehensive income (loss) Currency translation adjustment 4,111,281 (1,548,154 ) 5,659,435 366 % Comprehensive income (loss) 6,993,349 (13,979,335 ) 20,972,684 150 % Comprehensive income attributable to noncontrolling interests (3,332,249 ) 87,511 (3,419,760 ) -3908 % Total comprehensive income (loss) attributable to Class A Common stockholders $ 3,661,100 $ (13,891,824 ) $ 17,552,924 126 % Revenues and Cost of Revenues During the year ended December 31, 2025, our revenue was earned primarily through sales of our share of natural gas production from the Longanesi field and, to a lesser extent, from electricity generation and sales at the Casalino and Campopiano renewable natural gas plants.
Our year-end December 31, 2023 reserve quantities included the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ) allocable to the Blugas ORRI in our proved gas reserves.
Our year-end December 31, 2023 reserve quantities included the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ) allocable to the Blugas ORRI in our proved gas reserves.
However, the required payments to Blugas associated with the sale of such quantities were reflected as cash outflows (costs) in our year-end December 31, 2023 reserve report as if such amounts were paid to Blugas.
However, the required payments to Blugas associated with the sale of such quantities were reflected as cash outflows (costs) in our year-end December 31, 2023 reserve report as if such amounts were paid to Blugas.
Following settlement, our year-end December 31, 2024 reserve quantities continue to include the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ), however, the previously required payments to Blugas associated with the sale of such quantities are no longer reflected as cash outflows (costs) as if such amounts were paid to Blugas.
Following settlement, our year-end December 31, 2024 reserve quantities continue to include the 20% of 350 million standard cubic meters (approximately 2,472 10 6 ft 3 ), however, the previously required payments to Blugas associated with the sale of such quantities are no longer reflected as cash outflows (costs) as if such amounts were paid to Blugas.
We are using these funds to fulfill Longanesi gas pipeline and plant activity obligations, as well as general and administrative expenses. 57 Blugas Settlement On May 28, 2024, we reached a settlement agreement (the “Blugas Settlement Agreement”) with Blugas Infrastructure S.r.l.
We are using these funds to fulfill Longanesi gas pipeline and plant activity obligations, as well as general and administrative expenses. Blugas Settlement On May 28, 2024, we reached a settlement agreement (the “Blugas Settlement Agreement”) with Blugas Infrastructure S.r.l.
The majority of these losses stem from costs associated with the Longanesi field drilling and development, including asset impairments from previous years, as well as seismic imaging, exploratory costs for other conventional natural gas prospects, and general and administrative expenses.
The majority of these accumulated losses stem from costs associated with the Longanesi field drilling and development, including asset impairments from previous years, as well as seismic imaging, exploratory costs for other conventional natural gas prospects, and general and administrative expenses.
Accordingly, for accounting purposes, the Business Combination is treated as the equivalent of AleAnna Energy issuing stock for the net assets of SPAC, accompanied by a recapitalization. 56 We incurred $9.5 million in transaction costs related to the Business Combination.
Accordingly, for accounting purposes, the Business Combination is treated as the equivalent of AleAnna Energy issuing stock for the net assets of SPAC, accompanied by a recapitalization. We incurred $9.5 million in transaction costs related to the Business Combination.
Following the upgrade process to transition the assets to biomethane to renewable natural gas conversion, we expect to sell renewable natural gas to customer(s) by trucking or piping the renewable natural gas to the interstate pipeline system (SNAM).
Following the upgrade process to transition the assets to biomethane to renewable natural gas conversion, we expect to sell renewable natural gas to customer(s) by trucking or piping the renewable natural gas to the interstate pipeline system.
See Note 3 for more information. Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the consolidated financial statements carrying amounts of existing assets and liabilities and their respective tax bases.
See Note 6 for more information. Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the consolidated financial statements carrying amounts of existing assets and liabilities and their respective tax bases.
The development of our natural gas reserve quantities requires management to make significant estimates and assumptions related to the intent and ability to complete undeveloped proved reserves within a five-year development period, as prescribed by SEC guidelines. Management engaged DeGolyer to prepare reserves estimates for our estimated proved reserves at December 31, 2024, and 2023.
The development of our natural gas reserve quantities requires management to make significant estimates and assumptions related to the intent and ability to complete undeveloped proved reserves within a five-year development period, as prescribed by SEC guidelines. Management engaged DeGolyer to prepare reserves estimates for our estimated proved reserves at December 31, 2025, and 2024.
For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2024 or 2023.
For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2025 or 2024.
Since the total capped Euro-denominated liability was recorded as of December 31, 2024, December 31, 2023, and December 31, 2022, any changes in the USD-equivalent amount were entirely due to foreign exchange rate fluctuations. As such, these changes were included in currency translation adjustment for the years ended 2024 and 2023.
Since the total capped Euro-denominated liability was recorded as of December 31, 2025, December 31, 2024, and December 31, 2023, any changes in the USD-equivalent amount were entirely due to foreign exchange rate fluctuations. As such, these changes were included in currency translation adjustment for the years ended 2025 and 2024.
If the steps the Company takes do not remediate the material weaknesses in a timely manner, there could be a reasonable possibility that these control deficiencies or others may result in a material misstatement of its annual or interim financial statements that would not be prevented or detected on a timely basis.
If the steps the Company takes do not remediate the material weakness in a timely manner, there could be a reasonable possibility that these control deficiencies or others may result in a material misstatement of its annual or interim financial statements that would not be prevented or detected on a timely basis.
The JOBS Act provides that a company can elect not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable. We expect to be an emerging growth company at least through 2025.
The JOBS Act provides that a company can elect not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable. We expect to be an emerging growth company at least through 2026.
A portion of the total costs incurred were recorded as a reduction in additional paid-in capital, up to the $0.6 million of proceeds received from the Trust, with costs in excess of funds raised from the Business Combination required to be expensed under GAAP.
A portion of the total costs incurred were recorded as a reduction in additional paid-in capital, up to the $0.6 million of proceeds received from the Trust, with costs in excess of funds raised from the Business Combination required to be expensed under U.S. GAAP.
While the timing and quantities of expected Longanesi production were unchanged from December 31, 2023 to December 31, 2024, and we had fully accrued the total capped Euro amount of the liability, average annual European natural gas forward prices declined slightly.
While the timing and quantities of expected Longanesi production were unchanged from December 31, 2024 to December 31, 2025, and we had fully accrued the total capped Euro amount of the liability, average annual European natural gas forward prices declined slightly.
Critical Accounting Policies and Estimates Our unaudited consolidated financial statements are based on the selection and application of significant accounting policies.
Critical Accounting Policies and Estimates Our consolidated financial statements are based on the selection and application of significant accounting policies.
In addition, we are exploring Resource Backed Loan (“RBL”) financing and renewable natural gas project loan products with several financial institutions; however, there is no guarantee that such financing will be available to us.
In addition, we are exploring Resource Backed Loan (“RBL”) financing and renewable natural gas project loan products and other financing arrangements with several financial institutions; however, there is no guarantee that such financing will be available to us.
Gas Sale Agreement On October 29, 2024, we entered into a gas sale agreement (“GSA”) with Shell Energy Europe Limited (“SEEL”), whereby SEEL became the exclusive buyer of our share of the natural gas produced from the Longanesi field net of (i) any consumption and/or losses incurred in the transport, treatment and compression of gas before delivery; (ii) any volume to be allocated for regulated royalties auctions, if applicable; and (iii) any other volume contractually allocated to other parties before August 31, 2022.
Gas Sale Agreement On October 29, 2024, we entered into a gas sale agreement with Shell Energy Europe Limited, under which SEEL became the exclusive buyer of our share of the natural gas produced from the Longanesi field net of (i) any consumption and/or losses incurred in the transport, treatment and compression of gas before delivery; (ii) any volume to be allocated for regulated royalties auctions, if applicable; and (iii) any other volume contractually allocated to other parties before August 31, 2022.
We believe our achieving first production of the Longanesi field is a key milestone that will fuel our potential growth. We also have potentially viable discoveries in our Gradizza and Trava fields that are expected to achieve first production in the future.
We believe achieving first production of the Longanesi field was a key milestone that will fuel our potential growth. We also believe that we have potentially viable discoveries in our Gradizza and Trava fields, which are expected to achieve first production in the future.
The estimate of the contingent consideration liability was determined based on inputs including the following as of December 31, 2024 and December 31, 2023: the intercontinental exchange futures prices for European natural gas, Euro to USD exchange rates of 1.04 and 1.11, respectively, and management’s future expected annual Longanesi production.
The estimate of the contingent consideration liability was determined based on inputs including the following as of December 31, 2025 and 2024: the intercontinental exchange futures prices for European natural gas, Euro to USD exchange rates of 1.18 and 1.04, respectively, and management’s future expected annual Longanesi production.
The net assets of SPAC are stated at their historical carrying amounts with no goodwill or intangible assets recognized in accordance with the accounting principles generally accepted in the United States of America (“GAAP”).
The net assets of SPAC are stated at their historical carrying amounts with no goodwill or intangible assets recognized in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”).
Our Longanesi, Trava and Gradizza wells were classified by DeGolyer as proved undeveloped reserves as such wells had not yet started production as of December 31, 2024 and require future investments to install production pipelines and production facilities prior to being fully completed and producible.
Our Trava and Gradizza wells were classified by DeGolyer as proved undeveloped reserves as such wells had not yet started production as of December 31, 2025 and require future investments to install production facilities prior to being fully completed and producible.
The preparation of our management’s discussion and analysis of our financial condition and results of operations is based on our audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023, which have been prepared in accordance with GAAP.
The preparation of our management’s discussion and analysis of our financial condition and results of operations is based on our audited consolidated financial statements as of and for the years ended December 31, 2025 and 2024, which have been prepared in accordance with U.S. GAAP.
Commencing and Expanding Renewable Natural Gas Operations In 2021, we launched a renewable natural gas development business focused on bringing to market carbon negative renewable natural gas derived from animal and agricultural waste.
Expanding Renewable Natural Gas Operations In 2023, we launched a renewable natural gas development business focused on bringing to market carbon negative renewable natural gas derived from animal and agricultural waste.
Estimates are based on historical experience of plugging and abandoning wells and reclaiming of disposing other assets and estimated remaining (productive) lives of the wells and assets. No incremental ARO liabilities were incurred during the year ended December 31, 2024.
Estimates are based on historical experience of plugging and abandoning wells and reclaiming of disposing other assets and estimated remaining (productive) lives of the wells and assets. No incremental ARO liabilities were incurred during the years ended December 31, 2025 or 2024.
Change in Fair Value of Derivative Liability The change in the fair value of derivative liability related to the Class 1 Preferred Units was $0.2 million during the year ended December 31, 2024, compared to $0.7 million during the same period in 2023.
Change in Fair Value of Derivative Liability The change in the fair value of derivative liability related to the Class 1 Preferred Units was zero during the year ended December 31, 2025, compared to $0.2 million during the same period in 2024.
We acquired our working interest in the Longanesi field through a 2016 transaction with Enel. We also retain wholly owned concessions, permits, and pending applications on other exploration and development prospects across Italy which are supported by proprietary modern 3D seismic reservoir imaging.
We retain a 33.5% working interest in the Longanesi field with our working interest partner, and operator, Padana. We acquired our working interest in the Longanesi field through a 2016 transaction with Enel. We also retain wholly owned concessions, permits, and pending applications on other exploration and development prospects across Italy which are supported by proprietary modern 3D seismic imaging.
The fair value gain recorded during the year ended December 31, 2024 (representing a decrease in the liability) was primarily due to a higher liquidation threshold which was driven by capital contributions made during the first quarter of 2024 through the Class 1 Preferred Units.
The fair value gain recorded during the year ended December 31, 2024 (representing a decrease in the liability) was primarily due to a higher liquidation threshold which was driven by capital contributions made during the first quarter of 2024 through the Class 1 Preferred Units. The derivative liability was derecognized in conjunction with the Business Combination in the prior year.
As a result, AleAnna previously identified material weaknesses in its internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements would not be prevented or detected on a timely basis.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements would not be prevented or detected on a timely basis.
If the screen test is met, the transaction is accounted for as an asset acquisition. If the screen test is not met, we further consider whether the set of assets acquired have, at a minimum, inputs and processes that have the ability to create outputs in the form of revenue.
If the screen test is not met, we further consider whether the set of assets acquired have, at a minimum, inputs and processes that have the ability to create outputs in the form of revenue. If the assets acquired meet this criteria, the transaction is accounted for as a business combination.
See “ Note 10 — Equity” to the audited condensed consolidated financial statements for further details. We expect to continue to incur substantial expenses related to our operations, exploration, and development activities, including pre-commercialization efforts as we continue our development of, and seek regulatory approval for, our discoveries and exploration prospects.
See “ Note 9— Equity” to the audited consolidated financial statements for further details. We expect to continue to incur substantial expenses related to our operations, exploration, and development activities, including pre-commercialization efforts as we continue our development of, and seek regulatory approval for, our discoveries and exploration prospects. We achieved net income for the first time in 2025.
We apply a practical expedient in FASB ASC 606-10-55-18 applicable to our sales by assessing whether our right to consideration corresponds directly with the value to our customers (the “invoice practical expedient”). We concluded that pricing corresponds to the value provided to the customer.
We apply a practical expedient in FASB ASC 606-10-55-18 applicable to our sales by assessing whether our right to consideration corresponds directly with the value to our customers (the “invoice practical expedient”). We concluded that pricing corresponds to the value provided to the customer. Business Combinations and Asset Acquisitions We evaluate whether a transaction meets the definition of a business.
Achieving First Production at Longanesi As previously discussed, we and Padana achieved first production of the five wells in the Longanesi field in March 2025 through use of a temporary processing facility. The permanent processing facility is expected to be constructed over the remainder of 2025 and early 2026 and commissioned mid 2026.
Continued Development of Conventional Natural Gas Projects As previously discussed, we and Padana achieved first production of the five wells in the Longanesi field in March 2025 through use of a temporary processing facility. The permanent processing facility is expected to be constructed over the remainder of 2026.
The fair value of consideration transferred for an acquisition is allocated to the assets acquired and liabilities assumed based on their fair value on a nonrecurring basis on the acquisition date and are subject to fair value adjustments under certain circumstances.
Acquisitions that qualify as a business combination are accounted for using the acquisition method of accounting. The fair value of consideration transferred for an acquisition is allocated to the assets acquired and liabilities assumed based on their fair value on a nonrecurring basis on the acquisition date and are subject to fair value adjustments under certain circumstances.
Our plan includes the below: ● Designing and implementing a risk assessment process supporting the identification of risks facing AleAnna. ● Implementing controls to enhance our review of significant accounting transactions and other new technical accounting and financial reporting issues and preparing and reviewing accounting memoranda addressing these issues. ● Hiring additional experienced accounting, financial reporting and internal control personnel and changing roles and responsibilities of our personnel as we transition to being a public company and are required to comply with Section 404 of the Sarbanes-Oxley Act. ● Implementing controls to enable an accurate and timely review of accounting records that support our accounting processes and maintain documents for internal accounting reviews.
We have made significant progress on our remediation plan specific to material weakness identified with completion of the following tasks: ● Designing and implementing a risk assessment process supporting the identification of risks facing AleAnna. ● Implementing controls to enhance our review of significant accounting transactions and other new technical accounting and financial reporting issues and preparing and reviewing accounting memoranda addressing these issues. ● Hiring additional experienced accounting, financial reporting and internal control personnel and changing roles and responsibilities of our personnel as we transition to being a public company and are required to comply with Section 404 of the Sarbanes-Oxley Act. ● Implementing controls to enable an accurate and timely review of accounting records that support our accounting processes and maintain documents for internal accounting reviews. 64 The Company believes that these measures described above will remediate the identified material weakness and strengthen the Company’s internal control over financial reporting.
Reserve estimates are inherently imprecise. Accordingly, the estimates are expected to change as more current information becomes available. Such estimates are subject to the uncertainties inherent in the application of judgmental factors in interpreting such information.
PUDs are converted from undeveloped to developed as applicable wells begin production. Reserve estimates are inherently imprecise. Accordingly, the estimates are expected to change as more current information becomes available. Such estimates are subject to the uncertainties inherent in the application of judgmental factors in interpreting such information.
Future sales under the GSA are contingent upon the commencement of gas production. Renewable Natural Gas Acquisitions Between March 2024 and July 2024, we successfully completed three separate strategic acquisitions of renewable natural gas plant projects in Italy for an aggregate of approximately $9.5 million.
Renewable Natural Gas Acquisitions Between March 2024 and July 2024, we successfully completed three separate strategic acquisitions of renewable natural gas plant projects in Italy for an aggregate of approximately $9.5 million.
The core principle underlying revenue recognition under ASC 606 is that revenue should be recognized as goods or services are transferred to customers in an amount that reflects the consideration to which we expect to be entitled.
Revenue Recognition General — We follow the guidance of FASB Accounting Standards Codification 606, Revenue from Contracts with Customers (“ASC 606”). The core principle underlying revenue recognition under ASC 606 is that revenue should be recognized as goods or services are transferred to customers in an amount that reflects the consideration to which we expect to be entitled.
If the assets acquired meet this criteria, the transaction is accounted for as a business combination. Acquisitions that qualify as an asset acquisition are accounted for using a cost accumulation model where the purchase price of the acquisition is allocated to the assets acquired on a relative fair value basis on the date of acquisition.
Acquisitions that qualify as an asset acquisition are accounted for using a cost accumulation model where the purchase price of the acquisition is allocated to the assets acquired on a relative fair value basis on the date of acquisition. We generally account for acquisitions of renewable natural gas assets as asset acquisitions.
In preparing these financial statements, we make estimates and assumptions impacting asset and liability amounts, disclosure of contingent liabilities, and expenses incurred. 64 The estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.
The estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.
The plant assets are fully permitted for production of electricity through conversion of crop and animal waste bio feedstocks. The plant assets are currently biomethane to electricity conversion assets. It is our intention to begin upgrading the sites to refine biomethane into renewable natural gas through upgrading units.
The plant assets are currently biomethane to electricity conversion assets. It is our intention to begin upgrading the sites to refine biomethane into renewable natural gas through upgrading units.
We generally account for acquisitions of renewable natural gas assets as asset acquisitions. Inputs used to determine such fair values are primarily based upon internally-developed estimates, estimates developed by third-party valuation firms, and publicly-available data regarding renewable natural gas asset transactions consummated by other buyers and sellers, as applicable.
Inputs used to determine such fair values are primarily based upon internally-developed estimates, estimates developed by third-party valuation firms, and publicly-available data regarding renewable natural gas asset transactions consummated by other buyers and sellers, as applicable. These fair values are considered Level 3 assets in the fair value hierarchy. Any associated acquisition costs are generally capitalized.
Business Combinations and Asset Acquisitions We evaluate whether a transaction meets the definition of a business. We first apply a screen test to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets.
We first apply a screen test to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If the screen test is met, the transaction is accounted for as an asset acquisition.
Key Factors Affecting our Performance, Prospects and Future Results We believe that our performance and future success depend on a number of factors that present significant opportunities for us but also pose risks and challenges, including competition from other carbon-based and non-carbon-based fuel producers, regulatory hurdles posed by the Italian government, and other factors discussed under the section titled “ Risk Factors .” We believe the factors described below are key to our success.
As the cash outflows (costs) are no longer reflected as if paid to Blugas, such amounts are reflected in our December 31, 2024 reserve report as allocable to our unencumbered 33.5% working interest. 55 Key Factors Affecting our Performance, Prospects and Future Results We believe that our performance and future success depends on a number of factors that present significant opportunities for us but also pose risks and challenges, including competition from other carbon-based and non-carbon-based fuel producers, regulatory hurdles posed by the Italian government, and other factors discussed under the section titled “ Risk Factors .” We believe the factors described below are key to our success.
Key Components of Results of Operations We are an early-stage company and our historical results may not be indicative of our future results.
Key Components of Results of Operations We are an early-stage company, and our historical results may not be indicative of our future results. Accordingly, the drivers of our future financial results, as well as the components of such results, may not be comparable to our historical results of operations or our future results of operations.
Presently, Padana is the operator of the Longanesi field under a Unitized Operating Agreement, and other companies in the future may operate some of the properties in which we have an interest.
There can be no guarantee that financing will be available on acceptable terms or at all. Presently, Padana is the operator of the Longanesi field under a Unitized Operating Agreement, and other companies in the future may operate some of the properties in which we have an interest.
ASC 606 defines a five-step process to achieve recognition and mandates additional disclosure about the nature, amount, timing and uncertainty of revenues and cash flows arising from customer contracts, including significant judgments, and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. 65 Renewable Natural Gas — As of December 31, 2024, we primarily earn revenue through electricity generation revenue from the conversion of bio feedstocks to biomethane which is then converted to electricity through reciprocating generators.
ASC 606 defines a five-step process to achieve recognition and mandates additional disclosure about the nature, amount, timing and uncertainty of revenues and cash flows arising from customer contracts, including significant judgments, and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.
We are also subject to a Valued-Added Tax (“VAT”) which is a broadly-based consumption tax that is assessed to the value that is added to goods and services. The VAT applies to nearly all goods and services that are bought and sold within the EU. Italian law allows for certain VAT payments to be recovered through ongoing applications for refunds.
We are also subject to a Valued-Added Tax (“VAT”) which is a broadly-based consumption tax assessed on the value added to goods and services. VAT generally applies to most goods and services bought and sold within the EU.
Currency Translation Adjustment For the purposes of presenting consolidated financial statements, the assets and liabilities of our Euro operations are translated to USD at the exchange rate on the reporting date. The income and expenses are translated using average exchange rates.
The shift to taxable earnings in the current year led to the recognition of income tax expense based on applicable statutory rates. 59 Currency Translation Adjustment For the purpose of presenting consolidated financial statements, the assets and liabilities of our Euro operations are translated to USD at the exchange rate on the reporting date.
Of the remaining $8.9 million, approximately $0.5 million represented prepaid directors and officers insurance premiums that were recorded to other assets in the consolidated balance sheet, and $8.4 million represented legal, accounting, consulting and advisory fees which were recorded as Business Combination transaction expenses in the consolidated statement of operations and comprehensive loss.
Of the remaining $8.9 million, approximately $0.5 million represented prepaid directors and officers insurance premiums that were recorded to other assets in the consolidated balance sheet, and $8.4 million represented legal, accounting, consulting and advisory fees which were recorded as Business Combination transaction expenses in the consolidated statement of operations and comprehensive income (loss). 54 Recent Developments Gradizza Concession – Regional Intesa Approval During the third quarter of 2025, we reached an agreement with the Emilia Romagna Region (the “Intesa”) in support of our pending application for a production concession related to the Gradizza field.
The technologies used in the estimation of our net proved undeveloped reserves include, but are not limited to, empirical evidence through drilling results and well performance, production data, decline curve analysis, well logs, geologic maps, core data, seismic data, demonstrated relationship between geologic parameters and performance, and the implementation and application of statistical analysis.
The technologies used in the estimation of our net proved undeveloped reserves include, but are not limited to, empirical evidence through drilling results and well performance, production data, decline curve analysis, well logs, geologic maps, core data, seismic data, demonstrated relationship between geologic parameters and performance, and the implementation and application of statistical analysis. 65 Management has confirmed that none of the Unitized Operating Agreement’s reserves nor the Proved Undeveloped Reserves (“PUDs”) are scheduled to be developed on a date more than five years from the date the reserves were initially recognized as PUDs as prescribed by SEC guidelines.
AleAnna is a newly public company that is in the process of adding resources with the appropriate level of experience and technical expertise to oversee AleAnna’s business processes and controls. At this time, AleAnna does not have the necessary business processes and related internal controls formally designed and implemented.
Internal Control over Financial Reporting Effective internal controls are necessary to provide reliable financial reports and prevent fraud. AleAnna is a newly public company that is in the process of adding resources with the appropriate level of experience and technical expertise to oversee AleAnna’s business processes and controls.
Upon first production, AleAnna will also be required to reserve cash collateral of €3 million related to the contingent consideration liability which will be classified as restricted cash in future balance sheets and may be used to satisfy the contingent consideration liability as payments become due.
Upon first production, we were also required to issue a bank guarantee of €3 million secured by cash collateral of €1 million related to the contingent consideration liability which is classified as restricted cash as of December 31, 2025. The cash collateral may be used to satisfy the contingent consideration liability as payments become due.
Prior to the Blugas settlement in May 2024 (as further described below), in accounting for the acquisition of the 33.5% working interest, we did not recognize an asset or liability in the consolidated financial statements related to the Blugas ORRI as our SEC Case reserves estimates contemplated the contractual arrangement and physical gas delivery to Blugas, such that the gas revenues attributable to our 33.5% working interest were reduced to reflect sale of the Blugas quantity and payment of such revenues (cash outflows to Blugas).
Prior to the Blugas settlement in May 2024 (as further described below), in accounting for the acquisition of the 33.5% working interest, we did not recognize an asset or liability in the consolidated financial statements related to the Blugas ORRI as our SEC Case reserves estimates contemplated the contractual arrangement and physical gas delivery to Blugas, such that the gas revenues attributable to our 33.5% working interest were reduced to reflect sale of the Blugas quantity and payment of such revenues (cash outflows to Blugas). 63 The physical volumes due to Blugas were being contested by us as usury because we considered, among other reasons, that extraction services and all associated risks are executed by us and that participation by Blugas was limited to financing a part of the sum necessary to start drilling, without participation in the construction and exploitation of the reservoir, and therefore do not share the risks or costs, which had increased compared to the initial forecast of the investment.
Cash used in investing activities Cash used in investing activities increased by $14.1 million for the year ended December 31, 2024, compared to the year ended December 31, 2023. In all periods presented, cash used in investing includes continued drilling, completion, and tie in of Longanesi-2D and Longanesi-3D wells.
Cash used in investing activities Cash used in investing activities decreased by $16.1 million for the year ended December 31, 2025, compared to the year ended December 31, 2024. In both periods presented, investing cash flows primarily reflected continued development of the Longanesi wells.
There will be no deferred consideration due if Longanesi is not developed and no deferred consideration due if average annual gas prices are less than €3.65/Mcf over the Earn-Out Period. 66 We recognized a liability for the contingent consideration in accounting for the asset acquisition in accordance with ASC 450, Contingencies (the “contingent consideration liability”) based on our assessment of probability of the occurrence of payment and deemed the liability estimable based on the formulaic nature.
The deferred consideration is payable based on a formulaic calculation which is predominantly dependent on sales volumes and spot natural gas prices during the first 12 years of the Earn-Out Period. 67 We recognized a liability for the contingent consideration in accounting for the asset acquisition in accordance with ASC 450, Contingencies (the “contingent consideration liability”) based on our assessment of probability of the occurrence of payment and deemed the liability estimable based on the formulaic nature.
Interest and other income increased by $2.1 million during the year ended December 31, 2024 compared to the same period in 2023, primarily due to interest earned on larger average cash balances during the 2024 period compared to the 2023 period presented.
Interest and Other Income (Expenses) Interest and other income decreased by $0.7 million or 36% to $1.2 million during the year ended December 31, 2025 compared to $1.9 million for the same period in 2024, primarily due to lower interest earned during the 2025 period due to lower interest rates as compared to the 2024 period.
Management separated these expenses on its audited consolidated statement of operations for the year ended December 31, 2024 due to the significant and discrete nature of the expenses. Income Tax Effects AleAnna’s income tax consequences have been reflected in its consolidated financial statements in accordance with ASC 740, Income Taxes .
Management separated these expenses on its audited consolidated statement of operations for the year ended December 31, 2024 due to the significant and discrete nature of the expenses. Interest and Other Income (Expenses) Interest and other income (expenses) primarily includes interest earned on cash and cash equivalents.
We are not yet recognizing depletion as assets are not yet producing and therefore have not yet been placed in service. Costs for exploratory dry holes, exploratory geological and geophysical activities, and delay rentals as well as other property carrying costs are charged to exploration expense.
These costs include other internal costs directly attributable to production activities. Costs for exploratory dry holes, exploratory geological and geophysical activities, and delay rentals as well as other property carrying costs are charged to exploration expense.
Foreign currency differences that arise on translation for consolidated purposes are recognized as a currency translation adjustment in other comprehensive loss on the consolidated statements of operations and comprehensive loss. The currency translation adjustment decreased by $1.8 million for the year ended December 31, 2024 compared to the same period in 2023.
The income and expenses are translated using average exchange rates. Foreign currency differences that arise on translation for consolidated purposes are recognized as a currency translation adjustment in other comprehensive income (loss) on the consolidated statements of operations and comprehensive income (loss).
In connection with the preparation of AleAnna’s financial statements as of and for the years ended December 31, 2024 and 2023, management of AleAnna identified material weaknesses in its internal control over financial reporting as follows: ● Management did not maintain an effective control environment in accordance with the COSO framework as it did not maintain a sufficient complement of accounting and reporting resources commensurate with its financial reporting requirements.
In connection with the preparation of AleAnna’s financial statements as of and for the year ended December 31, 2025, management of AleAnna identified material weaknesses in its internal control over financial reporting.
Operations Our net losses were $12.4 million and $5.2 million for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024 and December 31, 2023, we had an accumulated deficit of $191.0 million and $146.4 million, respectively.
As of December 31, 2025 and December 31, 2024, we had an accumulated deficit of $189.2 million and $191.0 million, respectively.
General and administrative expenses (exclusive of Business Combination transaction expenses) increased by $0.6 million, or 11%, for the year ended December 31, 2024, compared to the year ended December 31, 2023. The increase was primarily due to increases in legal, audit and consulting fees. Business Combination transaction expenses See “Expenses” above for a description of the Business Combination transaction expenses.
General and Administrative (G&A) Expenses General and administrative expenses (exclusive of Business Combination transaction expenses) increased by $3.4 million, or 54% to $9.7 million for the year ended December 31, 2025, compared to $6.3 million for the year ended December 31, 2024.
Under this method, the cost of productive wells and related equipment, development dry holes, and any permits related to productive acreage are capitalized, and depleted using the unit-of-production method. These costs include other internal costs directly attributable to production activities.
Under this method, the cost of productive wells and related equipment, development dry holes, and any permits related to productive acreage are capitalized, and depleted using the unit-of-production method. Depletion expense is calculated using the units-of-production method, which allocates the cost of natural resources based on the number of units extracted during a period.
We have several conventional natural gas discoveries including the Longanesi field, located in the Po Valley in Northern Italy, which is one of Italy’s largest modern gas discoveries. We retain a 33.5% working interest in the Longanesi field with our working interest partner, and operator, Padana.
Overview AleAnna is a natural gas resource developer focused on delivering critical natural gas supplies to Europe through both onshore conventional natural gas exploration and renewable natural gas development in Italy. We have several conventional natural gas discoveries including the Longanesi field, located in the Po Valley in Northern Italy, which is one of Italy’s largest modern gas discoveries.
As of December 31, 2024, although we had generated revenue from electricity sales from two renewable natural gas assets, we had not generated any revenues from our principal business activities to date. Our recent activities involve the drilling and testing of three Longanesi development wells (2022 and 2023) as well as the completion of two original discovery wells.
Our recent drilling and exploration activities involve the drilling and testing of three Longanesi development wells (during 2022 and 2023) as well as the re-completion of two original discovery wells. We had no drilling activity during the years ended December 31, 2025 or 2024. We had no other exploratory or development drilling during years ended December 31, 2025 or 2024.
As a normal part of our business, depending on market conditions, we may from time to time consider opportunities to repay, redeem, repurchase or refinance the indebtedness of our subsidiaries or issue equity securities to raise additional capital.
As a normal part of our business, depending on market conditions, we may from time to time consider opportunities to issue equity or debt securities to raise additional capital. Changes in our operating plans, lower than anticipated revenues, increased expenses, acquisitions or other events may cause us to seek additional debt or equity financing in future periods.
Cash Flows The following table includes our cash flow data for the years ended December 31, 2024 and 2023: For the Year Ended December 31, 2024 2023 Consolidated Statement of Cash Flows Data: Net cash used in operating activities (16,897,557 ) (5,749,303 ) Net cash used in investing activities (23,066,287 ) (8,924,941 ) Net cash provided by financing activities 62,106,468 21,004,132 Cash used in operating activities Cash used in operating activities increased by $11.1 million for the year ended December 31, 2024, compared to the year ended December 31, 2023.
We are able to continuously monitor financial health of Gas Plus S.p.A. through exchange-required public disclosures, including half-annual and annual financial statements, corporate presentations, and press releases. 62 Cash Flows The following table includes our cash flow data for the years ended December 31, 2025 and 2024: For the Year Ended December 31, 2025 2024 Consolidated Statement of Cash Flows Data: Net cash provided by (used) in operating activities $ 10,155,902 $ (16,897,557 ) Net cash used in investing activities $ (7,005,061 ) $ (23,066,287 ) Net cash provided by financing activities $ 1,143,652 $ 62,106,468 Cash provided by (used in) operating activities Cash generated through operating activities increased by $27.1 million for the year ended December 31, 2025, compared to the year ended December 31, 2024.
Such Class 1 Preferred Units were exchanged for Class A and Class C commons stock as part of the Business Combination.
Cash provided by financing activities during the year ended December 31, 2024 reflects pre-Business Combination issuances of AleAnna Energy Class 1 Preferred Units used to fund our operations. Such Class 1 Preferred Units were exchanged for Class A and Class C commons stock as part of the Business Combination.
These funds will be classified as restricted cash in future balance sheets and may be used to satisfy the contingent consideration liability as payments become due.
The guarantee required $1.2 million in cash collateral, which is classified as restricted cash as of December 31, 2025. The collateral may be used to satisfy the contingent consideration liability as payments become due.
This discussion and analysis contains forward-looking statements that reflect our plans, estimates and beliefs that involve risks and uncertainties that may be outside our control. As a result of many factors, such as those set forth under the headings “Risk Factors” and elsewhere in this Form 10-K, our actual results may differ materially from those anticipated in these forward-looking statements.
As a result of many factors, such as those set forth in Part 1, Item 1A.“Risk Factors” and elsewhere in this Form 10-K, our actual results may differ materially from those anticipated in these forward-looking statements. Unless the context otherwise requires, all references in this section to “we,” “us,” “our,” “AleAnna,” or the “Company” refer to AleAnna, Inc.
Consideration paid included €7 million cash and up to €24 million of deferred consideration payable upon production of the Longanesi field. The deferred consideration is payable based on a formulaic calculation which is predominantly dependent on sales volumes and spot natural gas prices during the first 12 years of the Earn-Out Period.
Consideration paid included €7 million cash and up to €24 million of deferred consideration payable upon production of the Longanesi field.
This decrease was due to the fluctuation of the exchange rates between the Euro and the U.S. Dollar as well as the level of our activities.
The currency translation adjustment increased by $5.7 million for the year ended December 31, 2025 compared to the same period in 2024. This increase was primarily driven by fluctuation of the exchange rates between the Euro and the U.S. Dollar as well as the level of our Euro-denominated activities.
In 2021, we launched a renewable natural gas development business focused on bringing to market carbon-negative renewable natural gas derived from animal and agricultural waste. Planned principal operations have not yet commenced.
However, as noted in the “Recent Developments” section below, we achieved first production from the Longanesi field in March 2025. In 2023, we launched a renewable natural gas development business focused on bringing to market carbon-negative renewable natural gas derived from animal and agricultural waste. We currently generate revenue from electricity sales from two renewable natural gas assets.
These expenses were specific to the Business Combination that closed on December 13, 2024, with no similar expenses incurred in 2023. 60 Contingent Consideration Liability As of December 31, 2024 and December 31, 2023, the contingent consideration liability was recorded at $25.0 million and $26.5 million, respectively.
These expenses were specific to the Business Combination that closed in the prior year, with no similar expenses incurred in 2025. Depreciation and Depletion Depreciation and depletion increased by $2.8 million, or 2097% to $2.9 million for the year ended December 31, 2025, compared to $0.1 million for the year ended December 31, 2024.
Accordingly, the drivers of our future financial results, as well as the components of such results, may not be comparable to our historical results of operations or our future results of operations. 58 Revenue During the year ended December 31, 2024, we generated approximately $1.4 million of revenue from electricity sales at two renewable natural gas assets acquired in July 2024 (the “Casalino” and “Campopiano” plants).
During the year ended December 31, 2025, revenue from our Renewable segment was comprised of electricity sales at two renewable natural gas assets acquired in July 2024 (the “Casalino” and “Campopiano” plants). The plant assets are fully permitted for production of electricity through conversion of crop and animal waste bio feedstocks.
We have incurred higher VAT input paid (i.e., VAT paid on purchases) than the VAT output collected (i.e., VAT collected on sales), resulting in a net VAT refund receivable. As of December 31, 2024 and 2023, we had VAT receivables of $6.6 million, and $4.4 million, respectively.
In certain cases, including cross-border sales to business customers and sales of biogas within Italy, we are not required to collect VAT on revenues. To date, we have incurred higher VAT on purchases (input VAT) than we have collected on sales (output VAT), resulting in a net VAT refund receivable.
We will continue to assess the need for including multiple reportable segments as the business evolves. Liquidity, Capital Resources and Operations We have generated minimal revenues from our operations to date and we had an accumulated deficit of $191.0 million a s of December 31, 2024. We had $28.3 million in cash and cash equivalents on December 31, 2024.
We had an accumulated deficit of $189.2 million and $191.0 million as of December 31, 2025 and 2024, respectively. We had $31.8 million and $28.3 million in unrestricted cash and cash equivalents on December 31, 2025 and 2024, respectively.
In addition to sales of renewable natural gas, we expect to generate a significant portion of our future revenue from the sale of conventional natural gas. Expenses General and Administrative (G&A) Expense G&A expenses consist of compensation costs for personnel in executive, finance, accounting, and other administrative functions.
Such costs are passed down to us by the Longanesi field operator, Padana, and include accrued royalties payable to the Italian government, pipeline fees, repairs and maintenance, and other field-related costs. General and Administrative (G&A) Expense G&A expenses consist of compensation costs for personnel in executive, finance, accounting, and other administrative functions.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeItem 7A: Quantitative and Qualitative Disclosure About Market Risk Pursuant to Item 305(e) of Regulation S-K (§ 229.305(e)), the Company is not required to provide the information required by this Item as it is a “ smaller reporting company, ” as defined by Rule 229.10(f)(1). 67
Biggest changeItem 7A: Quantitative and Qualitative Disclosure About Market Risk Pursuant to Item 305(e) of Regulation S-K (§ 229.305(e)), the Company is not required to provide the information required by this Item as it is a “smaller reporting company,” as defined by Rule 229.10(f)(1). 68