Trimerica Energy (TECO) 10-Q 22 Jan 14 2013 Q3 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	9 Months Ended
	Sep. 30, 2013	Jan. 16, 2014
Document And Entity Information	'	'
Entity Registrant Name	'Treaty Energy Corp	'
Entity Central Index Key	'0001075773	'
Document Type	'10-Q	'
Document Period End Date	30-Sep-13	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--12-31	'
Is Entity a Well-known Seasoned Issuer?	'No	'
Is Entity a Voluntary Filer?	'No	'
Is Entity's Reporting Status Current?	'Yes	'
Entity Filer Category	'Smaller Reporting Company	'
Entity Common Stock, Shares Outstanding	'	1,879,770,280
Document Fiscal Period Focus	'Q3	'
Document Fiscal Year Focus	'2013	'

CONSOLIDATED_BALANCE_SHEETS

CONSOLIDATED BALANCE SHEETS (USD $)	Sep. 30, 2013	Dec. 31, 2012
ASSETS	'	'
Cash and equivalents	$746	$2,235
Accounts receivable	3,387	7,361
Other receivable	5,100	1,502
Total current assets	9,233	11,098
Oil and gas properties (successful efforts), net	150,659	84,486
Oil and gas properties (unproved), net	'	'
Oilfield support equipment, net	301,661	685,534
Net oil and gas properties	452,320	770,020
Other property, plant and equipment, net	708,114	836,309
Other assets	69,038	69,863
Carved out interest, net	'	70,235
TOTAL ASSETS	1,238,705	1,757,525
LIABILITIES	'	'
Accounts payable and accrued liabilities	1,521,876	1,217,757
Accrued expenses to related parties	130,414	74,000
Related party payable	76,464	114,628
Notes and accrued interest payable, net of discounts of $60,209 and $111,816, respectively	2,045,047	1,688,779
Derivative Liability	3,107,028	'
Total current liabilities	6,880,829	3,095,164
Deferred Revenue	'	504,094
Asset retirement obligation	89,016	225,881
TOTAL LIABILITIES	6,969,845	3,825,139
STOCKHOLDERS' EQUITY (DEFICIT)	'	'
Preferred stock - par value $0.001, 50 million shares authorized, 28,500 and -0- issued or outstanding at September 30, 2013 and December 31, 2012	29	'
Common stock – par value $0.001, 1.25 billion shares authorized, 1,251,049,036 and 945,249,192 issued and outstanding at June 30, 2013 and December 31, 2012, respectively	1,251,049	945,249
Additional paid in capital	22,601,020	17,763,235
Common stock payable	'	1,274,576
Accumulated loss - pre exploration stage	-644,829	-644,829
Accumulated loss	-28,622,959	-21,156,758
Accumulated other comprehensive income	4,741	8,812
Total stockholders' equity (deficit) attributable to Treaty Energy Corp	-5,410,949	-1,809,715
Non-Controlling Interest	-320,191	-257,899
Total stockholders' equity (deficit)	-5,731,140	-2,067,614
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	$1,238,705	$1,757,525

CONSOLIDATED_BALANCE_SHEETS_Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Stockholders Equity	'	'
Preferred stock, par value	$0.00	$0.00
Preferred stock, authorized shares	50,000,000	50,000,000
Preferred stock, issued shares	28,500	0
Preferred stock, outstanding shares	28,500	0
Common stock, par value	$0.00	$0.00
Common stock, authorized shares	1,250,000,000	1,250,000,000
Common stock, issued shares	1,251,049,036	945,249,192
Common stock, outstanding shares	1,251,049,036	945,249,192

CONSOLIDATED_STATEMENTS_OF_OPE

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
REVENUES	'	'	'	'
Oil and gas revenues	$79,322	$75,667	$208,384	$145,770
Drilling revenues	'	'	13,600	'
Total revenues	79,322	75,667	221,984	145,770
EXPENSES	'	'	'	'
Lease operating expenses	325,554	310,315	835,138	699,671
Production taxes	8,064	'	12,826	3,740
General and administrative	435,173	4,680,631	4,393,226	5,885,492
Impairment expense	615,500	'	615,500	'
Depreciation, depletion and amortization	67,546	133,732	240,445	287,048
Accretion of asset retirement obligation	1,014	6,102	3,395	18,339
Total expenses	1,452,851	5,130,780	6,100,530	6,894,290
Operating Loss	-1,373,529	-5,055,113	-5,878,546	-6,748,520
OTHER INCOME AND EXPENSE ITEMS	'	'	'	'
Interest expense	-86,870	-41,507	-412,605	-136,384
Gain (loss) on retirement of debt	-1,794	-860,835	-27,401	-862,212
Gain (Loss) on Derivative Liability	1,752,370	'	-1,190,586	'
Gain (Loss) on settlement of stock payable	-324,772	'	-324,772	'
Gain (Loss) on sale of assets	61,000	-265,163	305,417	-272,517
NET PROFIT (LOSS)	26,405	-6,222,618	-7,528,493	-8,019,633
Less: Comprehensive loss attributable to Non-Controlling Interests	5,482	101,781	62,292	190,411
Net loss attributable to the Company	31,887	-6,120,837	-7,466,201	-7,829,222
Foreign Currency Translation Gain or (Loss)	916	2,947	-3,860	6,587
Add: loss attributable to Non-Controlling Interests	5,482	101,781	62,292	190,411
Total Comprehensive Loss	$27,321	($6,219,671)	($7,532,353)	($8,013,046)
Weighted average common shares outstanding - basic and diluted	1,245,911,451	814,027,452	1,189,515,026	764,129,590
Loss per share	$0	($0.01)	($0.01)	($0.01)

CONSOLIDATED_STATEMENTS_OF_CAS

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
CASH FLOWS FROM OPERATING ACTIVITIES	'	'
Net loss	($7,528,493)	($8,019,633)
Adjustments to reconcile net loss to net cash provided by / (used in) operating activities:	'	'
Depreciation, depletion and amortization	243,692	287,048
(Gain) Loss on sale of assets	-580,483	272,517
(Gain) Loss on conversion of debt for equity	173,887	862,212
Loss on shares issued to settled stock payable/derivative	324,772	'
Loss on conversion of related party debt to stock	156,200	'
Loss on Derivative Liability	1,190,586	'
Impairment of O & G	653,500	'
Amortization of discount on notes payable	51,607	9,633
Accretion of asset retirement obligation	3,395	18,339
Stock based compensation (shares issued and owed)	2,546,203	4,217,770
Shares issued for settlement	257,794	'
Shares owed and expensed for default on NP	17,000	'
Interest imputed on related-party notes	5,324	27,712
Amortization of deferred revenue	-79,899	-35,735
Forgiveness of debt and accrued interest	-45,914	'
Bad Debt expense	16,500	'
Changes in operating assets and liabilities:	'	'
Accounts receivable	3,974	-8,206
Other receivables	1,417	'
Prepaid expenses & other assets	-3,675	'
Accounts payable and accrued expenses	602,543	89,144
Accounts payable & accrued expenses - Related Party	588,212	'
Net cash provided by / (used in) operating activities	-1,401,858	-2,279,199
CASH FLOWS FROM INVESTING ACTIVITIES	'	'
Acquisitions of oil and gas properties & fixed assets	-434,926	-516,793
Purchases of fixed assets	-2,000	-498,197
Proceeds from sales of oil and gas interests	150,214	60,000
Net cash provided by / (used in) investing activities	-286,712	-954,990
CASH FLOWS FROM FINANCING ACTIVITIES	'	'
Advances from related parties, net	-185,462	1,833,625
Proceeds from notes payable	550,008	908,000
Principal payments on notes payable	-17,994	-506,469
Bank overdraft	4,986	-1,982
Proceeds from sale of stock	1,343,772	994,493
Net cash provided by / (used in) financing activities	1,695,310	3,227,667
Net increase / (decrease) in cash and cash equivalents	6,740	-6,522
Foreign Currency translation gain/loss	-8,229	6,586
Cash and cash equivalents, beginning of period	2,235	14,716
Cash and cash equivalents, end of period	746	14,780
SUPPLEMENTAL CASH FLOW INFORMATION	'	'
Cash paid for interest	166,257	'
Shares issued for retirement of debt	200,100	1,042,801
Shares issued to relieve related party notes payable	384,500	'
Shares issued to relieve accounts payable	3,000	'
Shares issued to re-purchase ORRI	336,500	'
Shares issued to relieve stock payable	1,224,931	'
Shares issued by related party on behalf of company for potential acquisition	'	140,000
Related party debt donated to Additional Paid in Capital	'	'
Shares issued to purchase equipment	23,788	1,228,414
Reclass excess shares issued over cap to derivative liability	10,490	'
Stock payable for conversion of accrued liability	13,000	'
Reclass stock payable to derivative liability	2,106,631	'
Acquisition of oil & gas properties with debt	'	328,012
Preferred shares converted to common shares	'	60,000
Assumption of asset retirement obligation acquisition of oil and gas properties	$47,391	$76,707

1_ORGANIZATION_AND_NATURE_OF_B

1. ORGANIZATION AND NATURE OF BUSINESS	9 Months Ended
	Sep. 30, 2013
Accounting Policies [Abstract]	'
ORGANIZATION AND NATURE OF BUSINESS	'
	History
	Treaty Energy Corporation, formerly known as Alternate Energy Corp., (“Treaty”, “the Company”, “we”, or “us”) was incorporated as COI Solutions, Inc. in the State of Nevada in August, 1997.
	We incorporated as COI Solutions, Inc. on August 1, 1997 as a Nevada corporation. On May 22, 2003, we acquired all the assets of AEC Inc., formerly known as Alternate Energy Corporation, and changed our name to Alternate Energy Corp. We commenced active business operations on September 1, 2003 and were a development stage company under Codification Topic No. 915 developing alternate renewable energy sources.
	The Company merged with Treaty Petroleum, Inc., a Texas Corporation under a transaction commonly referred to as a reverse merger.  With the change in ownership in December 2008, we embarked on a new business plan, focusing on oil and gas production.

2_BASIS_OF_PRESENTATION_AND_SI

2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2013
Notes to Financial Statements	'
2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES	'
	Basis of Presentation
	The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Treaty Energy Drilling, C&C Petroleum Management, LLC, and Treaty Belize Energy, Ltd., in which the Company holds an 80% interest.  All significant intercompany transactions have been eliminated.
	The consolidated financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of financial information for the interim periods presented.  These adjustments are of a normal recurring nature and include appropriate estimated provisions.
	Use of Estimates
	The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates underlying these consolidated financial statements include the estimated quantities of proved oil reserves used to compute depletion of oil and natural gas properties and the estimated fair value of asset retirement obligations.
	All of the Company’s accounting policies are not included in this Form 10-Q.  A more comprehensive set of accounting policies adopted by the Company are included on our Form 10-K as of December 31, 2012 and are herein incorporated by reference.
	Revenue Recognition
	The Company recognizes oil, gas and natural gas condensate revenue in the period of delivery. Settlement on sales occurs anywhere from two weeks to two months after the delivery date. The Company recognizes revenue when an arrangement exists, the product has been delivered, the sales price is fixed or determinable, and collectability is reasonably assured.
	The Company recognizes drilling revenue in the period services are rendered.  The Company recognizes revenue when a drilling engagement exists, the service has been rendered, the contract fee is fixed or determinable, and collectability is reasonably assured.
	Stock-Based Compensation
	In December of 2004, the Financial Accounting Standards Board (FASB) issued guidance now codified as Topic 718 (“Topic 18”) which applies to transactions in which an entity exchanges its equity instruments for goods or services and also applies to liabilities an entity may incur for goods or services that are based on the fair value of those equity instruments. For any unvested portion of previously issued and outstanding awards, compensation expense is required to be recorded based on the previously disclosed Topic 18 methodology and amounts.  Prior periods presented are not required to be restated. The Company adopted Topic 18 at its inception and applied the standard using the modified prospective method.
	Accounting for Asset Retirement Obligations
	The Company accounts for conditional asset retirement obligations in accordance with FASB ASC 410-20.  Accordingly, an entity is required to recognize a liability for the fair value of a conditional asset retirement obligation if the fair value can be reasonably estimated. The Company estimates a fair value of the obligation on each well in which it owns an interest by identifying costs associated with the future dismantlement and removal of production equipment and facilities and the restoration and reclamation of a production operation’s surface to a condition similar to that existing before oil and natural gas extraction began.
	In general, the amount of an Asset Retirement Obligation (“ARO”) and the costs capitalized will be equal to the estimated future cost to satisfy the abandonment obligation using current prices that are escalated by an assumed inflation factor up to the estimated settlement date which is then discounted back to the date that the abandonment obligation was incurred using an assumed cost of funds for the Company. After recording these amounts, the ARO is accreted to its future estimated value using the same assumed cost of funds and the liability is increased each period as the retirement obligation approaches.  See Note 11 for a discussion of our estimated Asset Retirement Obligation.
	Reclassifications
	Certain prior period amounts have been reclassified to conform to the current period presentation. There was no material effect on the consolidated financial statements as a result of these reclassifications.
	Derivative Liability
	The Company accounts for shares sold in excess of the authorized number of shares as a derivative liability.  Fair values for exchange traded securities and derivatives are based on quoted market prices.  Where market prices are not readily available, fair values are determined using market based pricing models incorporating readily observable market data and requiring judgment and estimates.

3_RECENT_ACCOUNTING_PRONOUNCEM

3. RECENT ACCOUNTING PRONOUNCEMENTS	9 Months Ended
	Sep. 30, 2013
Accounting Changes and Error Corrections [Abstract]	'
RECENT ACCOUNTING PRONOUNCEMENTS	'
	There are no recent accounting pronouncements that affect our operations or require disclosure as of the date of this balance sheet.

4_GOING_CONCERN

4. GOING CONCERN	9 Months Ended
	Sep. 30, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]	'
GOING CONCERN	'
	The accompanying consolidated financial statements have been prepared assuming that Treaty will continue as a going concern. As shown in these consolidated financial statements, we have had continuing negative cash flows from operations and a working capital deficit as of September 30, 2013.  These conditions raise substantial doubt as to our ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.  Management intends to finance these deficits by making additional shareholder notes and seeking additional outside financing through either debt or sales of its common stock.

5_OIL_AND_GAS_PROPERTIES

5. OIL AND GAS PROPERTIES	9 Months Ended
	Sep. 30, 2013
Extractive Industries [Abstract]	'
OIL AND GAS PROPERTIES	'
	There were no property acquisitions during the three months ended September 30, 2013, however, a 4% ORRI was repurchased during the quarter ended March 31, 2013, and 0.5% and 1.3% ORRI interests were re-acquired during the quarter ended September 30, 2013.  The 4% ORRI was purchased with 1,000,000 shares valued at $38,000 but were immediately impaired and expensed based on the December 31, 2012, reserve report.  During the three months ended September 30, 2013, a ½ (one-half) % ORRI interest was purchased for 7,500,000 shares of common stock.  The value of the shares paid was $199,500 on the acquisition date.  During the three months ended September 30, 2013, a 1.3% ORRI interest was purchased for 11,000,000 shares of common stock and $17,000 cash.  The value of the shares paid was $99,000.  These ORRI’s had no fair market value at September 30, 2013, and were fully impaired as of September 30, 2013 for $315,500.
	During the three months ended March 31, 2013, we acquired assignments of the Mitchell #3 and #4 wells for a cash investment of $300,000.  It was immediately impaired for the full amount of the cost.
	Also during the quarter ended  September 30, 2013, we purchased an assignment of Working and Net Revenue interest in the Stockton lease for $50,000.  An additional $58,651 of drilling costs have been capitalized since the acquisition.
	In addition to the $300,000 impairment expense on the Mitchell leases, we have impaired another $315,500 of costs associated with those wells and for the ORRI interests repurchased for lease properties that were disposed of.
	Our geographical proved and unproved properties are as follows:
		9/30/13			12/31/12
	Oilfield Support Equipment	$	406,318		$	846,196
	Less: accumulated depreciation		(104,657	)		(160,662	)
	Total		301,661			685,534
	Proved developed producing:
	Texas	$	1,167,361		$	1,049,577
	Less: accumulated depletion and impairment		(1,016,702	)		(965,091	)
	Total		150,659			84,486
	Unproved:
	Belize		41,161			48,075
	Accumulated Impairment		(41,161	)		(48,075	)
	Total	$	-0-		$	0
	Production of Oil from all fields
	We recorded depreciation and depletion expense on oil and gas assets of $76,788 and $178,955 for the nine months ended September 30, 2013 and 2012, respectively, with total production of approximately 3,068 and 2,948 barrels.
	For the three and nine months ended September 30, 2013, we shipped 1,862.92 and 3,067.63 barrels, and reflect a $3,387 net receivable (after royalty and production tax reductions) for shipments made prior to September 30, 2013.
	Carved Out Production Payment
	As noted in the 10-K filed for the year ended December 31, 2012, we entered into an agreement with an investor to sell a 5% permanent royalty and a 15% temporary royalty to be paid until production reaches 200 barrels per day for $600,000.  The interests for both the permanent and temporary royalties relate to all current and future Texas leases.  Once total Texas production exceeds 200 barrels per day, the temporary 15% royalties will revert to Treaty Energy Corporation.
	In recording the temporary portion of the royalties sold, an advance on a production payment liability was established.  Since the amount of proceeds to be paid out in the future is not readily determinable and the Company is not responsible for any shortfall in payment related to future production, the temporary 15% is treated as a “Carved-Out Production Payment Payable in Product” consistent with the guidance in ASC 932-10.  Moreover, since the payout amounts are uncertain, no allocation of the proceeds between the permanent 5% and the temporary 15% Overriding Royalty was made, and therefore, no gain or loss was recorded on the transaction.
	Consistent with the aforementioned guidance, the cash received related to the 15% carved-out production interest is treated as deferred revenue and amortized with production and payment to the holder.  The proportional amount of carrying value of oil and gas assets will be amortized with production to match the costs to the production periods.
	Amortization was based on the independent reserve report and is subject to future changes in estimates.
	On April 19, 2013, the Company sold the Great 8 leases, effectively eliminating the carve-out balance.    As such, no amortization was recognized for the three months ended September 30, 2013.  For the six months ended September 30, 2013 and 2012, amortization of the carve out production was $11,132 and $2,197, respectively.
	For the same reason, the deferred revenue was eliminated with the sale of the Great 8 leases.  No deferred revenue was recorded for the three months ended September 30, 2013.  For the nine months ended September 30, 2013 and 2012, amortization of the deferred revenue was $79,899 and $30,805, respectively.
	Sale of Oil & Gas Properties
	During the quarter ended March 31, 2013, the Company returned the property to the lender and was released from further obligations.  The carrying value on the Converse lease was zero and the debt relief and ARO were $258,566 and $166,882 resulting in a gain of $425,448.
	During the first quarter of 2013 the Company sold a 5% net revenue interest within the San Juan #3 well located within the Company’s Belize lease for $45,000. The well is currently being drilled and is unproved at the time of this filing. The agreement entails that the Company return the $45,000 to the investor within 60 days if the well is considered to be a dry hole. Based on the uncertainty of the well at this time the $45,000 was accrued within liabilities as of September 30, 2013.
	During the first quarter of 2013 the Company transferred the Willingham lease and equipment to the former lender on the property.  The carrying value at the time of the disposition for the related lease and well equipment was $54,741 and the carrying value of the related asset retirement obligation was $1,700. The Company recorded a loss of $53,041 on this disposition.
	On April 19, 2013, the Company sold the Great 8 leases for a total of $550,000.  There have been subsequent amendments allowing full payment to be deferred until November 13, 2013.  However, the history of slow or minor payments resulted in our recognizing a bad debt loss against the note of $472,277.  After adjusting for the Carve-out production, various impairments, deferred revenues, asset retirement obligations and the effect of the bad debt loss, the Company is recognizing a net gain of $114,161.  Should further payments be made on the note they will be recognized as a gain.

6_PROPERTY_PLANT_AND_EQUIPMENT

6. PROPERTY, PLANT AND EQUIPMENT	9 Months Ended
	Sep. 30, 2013
Property, Plant and Equipment [Abstract]	'
PROPERTY, PLANT AND EQUIPMENT	'
	Other property, plant and equipment consist principally of drilling rigs, and office furniture and equipment.  Historical cost and accumulated depreciation are as follows:
		9/30/13			12/31/12
	Drilling rigs and related equipment	$	841,646		$	835,146
	Office equipment		5,165			5,165
	Furniture and fixtures		1,049			1,049
	Vehicles		212,140			188,521
	Equipment		24,598			24,598
	Total property, plant and equipment - at cost		1,084,598			1,054,479
	Less: accumulated depreciation		(376,484	)		(218,170	)
	Net property, plant and equipment - other	$	708,114		$	836,309
	Assets other than drilling equipment and vehicles generally have estimated useful lives of three years.  Estimated useful life of drilling equipment and vehicles is five years.  Depreciation for the nine months ended September 30, 2013 and 2012 was $163,657 and $64,806, respectively.

7_NOTES_PAYABLE

7. NOTES PAYABLE	9 Months Ended
	Sep. 30, 2013
Debt Disclosure [Abstract]	'
NOTES PAYABLE	'
	As of September 30, 2013 and December 31, 2012 the Company had the following debt principal amounts outstanding:
	Note	9/30/13			12/31/12
	Great 8 Lease note (original)	$	-		$	211,494
	11/14/11 Promissory Note		457,739			120,239
	1/30/12 Promissory Note		150,000			150,000
	8/12/12 Promissory Note		744,577			746,071
	Penalty on Promissory Note		50,000			-
	Converse Lease note		-			258,368
	11/28/12 Promissory Note		110,000			110,000
	12/11/12 Promissory Note		-			37,120
	Great 8 Lease note (new lender)		300,000			-
	Loan on Belize property		28,907			14,435
	Equipment Loan		13,001			13,001
	Belize 5% NRI		44,457			-
	04/08/13 Promissory Note		10,000			-
	08/26/13 Promissory Note		37,500			-
	Accrued Interest/Charges		159,075			139,867
	Total Debt Outstanding		2,105,256			1,800,595
	Debt Discount		(60,209	)		(111,816	)
	Net Debt Outstanding	$	2,045,047		$	1,688,779
	See footnote 12 for information on notes payable to related parties.
	None of our debts outstanding are contractually convertible. All conversions noted below were mutually agreed to between the lender and the Company which resulted in extinguishment accounting with gains or losses recorded based on the differences between the value of the shares issued compared to the debts relieved.
	Promissory Note Issued for the Acquisition of the Great 8 lease (principal of $-0- and $211,494 as of September 30, 2013 and December 31, 2012, respectively, and accrued interest of $-0- and $6,461 as of September 30, 2013 and December 31, 2012, respectively)
	On May 31, 2011, we issued a promissory note in the amount of $692,539 for the Great 8 leases in Texas, the payment terms of which are: monthly payments including interest and principal with the final payment due on September 1, 2012. This note accrues interest at 5%.  During the quarter ended March 31, 2013, the Company paid off the note and accrued interest in full through borrowing from other lenders who the company is now indebted to for $275,000.  The difference was charged to interest expense. As an additional expense related to the original default on the former note payable, the Company transferred the Willingham lease and equipment to the former lender. The carrying value at the time of the disposition for the related lease and well equipment was $54,741, and the carrying value of the related asset retirement obligation was $1,700. The Company recorded a loss of $53,041 on this disposition.
	Promissory Note Issued for Cash Deposit (principal of $ 457,739 and $120,239 as of September 30, 2013 and December 31, 2012, respectively, and accrued interest of $43,980 and $59,057 as of September 30, 2013 and December 31, 2012, respectively
	On November 14, 2011, we issued a promissory note in the amount of $150,000 in return for a cash advance. Stated interest on the loan is at 12% with quarterly payments starting September 30, 2012.  On February 26, 2013, an additional loan advance of $400,000 was received.  Terms of the note included quarterly principal and interest payments.  The Company is currently in default on these notes, but have been working with the lender to rectify the outstanding issue.  During the quarter ended September 30, 2013, no principal or interest payments were made.
	During the first quarter, we converted some of this debt through issuances of stock.  The conversion of 10,593,313 shares for relief of $62,500 of principal and interest resulted in a loss of $76,065.
	Promissory Note Issued for Cash Deposit (principal of $ 150,000 and $150,000 as of September 30, 2013 and December 31, 2012, respectively, and accrued interest of $72,500 and $77,500 as of September 30, 2013 and December 31, 2012, respectively)
	On January 30, 2012, we issued a promissory note in the amount of $100,000 in return for a cash advance.  Payments are interest only at 5% per month for one year at which time the principal amount is due and payable.  This note is collateralized with 10,000,000 common shares of the Company. In the event the Company defaults on the note these shares would be owed to the lender. The agreement requires that the Company provide additional collateral if the fair value of the shares decreases below $200,000 while the note is outstanding.  As of September 30, 2013, the collateral exceeded $200,000.  At December 31, 2012, in accordance with the terms of the contract we added $50,000 to the note as a penalty for delinquent payments.  During the quarter ended September 30, 2013, no payments of principal or interest were made and  the note is in technical default, though we have been in negotiations with the lender to satisfy the debt balance.
	During the first quarter, we converted some of this debt through issuances of stock.  The conversion of 12,598,360 shares valued at $144,228 for relief of $72,500 of principal and interest, resulted in a loss of $71,278.
	Promissory Note Issued for Cash Deposit (principal of $744,577 and $746,071 as of September 30, 2013 and December 31, 2012, respectively, and a discount of $60,209 and $111,816 as of September 30, 2013 and December 31, 2012, respectively)
	On August 12, 2012, we issued a promissory note in the amount of $750,000 in return for a cash advance.  Payments are structured to be paid at a rate of 7% of royalties earned on three of the East Texas leases, plus one-half (1/2) of the net income derived from those wells until the note is paid in full.  The note specifies that repayment must be completed within 24 months.
	There is no stated interest rate on the note; however, the Company has assigned a 7% royalty interest to the lender that will continue after the note is paid in full.  The Company has recognized the royalty interest as a discount on the note for $137,620 and is amortizing it over a 24 month period.  Amortization of $ 51,607 and $23,983 was recognized for the nine months ended September 30, 2013 and September 30, 2012, respectively.  During the nine months ended September 30, 2013, $1,494 of principal has been repaid on this loan.
	Promissory Note Issued for Purchase of property (principal of $-0- and $258,368 as of September 30, 2013 and December 31, 2012, respectively, and accrued interest of $-0- and $198 as of September 30, 2013and December 31, 2012, respectively)
	On September 21, 2012, the Company purchased the Converse lease and issued a promissory note in the amount of $328,012.  The note requires two (2) $20,000 payments in October, 2012, and $20,000 per month thereafter.  Interest accrues at a rate of 7%.  As of December 31, 2012, the Company was in default by $2,500 on the December payment.  During the quarter ended March 31, 2013, the Company returned the property to the lender and was released from further obligations.  The carrying value on the Converse lease was zero and the debt relief and ARO were $258,566 and $166,882 resulting in a gain of $425,448.
	Promissory Note Issued for Cash Deposit (principal of $ 110,000 and $110,000 as of September 30, 2013 and December 31, 2012, respectively, and accrued interest of $10,954 and $1,009 as of September 30, 2013 and December 31, 2012, respectively)
	On November 28, 2012 and December 31, 2012, we received $40,000 and $70,000 from the same lender.  Interest accrues at the rate of 12% per annum.  The terms of this note required payment by February 28, 2013, which the Company did not make.  The note is considered to be in default.
	Promissory Note Issued for Cash Deposit (principal of $ -0- and $37,120 as of September 30, 2013 and December 31, 2012, respectively, and accrued interest of $-0- and $-0- as of September 30, 2013 and2013and December 31, 2012, respectively)
	On December 11, 2012, we issued a note for a cash advance of $20,000.  The note bears an interest rate of 18%.  Per the terms, payment was due on December 21, 2012, after which, in addition to interest on the outstanding amount, the Company is obligated to issue 100,000 shares per day until it is paid in full.  As of December 31, 2012, we have accrued $100 in interest and $17,110 for the value of the stock that was due on that date.  The stock was priced at the closing price of the stock on each day of accrual.  During January, 2013, a cash payment of $12,500 was made on this note, and on February 19, 2013, $65,100 was converted to 4,650,000 shares valued at $72,700 resulted in a $7,600 loss.  An additional gain of $45,914 was recognized for amounts forgiven by the holder with the extinguishment, resulting in a net gain with settlement of $38,314.
	Promissory Note Issued for Cash Deposit (principal of $300,000 and $ -0- as of September 30, 2013 and December 31, 2012, respectively, and accrued interest of $24,461 and $-0- as of September 30, 2013 and December 31, 2012, respectively)
	On March 28, 2013, we issued a note for a cash advance of $300,000.  $275,000 of the related proceeds from this note was used to pay off the aforementioned note in default relating to the Great 8 leases. The remaining $25,000 was received in cash. The note is collateralized by the note receivable we have from the sale of the Great 8 leases.  The balance of this note is due on 7/1/13 or when the leases are sold, whichever comes sooner.  As noted above, the leases have been sold; however, full payment from the buyer has not been received as of September 30, 2013; therefore this note was considered to be in default.
	Payable related to 5% NRI in Belize Well ($45,000 and $0 as of September 30, 2013 and December 31, 2012)
	During the first quarter of 2013 the Company sold a 5% net revenue interest within the San Juan #3 well located within the Company’s Belize lease for $45,000. The well is currently being drilled and is unproved at the time of this filing. The agreement entails that the Company return the $45,000 to the investor within 60 days if the well is considered to be a dry hole. Based on the uncertainty of the well at this time the $45,000 was accrued within debt as of September 30, 2013.
	Equipment Loan ($13,001 as of September 30, 2013 and December 31, 2012)
	On May 1, 2012, we purchased wire-line truck for $73,101, and issued a promissory note for $67,101. The purchase was treated as a rent to own agreement and in lieu of interest, rental payments of $9,138 were paid in 2012. As of December 31, 2012 and September 30, 2013 this note was in default.
	Borrowing from Princess Entertainment for Belize interest ($28,907 and $14,435 as of September 30, 2013 and December 31, 2012)
	During 2012 and 2013, Princess Entertainment, our concession partner in Belize has advanced us operating funds. There is no stated interest rate or terms on these advances. Imputed interest for these advances was considered to be immaterial. The balance is held as a current liability and is considered to be due upon demand.
	Promissory Note Issued for Cash Deposit (principal of $10,000 and $ -0- as of September 30, 2013 and December 31, 2012, respectively, and accrued interest of $2,500 and $-0- as of September 30, 2013 and December 31, 2012, respectively)
	On April 8, 2013, we issued a note for a cash advance of $10,000.  The terms called for interest of $2,500 and 2,000,000 shares of the Company’s common stock.  At September 30, 2013, we accrued the $2,500 of stated interest and $17,000 of interest attributable to the valuation of the stock.  Terms of the note required payment of principal, interest and issuance of stock within 15 days.  We are currently in default on this note.
	Promissory Note Issued for Cash Deposit (principal of $37,500 and $ -0- as of September 30, 2013 and December 31, 2012, respectively, and accrued interest of $941 and $-0- as of September 30, 2013 and December 31, 2012, respectively)
	On August 26, 2013, we issued a note for a cash advance of $37,500.  The note is to be repaid within six months with an interest payment of $5,000.  As of September 30, 2013, the Company accrued interest of $941.
	During the quarter ended September 30, 2013, we factored oil sales for a cash advance of $16,500 with an investor. The amount was repaid through August production from Mitchell #3 and #4 oil production and included a financing fee of $984.

8_SHAREHOLDERS_EQUITY

8. SHAREHOLDERSb EQUITY	9 Months Ended
	Sep. 30, 2013
Equity [Abstract]	'
SHAREHOLDERSb EQUITY	'
	We are authorized to issue 1.25 Billion shares of our common stock.  At December 31, 2012, we had 945,249,192 shares issued and outstanding.  During the nine months ended September 30, 2013, we issued 305,799,844 shares.
	During the quarter ended March 31, 2013, the Company issued 108,034,016 shares to relieve stock payable valued at $1,112,243. No gain or loss was recorded for these issuances as the number of shares issued was consistent with the amounts owed.
	During the quarter ended March 31, 2013, the Company issued 25,341,673 shares to extinguish notes and accrued interest payable of $187,600. The shares were valued at the closing stock price on the conversion agreement date equal to $330,493. A loss of $142,893 was recorded due to the value of the shares exceeding the amount converted.
	During the quarter ended March 31, 2013, the Company issued 35,024,370 shares to extinguish related party notes and accrued interest payable of $374,500. The shares were valued at the closing stock price on the conversion agreement date equal to $464,571. Any gains on individual conversions were recorded to additional paid in capital rather than gain based on the related party relationship. As a result of the conversions, an additional $66,129 beyond the shares value was recorded to additional paid in capital and a loss of $156,200 was recorded.
	During the quarter ended March 31, 2013, the Company issued 400,000 shares to extinguish accounts payable of $3,000. The shares were valued at the closing stock price on the conversion agreement date equal to $5,400. A loss of $2,400 was recorded due to the value of the shares exceeding the amount converted.
	During the quarter ended March 31, 2013, the Company issued 113,310,345 shares for services. The shares were expensed for the value at the closing stock price on the grant date equal to $2,329,404.
	During the quarter ended March 31, 2013, an additional 4% ORRI in a lease already held by the Company was repurchased. The 1,000,000 shares issued with the acquisition were valued at $38,000 based on the closing price of the stock on the acquisition date, but were immediately impaired and expensed based on the December 31, 2012 reserve report.
	During the quarter ended June 30, 2013, the Company issued 12,949,440 shares to relieve stock payable valued at $112,688. No gain or loss was recorded for these issuances as the number of shares issued was consistent with the amounts owed, with 425,000 shares for services.
	During the quarter ended June 30, 2013, the Company issued 2,300,000 shares for services. The shares were expensed for the value at the closing stock price on the grant date equal to $25,400.
	During the quarter ended June 30, 2013, the Company issued 90,000 shares that were previously granted and accounted for but had not been issued. Since the shares had been properly expensed and recorded to additional paid in capital on the grant the shares were recorded at par value with the issuance.
	Preferred Stock
	On July 19, 2013, the Company contracted with an investor to issue 22,500 shares of Class A, Series F preferred stock for the return of 15,000,000 shares of free trading common stock of the Company.  The free-trading stocks obtained in this stock swap have been issued as follows:
	8,055,556 shares to individuals that paid cash to the Company of $65,918
	5,500,000 shares to a consultant under a Contract dated 10/19/12 and valued at $109,450
	500,000 shares to reduce accrued fees to related party valued at $9,950
	944,444 shares for the balance of an ORRI purchase
	Of the above amount, 876,885 shares were issued in excess of the number of shares  owed which were recored as a loss for $12,452 based on the closing stock price on the transaction date.  Additionally, the related stock payables prior to the settlement were re-classed to derivative liabilities and marked to market on the settlement date.  The 15,000,000 shares issued were relieved from treasury for $513,000 and the stock payable relieved  was valued at $200,679  resulting in a loss of $312,321 with the issuance.
	On September 9, 2013, the Company approved the issuance of 5,000 shares of its Class A, Series G preferred stock to a consultant for performance on a drilling contract initiated in October, 2012.  The stock was valued based the convertible value of the common stock of $60,000.
	Also, on September 9, 2013, the Company approved the issuance of 1,000 shares of its Class A, Series G preferred stock for legal services provided pertaining to the drilling contracts.  The stock was valued based the convertible value of the common stock of $12,000.
	Class A, Series F & G Preferred Stock have the same terms as follows:
	a.	The Par Value of each share of Class A, Series G Preferred Stock is $0.001.
	b.	Each holder of Class A, Series G Preferred Stock shall have the right to One thousand (1000) votes per share, for each share owned on any matter put forth for a vote to shareholders.
	c.	Each holder of Class A, Series G Preferred Stock may, at the election of the Board of the Company or the holder, be required to convert its shares of Class A Series G Preferred Stock into shares of the Corporation’s common stock at rate of one thousand (1000) shares of common stock for each share of Class A Series G Preferred Stock; provided, however, a holder’s ability to convert of Class A, Series G Preferred Stock into common stock is expressly upon the Corporation having sufficient authorized but unissued shares of stock to fulfill such request. The Corporation shall have no obligation to shares of common stock upon a purported conversion to a holder of Class An Series G Preferred Stock should the Corporation have insufficient shares authorized but unissued shares of common stock to fulfill such request, and such conversion request shall be deemed null and void to the of such insufficiency.
	d.	Upon the dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, the holders of Class A, Series G Preferred Stock shall participate in the payment or distribution made on the Company’s common as if such shares of Class A, Series G Preferred Stock had been converted shares of common stock.
	e.	Each holder of Class A, Series G Preferred Stock shall be entitled to participate in any dividends declared by the Corporation’s Board as if such shares of Class A, Series G Preferred Stock had been converted into shares of common stock, any such declared dividend to subtract from any already accrued dividend.
	Stock Payable
	On March 6, 2013 the Company and a lender agreed to extinguish $12,500 of amounts owed in accrued interest to 2,500,000 shares. The value of the shares owed according to the closing stock price on the agreement date was $25,000. The loss on debt conversion was $12,500.
	During the quarter ended March 31, 2013, the Company received cash payments of $314,654 for 37,016,178 shares owed.
	During the quarter ended June 30, 2013, the Company received cash payments of $607,201 for 118,105,173 shares owed.
	During the quarter ended June 30, 2013, the Company became in default on a note payable which requires the Company to issue 2,000,000 common shares as a result of the default. The shares were valued upon default based on the closing price of the stock and recorded to common stock payable for $17,000.
	During the quarter ended June 30, 2013, the Company agreed to issue 1,774,648 common shares to relieve an accrued payable to a consultant of $13,000. The shares value on the agreement date based on the closing price of the stock was $29,094. The difference between the value of the shares and amount of debt relief was recorded as a loss for $16,094.
	During the quarter ended June 30, 2013, the Company agreed to issue 594,718 common shares for equipment. The value of the shares on the agreement date based on the closing price of the stock was $23,788.
	During the quarter ended September 30, 2013, the Company agreed to issue 7,500,000 to an individual for the purchase of a ½ % ORRI interest.  Based on the market value of the stock, the purchase was recorded at $199,500.
	During the quarter ended September 30, 2013, the Company received cash payments of $354,918 for 71,909,291 shares of its common stock.
	During the quarter ended September 30, 2013, the Company settled with TNC Energy for the purchase and drilling of Mitchell #3 and #4 for 10,000,000 shares of common stock valued at $239,000.
	During the quarter ended September 30, 2013, the Company reduced its debt by $10,000 to Rampant Leon Financial Corporation , a related party, for 1,488,095 shares of common stock valued at $10,000.
	During the quarter ended September 30, 2013, the Company agreed to provide 11,000,000 shares valued at $99,000 for the re-purchase of a 1.3% ORRI interest.
	During the quarter ended September 30, 2013, the Company issued 6,000,000 to outside consultants valued at $119,400 for services rendered.
	During the quarter ended September 30, 2013, the Company agreed to provide 944,444 shares valued at $18,794 to settle amounts owed for an ORRI purchase.
	At September 30, 2013, the Company had obligations to issue 229,683,108 common shares recorded at $1,540,538.  As the Company had already issued shares in excess of their authorization, the entire balance was re-classed to Derivative Liabilities (See Note 10).

9_ACCOUNTS_PAYABLE_AND_ACCRUED

9. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES	9 Months Ended
	Sep. 30, 2013
Payables and Accruals [Abstract]	'
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES	'
	Accounts payable and accrued liabilities at September 30, 2013 and December 31, 2012 consist of the following:
		9/30/13		12/31/12
	Trade accounts payable	$	1,013,963	$	846,784
	Royalties payable		71,861		33,120
	Liabilities associated with our reverse merger		200,380		200,380
	Accrued expenses		93,213		-
	Due to AFEC		120,000		120,000
	All Secure payable		17,473		17,473
	Bank overdraft		4,986		-
	Total		1,521,876		1,217,757
	As of September 30, 2013, the Company owed three related parties a combined liability of $130,414 for cash advances and for accrued consulting fees.

10_DERIVATIVE_LIABILITY

10. DERIVATIVE LIABILITY

9 Months Ended

Sep. 30, 2013

Notes to Financial Statements

'

10. DERIVATIVE LIABILITY

'

On April 15, 2013, the Company issued 1,049,036 shares that exceeded our authorized amount of shares.  To account for this error, we initially recorded a Derivative Liability of $10,490 related to these shares.  Fair values for exchange traded securities and derivatives are based on quoted market prices.  Where market prices are not readily available, fair values are determined using market based pricing models incorporating readily observable market data and requiring judgment and estimates.  Upon recognition of the derivative liability, the Company reclassed the value initially recorded to additional paid in capital with the issuance for $10,490 related to the 1,049,036 shares to derivative liabilities. In adjusting the related derivative liability to the market price at September 30, 2013, the Company realized a loss of $1,994.   As of September 30, 2013, the derivative value of the shares was $12,484.

At April 15, 2013, the Company had a stock payable obligation of $1,066,019.  Until the increase of authorized shares is completed during the fourth quarter of 2013, we have re-classed the stock payable to Derivative Liability as there are not any authorized shares to settle this obligation.  In conformance with Generally Accepted Accounting Principles we have recorded a liability of $3,094,544, recognizing a loss of $1,188,592 for the nine months ended September 30, 2013.  Where market prices are not readily available, fair values are determined using market based pricing models incorporating readily observable market data and requiring judgment, and estimates.

During the quarter ended September 30, 2013 the Company issued 15,000,000 common shares from treasury stock with a value of $513,000. These shares were issued to settle stock payable recorded within the derivative liabilities. The derivative liabilities related to the stock payable relieved was marked to market on the settlement date at $200,679 and a loss of $312,321 was recorded due to the share value exceeding the derivative value settled.

During the quarter ended September 30, 2013, the Company issued 15,000,000 shares from treasury stock with a value of $513,000.  These shares were issued to settle stock payable recorded within the derivative liabilities.  The derivative liabilities related to the stock payable relieved was marked to market on the settlement date at $200,679 and a loss of $312,321 was recorded due to the share value exceeding the derivative settled.

At September 30, 2013, the Company had a total Derivative Liability of $3,107,028 and has recognized a Gain/ (Loss) on Derivatives of $1,752,370 and ($1,190,586) during the three and nine months then ended.

The table below shows the change to the derivative liability during the nine months ended September 30, 2013:

Reclass

Gain/Loss

Balance

from

Marked to

Balance

12/31/12

Equity

Settled

Market

9/30/13

Derivative liability shares owed and unissued

-

2,106,631

(206,679

)

1,188,592

3,094,544

Derivative liability shares issued over authorized

-

10,490

-

1,994

12,484

Total

-

2,117,121

(206,679

)

1,190,586

3,107,028

11_ASSET_RETIREMENT_OBLIGATION

11. ASSET RETIREMENT OBLIGATION	9 Months Ended
	Sep. 30, 2013
Asset Retirement Obligation Disclosure [Abstract]	'
ASSET RETIREMENT OBLIGATION	'
	A reconciliation of the aggregate carrying amount of asset retirement obligations is as follows:
	The Company recorded an accretion expense of $1,014 and $6,102 for the three months ended September 30, 2013 and September 30, 2012, respectively and $3,395 and $18,339 for the nine months ended September 30, 2013 and September 30, 2012, respectively.
		September 30,			December 31,
		2013			2012
	Balance, beginning of year	$	225,881		$	130,397
	Liabilities assumed on acquired properties		47,392			75,396
	Liabilities settled for sale of leases		(181,800	)		(3,271	)
	Accretion expense		3,395			18,171
	Reduction for sale of ORRI & Working Interest		(5,852	)
	Revision of existing liabilities		-			5,188
	Balance at End of Period	$	89,016		$	225,881

12_RELATED_PARTY_TRANSACTIONS

12. RELATED PARTY TRANSACTIONS	9 Months Ended
	Sep. 30, 2013
Related Party Transactions [Abstract]	'
RELATED PARTY TRANSACTIONS	'
	During the nine months ended September 30, 2013, we had the following transactions with related parties:
	●	We accrued $420,000 in compensation costs to our Chairman and CEO and three other related consultants, of which $205,399 was paid to them during the nine months ended September 30, 2013.  Balances owed to these related parties were $130,414 and $74,000 at September 30, 2013 and December 31, 2012, respectively.
		During the three and nine months ended September 30, 2013, we paid consulting fees of $155,000 and $485,000 to related parties.
	●	We repaid a net amount of $37,664 from an entity owned by our Chairman and CEO, Andrew Reid during the nine months ended September 30, 2013.  We owed that company $26,464 and $64,629 at September 30, 2013 and December 31, 2012. Imputed interest expense on this note was $5,324 and $27,712 for the nine months ended September 30, 2013 and 2012, respectively. During the quarter ended September 30, 2013 the Company issued 1,488,095 shares valued at $10,000 to reduce the liability by $10,000.
	●	We borrowed $50,000 from our former CFO, George Warren during 2012.  The demand note carries a 10% interest rate.  Balance on this note was $50,000 and $50,000 at September 30, 2013 and December 31, 2012, respectively.  Accrued interest on this note was $3,739 and $-0- at September 30, 2013 and December 31, 2012, respectively.

13_FAIR_VALUE_OF_FINANCIAL_INS

13. FAIR VALUE OF FINANCIAL INSTRUMENTS	9 Months Ended
	Sep. 30, 2013
Fair Value Disclosures [Abstract]	'
13. FAIR VALUE OF FINANCIAL INSTRUMENTS	'
	The Company adopted FASB ASC 820-10 upon inception at April 9, 2010. Under FASB ASC 820-10-5, fair value is defined as 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 (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value.
	The Company has derivative liabilities that must be measured under the new fair value standard. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows:
	●	Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
	●	Level 2 - Inputs include quoted prices for similar assets and 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, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).
	●	Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.
	The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of September 30, 2013 and December 31, 2012:
			Fair Value Measurements at September 30, 2013
			Level 1		Level 2			Level 3
	Assets
	Cash and cash equivalents			746		–			–
	Total assets			746		–			–
	Liabilities
	Derivative Liabilities			–		3,107,028			–
	Total Liabilities			–		3,107,028			–
			$	746	$	(3,107,028	)	$	–
			Fair Value Measurements at December 31, 2012
			Level 1		Level 2			Level 3
	Assets
	Cash and cash equivalents		$	2,235	$	–		$	–
	Total assets			2,235		–			–
	Liabilities
	Derivative Liabilities			–		-			–
	Total Liabilities			–		-			–
			$	2,235	$	-		$	–
	There were no transfers of financial assets or liabilities between Level 1 and Level 2 inputs for the nine months ended September 30, 2013 and 2012.
	Level 2 liabilities consist of Derivative Liabilities. These liabilities were adjusted to fair market value as of September 30, 2013. Fair market value of derivative liabilities was determined based on the closing stock price on the valuation date.

14_SUBSEQUENT_EVENTS

14. SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2013
Subsequent Events [Abstract]	'
SUBSEQUENT EVENTS	'
	During the quarter ended December 31, 2013, the Company sold its assigned interest in the Mitchell #3 and #4 wells for a cash payment of $175,000.
	On October 31, 2013, the Company finalized the process to increase the authorized number of shares to 1.95 Billion shares. Beginning immediately, the Company began to issue the shares re-classed to the derivative liability, therefore, during the quarter ended December 31, 2013, the liability will be eliminated.
	On October 2, 2013, the Company authorized and issued 195,000 shares of Class A, Series H Preferred Stock to related parties for fees and expenses owed.  These shares are valued at $3,120,000.
	Also on October 2, 2013, the Company authorized and issued 129,204 shares of Class A, Series H Preferred Stock to several unrelated consultants and vendors for fees owed to them.  These shares are valued at $2,067,264.
	On October 21, 2013, the Company authorized and issued 10,000 shares of Class A, Series H Preferred Stock to a consultant.  These shares are valued at $129,000.
	The Company’s Class A Preferred Stock bears the same terms as the Class A, Series F & G Preferred Stock as described in Note 8.
	On November 27, 2013, the Company issued 97,719,396 shares of its common stock.  These included 85,082,500 shares for $388,494 of cash payments; 5,136,896 shares valued at $64,654 for consulting services; and 7,500,000 shares valued at $191,250 were issued to repurchase a royalty interest.
	On November 1, 2013, the Company acquired an assignment to the Kubacek wells for a nominal fee of $10.
	On November 1, 2013 the Company issued 12,500,000 of its common stock for consulting services received. These shares are valued at $175,000.
	On December 5, 2013, the Company issued 151,336,454 shares of its common stock.  These included 95,065,545 shares for $413,971 of cash payments and 56,270,909 shares valued at $865,866 for consulting services.
	Also on December 5, 2013, two holders of 32,000 preferred shares converted them to 32,000,000 shares of common stock.
	On January 3, 2013, nine holders of 257,614 preferred shares converted them to 257,614,000 shares of common stock.
	On January 13, 2013, the Company issued 77,551,394 shares of its common stock.  These included 71,414,139 shares for $338,500 of cash payments; 1,137,255 shares valued at $9,098 for consulting services; and 5,000,000 shares valued at $40,000 to relieve debt of $38,965.

15_LEGAL_PROCEEDINGS

15. LEGAL PROCEEDINGS	9 Months Ended
	Sep. 30, 2013
Commitments and Contingencies Disclosure [Abstract]	'
15. LEGAL PROCEEDINGS	'
	In January, 2013, the Company was advised that legal remedies were being sought by the party involved in the rescission action pertaining to the Belize investment.  The Company disputes that the amount of $120,000 had become past due as the stock to be returned had not been returned at that point.  Aside from the stated amount due for the rescission and described in Note 9, the Company does not believe that any additional liability will be incurred.  The full amount of $120,000 has been accrued on our books.
	On May 23, 2013, a vendor obtained a judgment against the Company for an unpaid invoice, plus court fees and interest of $98,070.  The Company recorded the liability and has established an installment agreement with the vendor.

2_BASIS_OF_PRESENTATION_AND_SI1

2. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2013
Notes to Financial Statements	'
Basis of Presentation	'
	The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Treaty Energy Drilling, C&C Petroleum Management, LLC, and Treaty Belize Energy, Ltd., in which the Company holds an 80% interest.  All significant intercompany transactions have been eliminated.
	The consolidated financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of financial information for the interim periods presented.  These adjustments are of a normal recurring nature and include appropriate estimated provisions.
Use of Estimates	'
	The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates underlying these consolidated financial statements include the estimated quantities of proved oil reserves used to compute depletion of oil and natural gas properties and the estimated fair value of asset retirement obligations.
	All of the Company’s accounting policies are not included in this Form 10-Q.  A more comprehensive set of accounting policies adopted by the Company are included on our Form 10-K as of December 31, 2012 and are herein incorporated by reference.
Revenue Recognition	'
	The Company recognizes oil, gas and natural gas condensate revenue in the period of delivery. Settlement on sales occurs anywhere from two weeks to two months after the delivery date. The Company recognizes revenue when an arrangement exists, the product has been delivered, the sales price is fixed or determinable, and collectability is reasonably assured.
	The Company recognizes drilling revenue in the period services are rendered.  The Company recognizes revenue when a drilling engagement exists, the service has been rendered, the contract fee is fixed or determinable, and collectability is reasonably assured.
Stock-Based Compensation	'
	In December of 2004, the Financial Accounting Standards Board (FASB) issued guidance now codified as Topic 718 (“Topic 18”) which applies to transactions in which an entity exchanges its equity instruments for goods or services and also applies to liabilities an entity may incur for goods or services that are based on the fair value of those equity instruments. For any unvested portion of previously issued and outstanding awards, compensation expense is required to be recorded based on the previously disclosed Topic 18 methodology and amounts.  Prior periods presented are not required to be restated. The Company adopted Topic 18 at its inception and applied the standard using the modified prospective method.
Accounting for Asset Retirement Obligations	'
	The Company accounts for conditional asset retirement obligations in accordance with FASB ASC 410-20.  Accordingly, an entity is required to recognize a liability for the fair value of a conditional asset retirement obligation if the fair value can be reasonably estimated. The Company estimates a fair value of the obligation on each well in which it owns an interest by identifying costs associated with the future dismantlement and removal of production equipment and facilities and the restoration and reclamation of a production operation’s surface to a condition similar to that existing before oil and natural gas extraction began.
	In general, the amount of an Asset Retirement Obligation (“ARO”) and the costs capitalized will be equal to the estimated future cost to satisfy the abandonment obligation using current prices that are escalated by an assumed inflation factor up to the estimated settlement date which is then discounted back to the date that the abandonment obligation was incurred using an assumed cost of funds for the Company. After recording these amounts, the ARO is accreted to its future estimated value using the same assumed cost of funds and the liability is increased each period as the retirement obligation approaches.  See Note 11 for a discussion of our estimated Asset Retirement Obligation.
Reclassifications	'
	Certain prior period amounts have been reclassified to conform to the current period presentation. There was no material effect on the consolidated financial statements as a result of these reclassifications.
Derivative Liability	'
	The Company accounts for shares sold in excess of the authorized number of shares as a derivative liability.  Fair values for exchange traded securities and derivatives are based on quoted market prices.  Where market prices are not readily available, fair values are determined using market based pricing models incorporating readily observable market data and requiring judgment and estimates.

5_OIL_AND_GAS_PROPERTIES_Table

5. OIL AND GAS PROPERTIES (Tables)	9 Months Ended
	Sep. 30, 2013
Extractive Industries [Abstract]	'
Geographical proved and unproved properties	'
		9/30/13			12/31/12
	Oilfield Support Equipment	$	406,318		$	846,196
	Less: accumulated depreciation		(104,657	)		(160,662	)
	Total		301,661			685,534
	Proved developed producing:
	Texas	$	1,167,361		$	1,049,577
	Less: accumulated depletion and impairment		(1,016,702	)		(965,091	)
	Total		150,659			84,486
	Unproved:
	Belize		41,161			48,075
	Accumulated Impairment		(41,161	)		(48,075	)
	Total	$	-0-		$	0

6_PROPERTY_PLANT_AND_EQUIPMENT1

6. PROPERTY, PLANT AND EQUIPMENT (Tables)	9 Months Ended
	Sep. 30, 2013
Property, Plant and Equipment [Abstract]	'
Other property, plant and equipment	'
		9/30/13			12/31/12
	Drilling rigs and related equipment	$	841,646		$	835,146
	Office equipment		5,165			5,165
	Furniture and fixtures		1,049			1,049
	Vehicles		212,140			188,521
	Equipment		24,598			24,598
	Total property, plant and equipment - at cost		1,084,598			1,054,479
	Less: accumulated depreciation		(376,484	)		(218,170	)
	Net property, plant and equipment - other	$	708,114		$	836,309

7_NOTES_PAYABLE_Tables

7. NOTES PAYABLE (Tables)	9 Months Ended
	Sep. 30, 2013
Notes to Financial Statements	'
7. NOTES PAYABLE (Tables)	'
	Note	9/30/13			12/31/12
	Great 8 Lease note (original)	$	-		$	211,494
	11/14/11 Promissory Note		457,739			120,239
	1/30/12 Promissory Note		150,000			150,000
	8/12/12 Promissory Note		744,577			746,071
	Penalty on Promissory Note		50,000			-
	Converse Lease note		-			258,368
	11/28/12 Promissory Note		110,000			110,000
	12/11/12 Promissory Note		-			37,120
	Great 8 Lease note (new lender)		300,000			-
	Loan on Belize property		28,907			14,435
	Equipment Loan		13,001			13,001
	Belize 5% NRI		44,457			-
	04/08/13 Promissory Note		10,000			-
	08/26/13 Promissory Note		37,500			-
	Accrued Interest/Charges		159,075			139,867
	Total Debt Outstanding		2,105,256			1,800,595
	Debt Discount		(60,209	)		(111,816	)
	Net Debt Outstanding	$	2,045,047		$	1,688,779

9_ACCOUNTS_PAYABLE_AND_ACCRUED1

9. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Tables)	9 Months Ended
	Sep. 30, 2013
Payables and Accruals [Abstract]	'
Accounts payable and accrued liabilities	'
		9/30/13		12/31/12
	Trade accounts payable	$	1,013,963	$	846,784
	Royalties payable		71,861		33,120
	Liabilities associated with our reverse merger		200,380		200,380
	Accrued expenses		93,213		-
	Due to AFEC		120,000		120,000
	All Secure payable		17,473		17,473
	Bank overdraft		4,986		-
	Total		1,521,876		1,217,757

10_DERIVATIVE_LIABILITY_Tables

10. DERIVATIVE LIABILITY (Tables)	9 Months Ended
	Sep. 30, 2013
Derivative Liability Tables	'
Schedule of Derivative Liability	'
				Reclass					Gain/Loss
		Balance		from					Marked to		Balance
		12/31/12		Equity		Settled			Market		9/30/13
	Derivative liability shares owed and unissued		-		2,106,631		(206,679	)		1,188,592		3,094,544
	Derivative liability shares issued over authorized		-		10,490		-			1,994		12,484
	Total		-		2,117,121		(206,679	)		1,190,586		3,107,028

11_ASSET_RETIREMENT_OBLIGATION1

11. ASSET RETIREMENT OBLIGATION (Tables)	9 Months Ended
	Sep. 30, 2013
Asset Retirement Obligation Disclosure [Abstract]	'
Reconciliation of the aggregate carrying amount of asset retirement obligation	'
		September 30,			December 31,
		2013			2012
	Balance, beginning of year	$	225,881		$	130,397
	Liabilities assumed on acquired properties		47,392			75,396
	Liabilities settled for sale of leases		(181,800	)		(3,271	)
	Accretion expense		3,395			18,171
	Reduction for sale of ORRI & Working Interest		(5,852	)
	Revision of existing liabilities		-			5,188
	Balance at End of Period	$	89,016		$	225,881

13_FAIR_VLAUE_OF_FINANCIAL_INS

13. FAIR VLAUE OF FINANCIAL INSTRUMENTS (Tables)	9 Months Ended
	Sep. 30, 2013
Fair Vlaue Of Financial Instruments Tables	'
13. FAIR VALUE OF FINANCIAL INSTRUMENTS	'
		Fair Value Measurements at September 30, 2013
		Level 1		Level 2			Level 3
	Assets
	Cash and cash equivalents		746		–			–
	Total assets		746		–			–
	Liabilities
	Derivative Liabilities		–		3,107,028			–
	Total Liabilities		–		3,107,028			–
		$	746	$	(3,107,028	)	$	–
		Fair Value Measurements at December 31, 2012
		Level 1		Level 2			Level 3
	Assets
	Cash and cash equivalents	$	2,235	$	–		$	–
	Total assets		2,235		–			–
	Liabilities
	Derivative Liabilities		–		-			–
	Total Liabilities		–		-			–
		$	2,235	$	-		$	–

5_GEOGRAPHICAL_PROVED_AND_UNPR

5. GEOGRAPHICAL PROVED AND UNPROVED PROPERTIES (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Geographical Proved And Unproved Properties Details	'	'
Oilfield Support Equipment	$406,318	$846,196
Less: accumulated depreciation	-104,657	-160,662
Total	301,661	685,534
Proved developed producing:	'	'
Texas	1,167,361	1,049,577
Less: accumulated depletion	-1,016,702	-965,091
Total	150,659	84,486
Unproved:	'	'
Belize	41,161	48,075
Accumulated Impairment	-41,161	-48,075
Total	$0	$0

6_PROPERTY_PLANT_AND_EQUIPMENT2

6. PROPERTY, PLANT AND EQUIPMENT (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Property Plant And Equipment Details	'	'
Drilling rigs and related equipment	$841,646	$835,146
Office equipment	5,165	5,165
Furniture and fixtures	1,049	1,049
Vehicles	212,140	188,521
Equipment	24,598	24,598
Total property, plant and equipment - at cost	1,084,598	1,054,479
Less: accumulated depreciation	-376,484	-218,170
Net property, plant and equipment - other	$708,114	$836,309

6_PROPERTY_PLANT_AND_EQUIPMENT3

6. PROPERTY, PLANT AND EQUIPMENT (Details Narrative) (USD $)	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Property Plant And Equipment Details Narrative	'	'
Depreciation expense	$163,657	$64,806

9_ACCOUNTS_PAYABLE_AND_ACCRUED2

9. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Accounts Payable And Accrued Liabilities Details	'	'
Trade accounts payable	$1,013,963	$846,784
Royalties payable	71,861	33,120
Liabilities associated with our reverse merger in December, 2008	200,380	200,380
Accrued expenses	93,213	'
Due to AFEC	120,000	120,000
All-Secure payable	17,473	17,473
Bank overdraft	4,986	'
Total	$1,521,876	$1,217,757

10_DERIVATIVE_LIABILITY_Detail

10. DERIVATIVE LIABILITY (Details) (USD $)	9 Months Ended
	Sep. 30, 2013
Derivative liability: shares owed and unissued	$3,094,544
Derivative liability: shares issued over authorized	12,484
Total	3,107,028
Re-class from equity	'
Derivative liability: shares owed and unissued	2,106,631
Derivative liability: shares issued over authorized	10,490
Total	2,117,121
Settled	'
Derivative liability: shares owed and unissued	-206,679
Derivative liability: shares issued over authorized	'
Total	-206,679
(Gain) / Loss Mark to Market	'
Derivative liability: shares owed and unissued	1,188,592
Derivative liability: shares issued over authorized	1,994
Total	$1,190,586

11_ASSET_RETIREMENT_OBLIGATION2

11. ASSET RETIREMENT OBLIGATION (Details Narrative) (USD $)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Asset Retirement Obligation Details Narrative	'	'	'	'	'
Accretion Expense	$1,002	$11,061	$3,395	$12,237	$18,171

11_RECONCILIATION_OF_THE_AGGRE

11. RECONCILIATION OF THE AGGREGATE CARRYING AMOUNT OF ASSET RETIREMENT OBLIGATIONS (Details) (USD $)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Reconciliation Of Aggregate Carrying Amount Of Asset Retirement Obligations Details	'	'	'	'	'
Beginning Balance	'	'	$225,881	$130,397	$130,397
Liabilities assumed on acquired properties	'	'	47,392	'	75,396
Liabilities settled	'	'	-181,800	'	-3,271
Accretion expense	1,002	11,061	3,395	12,237	18,171
Reduction for sale of ORRI & Working Interest	'	'	-5,852	'	'
Revision of existing liabilities	'	'	'	'	5,188
Asset retirement obligation at balance sheet date	$89,016	'	$89,016	'	$225,881

13_FAIR_VALUE_OF_FINANCIAL_INS1

13. FAIR VALUE OF FINANCIAL INSTRUMENTS Schedule of financial instruments at fair value on a recurring basis (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Level 1	'	'
Assets	'	'
Cash and cash equivalents	$746	$2,235
Total assets	746	2,235
Liabilities	'	'
Derivative Liabilities	0	0
Total Liabilities	0	0
Level 2	'	'
Assets	'	'
Cash and cash equivalents	0	0
Total assets	0	0
Liabilities	'	'
Derivative Liabilities	3,107,028	0
Total Liabilities	3,107,028	0
Level 3	'	'
Assets	'	'
Cash and cash equivalents	0	0
Total assets	0	0
Liabilities	'	'
Derivative Liabilities	0	0
Total Liabilities	$0	$0