PART I – FINANCIAL INFORMATION

Item 1.  Financial Statements.Statements.

Item 2. Management’sManagement's Discussion and Analysis of Financial Condition and Results of Operations

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Item 4. Controls and Procedures

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Item 6. Exhibits

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

COJAX OIL AND GAS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

COJAX OIL AND GAS CORPORATION

NOTES TO CONDENSED CONSOLIDATEDFINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1 – ORGANIZATION, NATURE OF OPERATIONS AND BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Organization

CoJax Oil & Gas Corporation, a Virginia corporation (“Company”), was incorporated on November 13, 2017.  The Company is based in Arlington Virgina, with a wholly owned subsidiary, Barrister Energy LLC (‘Barrister Energy’), registered in Mississippi and based in Laurel, Mississippi.

Nature of Operations

The Company is a growing U.S. energy company, engaged in the acquisition and development of lower risk onshore oil and gas producing properties within the Southeastern U.S. The Company’s focused growth strategy relies primarily on leveraging management’s expertise to acquire both operated and non-operated interests in producing properties with the goal of assembling a large oil and gas portfolio. Through this strategy of acquisition of operated and non-operated properties, the Company has the unique ability to benefit from the technical and scientific expertise of world-class E&P companies operating in the area.

Since the company’s inception, it has been engaged in organizational activities and had no revenue-generating operations until the period covered by this current report.  The company has begun to acquire assignments of hydrocarbon revenues and underlying oil and gas exploration and production rights as covered by this current report. The company outsources all operations of it’s current acquisitions through Barrister Energy LLC, the operational subsidiary.

The Company focuses on the acquisition of and exploitation of upstream energy assets, specifically targeting select oil and gas mineral interests.  These acquisitions are structured primarily as acquisitions of leases, real property interests and mineral rights and royalties and are generally not regarded as the acquisition of securities, but rather real property interests.  As an owner, the Company has the right to receive a portion of the production from the leased acreage (or of the proceeds of the sale thereof).

Condensed ConsolidatedFinancial Statements –

The accompanying condensed consolidated financial statements prepared by CoJax Oil and Gas Corporation (the “Company”"Company" or “CoJax”"CoJax") have not been audited by an independent registered public accounting firm.  In the opinion of the Company’sCompany's management, the accompanying unaudited financial statements contain all adjustments necessary for thea fair presentation of the results of operations for the periods presented, which adjustments were of a normal recurring nature, except as disclosed herein. The results of operations for the three and six months ended June 30, 2022,March 31, 2023, are not necessarily indicative of the results to be expected for the full year ending December 31, 2022,2023, for various reasons, including as a result of the impact of fluctuations in prices received for oil and natural gas, natural production declines, the uncertainty of exploration and development drilling results, fluctuations in the fair value of derivative instruments, the impacts of COVID-19 and other factors.

These unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”("GAAP") for interim financial information, and, accordingly, do not include all of the information and footnotes required by GAAP for complete financial statements.  Therefore, these financial statements should be read in conjunction with the Company’s Annual Report.Company's annual report on Form 10-K for the year ended December 31, 2022.

OrganizationNOTE 2 – GOING CONCERN DISCLOSURE

The Company’s condensed consolidated financial statements are prepared using U.S. GAAP applicable to a going concern that contemplates the realization of assets and Natureliquidation of Operations – liabilities in the normal course of business. There can be no assurance that the Company will be able to achieve its business plan, raise any additional capital, or secure the additional financing necessary to implement its current operating plan. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

The Company has yet to achieve profitable operations, expects to incur further losses in the development of its business, has negative cash flows from operating activities, and is dependent upon future issuances of equity or other financings to fund ongoing operations, all of which raises substantial doubt about the Company’s ability to continue as a Virginia corporation that owns interests in oil and natural gas properties located in Alabama.going concern. The Company’s oil and natural gas sales, profitability, and future growth areability to continue as a going concern is dependent upon prevailingits ability to generate future profitable operations and/or to obtain the necessary financing from stockholders or other sources to meet its obligations and future prices for oil and natural gas andrepay its liabilities arising from normal business operations when they come due. Management has no formal plan in place to address this concern but considers that the successful acquisition, exploration, and developmentCompany will be able to obtain additional funds by equity financing and/or related party advances, however, there is no assurance of oil and natural gas properties. Oil and natural gas prices have historically been volatile and may be subject to wide fluctuations in the future. A substantial decline in oil and natural gas prices could have a material adverse effectadditional funding being available or on the Company’s financial position, results of operations, cash flows, and quantities of oil and natural gas reserves that may be economically produced.acceptable terms, if at all.

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

COVID - 19 – Principles of consolidationIn March 2020,

The accompanying consolidated financial statements include the World Health Organization classified the outbreak of COVID-19 as a pandemic. The nature of COVID-19 led to worldwide shutdowns, reductions in commercial and interpersonal activity, and changes in consumer behavior. In attempting to control the spread of COVID-19, governments worldwide imposed laws and regulations such as shelter-in-place orders, quarantines, executive orders, and similar restrictions. As a result, the global economy has been marked by significant slowdown and uncertainty, which in turn has led to a precipitous decline in oil prices in response to decreased demand, further exacerbated by global energy storage shortages and by the price war among membersaccounts of the OrganizationCompany and of Petroleum Exporting Countries (“OPEC”)its wholly-owned subsidiaries. All significant intercompany accounts and other non-OPEC producer nations (collectively with OPEC members, “OPEC+”) during the first quarter 2020. As of the second quarter of 2022, pricestransactions have recovered to pre-pandemic levels, duebeen eliminated in part to the accessibility of vaccines, the reopening of states after the lockdown, and optimism about the economic recovery.  The continued spread of COVID-19, including-vaccine resistant strains, or repeated deterioration in oil and natural gas prices could result in additional adverse impacts on the Company's results of operations, cash flows, and financial position, including further asset impairments.

Liquidity and Capital Considerations – We strive to maintain an adequate liquidity level to address volatility and risk. Sources of liquidity include loans from our CEO, our cash flow from operations, cash on hand, and sales of shares.

While changes in oil and natural gas prices affect the Company's liquidity, if oil or natural gas prices rapidly deteriorate due to a resurgence of COVID-19 or other reasons, this could have a material adverse effect on the Company's cash flows.

The Company expects ongoing oil price volatility over the short term. Extended depressed oil prices have historically had and could continue to have a material adverse impact on the Company’s oil revenue.  The Company is always mindful of oil price volatility and its impact on our liquidity.consolidation.

Use of Estimates –

The preparation of financial statements in conformity withU.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosurethe disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. The Company’s unaudited condensed financial statements are based on a numberSignificant areas of significant estimates, including estimates of oil and natural gas reserve quantities, which areestimate include the basis for the calculation of depletion and impairment of oilassets and gas properties.  Reserve estimates, by their nature, are inherently imprecise.rates for amortization, accrued liabilities, future income tax obligations, and the inputs used in calculating stock-based compensation. Actual results could differ from those estimates. Changes inestimates and would affect future results of operations and cash flows.

Reclassifications

Certain prior period amounts have been reclassified to conform with the future estimated oil and natural gas reserves or the estimated future cash flows attributable to the reserves that are utilized for impairment analysis could have acurrent year presentation. Such reclassifications had no significant impact on the Company’s future results of operations.our reported net income (loss), current assets, total assets, current liabilities, total liabilities, shareholders’ equity or cash flows.

Fair Value MeasurementsAccounts Receivable and Allowance for Doubtful Accounts – Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Financial Accounting Standards Board (“FASB”) has established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy consists of three broad levels. Level 1 inputs are the highest priority and consist of unadjusted quoted prices in active markets for identical assets and liabilities. Level 2 is inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. Level 3 is unobservable inputs for an asset or liability.

Fair ValuesAccounts receivable will consist primarily of Financial Instruments – The carrying amounts of accounts receivables and accounts payable and other current assets and liabilities approximate fair value because of the short-term maturities and/or liquid nature of these assets and liabilities.

Derivative Instruments and Commodity Risk Activities – The Company currently does not engage in derivative instruments. Going forward, the Company may periodically enter into derivative contracts to manage its exposure to commodity risk. These derivative contracts, which are generally placed with major financial institutions, may take the form of forward contracts, futures contracts, swaps, or options. The oil and gas reference prices upon which the commodity derivative contracts are based reflect various market indices that havesales, net of a high degree of historical correlation with actual prices received by the Companyvaluation allowance for its oil and gas production.

Any gains or losses resulting from changes in the fair value of outstanding derivative financial instruments and from the settlement of derivative financial instruments will be recognized in earnings and included as a component of other income (expense) in the Statement of Operations.

When applicable, the Company will record all derivative instruments, other than those that meet the normal purchases and sales exception, on the balance sheet as either an asset or liability measured at fair

value. Changes in fair value are currently recognized in earnings unless specific hedge accounting criteria are met.

Concentration of Credit Risk –The Company maintains cash and cash equivalent balances at a single financial institution that are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000.doubtful accounts. At June 30, 2022,both March 31, 2023, and December 31, 2021,2022, the Company had no exposure in excess of insurance.allowance for doubtful accounts was $0.

Oil and Gas PropertiesProducing Activities –

The Company uses the successful efforts method of accounting for oil and gas activities. Under this method, the costs of productive exploratory wells, all development wells, related asset retirement obligation assets, and productive leases are capitalized and amortized, principally by field, on a units-of-production basis over the life of the remaining proved reserves. Exploration costs, including personnel costs, geological and geophysical expenses, and delay rentals for oil and gas leases are charged to expensesexpense as incurred. Exploratory drilling costs are initially capitalized but charged to expense if and when the well is determined not to have found reserves in commercial quantities.

Depreciation, depletion, and amortization expense for the three and six months ended June 30, 2022, was $0 per barrelEstimates of oil equivalent comparedand gas reserves, as determined by independent petroleum engineers, are continually subject to $0 forrevision based on price, production history and other factors. Depletion expense, which is computed based on the threeunits of production method, could be significantly impacted by changes in such estimates. Additionally, US GAAP requires that if the expected future undiscounted cash flows from an asset are less than its carrying cost, that asset must be written down to its fair market value. As the fair market value of an oil and six months ended June 30, 2021.gas property will usually be significantly less than the total undiscounted future net revenues expected from that asset, slight changes in the estimates used to determine future net revenues from an asset could lead to the necessity of recording a significant impairment of that asset.

Equipment, vehicles,Unproved oil and leasehold improvements – Currently, the Company has no office equipment. Going forward, office equipmentgas properties will be valued at historical cost adjustedassessed annually to determine whether they have been impaired by the drilling of dry holes on or near the related acreage or other circumstances, which may indicate a decline in value. When impairment occurs, a loss will be recognized. When leases for unproved properties expire, the costs thereof, net of any related allowance for impairment, loss less accumulated depreciation. Historical costs include all direct costs associated with the acquisition of office equipment and placing such equipment in service. Depreciation will be calculated usingremoved from the straight-line method based upon an estimated useful life of 3accounts and charged to 10 years.expense.

Asset Retirement Obligation – The Company recordswill review its proved oil and natural gas properties for impairment whenever events and circumstances indicate that a liabilitydecline in the period in which an asset retirement obligation (“ARO”) is incurred, in an amount equal torecoverability of its carrying value may have occurred. It estimates the discounted estimated fair value of the obligation that is capitalized. Thereafter, this liability is accreted up to the final estimated retirement cost. An ARO is aundiscounted future expenditure related to the disposal or other retirement of certain assets. The Company’s ARO relates to future plugging and abandonment expensesnet cash flows of its oil and natural gas properties and related facilities disposal.compares such undiscounted future cash flows to the carrying amount of the oil and natural gas properties to determine if the carrying amount is recoverable. If the carrying amount exceeds the estimated undiscounted future cash flows, the Company will adjust the carrying amount of the oil and natural gas properties to fair value.

During the year ended December 31, 2022, the Company recorded impairments of $3,909,700 on oil and gas properties. There were no impairments recorded during the three months ended March 31, 2023 and 2022.

Share-Based Employee CompensationFair Values of Financial Instruments –

The Company hashad no outstanding stock option grantsfinancial instruments for the three months ended March 31, 2023, or for the year ended December 31, 2022.

ASC 820 “Fair Value Measurements and restricted stock awards to directors, officers, and employees. The Company recognizesDisclosures” defines fair value as the cost of employee servicesexchange price that would be received in exchange for an award of equity instrumentsasset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the

measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) a reporting entity’s own assumptions about market participant assumptions developed based on the grant-datebest information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which give the awardhighest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and recognizes the related compensation expense over the period during which an employee is requiredlowest priority to provide service in exchange for the award, which is generally the vesting period.

Share-Based Compensation to Non-Employees –unobservable inputs (Level 3). The Company accounts for share-based compensation issued to non-employees as eitherthree levels of the fair value ofhierarchy are described below:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. The measurement date for identical, unrestricted assets or liabilities;

Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means; and

Level 3 – Fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of March 31, 2023, and December 31, 2022. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these issuancesinstruments.

Revenue Recognition

To determine revenue recognition for contracts with customers, the Company performs the following steps described in ASC 606, Revenue from Contracts with Customers: (1) identifies the contract with the customer, or Step 1, (2) identifies the performance obligations in the contract, or Step 2, (3) determines the transaction price, or Step 3, (4) allocates the transaction price to the performance obligations in the contract, or Step 4, and (5) recognizes revenue when (or as) the entity satisfies a performance obligation, or Step 5.

Under ASC 606, oil and natural gas sales revenues are recognized when control of the product is transferred to the earliercustomer, the performance obligations under the terms of (i) the datecontracts with customers are satisfied and collectability is reasonably assured. All the Company’s oil and natural gas sales are made under contracts with customers. The performance obligations for the Company’s contracts with customers are satisfied at which a commitmentpoint in time through the delivery of oil and natural gas to its customers. Accordingly, the Company’s contracts do not give rise to contract assets or liabilities. The Company typically receives payment within 30 days of the month of delivery. The Company’s contracts for performanceoil and natural gas sales are standard industry contracts that include variable consideration based on the monthly index price and adjustments that may include counterparty-specific provisions related to volumes, price differentials, discounts, and other adjustments and deductions.

The following table presents revenues disaggregated by product for the recipient to earnthree months ended March 31, 2023, and 2022:

All revenues are from production from the equity instruments is reached or (ii) the date at which the recipient’s performance is complete.Gulf States Drilling Region.

Income Taxes – Provisions

Income taxes are accounted for under the liability method of accounting for income taxestaxes. Under the liability method, future tax liabilities and assets are based on taxes payable or refundablerecognized for the current year and deferred taxes. Deferred taxes are based onestimated future tax consequences attributable to differences between the tax basesamounts reported in the financial statement carrying amounts of assets and liabilities and their reported amounts in the financial statements andrespective tax carryforwards. Deferredbases. Future tax assets and liabilities are included in the financial statements at currentlymeasured using enacted or substantially enacted income tax rates applicableexpected to apply when the asset is realized, or the liability settled. The effect of a change in income tax rates on future income tax liabilities and assets is recognized in income in the period that the change occurs. Future income tax assets are recognized to the period in which the deferred tax assets and liabilitiesextent that they are expectedconsidered more likely than not to be realized or settled. As changes in

tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes.realized.

The CARES Act was enacted on March 27, 2020, and includesFASB has issued ASC 740 “Income Taxes”. ASC 740 clarifies the accounting for uncertainty in income tax provisions that, among other things, allow net operating lossestaxes recognized in an enterprise’s financial statements. This standard requires a company to be carried back, and permit interest expense to be deducted up to a higher percentage of adjusted taxable income, and modifies tax depreciation of qualified improvement property. Due to the Company having taxable losses in all years eligible for the NOL carryback, no benefit was recorded, and these provisions have no material impact on the Company.

For the period ended June 30, 2022, the Company recorded no income tax expense or benefit due to the Company having a full valuation allowance against its net deferred tax assets. Since December 31, 2021, the Company has determined that a full valuation allowance is necessary due to the Company assessment thatdetermine whether it is more likely than not that ita tax position will be unablesustained upon examination based on the technical merits of the position. If the more-likely-than-not threshold is met, a company must measure the tax position to obtaindetermine the benefitsamount to recognize in the financial statements.

Because of the implementation of this standard, the Company performed a review of its deferredmaterial tax positions in accordance with recognition and measurement standards established by ASC 740 and concluded that it had no uncertain tax positions as of March 31, 2023, or as of December 31, 2022.

Basic and Diluted Earnings per Share

The Company computes income per share in accordance with ASC 260, "Earnings per Share", which requires the presentation of both basic and diluted earnings per share (“EPS”) on the face of the statement of operations. Basic EPS is computed by dividing income available to common stockholders by the weighted average number of shares outstanding during the period. Diluted EPS gives effect to all dilutive potential shares of common stock outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants.  Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As of March 31, 2023 and 2022, the Company had 1,050,000 and 550,000 potentially dilutive common shares outstanding, respectively

Asset Retirement Obligations

The Company records the estimated fair value of obligations associated with the retirement of tangible, long-lived assets duein the period in which they are incurred. When a liability is initially recorded, the

Company capitalizes the cost by increasing the carrying amount of the related long-lived asset. Over time, the liability is accreted to its present value, and the capitalized cost is depleted over the useful life of the related asset.

Revisions to estimated asset retirement obligations will result in an adjustment to the related capitalized asset and corresponding liability. Upon settlement of the liability, the Company either settles the obligation for its recorded amount or incurs a gain or loss. The Company’s historyasset retirement obligation relates to the plugging, dismantling, removal, site reclamation, and similar activities of taxable losses.its oil and gas properties.

Asset retirement obligations are estimated at the present value of expected future net cash flows and are discounted using the Company’s credit adjusted risk free rate. The Company reviews its Deferred Tax Assets (“DTAs”)uses unobservable inputs in the estimation of asset retirement obligations that include, but are not limited to: costs of labor, costs of materials, profits on costs of labor and valuation allowancematerials, the effect of inflation on a quarterly basis.estimated costs, and discount rate. Due to the subjectivity of assumptions and the relative long lives of the Company’s leases, the costs to ultimately retire the Company’s obligations may vary significantly from prior estimates. Assumptions used in determining estimates are reviewed annually.

Concentration of Credit Risk

Our revenue can be materially affected by current economic conditions and the price of oil and natural gas. However, based on the current demand for crude oil and natural gas and the fact that alternative purchasers are readily available, we believe that the loss of our marketing agents and/or any of the purchasers identified by our marketing agents would not have a long term material adverse effect on our financial position or results of international operations. The continued economic disruption resulting from Russia’s invasion of Ukraine, a potential global recession, and other varying macroeconomic conditions could materially impact the Company's business in future periods. Any potential disruption will depend on the duration and intensity of these events, which are highly uncertain and cannot be predicted at this time.

Concentration of Credit Risk – Cash – The Company maintains cash and cash equivalent balances at a single financial institution that are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. At March 31, 2023, and December 31, 2022, the Company had no exposure in excess of insurance.

Concentration of Credit Risk – Accounts Receivable – All of the Company’s outstanding accounts receivable was with one party, Taxodium Energy, LLC.

NOTE 4 – RECENT ACCOUNTING PRONOUNCEMENTS

New and Recently IssuedAdopted Accounting Pronouncements – 

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

Basic and Diluted Earnings per Share – Basic earnings per share are computed by dividing net income by the weighted-average number of common shares outstanding during the period.  Diluted earnings per share reflect the potential dilution that could occur if all contracts to issue common stock were converted into common stock, except for those that are anti-dilutive.  The dilutive effect of stock options and other share-based compensation is calculated using the treasury method. The computation of diluted loss per share does not assume the exercise or conversion of securities that would have an anti-dilutive effect. As of June 30, 2022, the effect of 55,000 convertible preferred shares into 550,000 common shares was excluded from the computation of diluted net loss per common share as their effect is anti-dilutive.

NOTE 2 – GOING CONCERN DISCLOSURE

The Company’s financial statements are prepared using U.S. GAAP applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. During 2020, the Company acquired Barrister Energy with identified proven or probable reserves and correspondingly expects to be generating revenue during its exploration stage. There can be no assurance that the Company will be able to achieve its business plan, raise any additional capital, or secure the additional financing necessary to implement its current operating plan. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

The Company has yet to achieve profitable operations, expects to incur further losses in the development of its business, has negative cash flows from operating activities, and is dependent upon future issuances of equity or other financings to fund ongoing operations, all of which raises substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing from shareholders or other sources to meet its obligations and repay its liabilities arising from

normal business operations when they come due. Management has no formal plan in place to address this concern but considers thatNOTE 5 –ROYALTY INTERESTS IN OIL AND GAS PROPERTIES

On November 8, 2022, the Company will be ableapproved and authorized, by unanimous written consent, the issuance of 1,600,000 shares of common stock, $0.01 par value per share, valued at $2.10 per share, to obtain additional fundsTaxodium Energy LLC, a Mississippi limited liability company (“Taxodium”), in consideration for the sale and assignment of various mineral and oil and gas royalty interests in and to certain properties located in Mississippi and Alabama to Barrister Energy LLC, a wholly-owned subsidiary of the Company organized under the laws of Mississippi.  At the request and the instructions of Taxodium, the Company issued the Shares to all members of Taxodium on the pro rata basis of their ownership interest in Taxodium.This acquisition was effective as of October 1, 2022.

During the year ended December 31, 2022, this property was impaired by equity financing and/or related party advances; however, there is no assurance$2,085,100.  

On December 2, 2022, the Company approved and authorized, by unanimous written consent, the issuance of additional funding being available or1,500,000 shares of common stock, $0.01 par value per share, valued at $2.10 per share, to Taxodium. At the request and the instructions of Taxodium, the Company issued the Shares to all members of Taxodium on acceptable terms if at all.

NOTE 3 – REVENUE RECOGNITIONthe pro rata basis of their ownership interest in Taxodium. 

The Shares were issued by the Company predominantly derives its revenue fromin consideration of the sale and assignment of produced crude oilthe wells, facilities, and natural gas. The contractual performance obligation is satisfied whenall of the product is deliveredAssignor’s title, rights, and interest in and to the customer.  Revenue is recordedcertain properties located in the month the product is deliveredMississippi, collectively known as “Buckley,” to the purchaser, andBarrister Energy LLC, a wholly-owned subsidiary of the Company receives payment from one to three months after delivery.  The transaction price includes variable consideration as product pricing is based on published market prices and reduced for contract-specified differentials.  The guidance does not require that the transaction price be fixed or stated in the contract.

Oil sales

Under the Company’s oil sales contracts, the Company sells oil production at the point of delivery and collects an agreed-upon index price, net of pricing differentials. The Company recognizes revenue when control transfers to the purchaser at the point of delivery at the net price received.

Natural gas sales

The Company currently is not producing natural gas.

Disaggregation of Revenue. The following table presents revenues disaggregated by product for the three and six months ended June 30, 2022, and 2021:

All revenues are from production from the Gulf State Drilling Region in Alabama.

NOTE 4 – LEASES

Effective January 1, 2019, the Company adopted ASU 2016-02, Leases (Topic 842). The purpose of this guidance is to increase transparency and comparability among organizations by recognizing certain lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The main difference between the previous GAAP methodology and the method proposed by this new guidance is the recognition on the balance sheet of certain lease assets and lease liabilities by lessees for those leases that were classified as operating leasesorganized under the previous GAAP.

laws of Mississippi.  The Company made accounting policy elections to not capitalize leasesAssignment was completed on December 2, 2022, with a lease term of twelve months or less and to not separate lease and non-lease components for all asset classes. The Company has also elected to adopt the package of practical expedients within ASU 2016-02 that allows an entity to not reassess prior to the effective date (i) whether any expired or existing contracts are or contain leases,

(ii) the lease classificationof October 15, 2022, for any expired or existing leases, or (iii) initial direct costs for any existing leases and the practical expedient regarding land easements that exist prior to the adoption of ASU 2016-02. accounting purposes.

The Company did not electexecute any acquisitions during the practical expedient of hindsight when determining the lease term of existing contracts at the effective date.

The Company has a month-to-month rental agreement for our offices in Arlington, Virginia, and Laurel, Mississippi.

NOTE 5 – EARNINGS (LOSS) PER SHARE INFORMATIONthree months ended March 31, 2023.

The Company computes basic loss per share by dividing net loss by

We recorded depletion expense of $95,224 and $0 for the weighted-average number of common shares outstanding during the period. The Company computes diluted loss per share by dividing net loss by the sum of the weighted-average number of common shares outstandingthree months ended March 31, 2023 and the weighted-average dilutive common share equivalents outstanding.

2022, respectively.

NOTE 6 – FAIR VALUE MEASUREMENTS

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The authoritative guidance requires disclosure of the framework for measuring fair value and requires that fair value measurements be classified and disclosed in one of the following categories:

Level 1:  Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. We consider active markets as those in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2:  Quoted prices in markets that are not active or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability. This category includes those derivative instruments that we value using observable market data. Substantially all of these inputs are observable in the marketplace throughout the full term of the derivative instrument, can be derived from observable data, or are supported by observable levels at which transactions are executed in the marketplace.

Level 3:  Measured based on prices or valuation models that require inputs that are both significant to the fair value measurement and less observable from objective sources (i.e., supported by little or no market activity).

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of June 30, 2022, and June 30, 2021. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments.

NOTE 7 – ASSET RETIREMENT OBLIGATION

The Company records the obligation to plug and abandon oil and gas wells at the dates the properties are either acquired or the wells are drilled. The asset retirement obligation is adjusted each quarter for any liabilities incurred or settled during the period, accretion expense, and any revisions made to the costs or timing estimates. The asset retirement obligation is incurred using an annual credit-adjusted risk-free discount rate at the applicable dates. Changes in the asset retirement obligation were as follows:

NOTE 7 – RELATED PARTY TRANSACTIONS

For the three months ending March 31, 2023 and the year ending 2022, the following related party transactions occurred between any of the Company’s directors or executive officers or any person nominated or chosen by the Company to become a director or executive officer:

On January 4, 2022, the Company issued 12,500 shares of Series A convertible preferred stock to Jeffrey J. Guzy, the CEO, and 12,500 shares of Series A convertible preferred stock to Wm. Barrett Wellman, the CFO. Each share is convertible at the option of the holder to ten (10) shares of common stock. The fair value of $500,000 ($20 per share) has been recorded as part of the settlement of accrued salaries and payroll taxes.  The fair value was based on the value assigned to common stock ($2 per share) multiplied by 10.

On January 13, 2022, the Company's Executive Chairman loaned $10,000 to the Company, and the Company issued a promissory note for such an amount. The promissory note is unsecured and bears interest at 2% per annum principal and accrued interest matures on December 31, 2022.

On January 24, 2022, the Company's Executive Chairman loaned $10,000 to the Company, and the Company issued a promissory note for such an amount. The promissory note is unsecured and bears interest at 2% per annum principal and accrued interest matures on December 31, 2022.

On February 1, 2022, the Company issued 170,000 shares of common stock at $2.00 per share to three individual investors in settlement of claims and for strategic consulting services totaling $340,000.

On February 15, 2022, the Company issued 10,000 shares of common stock at $2.00 per share to William Allan Bradley for services as a Board member totaling $20,000.

On January 25, 2023, the Company issued 25,000 shares of its Series A convertible preferred stock to Jeffrey J. Guzy, the Company’s CEO, and 25,000 shares of Series A convertible stock to Wm. Barrett Wellman, the Company’s CFO. Each share is convertible at the option of the holder to ten (10) shares of common stock. The total fair value of $1,065,000 ($21.30 per share) was recorded as part of accrued salaries and payroll taxes for the year ended December 31, 2022 as service was provided in that year. The accrual was reversed upon issuance of the shares in January 2023. The fair value was based on the value assigned to common stock ($2.13 per share) multiplied by 10.

On February 14, 2023, the Company entered into a new employment agreement with Mr. Guzy (the “Guzy 2023 Employment Agreement”), pursuant to which Mr. Guzy will continue serving the Company as Chief Executive Officer, President and Chairman of the Company.  

On March 14, 2023, Mr. Wellman’s Employment Agreement has been extended to a termination date of August 16, 2024. Mr. Wellman will continue serving the Company as Chief Finance Officer.

NOTE 8 – STOCKHOLDERS' DEFECIT

Authorized Capital

As of March 31, 2023, the Company has 300,000,000 authorized shares of Common Stock at $0.01 par value and 50,000,000 authorized shares of Preferred Stock at a par value of $0.10.

Preferred Stock

Refer to Note 7 for details on convertible preferred stock issuances to the Company’s CEO and CFO.

Common Stock

On January 31, 2023, the Company issued 20,642 shares for vendor payments at $2.13 per share.

On February 1, 2023, the Company issued 120,000 shares for consulting fees at $2.13 per share.

On March 1, 2023 the Company received $10,000 for stock subscriptions payable of 5,000 shares of common stock.

On February 1, 2022, the Company issued 170,000 shares for settlements and consulting fees at $2.00 per share.

On February 15, 2022, the Company issued 10,000 shares for payment to William A. Bradley, Board member at $2.00 per share.

The above shares of capital stock are restricted securities under Rule 144 and were issued in reliance on an exemption from the registration requirements of the Securities Act.

Capital Contributions

During the periods ending March 31, 2023, and March 31, 2022, the Company did not receive any capital contributions.

NOTE 9 – CONTINGENCIES AND COMMITMENTS

Operating Lease Commitments

The Company has no lease obligations at June 30, 2022,March 31, 2023, and June 30, 2021.December 31, 2022. The Company has a month-to-month rental agreement for an office share in Arlington, Virginia beginning on April 1, 2018, for $50 per month. Additionally, the Company has no known contingencies as of June 30, 2022,March 31, 2023, and June 30, 2021.December 31, 2022.

Purchase Commitments

The Company has no purchase obligations at June 30, 2022.

Significant Risks and Uncertainties

Concentration of Credit Risk – Cash – The Company maintains cash and cash equivalent balances at a single financial institution that are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. At June 30, 2022,March 31, 2023 and December 31, 2021, the Company had no exposure in excess of insurance.

Concentration of Credit Risk – Accounts Receivable – The Company had no revenue-generating operations and, therefore, no accounts receivable as of the date of these financial statements.2022.

Legal Matters

During the course of business, litigation commonly occurs. From time to time, the Company may become involved in various lawsuits and legal proceedings, which arise inbe a party to litigation matters involving claims against the ordinary course of business. However, litigation is subject to inherent uncertainties, and an

adverse result in these or other matters may arise from time to time that may harm our business. Company. The Company operates in a highly regulated industry and employs personnel, which may inherently lend itself to legal matters. Management is aware that litigation has associated costs and that results of adverse litigation verdicts could have a material effect on the Company's financial position or results of operations. There are no known legal proceedings against the Company or its officers and directors in their capacity as officers and directors of the Company.

NOTE 9 – RELATED PARTY TRANSACTIONS

On January 4, 2022, the Company issued 12,500 shares of Series A Convertible Preferred Stock to Jeffrey J. Guzy, the CEO, and 12,500 shares of Series A Convertible Preferred Stock to Wm. Barrett Wellman, the CFO. Each share is convertible at the option of the holder to ten (10) shares of common stock. The fair value of $500,000 ($20 per share) has been recorded as part of the settlement of accrued salaries and payroll taxes.  The fair value was based on the value assigned to common stock ($2 per share) multiplied by 10.

On January 13, 2022, the Company's Executive Chairman loaned $10,000 to the Company, and the Company issued a promissory note for such an amount. The promissory note is unsecured and bears interest at 2% per annum principal, and accrued interest matures on December 31, 2022.

On January 24, 2022, the Company's Executive Chairman loaned $10,000 to the Company, and the Company issued a promissory note for such an amount. The promissory note is unsecured and bears interest at 2% per annum principal, and accrued interest matures on December 31, 2022.

On February 1, 2022, the Company issued 170,000 shares of common stock at $2.00 per share to three individual investors in settlement of claims and for strategic consulting services totaling $340,000.

On February 15, 2022, the Company issued 10,000 shares of common stock at $2.00 per share to William Allan Bradley for services as a Board member totaling $20,000.

On April 21, 2022, the Company's Executive Chairman loaned $18,000 to the Company, and the Company issued a promissory note for such an amount. The promissory note is unsecured and bears interest at 2% per annum principal, and accrued interest matures on April 31, 2023.

There were no other related party transactions between any of the Company’s directors or executive officers or any person nominated or chosen by the Company to become a director or executive officer.

NOTE 10 – STOCKHOLDERS’ EQUITY

Authorized Capital

As of June 30, 2022, the Company has 300,000,000 authorized shares of Common Stock at $0.01 par value and 50,000,000 authorized shares of Series A Convertible Preferred Stock at a par value of $0.10.

Preferred Stock

During the period ending June 30, 2022, the Company issued 25,000 shares of Series A convertible preferred stock to its officers (see NOTE 9) in settlement of $500,000 of accrued salary. During the period ending June 30, 2021, the Company issued 30,000 shares of Series A convertible preferred stock to its officers in settlement of $600,000 of accrued salary.

Common Stock

On February 1, 2022, the Company issued 170,000 shares for settlements and consulting fees at $2.00 per share.

On February 15, 2022, the Company issued 10,000 shares for payment to William A. Bradley, Board member, at $2.00 per share.

On May 4, 2022, the Company issued 31,554 shares to Intelligent Investments I, LLC, assigned by The Crone Law Group, PC, in settlement of legal fees. The shares had an assigned price of $2.00 per share totaling $63,108.

During the quarter ending March 31, 2021, the company 17,500 shares of common stock for sale of shares for cash, 310,250 shares of common stock to Newbridge Securities Corporation in settlement of $620,500 in M&A fees for the Barrister acquisition, 100,000 shares of common stock to various vendors in settlement of $200,000 in service and consulting fees and 10,000 shares of common stock to its executive officers.

During the quarter ending June 30, 2021, the company issued no shares of common stock.

During the periods ending June 30, 2022, and June 30, 2021, the Company did not repurchase any shares.

The above shares of capital stock are restricted securities under Rule 144 and were issued in reliance on an exemption from the registration requirements of the Securities Act.

Capital Contributions

During the periods ending June 30, 2022, and June 30, 2021, the Company did not receive any capital contributions.

NOTE 1110 – SUBSEQUENT EVENTS

The Company has evaluated all events that occurred after the balance sheet date through the date when the financial statements were issued to determine if they must be reported. ManagementThe management of the

Company decided the followingdetermined that there were no reportable subsequent reportable events to be disclosed:disclosed beyond the following:

Issuance of Common Stock

On June 2, 2023, the Company issued 14,217 Common Shares, at $2.40 per share, to Intelligent Investments I, LLC, a Florida limited liability company for legal services.

On June 12, 2023, the Company issued 35,000 Common Shares, at $1.90 per share, to William R. Downs for oil and gas business development and consulting services.

On July 24, 2023, the Company issued 7,107 Common Shares, at $0.99 per share, to Intelligent Investments I, LLC, a Florida limited liability company, for legal services.

On August 25, 2022, the Company's Executive Chairman loaned $20,000 to the Company, and21, the Company issued 4,490 Common Shares, at $0.99 per share, to Intelligent Investments I, LLC, a promissory noteFlorida limited liability company, for such an amount. The promissory note is unsecuredlegal services.

Related Party Notes Payable

On October 10, 2023, all outstanding notes with the Company’s CEO and bears interest at 2% per annum principal, and accrued interest matures on August 25, 2023.Executive Chairman were extended to have a maturity date of May 13, 2024.

Item 2. Management’sManagement's Discussion and Analysis of Financial Condition and Results of Operations

The information set forth in this Management’sManagement's Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) contains forward-looking statements withinanalyzes the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation, Reform Act of 1995, including, among others. The statements contained in this Quarterly Report on Form 10-Q that are not historical facts are forward-looking statements that represent management’s beliefs and assumptions based on currently available information. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, need for financing, competitive position, and potential growth opportunities, and can be identified by the use of forward-looking terminology such as the words “believes,” “intends,” “may,” “should,” “anticipates,” “expects,” “could,” “plans,” “estimates,” “projects,” “targets” or comparable terminology or by discussions of strategy or trends. Our forward-looking statements do not consider the effects of future legislation or regulations. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurances that these expectations will prove to be correct. Such statements, by their nature, involve risks and uncertainties that could significantly affect expected results, and actual future results could differ materially from those described in such forward-looking statements.

While it is not possible to identify all factors, we continue to face many risks and uncertainties including, but not limited to:

·declines or volatility in the prices we receive for our oil and natural gas;

·our ability to raise additional capital to fund future capital expenditures;

·our ability to generate sufficient cash flow from operations, borrowings, or other sources to enable us to fully develop and produce our oil and natural gas properties;

·general economic conditions, whether internationally, nationally, or in the regional and local market areas in which we do business;

·risks associated with drilling, including completion risks, cost overruns, and the drilling of non-economic wells or dry holes;

·uncertainties associated with estimates of proved oil and natural gas reserves;

·the presence or recoverability of estimated oil and natural gas reserves and the actual future production rates and associated costs;

·risks and liabilities associated with acquired companies and properties;

·risks related to the integration of acquired companies and properties;

·potential defects in title to our properties;

·cost and availability of drilling rigs, equipment, supplies, personnel, and oilfield services;

·geological concentrationmajor elements of our reserves;

·environmental or other governmental regulations, including the legislationbalance sheets and statements of hydraulic fracture stimulation;

·our ability to secure firm transportation for oil and natural gas we produce and to sell the oil and natural gas at market prices;

·exploration and development risks;

·management’s ability to execute our plans to meet our goals;

·our ability to retain key members of our management team on commercially reasonable terms;

·the occurrence of cybersecurity incidents, attacks, or other breaches to our information technology systems or on systems and infrastructure used by the oil and gas industry;

·weather conditions;

·effectiveness of our internal control over financial reporting;

·actions or inactions of third-party operators of our properties;

·costs and liabilities associated with environmental, health, and safety laws;

·our ability to find and retain highly skilled personnel;

·operating hazards attendant to the oil and natural gas business;

·competition in the oil and natural gas industry;

·evolving geopolitical and military hostilities in the Middle East;

·economic and competitive conditions;

·lack of available insurance;

·cash flow and anticipated liquidity;

·continuing compliance with the financial covenant contained in our amended and restated credit agreement;

·the ongoing COVID-19 pandemic, including any reactive or proactive measures taken by businesses, governments, and other organizations related thereto, and the direct and indirect effects of COVID-19 on the market for and price of oil; and

·the other factors discussed under “Risk Factors” in our Annual Report.

operations. This section should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2022, and our interim unaudited financial statements and accompanying notes to these financial statements. Should our underlying assumptions prove incorrect or the consequences of the aforementioned risks worsen, actual results could differ materially from those expected. Except as otherwise required by applicable law, we disclaim any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events, or otherwise.

Overview

CoJax is a growth-oriented independent exploration and production company based in Arlington, Virginia, and is engaged in oil and natural gas development, production, acquisition, and exploration activities currently focused in the Gulf States Region.

Business Description and Plan of Operation

The CompanyCoJax is currently engaged in oil and natural gas acquisition, exploration, development, and production in Mississippi and Alabama. We focus on developing our existing properties while continuing to pursue acquisitions of oil and gas properties with upside potential.potential in the Gulf States Region.

Our goal is to increase stockholder value by investing in oil and natural gas projects with attractive rates of return on capital employed. We plan to achieve this goal by exploiting and developing our existing oil and natural gas properties and pursuing strategic acquisitions of additional properties, while remaining cash flow positive, maintaining low operating costs, and striving to show a gain in annual production while reducing the Company’sCompany's debt.

Executive Summary - SecondFirst Quarter 20222023 Developments and Highlights

COVID-19 ImpactRisks and Uncertainties

In DecemberSince March 2020, and throughout the Foodlast two years, global markets and Drug Administration authorizedcommodity prices have been extremely volatile due to the use ofimpacts from the COVID-19 vaccinationpandemic, with further impacts on volatility caused by the war in Ukraine that began in February 2022. Commodity prices remained steady during the United States.  The shots were first administeredfourth quarter of 2022 as demand has continued to front-line workersoutpace relative supply. While recessionary concerns have placed some downward pressure on commodity prices, causing oil and the elderly but were soon

made availablegas prices to all adults.  The daily new infections peakeddecline in the first quarter of 20212023 from their earlier highs in 2022, worldwide commodity demand continues to exceed pre COVID-19 pandemic levels. Although supply has increased and we have seen continued recovery in commodity prices since the beginning of the pandemic, there is still an overall steady decline, giving stateselement of volatility and uncertainty that we expect to continue at least for the ability to reopen to certain extents. In March 2021,near-term and possibly longer, in part by the Federal Government passed a $1.9 trillion coronavirus relief package which included direct payments to qualifying individuals, extended unemployment benefits,impact of the Russian-Ukrainian military conflict on global commodity and statefinancial markets, and local assistance.  The demand for oil and gas is expected to increase as the economy recovers, which should strengthen oil prices. While oil prices have increased to pre-pandemic levels, volatility due to OPEC actions and other factors affecting the global supply and demandassociated effect of trade sanctions on imports of oil and natural gas may continue.from Russia. This volatility could negatively impact future prices for oil, natural gas, petroleum products and industrial products.

Results of Operations – For the Three andSixMonths Ended June 30March 31, 20222023, and 20212022

* In excess of 1,000%

Oil and natural gas sales.  RevenuesFor

Revenues were $228,718 for the sixthree months ended June 30, 2022, oilMarch 31, 2023, and natural gas sales revenue decreased $8,160 to $0 compared to $8,160 for the same period during 2021, entirely as a result of the Company’s acquisition of Barrister Energy, LLC. For the three months ended June 30, 2022 and 2021during which there were no sales of natural gas. The Company is an early-stage company having just begun to acquire assignments of hydrocarbon revenues and underlying oil and natural gas.gas exploration and production rights, and therefore has just begun producing significant revenue in 2023.

Oil and gas production costs.Lease Operating Expenses

Lease operating expenses were $28,885 for the six months ended June 30, 2022, and $28,410 for the six months ended June 30, 2021. Lease operating expenses were $27,459$59,139 for the three months ended June 30, 2022, and $1,458March 31, 2023, compared to $1,426 for the three months ended June 30, 2021.

Production taxes.  Production taxes as a percentageMarch 31, 2022. The increase was due to additional operating expenses resulting from acquisitions of oil and natural gas salesproperties.

Depletion and Accretion on Discounted Liabilities

Depletion and accretion expenses were 6%, or $490, during the six months ended June 30, 2021, and 0% for the six months ended June 30, 2022, and $0$98,444 for the three months ended June 30, 2022, and June 30, 2021.  These rates are expected to stay relatively steady unless we make acquisitions in other states with differing production tax rates or the state of Alabama changes its production tax rates.

Depreciation, depletion, amortization, and accretion.  Our depreciation, depletion, amortization, and accretion expenses were $1,244 for the six months ended June 30, 2022,March 31, 2023, compared to $1,208 during the same period in 2021. For the three months ended June 30, 2022, the accretion expense was $622 and $604 for the same period in 2021.  

General and administrative expenses.  General and administrative expenses increased $297,385 to $642,372 for the six months ended June 30, 2022, as compared to $344,987 for the six months ended June 30, 2021.  The increase in general and administrative expense is primarily attributable to stock-based vendor and compensation-related expenses. General and administrative expenses increased $67,626 to $171,200 for the three months ended June 30, 2022, as compared to $103,574March 31, 2022. The increase resulted from acquisitions of oil and gas properties.

Loss from Operations

Total operating loss was $300,219 for the three months ended June 30, 2021.

Interest expense.  Interest expense decreased $12 to $1,254 for the six months ended June 30, 2022, as compared to $1,266 for the six months ended June 30, 2021;March 31, 2023, and decreased $346 to $290$473,220 for the three months ended June 30, 2022, as compared to $636March 31, 2022. The decreased loss was primarily driven by the $228,718 increase in revenues during the three months ended March 31, 2023. The increase was partially offset by the $57,713 increase in lease operating expenses and the $97,822 increase in depletion and accretion expense on discounted liabilities over the same period.

Other Expense

Other expense was $556 for the three months ended June 30, 2021.  March 31, 2023, as compared to $962 for the three months ended March 31, 2022, due to an increase in interest expense.  

Net income (loss).  LossFor

As a result of the sixabove factors, for the three months ended June 30, 2022,March 31, 2023, the Company had a net loss of $673,751,$300,775 as compared to a net loss of $368,196 for the six months ended June 30, 2021. For the three months ended June 30, 2022, the Company had a net loss of $199,569, as compared to a net loss of $106,278$474,182 for the three months ended June 30, 2021.March 31, 2022.

Sales volumes and commodity prices received

The following table presents our sales volumes and received pricing information for the three and six-monththree-month periods ended June 30, 2022,March 31, 2023, and 2021:2022:

Liquidity and Capital Resources and Liquidity

For the six months ended June 30, 2022, theSources of Liquidity

The Company had cash on hand of $12,946,$23,934 at March 31, 2023, compared to $12,098 as of$37,750 at December 31, 2021.  The2022.  For the three months ended March 31, 2023, the Company had net cash used in operating activities for the six months ended June 30, 2022, of $33,031,$21,353, compared to $37,762$11,869 for the same period of 2021.2022. The Company hadincrease in cash used in operating activities was driven by the $173,407 dencrease in net loss from operations for the three months ended March 31, 2023, compared to the three months ended March 31, 2022, offset by the $382,109 net increase in adjustments for non-cash items and changes in the balances of accounts receivables, prepaid expenses, accounts payables, and accrued expenses.  

Net cash used in investing activities ofwas $0 for the sixthree months ended June 30, 2022, compared to $0 in 2021.  March 31, 2023, and March 31, 2022.  

Net cash provided by financing activities was $33,879$7,537 for the sixthree months ended June 30, 2022, and $76,665March 31, 2023, compared to $18,321 for the same period in 2021.  

2022. The COVID-19 pandemic reduced global economic activity and negatively impacted energy demanddecrease is due to proceeds from related party loans payable of $20,000 during the previous twelve months. Demand for oil and natural gas is slowly returningperiod ended March 31, 2022, compared to pre-pandemic levels as COVID-19 vaccine rates and economic activity have increased. Additionally, we have implemented several additional initiatives to maximize free cash flow, reduce our debt level, maximize our liquidity position and ultimately realize greater shareholder value.$0 during the same period in 2023. 

Capital Resources for Future Acquisition and Development Opportunities

We continuously evaluate potential acquisitions and development opportunities. To the extent possible, we intend to acquire producing properties and/or developed undrilled properties rather than exploratory properties.  We do not intend to limit our evaluation to any one state.  We presently have no intention to evaluate offshore properties or properties located outside of the United States.

Effects of Inflation and Pricing

The oil and natural gas industry is very cyclical and the demand for goods and services of oil field companies, suppliers, and others associated with the industry puts pressure on the economic stability and pricing structure within the industry. Typically, as prices for oil and natural gas increase, so do all

associated costs. Material changes in prices impact the current revenue stream, estimates of future reserves, borrowing base calculations of bank loans, and the value of properties in purchase and sale transactions. Material changes in prices can impact the value of oil and natural gas companies and their ability to raise capital, borrow money and retain personnel. We anticipate business costs will vary in

accordance with commodity prices for oil and natural gas, and the associated increase or decrease in demand for services related to production and exploration.

Off Balance Sheet Arrangements

The Company does not have any off balanceoff-balance sheet arrangements, and it is not anticipated that the Company will enter into any off-balance sheet arrangements.

Disclosures About Market Risks

Like other natural resource producers, the Company faces certain unique market risks associated with the exploration and production of oil and natural gas.  The most salient risk factors are the volatile prices of oil and gas, operational risks, the ability to integrate properties and businesses, and certain environmental concerns and obligations.

Oil and Gas Prices

The price we receive for our oil and natural gas will heavily influence our revenue, profitability, access to capital, and future rate of growth. Oil and natural gas are commodities and, therefore, their prices are subject to wide fluctuations in response to relatively minor changes in supply and demand. The prices we receive for our production depend on numerous factors beyond our control. These factors include, without limitation, the following: worldwide and regional economic conditions impacting the global supply and demand for oil and natural gas; the price and quantity of imports of foreign oil and natural gas; the level of global oil and natural gas inventories; localized supply and demand fundamentals; the availability of refining capacity; price and availability of transportation and pipeline systems with adequate capacity; weather conditions, natural disasters, and public health threats; governmental regulations; speculation as to the future price of oil and the speculative trading of oil and natural gas futures contracts; price and availability of competitors’competitors' supplies of oil and natural gas; energy conservation and environmental measures; technological advances affecting energy consumption; the price and availability of alternative fuels and energy sources; and domestic and international drilling activity.

A substantial or extended decline in oil or natural gas prices may result in impairments of our proved oil and gas properties and may materially and adversely affect our future business, financial condition, cash flows, and results of operations. 

Transportation of Oil and Natural Gas

CoJax is presently committed to using the services of the existing gatherers in its present areas of production.  This gives such gatherers certain short-term relative monopolistic powers to set gathering and transportation costs.  Obtaining the services of an alternative gathering company would require substantial additional costs since an alternative gatherer would be required to lay a new pipelinespipeline and/or obtain new rights-of-way.

Competition in the Oil and Natural Gas Industry

We operate in a highly competitive environment for developing and acquiring properties, marketing oil and natural gas, and securing equipment and trained personnel. As a relatively small oil and natural gas company, many large producers possess and employ financial, technical, and personnel resources substantially greater than ours. Those companies may be able to develop and acquire more prospects and productive properties than our financial or personnel resources permit.  It is also significant that more

favorable prices can usually be negotiated for larger quantities of oil and/or gas products, such that CoJax views itself as having a price disadvantage compared to larger producers.  

Retention of Key Personnel

We depend to a large extent on the services of our officers. These individuals have extensive experience in the energy industry, as well as expertise in evaluating and analyzing producing oil and natural gas properties and drilling prospects, maximizing production from oil and natural gas properties, and developing and executing financing strategies. The loss of any of these individuals could have a material adverse effect on our operations and business prospects.  Our success may be dependent on our ability to continue to hire, retain and utilize skilled executive and technical personnel.

Environmental and Regulatory Risks

Our business and operations are subject to and impacted by a wide array of federal, state, and local laws and regulations governing the exploration for and development, production, and marketing of oil and natural gas, the operation of oil and natural gas wells, taxation, and environmental and safety matters. Many laws and regulations require drilling permits and govern the spacing of wells, rates of production, water, waste use and disposal, prevention of waste hydraulic fracturing, and other matters. From time to time, regulatory agencies have imposed price controls and limitations on production in order to conserve supplies of oil and natural gas. In addition, the production, handling, storage, transportation, and disposal of oil and natural gas, byproducts thereof, and other substances and materials produced or used in connection with oil and natural gas operations are subject to regulation under federal, state, and local laws and regulations.

Compliance with these regulations may constitute a significant cost and effort for CoJax.  To date, no specific accounting for environmental compliance has been maintained or projected by CoJax.  CoJax does not presently know of any environmental demands, claims, adverse actions, litigation, or administrative proceedings in which it or the acquired properties are involved or subject to or arising out of its predecessor operations.

In the event of a violation of environmental regulations, these environmental regulatory agencies have a broad range of alternative or cumulative remedies including ordering a cleanup of any spills or waste material and restoration of the soil or water to conditions existing prior to the environmental violation; fines; or enjoining further drilling, completion or production activities.  

Recently Issued Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect.  These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

Going Concern

There can be no assurance that the Company will be able to achieve its business plan, raise additional capital, or secure the additional financing necessary to implement its current operating plan. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

The Company has yet to achieve profitable operations, expects to incur further losses in the development of its business, has negative cash flows from operating activities, and is dependent upon future issuances of equity or other financings to fund ongoing operations, all of which raises substantial doubt about the Company's ability to continue as a going concern. The Company's ability to continue as a going concern is dependent upon its ability to generate future profitable operations or to obtain the necessary financing from shareholders or other sources to meet its obligations and repay its liabilities arising from normal

business operations when they come due. Management has no formal plan in place to address this concern. Still, it considers that the Company will be able to obtain additional funds by equity financing or related party advances. However, there is no assurance of additional funding being available or on acceptable terms, if at all.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

The Company is currently not subject to market risk exposure related to changes in interest rates on its indebtedness.

Currently, the Company does not use interest rate derivative instruments to manage exposure to interest rate changes.

Commodity Price Risk

Our major market risk exposure is in the pricing applicable to our oil and natural gas production. Market risk refers to the risk of loss from adverse changes in oil and natural gas prices. Realized pricing is primarily driven by the prevailing domestic price for crude oil and spot prices applicable to the region in which we produce natural gas. Historically, prices received for oil and natural gas production have been volatile and unpredictable. We expect pricing volatility to continue.

The prices we receive depend on many factors outside of our control.  A significant decline in the prices of oil or natural gas could have a material adverse effect on our financial condition and the results of operations.  In order to reduce commodity price uncertainty and increase cash flow predictability relating to the marketing of our crude oil and natural gas, we may enter into crude oil and natural gas price hedging arrangements with respect to a portion of our expected production.

The Company’sCompany's revenues, profitability, and future growth depend substantially on prevailing prices for oil and natural gas.  Prices also affect the amount of cash flow available for capital expenditures and CoJax’sCoJax's ability to borrow and raise additional capital. The amount the Company can borrow under its Credit Facility is subject to periodic redetermination based in part on changing expectations of future prices. Lower prices may also reduce the amount of oil and natural gas that the Company can economically produce. CoJax currently sells all of its oil and natural gas production under price-sensitive or market price contracts.

Currency Exchange Rate Risk

Foreign sales accounted for none of the Company’sCompany's sales; further, the Company accepts payment for its commodity sales only in U.S. dollars.  CoJax is therefore not exposed to foreign currency exchange rate risk on these sales.

Item 4. Controls and Procedures

Evaluation of disclosure controls and procedures

Our management, with the participation of Jeffrey J. Guzy, our principal executive officer, and Wm. Barrett Wellman, our principal financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Exchange Act. In designing and evaluating the disclosure

controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Based on management’smanagement's evaluation, Messrs. Guzy and Wellman concluded that our disclosure controls and procedures as of the end of the period covered by this report were not effective in ensuring that information required to be disclosed by us in reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’sCommission's rules and forms, and (ii) is accumulated and communicated to the Company’sCompany's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

We will continue to monitor and evaluate the effectiveness of our disclosure controls and procedures and our internal controls over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.

Changes in internal control over financial reporting

We regularly review our system of internal control over financial reporting and make changes to our processes and systems to improve controls and increase efficiency, while ensuring that we maintain an effective internal control environment. Changes may include such activities as implementing new, more efficient systems, consolidating activities, and migrating processes.

There were no changes in our internal control over financial reporting that occurred during the sixthree months ended June 30, 2022,March 31, 2023, that have materially affected or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.Proceedings

From time to time, weWe may become involved in various lawsuitsbe the subject of threatened or pending legal actions and legal proceedings which arisecontingencies in the ordinarynormal course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harmconducting our business. We are currently not awareprovide for costs related to these matters when a loss is probable and the amount can be reasonably estimated. The effect of the outcome of these matters on our future results of operations and liquidity cannot be predicted because any such legal proceedingseffect depends on future results of operations and the amount or timing of the resolution of such matters. For certain types of claims, we maintain insurance coverage for personal injury and property damage, product liability, and other liability coverages in amounts and with deductibles that we believe are prudent, but there can be no assurance that these coverages will be applicable or adequate to cover adverse outcomes of claims or legal proceedings against us.

Item 1A. Risk Factors

We are subject to certain risks and hazards due to the nature of the business activities we conduct.  For a discussion of these risks, see "Item 1A. Risk Factors" in the 2022 Form 10-K in addition to the risks described below.  Other than as described below, there have been no material changes to the risks described in the 2022 Form 10-K.  We may experience additional risks and uncertainties not currently known to us.  Furthermore, as a material adverse effect onresult of developments occurring in the future, conditions that we currently deem to be immaterial may also materially and adversely affect us. Any such risk may materially and adversely affect our business, financial condition, or operatingcash flows, and results. of operations.

Item 1A. Risk Factors

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this item.

Item 2. Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities.Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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