CannAwake 10-Q 14 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Nov. 14, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	Delta International Oil & Gas Inc.
Entity Central Index Key	1,112,985
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3
Entity Filer Category	Smaller Reporting Company
Entity Common Stock Shares Outstanding		32,338,826

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Current Assets:
Cash	$ 328,536	$ 717,085
Receivable from sale of bidding rights and oil and gas properties (net of allowance for doubtful accounts of $0 and $3,200,069 as of September 30, 2016 and December 31, 2015, respectively)
Total current assets	328,536	717,085
Property and equipment (net of accumulated depreciation of $0 and $16,386 as of September 30, 2016 and December 31, 2015, respectively)	693
Investment in MHD Technology Corporation	125,000
Investments in unproved oil and gas properties		221,880
Other assets		6,368
TOTAL ASSETS	454,229	945,333
Current Liabilities:
Accounts payable	2,200	560
Accrued expenses	6,140	4,705
Notes payable	15,000	15,000
Total current liabilities	23,340	20,265
Total liabilities	23,340	20,265
Commitments and Contingencies
Stockholders' Equity:
Preferred stock $0.0001 par value-authorized 10,000,000 shares; no shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively
Common stock $0.0001 par value - authorized 250,000,000 shares; 32,338,826 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively	3,233	3,233
Additional paid-in capital	7,151,482	7,151,482
Accumulated deficit	(6,741,785)	(6,280,417)
Accumulated other comprehensive gain	17,959	50,770
Total stockholders' equity	430,889	925,068
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 454,229	$ 945,333

Consolidated Balance Sheets (U3

Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Accumulated depreciation	$ 0	$ 16,386
Allowance for doubtful accounts	$ 0	$ 3,200,069
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	32,338,826	32,338,826
Common stock, shares outstanding	32,338,826	32,338,826

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Costs and Expenses:
Impairment charge			$ 191,236
General and administrative	84,154	127,731	270,212	413,016
Costs and expenses	84,154	127,731	461,448	413,016
Loss from operations	(84,154)	(127,731)	(461,448)	(413,016)
Other Income (Expense):
Foreign exchange (loss)		(18,290)		(25,735)
Other income			80
Other Income (expense)		(18,290)	80	(25,735)
Loss before income taxes	(84,154)	(146,021)	(461,368)	(438,751)
Provision (benefit) for income taxes
Net Loss	$ (84,154)	$ (146,021)	$ (461,368)	$ (438,751)
Net (loss) per common share:
Basic and Diluted	$ 0	$ 0	$ (0.01)	$ (0.01)
Weighted average common shares - Basic and Diluted	32,338,826	32,338,826	32,338,826	32,338,826

Unaudited Consolidated Statemen

Unaudited Consolidated Statements of Comprehensive (Loss) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Statements of Comprehensive Income Loss [Abstract]
Net (loss)	$ (84,154)	$ (146,021)	$ (461,368)	$ (438,751)
Other comprehensive (loss):
Foreign currency translation adjustment	(2,176)	(14,758)	(32,811)	(56,556)
Net change in other comprehensive (loss)	(2,176)	(14,758)	(32,811)	(56,556)
Comprehensive (loss)	$ (86,330)	$ (160,779)	$ (494,179)	$ (495,307)

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from Operating Activities:
Net income (loss)	$ (461,368)	$ (438,751)
Impairment charge	191,236
Warrants issued for services		32,499
Adjustments to reconcile net earnings (loss) to net cash used in operating activities:
Changes in operating assets and liabilities	9,443	(3,814)
Net cash used in operating activities	(260,689)	(410,066)
Cash flows from investing activities:
Purchases of furniture and equipment	(693)
Investment in MHD Technology Corporation	(125,000)
Net cash used in investing activities	(125,693)
Cash flows from financing activities:
Proceeds from notes payable		12,000
Net cash provided by financing activities		12,000
Effect of Exchange Rates on Cash	(2,167)	(33,028)
Net (decrease) in cash	(388,549)	(431,094)
Cash - Beginning of period	717,085	1,206,177
Cash - End of period	328,536	775,083
Changes in operating assets and liabilities consists of:
Increase (decrease) in accounts payable and accrued expenses	3,075	(3,814)
Decrease in other assets	(6,368)	0
Changes in assets and liabilities	9,443	(3,814)
Supplemental disclosure of cash flow information:
Cash paid for interest
Cash paid for income taxes

Basis of Presentation

Basis of Presentation	9 Months Ended
	Sep. 30, 2016
Basis of Presentation [Abstract]
BASIS OF PRESENTATION	1. BASIS OF PRESENTATION The accompanying unaudited interim consolidated financial statements of Delta International Oil & Gas Inc. (“Delta” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year end December 31, 2015 as reported on Form 10-K, have been omitted.

Receivable from Sale of Bidding

Receivable from Sale of Bidding Rights and Oil and Gas Properties	9 Months Ended
	Sep. 30, 2016
Receivable from Sale of Bidding Rights and Oil and Gas Properties [Abstract]
RECEIVABLE FROM SALE OF BIDDING RIGHTS AND OIL AND GAS PROPERTIES	2. RECEIVABLE FROM SALE OF BIDDING RIGHTS AND OIL AND GAS PROPERTIES On March 30, 2012 the Company entered into the Cooperation Agreement with PPL. Under the Cooperation Agreement, PPL agreed to pay us $7,000,000 for certain exploration and exploitation rights to oil and gas deposits and certain bidding rights held by Delta on the following areas: Valle de Lerma in the province of Salta; San Salvador de Jujuy; Libertador General San Martin in the province of Jujuy; and Selva Maria in the province of Formosa. Pursuant to a separate Agreement dated March 31, 2012, the Company agreed with PPL to assign and transfer 50% of SAHF's current ownership of the Tartagal and Morillo (i.e., a 9% interest in the concession) to PPL for a purchase price of $500,000. PPL had also agreed in an Undertaking to provide funds to the operating entities of Valle de Lerma (the San Salvador, Libertador, and Selva Maria concessions were awarded to another party, whose bid exceeded that of the Company for these concessions), in the aggregate amount of up to $10,000,000. As of September 30, 2016, the Company had received deposits in the amount of $4,299,891 from PPL on account. The remainder of the proceeds was recorded as a $3,200,069 receivable from the sale of bidding rights and oil and gas properties. As of December 31, 2014, the Company provided a reserve for doubtful accounts of $3,200,069. Because of PPL’s payment default, the Company has not transferred the Tartagal, and Morillo interests. The Company, however, did incorporate High Luck Group (a subsidiary of New Times Energy) into the official UTE for Valle de Lerma, as per PPL’s request. In July 2016, Delta and SAHF terminated all of their agreements with PPL with no further consideration as provided by the MOU with New Times detailed in footnote 5. The final contract is still being worked on by the Parties.

Investments in MHD Technology

Investments in MHD Technology	9 Months Ended
	Sep. 30, 2016
Investments in MHD Technology [Abstract]
INVESTMENTS IN MHD TECHNOLOGY	3. INVESTMENTS IN MHD TECHNOLOGY We have made an investment of $125,000 in MHD Technology Corporation, a Delaware corporation (“MHD Tech”), for an equity position of 1,343,750 shares of common stock of MHD Tech (approximately 6.25% of the outstanding shares in the company); this investment was made through a separate limited liability company owned by Delta and set up specifically for this investment. In connection with the investment, Santiago Peralta, our Interim Chief Executive Officer and sole director, has joined the Board of Directors of MHD Tech. The investment that Delta made into MHD Tech will be primarily for research and development purposes. In November 2016, a simulation company from Florida finished a simulation of the unit for MHD Tech to start selling licenses. The next step is building a working prototype that will establish the exact specifications of the unit. This investment is accounted for using the cost accounting method. The value of the investment on the balance sheet will be shown at historical cost and will not be adjusted according to fair market value. If there is evidence that suggests that the fair market value of the investment is lower than the historical cost, then the investment will be written down to its new fair market value.

Potential Manager Bonus

Potential Manager Bonus	9 Months Ended
	Sep. 30, 2016
Potential Manager Bonus [Abstract]
POTENTIAL MANAGER BONUS	4. POTENTIAL MANAGER BONUS Due to the agreement reached between New Times Energy and Delta, and the commitments made in July 2015 for a manager bonus to Alberto Mac Mullen and January 2016 for a negotiating commission for Enrique Vidal, the Company expects to have cash disbursements upwards of $200,000 as the payment installments come into the Company.

Asset Sale

Asset Sale	9 Months Ended
	Sep. 30, 2016
Asset Sale [Abstract]
ASSET SALE	5. ASSET SALE On May 12, 2016, Delta and New Times Energy reached an agreement in principle for the sale of 18% of Tartagal Oriental and Morillo. The two companies signed an MOU detailing the purchase amount, payment terms, and conditions on both sides, and a further Assignment of Rights agreement, which is subject to closing conditions applicable to all parties to the agreement. The total consideration for the 18% of Tartagal Oriental and Morillo is US$4,000,000. The initial payment of US$2,000,000 will be placed in escrow at the signing and will be released when the official transfer of interest in the properties is completed. Additionally, Delta will receive 3% of gross revenues of production of both oil and gas in the properties until an additional US$2 million are paid. New Times has committed to drill 3 exploratory wells in the next 15 months in Tartagal and Morillo. The parties are working on a final draft of the agreement and preparation for closing. Both companies are working in good faith to move forward but there is no certainty that a contract will be finalized or that it will remain in the same terms.

Valle De Lerma Concession

Valle De Lerma Concession	9 Months Ended
	Sep. 30, 2016
Valle De Lerma Concession [Abstract]
VALLE DE LERMA CONCESSION	6. VALLE DE LERMA CONCESSION The oil and gas concession owned by SAHF in the Province of Salta, Argentina known as Valle de Lerma has been impaired and has a carrying value of $0 as of September 30, 2016. The impairment expense at September 30, 2016 and 2015 was $191,236 and zero dollars, respectively. The property was impaired as of September 30, 2016 because there is a likely scenario in which the property will be returned to the government for no consideration. SAHF still holds title to the property. The property has around 205 work unit commitments outstanding so Delta is looking at ways to transfer the property to an external party to free itself from that potential liability.

Receivable from Sale of Biddi13

Receivable from Sale of Bidding Rights and Oil and Gas Properties (Details) - USD ($)	1 Months Ended	9 Months Ended	12 Months Ended
	Mar. 31, 2012	Sep. 30, 2016	Dec. 31, 2014
Receivable from Sale of Bidding Rights and Oil and Gas Properties (Textual)
Proceed from sale of Principle Petroleum Ltd.	$ 7,000,000
Percentage sale of share in SAHF's	50.00%
Percentage of interest in the concession	9.00%
Proceed from sale of share in SAHF's	$ 500,000
Maximum limit to provide funds to the operating entities	$ 10,000,000
Amount received as deposit for purchase exploration and exploitation rights		$ 4,299,891
Receivable from the sale of bidding rights and oil and gas properties		$ 3,200,069
Reserve for doubtful accounts			$ 3,200,069

Investments in MHD Technology (

Investments in MHD Technology (Details)	9 Months Ended
	Sep. 30, 2016USD ($)shares
Investments in MHD Technology (Textual)
Investments in equity | $	$ 125,000
Investments in equity, Shares | shares	1,343,750
Common stock outstanding shares	6.25%

Potential Manager Bonus (Detail

Potential Manager Bonus (Details)	9 Months Ended
	Sep. 30, 2016USD ($)
Potential Manager Bonus [Abstract]
Cash disbursements upwards	$ 200,000

Asset Sale (Details)

Asset Sale (Details)	May 12, 2016USD ($)Companies
Asset sale (Textual)
Number of Companies | Companies	2
Percentage of sale agreement	18.00%
Total consideration	$ 4,000,000
Initial payment	$ 2,000,000
Sale of asset agreement, description	Delta will receive 3% of gross revenues of production of both oil and gas in the properties until an additional US$2 million are paid. New Times has committed to drill 3 exploratory wells in the next 15 months in Tartagal and Morillo.

Valle De Lerma Concession (Deta

Valle De Lerma Concession (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Valle De Lerma Concession (Textual)
Impairment charge			$ 191,236