Midland-based Next Bridge Hydrocarbons has announced a setback in its plan to offer 40 million shares of common stock.
According to a news release, the oil and natural gas exploration and production company received another round of comments from the U.S. Securities and Exchange Commission (SEC) regarding its annual report on Form 10-K for the 2023 fiscal year. This development delays the company's ability to offer stock in its registration statement on Form S-1, which was filed on January 23, 2023.
The SEC issued comments to the company concerning the 2023 10-K form. After addressing these comments, the SEC indicated that Next Bridge should not have resaid its 2022 audited financial statements, which impaired the balance sheet value of its Orogrande property down to zero. These were included in the 2023 10-K filed in July 2024. The news release states that Next Bridge Hydrocarbons has spent tens of thousands of dollars addressing these issues.
The SEC is requiring the company to restate its 2022 financials to update the impairment analysis. This would necessitate amending two annual reports on Form 10-K and six Quarterly Reports on Form 10-Q from the previous two years. Additionally, the SEC is asking Next Bridge Hydrocarbons to consider Torchlight Energy Corporation and Meta Materials, Inc. as one entity from June 2021 until Meta Materials becomes an independent operations company in December 2022. Next Bridge Hydrocarbons clarified that it is not and has never been an entity of Meta Materials and will soon post all prior communications with the SEC related to the 2023 10-K for download on its website for transparency.
"As in the past, Next Bridge will continue to advance our business strategies on the oil and gas front while concurrently investigating the magnitude of our demonstrable shareholder imbalance," said CEO Greg McCabe. "In light of recent events, the company will pivot and intensify our efforts to obtain clarity on this untenable and inexcusable imbalance, which remains, to this day, an unsettled injustice to our loyal shareholders."