Primo 2026 Portfolio Review

Overall portfolio breakdown: Seadrill - 10.8% Weatherford International - 10.7% Atlas Energy Solutions - 9.1% Crescent Energy - 9.0% Valaris - 8.7% Noble A - 8.6% Geopark - 8.5% Chord Energy - 8.3% Civitas Resources - 8.1% FTAI Infrastructure - 8.0% Scorpio Tankers - 6.5% Kosmos Energy - 6.4% TORM plc A - 5.9% Star Bulk Carriers - 5.0% Petroleo Brasileiro S.A. - Petrobras ADR - 4.1% New Fortress Energy A - 2.9% Cash - (20.5%)* () = Negative Cash / Margin Individual holdings breakdown: Seadrill Seadrill is a pure-play offshore drilling contractor focused on high-specification deepwater floaters, including drillships and semisubmersibles. Its fleet is relatively young compared to legacy offshore peers, positioning it to command premium day rates during periods of strong offshore demand. Key operating regions include Brazil, the U.S. Gulf of Mexico, and West Africa. Following its 2022 restructuring, Seadrill significantly reduced debt and simplified its capital structure, though it remains leveraged relative to onshore service companies. The company maintains a multi-year contract backlog that provides medium-term visibility, but earnings remain highly sensitive to utilization and day rates. Legacy legal matters from prior corporate iterations remain outstanding, though their ultimate financial impact is uncertain. --- Weatherford International Weatherford is a global oilfield services company providing drilling, evaluation, completion, and production technologies, with a predominantly international footprint across Latin America, the Middle East, and Asia. Its service-oriented model offers more stable activity levels than rig-based contractors, though it remains cyclical. Since emerging from restructuring, Weatherford has materially improved margins and free cash flow, supported by cost discipline and higher-value digital and production optimization services. While leverage has declined, interest expense and balance-sheet repair remain ongoing considerations, particularly in a lower-oil-price environment. --- Atlas Energy Solutions Atlas Energy Solutions is a Permian Basin–focused frac sand producer and logistics provider, differentiated by its integrated mining, processing, and last-mile delivery infrastructure. Its conveyor-based systems reduce reliance on trucking and can materially lower delivered sand costs versus traditional logistics. Frac sand demand is tied closely to U.S. shale completion activity, which is cyclical and seasonal. Atlas benefits from increasing sand intensity per well, but its geographic concentration in West Texas exposes it to localized drilling slowdowns. Management has outlined operational efficiency initiatives aimed at lowering unit costs over time. --- Crescent Energy Crescent Energy is a U.S. onshore E&P with assets primarily in the Eagle Ford, Permian Basin, and Uinta Basin. The company focuses on acquiring mature, cash-flow-generating assets and emphasizes disciplined capital allocation and shareholder returns. Crescent has completed multiple acquisitions in recent years, increasing scale and inventory depth. While this supports stable cash flow, it introduces integration and execution risk. Free cash flow and dividend sustainability remain sensitive to commodity prices. --- Valaris Valaris is a diversified offshore drilling contractor operating drillships, semisubmersibles, and jack-up rigs, with exposure to deepwater and harsh-environment markets such as the North Sea. Its balanced fleet mix provides some insulation from weakness in any single offshore segment. Parts of the fleet are older, which can increase maintenance capital requirements. Earnings remain cyclical and dependent on contract renewals and repricing, with longer-term upside tied to sustained offshore project sanctions. --- Noble Corporation Noble operates a premium offshore drilling fleet focused on ultra-deepwater and harsh-environment markets. Core regions include the Gulf of Mexico, Guyana, and the North Sea. The company has substantially reduced leverage since its 2021 restructuring and maintains a sizeable contract backlog. A key differentiator is Noble’s 50% ownership in ARO Drilling, a joint venture with Saudi Aramco that provides long-term exposure to the Middle East jack-up market. Revenue concentration among a small group of major customers remains a structural risk. --- GeoPark GeoPark is an independent E&P focused on onshore oil production in Latin America, primarily in Colombia and Ecuador. The company targets conventional reservoirs with relatively low operating and development costs. While GeoPark has historically emphasized capital discipline and free cash flow, its geographic footprint exposes it to political, regulatory, and community-related risks, including permitting delays and fiscal uncertainty. --- Chord Energy Chord Energy is a Williston Basin–focused E&P formed through the merger of Oasis Petroleum and Whiting Petroleum, later expanded through the Enerplus acquisition. The company operates a large Bakken inventory and prioritizes shareholder returns through dividends and share repurchases. Chord benefits from the Bakken’s infrastructure and stable decline characteristics, but its growth profile is more modest than Permian-focused peers. Capital efficiency and returns remain sensitive to oil prices. --- Civitas Resources Civitas Resources operates in the DJ Basin and the Permian Basin, pursuing a consolidation strategy to build scale and inventory depth. The company has expanded through acquisitions while emphasizing operational efficiencies. DJ Basin assets face regulatory and decline-rate challenges, increasing reliance on the Permian for growth. Leverage and cost control remain key considerations during this portfolio transition. --- FTAI Infrastructure FTAI Infrastructure owns a diversified portfolio of transportation and energy infrastructure assets, including railroads, ports, and power facilities. The company emphasizes asset-level optimization and long-duration cash flows rather than direct commodity exposure. Despite asset diversity, FTAI Infrastructure carries elevated leverage and continues to invest heavily, increasing refinancing and execution risk. The investment thesis depends on cash-flow growth and gradual deleveraging. --- Scorpio Tankers Scorpio Tankers is a leading owner of product tankers, with a modern, fuel-efficient fleet focused on MR and LR vessels. The company has significantly reduced debt since the last shipping downturn. Product tanker earnings are highly cyclical and driven by refined product trade flows, refinery utilization, and geopolitical disruptions. While recent conditions have been favorable, normalization remains a key risk. --- Kosmos Energy Kosmos Energy is an offshore-focused E&P with assets in West Africa and the Gulf of Mexico, including producing fields and LNG-linked developments such as Greater Tortue Ahmeyim. Its portfolio offers long-life resource potential but requires substantial capital investment. Kosmos carries relatively high leverage for an E&P company, and free cash flow generation depends on project execution, timing, and commodity prices. Liquidity management remains a central concern. --- TORM plc TORM is a product tanker operator with a modern fleet and a commercial strategy emphasizing spot market exposure. The company has returned substantial capital to shareholders during periods of strong tanker rates while maintaining moderate leverage. Spot exposure allows TORM to benefit from market dislocations but also increases earnings volatility during downturns. --- Star Bulk Carriers Star Bulk is one of the largest publicly traded dry bulk shipping companies, transporting iron ore, coal, grain, and other commodities. The company operates a diversified fleet across vessel classes and has improved its balance sheet in recent years. Dry bulk demand is tied to global industrial activity and commodity trade, making earnings inherently cyclical. Fleet renewal and maintenance capex remain ongoing considerations. --- Petrobras Petrobras is Brazil’s state-controlled integrated oil and gas company, with leading positions in deepwater pre-salt production, refining, and downstream operations. Vertical integration provides some insulation from commodity price volatility. Political influence over pricing, dividends, and capital allocation remains a persistent governance risk, even as Petrobras generates strong operating cash flow from high-quality offshore assets. --- New Fortress Energy New Fortress Energy develops and operates LNG infrastructure and gas-to-power assets, primarily in emerging markets. The company has pursued rapid expansion funded largely with debt, resulting in high leverage and tight liquidity. New Fortress Energy is in active forbearance with certain creditors following missed interest payments. Lenders have temporarily agreed not to accelerate debt or enforce remedies while the company negotiates refinancing and asset monetizations. Asset sales and restructuring efforts have improved near-term liquidity, but leverage remains elevated, and the company’s ability to continue as a going concern depends on successful refinancing, extensions of forbearance, or additional asset dispositions.