Laredo Oil Reports Widening Losses

While drilling setbacks and debt weigh on performance, the company expands international efforts to revive stranded oil fields.

January 21, 2026

Rising Losses, Modest Revenue

Laredo Oil is navigating a pivotal moment. For the six months ending November 30, 2025, the company reported a net loss of $4.3 million—up significantly from the $1.3 million loss in the same period last year. Revenue barely moved, coming in at just over $3,100.

Still, the company is pushing forward on multiple fronts: scaling its unconventional recovery methods, restructuring its balance sheet, and entering new markets.

Strategic Expansion of UGD Operations

One area of focus is the company’s proprietary underground gravity drainage (UGD) method, aimed at unlocking stranded reserves in mature oil fields. Laredo believes this approach can be more cost-effective than traditional enhanced oil recovery techniques.

To pursue these opportunities, the company established Laredo Mex, LLC —a new subsidiary designed to lead potential operations in Mexico. Conversations are also underway in several other international markets, including parts of the Middle East and North Africa.

Setbacks in Montana

Domestically, projects faced challenges. In Montana, three Texakoma-operated wells and the Reddig 11-21 well were shut in after limited oil production made them economically unviable.

Laredo has since sold its interest in Hell Creek Crude LLC, the entity that operated Reddig, to B&B Oil in exchange for a carried interest in future distributions. The move helped offload associated liabilities, but also contributed to a $52,000 loss from discontinued operations.

Funding and Liquidity

The company continues to rely heavily on external capital. It raised $1.06 million in equity during the period, issuing over 2.4 million shares at $0.43 each. In parallel, Laredo took in $1.28 million in new promissory notes.

At quarter’s end, total debt stood at $4.9 million—nearly $1 million higher than six months earlier. Debt instruments include PPP loans, bridge notes, convertible debt, and a revolving credit facility.

Even with the added financing, liquidity remains a concern. The company ended the quarter with $569,000 in cash—more than double the balance at the end of May, but modest in light of its liabilities and development needs. Laredo acknowledges the risk: management continues to flag substantial doubt about the company’s ability to continue as a going concern.

Operating Expenses and Cost Structure

General and administrative expenses climbed to $3.6 million, up from $1.4 million in the same period last year. The increase is driven primarily by $2 million in new stock option grants , along with higher travel, payroll, and professional services costs.

Interest expense also rose sharply, reflecting Laredo’s expanded use of debt to fund operations. Short-term promissory notes and bridge loans accounted for a sizable portion of the increase.

Operational Partnerships and Drilling Plans

Despite setbacks, Laredo is maintaining its relationships with firms like Texakoma and Erehwon. It has paused development on eight additional wells while evaluating oil prices and field data, but continues to explore new options to move forward.

In the northern section of its Montana acreage, the company is also keeping open a $7.5 million project to drill three exploratory wells. The project’s progress will depend on whether alternative funding or partnerships can be secured.

Looking Ahead

Laredo’s story remains a work in progress. With limited production, constrained cash flow, and a capital-intensive growth strategy, execution in the coming quarters will be critical.

Still, the groundwork is in place. If new capital and stronger field results align, the company could position itself to bring more mature oil fields back online—both in the U.S. and beyond.