Sky Quarry's Nevada Refinery Gains Strategic Value as Brent Crude Surpasses $110 and West Coast Refining Capacity Shrinks

Nevada's only operating refinery is positioned at the intersection of surging global oil prices, accelerating California refinery closures, and rising demand for domestically produced fuel

WOODS CROSS, UT / ACCESS Newswire / April 2, 2026 / Sky Quarry Inc. (NASDAQ:SKYQ), operator of Nevada's only operating refinery, today highlighted the strategic importance of its Foreland Refinery as Brent crude oil surged past $110 per barrel - its highest level since mid-2022 - and the Western United States continues to lose refining capacity at an accelerating rate. The convergence of a major oil price rally amid disruptions in the Strait of Hormuz, the permanent closure of major California refineries, and strong regional fuel demand creates a favorable backdrop for domestic refining infrastructure serving the local market.

Nevada's Only Refinery - Serving the Local Market

Sky Quarry owns and operates the Foreland Refinery, the only refinery located in Nevada, with approximately 5,000 barrels per day of permitted refining capacity. The facility produces diesel, vacuum gas oil (VGO), naphtha, and liquid paving asphalt from crude oil sourced from Nevada and Utah, serving the regional fuel market across Nevada and parts of the broader Intermountain West.

Nevada consumes more than 300,000 barrels per day of petroleum products - including gasoline, diesel, and jet fuel - according to the U.S. Energy Information Administration. Because the state has no other in-state refining capacity, nearly all refined fuels must be transported from refineries in neighboring states, principally California.

"Nevada is one of the most import-dependent fuel markets in the country," said Marcus Laun, Chief Executive Officer of Sky Quarry. "If two of the largest California refineries serving the Western region close permanently and global oil prices spike above $110 a barrel, the question of where refined product comes from - and who controls local supply - becomes urgent. We own the only refinery in Nevada, and that is a strategically significant position."

Brent at $110+: A Major Supply Shock

Crude oil markets have experienced a significant surge in March 2026. Brent crude settled at approximately $112 per barrel on March 30, 2026 - up more than 50% since the beginning of the year - as conflict in the Middle East effectively closed the Strait of Hormuz to most commercial traffic. The U.S. Energy Information Administration's March 10 Short-Term Energy Outlook forecast Brent remaining above $95 per barrel over the next two months.

Higher oil prices typically support increased domestic drilling activity. Analysis from the Federal Reserve Bank of Dallas has shown that U.S. shale drilling activity tends to accelerate when oil prices rise above the $70 to $80 per barrel range, where many drilling programs become economically attractive. At current price levels, the economics for regional crude production in Nevada and Utah are substantially improved.

Sky Quarry is currently in discussions with regional crude oil suppliers and leaseholders in Nevada regarding opportunities to increase local production that could supply the Foreland Refinery.

"At $110 oil, the economics for local drilling and local refining both improve materially," Laun continued. "Several producers we work with are actively evaluating opportunities to increase production. If that activity accelerates, it can create a natural and advantageous supply relationship between local crude and local refining capacity - exactly the kind of integrated position we have been building toward."

California Refinery Closures Tighten Regional Supply

While fuel demand across the Western United States remains strong, California's refining capacity - the primary source of imported refined fuels for Nevada and neighboring states - has been declining sharply and will likely continue to do so.

The Phillips 66 Wilmington refinery in Los Angeles (~138,700 barrels per day) permanently ceased crude processing operations at the end of 2025. Valero's Benicia refinery (~145,000 barrels per day), located northeast of San Francisco, is scheduled to close by mid-2026. Together, these two facilities represent approximately 290,000 barrels per day of capacity - roughly 18% of California's total refining infrastructure, according to reporting by Oil & Gas Journal and TankTerminals.com.

California's boutique fuel blend requirements mean that replacement supply cannot easily be sourced from other domestic refining centers, amplifying the impact of any capacity reduction. States such as Nevada that already depend on fuel transported from California face compounding exposure as in-state California supply tightens, transportation costs rise, and the global price of crude climbs simultaneously.

"The West Coast fuel supply chain is being stressed from multiple directions at the same time," said Laun. "California may be losing roughly 290,000 barrels a day of refining capacity just as global crude prices are hitting multi-year highs. That is a challenging equation for any market that depends on California for refined product - particularly Nevada."

PR Spring: Long-Term Unconventional Resource

Sky Quarry's wholly-owned PR Spring facility in eastern Utah represents an additional long-term energy asset. Constructed at a cost of more than $50 million, the facility is designed to process asphaltic bitumen oil sands ore into heavy oil. The property contains an estimated 180 million barrels of asphaltic bitumen ore. At sustained elevated crude prices, the economics of unconventional resource development may improve materially, and the Company intends to continue evaluating development pathways for the asset.

About Sky Quarry Inc.

Sky Quarry Inc. (NASDAQ:SKYQ) is an oil production and refining company that operates the Foreland Refinery, Nevada's only operating refinery, producing diesel, VGO, naphtha, and liquid paving asphalt from crude oil sourced from Nevada and Utah. The Company is also advancing its PR Spring facility in eastern Utah, focused on technologies to recover hydrocarbons from oil-saturated sands and soils and consumer waste, including asphalt shingles. For more information, please visit www.skyquarry.com

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of applicable securities laws, including statements about future developments in the energy industry. All statements other than statements of historical fact may constitute forward-looking statements. The statements may be identified by words such as "expect," "anticipate," "intend," "plan," "believe," "seek," "estimate," "will," "project," "may," "can," "if," or words of similar meaning. Such statements are based on current expectations and assumptions of management, many of which are beyond the Company's control, and are subject to a number of risks, uncertainties, and factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described explicitly or implicitly in any forward-looking statement. The Company neither intends nor assumes any obligation to update or revise these forward-looking statements in light of developments that differ from those anticipated. You are urged to carefully review and consider the cautionary statements and the Company's other disclosures, including the statements made under the heading "Risk Factors" and elsewhere in the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the SEC. Forward-looking statements speak only as of the date of the document in which they are contained.

Investor Relations
Jennifer Standley
Director of Investor Relations
ir@skyquarry.com
www.skyquarry.com

SOURCE: Sky Quarry