EPSN · CIK 1726126
What Epsilon Energy Ltd. told the SEC could break it.
Epsilon Energy's register is that of a small, geographically concentrated gas producer. About 67% of its 2025 revenue came from natural gas production and gathering in Pennsylvania and roughly 19% from Texas, so its results ride on volatile natural gas, oil and NGL prices and on securing pipeline space to reach markets. Its offtake is concentrated too — it sells substantially all production under arm's-length contracts of a year or less to a small number of purchasers, with two buyers alone accounting for 95.7% of its newer Wyoming revenue — and across all its operations it is exposed to EPA and BLM methane and greenhouse-gas regulation that raises compliance cost and penalty risk.
4 self-disclosed vulnerabilities, pulled from its own filings — each in the company’s words, with the source. This is the risk register almost nobody reads.
In its own words
What could break it.
Commodity & input dependence
- natural gas, oil and NGL priceshigh
Epsilon's revenue is driven by volatile natural gas, oil and NGL prices (2025 realized gas $2.98/Mcf, up 66%; oil ~$55.84/Bbl) and by its ability to secure pipeline space to reach markets — exposing results to commodity-price and takeaway swings.
“Epsilon's realized natural gas price was $2.98 per Mcf, 5 excluding the impact of hedges, a 66% increase from $1.80 for the year ended December 31, 2024.”
Customer concentration
- two purchasers = 95.7% of Wyoming revenue (HF Sinclair 68.4%, WGR 27.3%); no long-term contractshigh
In Epsilon's new Wyoming operated production, two purchasers (HF Sinclair and WGR Operating) accounted for ~95.7% of that region's revenue, and Epsilon sells substantially all production under arm's-length contracts of 12 months or less to a small number of purchasers — concentrating offtake risk.
“In Wyoming, for our operated oil and gas production, two customers accounted for 95.7% of our total revenues.”
SEC filing →As of 2026
Geographic concentration
- 67% of revenue from Pennsylvania gas, 19% from Texas (FY2025)high
Epsilon's operations are geographically concentrated — ~67% of 2025 revenue from Pennsylvania natural gas production/gathering and ~19% from Texas oil/gas/NGLs — exposing it to regional economic, regulatory and pipeline-capacity risk.
“Approximately 67% and 50% of our revenue during fiscal years 2025 and 2024, respectively, was derived from natural gas production and gathering system revenues in the state of Pennsylvania.”
SEC filing →As of 2026
Regulatory & policy
- EPA methane / GHG regulation of oil & gas operationsmedium
Federal agencies (EPA, BLM) directly regulate methane and GHG emissions across all segments of the oil & gas industry — including gathering/boosting facilities Epsilon operates — with GHG reporting, PSD permitting and methane rules raising compliance cost and penalty risk.
“Federal agencies also have begun directly regulating emissions of methane from natural gas operations.”
SEC filing →As of 2026
The hidden graph
Who it depends on, and who depends on it.
Relationships surfaced from filings — including ones disclosed by the other side, which is how the non-obvious ones come to light.
Its customers
WGR Operating, LP (Western Midstream)
“For year ended December 31, 2025, HF Sinclair Refining & Marketing LLC and WGR Operating, LP accounted for approximately 68.4% and 27.3% of our total revenues in Wyoming, respectively, excluding the impact of our commodity derivatives.”
Cited →HF Sinclair Refining & Marketing LLC (HF Sinclair Corp.)
“For year ended December 31, 2025, HF Sinclair Refining & Marketing LLC and WGR Operating, LP accounted for approximately 68.4% and 27.3% of our total revenues in Wyoming, respectively, excluding the impact of our commodity derivatives.”
Cited →
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