PEDEVCO (PED) 10-Q 15 May 23 2023 Q1 Quarterly report Financial data

Cover

Cover - shares	3 Months Ended
	Mar. 31, 2023	May 12, 2023
Cover [Abstract]
Entity Registrant Name	PEDEVCO Corp.
Entity Central Index Key	0001141197
Document Type	10-Q
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Current Reporting Status	Yes
Document Period End Date	Mar. 31, 2023
Entity Filer Category	Non-accelerated Filer
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2023
Entity Common Stock Shares Outstanding		87,040,267
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	001-35922
Entity Incorporation State Country Code	TX
Entity Tax Identification Number	22-3755993
Entity Address Address Line 1	575 N. Dairy Ashford
Entity Address Address Line 2	Suite 210
Entity Address City Or Town	Houston
Entity Address State Or Province	TX
Entity Address Postal Zip Code	77079
City Area Code	713
Local Phone Number	221-1768
Security 12b Title	Common Stock, $0.001 par value per share
Trading Symbol	PED
Security Exchange Name	NYSE
Entity Interactive Data Current	Yes

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
CONSOLIDATED BALANCE SHEETS
Cash and cash equivalents	$ 14,139	$ 29,430
Accounts receivable - oil and gas	5,788	2,430
Prepaid expenses and other current assets	149	249
Total current assets	20,076	32,109
Oil and gas properties:
Oil and gas properties, subject to amortization, net	82,692	79,372
Oil and gas properties, not subject to amortization, net	1,500	775
Total oil and gas properties, net	84,192	80,147
Operating lease - right-of-use asset	45	71
Other assets	3,821	3,783
Total assets	108,134	116,110
Current liabilities:
Accounts payable	3,683	1,556
Accrued expenses	1,375	13,835
Revenue payable	1,000	1,018
Operating lease liabilities - current	51	81
Asset retirement obligations - current	658	472
Total current liabilities	6,767	16,962
Long-term liabilities:
Asset retirement obligations, net of current portion	2,628	2,689
Total liabilities	9,395	19,651
Shareholders' equity:
Common stock, $0.001 par value, 200,000,000 shares authorized; 87,040,267 and 85,790,267 shares issued and outstanding, respectively	87	86
Additional paid-in capital	223,631	223,114
Accumulated deficit	(124,979)	(126,741)
Total shareholders' equity	98,739	96,459
Total liabilities and shareholders' equity	$ 108,134	$ 116,110

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
CONSOLIDATED BALANCE SHEETS
Common Stock, Par Value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	200,000,000	200,000,000
Common Stock, Shares Issued	87,040,267	85,790,267
Common Stock, Shares Outstanding	87,040,267	85,790,267

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Revenue:
Oil and gas sales	$ 8,164	$ 7,090
Operating expenses:
Lease operating costs	2,466	2,356
Selling, general and administrative expense	1,488	1,592
Depreciation, depletion, amortization and accretion	2,581	1,886
Total operating expenses	6,535	5,834
Operating income	1,629	1,256
Interest income	98	3
Other income	35	80
Total other income	133	83
Net income	$ 1,762	$ 1,339
Basic	$ 0.02	$ 0.02
Diluted	$ 0.02	$ 0.02
Weighted average number of common shares outstanding:
Basic	86,720,823	86,066,070
Diluted	86,720,823	86,066,070

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash Flows From Operating Activities:
Net income	$ 1,762	$ 1,339
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion, amortization and accretion	2,581	1,886
Amortization of right-of-use asset	26	24
Share-based compensation expense	518	563
Changes in operating assets and liabilities:
Accounts receivable - oil and gas	(3,358)	(2,188)
Prepaid expenses and other current assets	100	109
Accounts payable	35	(94)
Accrued expenses	136	(243)
Revenue payable	(18)	19
Net cash provided by operating activities	1,782	1,415
Cash Flows From Investing Activities:
Cash paid for drilling and completion costs	(17,032)	(5,508)
Cash paid for vehicle	(41)	0
Net cash used investing activities	(17,073)	(5,808)
Net decrease in cash, cash equivalents and restricted cash	(15,291)	(4,093)
Cash, cash equivalents and restricted cash at beginning of period	32,977	29,227
Cash, cash equivalents and restricted cash at end of period	17,686	25,134
Supplemental Disclosure of Cash Flow Information
Interest	0	0
Income taxes	0	0
Noncash investing and financing activities:
Change in accrued oil and gas development costs	10,534	173
Changes in estimates of asset retirement costs, net	6	45
Issuance of restricted common stock	$ 1	$ 1

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY (Unaudited) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Retained Earnings (Accumulated Deficit)
Balance, shares at Dec. 31, 2021		84,236,146
Balance, amount at Dec. 31, 2021	$ 91,483	$ 84	$ 220,984	$ (129,585)
Issuance of restricted common stock, shares		1,200,000
Issuance of restricted common stock, amount	0	$ 1	(1)	0
Share-based compensation	563	0	563	0
Net income	1,339	$ 0	0	1,339
Balance, shares at Mar. 31, 2022		85,436,146
Balance, amount at Mar. 31, 2022	93,385	$ 85	221,546	(128,246)
Balance, shares at Dec. 31, 2022		85,790,267
Balance, amount at Dec. 31, 2022	96,459	$ 86	223,114	(126,741)
Issuance of restricted common stock, shares		1,250,000
Issuance of restricted common stock, amount	0	$ 1	(1)	0
Share-based compensation	518	0	518	0
Net income	1,762	$ 0	0	1,762
Balance, shares at Mar. 31, 2023		87,040,267
Balance, amount at Mar. 31, 2023	$ 98,739	$ 87	$ 223,631	$ (124,979)

BASIS OF PRESENTATION

BASIS OF PRESENTATION	3 Months Ended
	Mar. 31, 2023
BASIS OF PRESENTATION
BASIS OF PRESENTATION	NOTE 1 – BASIS OF PRESENTATION The accompanying interim unaudited consolidated financial statements of PEDEVCO Corp. (“PEDEVCO” or the “Company”), have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with the audited financial statements and notes thereto contained in PEDEVCO’s latest Annual Report filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the 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 that would substantially duplicate disclosures contained in the audited financial statements for the most recent fiscal year, as reported in the Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 29, 2023 (the “2022 Annual Report”), have been omitted. The Company’s consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and subsidiaries in which the Company has a controlling financial interest. All significant inter-company accounts and transactions have been eliminated in consolidation. The Company’s future financial condition and liquidity will be impacted by, among other factors, the success of our drilling program, the number of commercially viable oil and natural gas discoveries made and the quantities of oil and natural gas discovered, the speed with which we can bring such discoveries to production, the actual cost of exploration, appraisal and development of our prospects, the prevailing prices for, and demand for, oil and natural gas.

DESCRIPTION OF BUSINESS

DESCRIPTION OF BUSINESS	3 Months Ended
	Mar. 31, 2023
BASIS OF PRESENTATION
Description Of Business	NOTE 2 – DESCRIPTION OF BUSINESS PEDEVCO is an oil and gas company focused on the development, acquisition and production of oil and natural gas assets where the latest in modern drilling and completion techniques and technologies have yet to be applied. In particular, the Company focuses on legacy proven properties where there is a long production history, well defined geology and existing infrastructure that can be leveraged when applying modern field management technologies. The Company’s current properties are located in the San Andres formation of the Permian Basin situated in West Texas and eastern New Mexico (the “Permian Basin”) and in the Denver-Julesburg Basin (“D-J Basin”) in Colorado and Wyoming. The Company holds its Permian Basin acres located in Chaves and Roosevelt Counties, New Mexico, through its wholly-owned operating subsidiary, Pacific Energy Development Corp. (“PEDCO”), which asset the Company refers to as its “Permian Basin Asset,” and it holds its D-J Basin acres located in Weld and Morgan Counties, Colorado, and Wyoming, through its wholly-owned operating subsidiary, Red Hawk Petroleum, LLC (“Red Hawk”), which asset the Company refers to as its “D-J Basin Asset.” The Company believes that horizontal development and exploitation of conventional assets in the Permian Basin and development of the Wattenberg and Wattenberg Extension in the D-J Basin represent among the most economic oil and natural gas plays in the United States (“U.S.”). Moving forward, the Company plans to optimize its existing assets and opportunistically seek additional acreage proximate to its currently held core acreage, as well as other attractive onshore U.S. oil and gas assets that fit the Company’s acquisition criteria, that Company management believes can be developed using its technical and operating expertise and be accretive to shareholder value.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2023
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Summary Of Significant Accounting Policies	NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company has provided a discussion of significant accounting policies, estimates and judgments in its 2022 Annual Report. There have been no changes to the Company’s significant accounting policies since December 31, 2022. Recently Issued Accounting Pronouncements On January 1, 2023, the Company adopted Accounting Standards Update (“ASU”) No. 2016-13, Measurement of Credit Losses on Financial Instruments Subsequent Events The Company has evaluated all transactions through the date the consolidated financial statements were issued for subsequent event disclosure consideration.

REVENUE FROM CONTRACTS WITH CUS

REVENUE FROM CONTRACTS WITH CUSTOMERS	3 Months Ended
	Mar. 31, 2023
REVENUE FROM CONTRACTS WITH CUSTOMERS
Revenue From Contracts With Customers	NOTE 4 – REVENUE FROM CONTRACTS WITH CUSTOMERS Disaggregation of Revenue from Contracts with Customers. Three Months Ended March 31, 2023 2022 Oil sales $ 7,460 $ 6,396 Natural gas sales 504 421 Natural gas liquids sales 200 273 Total revenue from customers $ 8,164 $ 7,090 There were no significant contract liabilities or transaction price allocations to any remaining performance obligations as of March 31, 2023.

CASH

CASH	3 Months Ended
	Mar. 31, 2023
CASH
Cash	NOTE 5 – CASH AND CASH EQUIVALENTS The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets, which sum to the total of such amounts in the periods indicated (in thousands): March 31, 2023 December 31, 2022 Cash and Cash Equivalents* $ 14,139 $ 29,430 Restricted cash included in other assets 3,547 3,547 Total cash and cash equivalents and restricted cash $ 17,686 $ 32,977 * Includes a U.S. Treasury Bill with maturity of three months or less when purchased of $5.0 million at March 31, 2023 and $-0- at December 31, 2022.

OIL AND GAS PROPERTIES

OIL AND GAS PROPERTIES	3 Months Ended
	Mar. 31, 2023
OIL AND GAS PROPERTIES
Oil And Gas Properties	NOTE 6 – OIL AND GAS PROPERTIES The following table summarizes the Company’s oil and gas activities by classification for the three months ended March 31, 2023 (in thousands): Balance at December 31, 2022 Additions Disposals Transfers Balance at March 31, 2023 Oil and gas properties, subject to amortization $ 176,253 $ 5,773 $ - $ - $ 182,026 Oil and gas properties, not subject to amortization 775 725 - - 1,500 Asset retirement costs 1,407 (6 ) - - 1,401 Accumulated depreciation, depletion and impairment (98,288 ) (2,447 ) - - (100,735 ) Total oil and gas assets $ 80,147 $ 4,045 $ - $ - $ 84,192

ASSET RETIREMENT OBLIGATIONS

ASSET RETIREMENT OBLIGATIONS	3 Months Ended
	Mar. 31, 2023
ASSET RETIREMENT OBLIGATIONS
Asset Retirement Obligations	NOTE 7 – ASSET RETIREMENT OBLIGATIONS Activity related to the Company’s asset retirement obligations is as follows (in thousands): Three Months Ended March 31, 2023 Balance at the beginning of the period (1) $ 3,161 Accretion expense 131 Changes in estimates, net (6 ) Balance at end of period (2) $ 3,286 (1) Includes $472,000 of current asset retirement obligations at December 31, 2022. (2) Includes $658,000 of current asset retirement obligations at March 31, 2023.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2023
COMMITMENTS AND CONTINGENCIES
Commitments And Contingencies	NOTE 8 – COMMITMENTS AND CONTINGENCIES Lease Agreements Currently, the Company has one operating sublease for office space that requires ASC Topic 842 treatment, discussed below. The Company’s leases typically do not provide an implicit rate. Accordingly, the Company is required to use its incremental borrowing rate in determining the present value of lease payments based on the information available at the commencement date. The Company’s incremental borrowing rate would reflect the estimated rate of interest that it would pay to borrow on a collateralized basis over a similar term, an amount equal to the lease payments in a similar economic environment. However, the Company currently maintains no debt, and in order to apply an appropriate discount rate, the Company used an average discount rate of eight publicly-traded peer group companies similar to it based on size, geographic location, asset types, and/or operating characteristics. The Company has a sublease for its corporate offices in Houston, Texas on approximately 5,200 square feet of office space that expires on August 31, 2023 and has a base monthly rent of approximately $10,000. In December 2022, the Company entered into a new lease agreement for its existing office space that will commence on September 1, 2023, and expire on February 28, 2027. The base monthly rent will be approximately $9,200 for the first 18 months and increase to approximately $9,500 thereafter. The Company paid both a security deposit and prepaid rent for $14,700, respectively. Supplemental cash flow information related to the Company’s operating office sublease is included in the table below (in thousands): Three Months Ended March 31, 2023 Cash paid for amounts included in the measurement of lease liabilities $ 31 Supplemental balance sheet information related to the Company’s operating sublease is included in the table below (in thousands): March 31, 2023 Operating lease – right-of-use asset $ 45 Operating lease liabilities - current $ 51 Operating lease liabilities - long-term - Total lease liability $ 51 The weighted-average remaining lease term for the Company’s operating sublease is 0.4 years as of March 31, 2023, with a weighted-average discount rate of 5.35%. The Company’s operating sublease liability with enforceable contract terms that have greater than one-year terms are as follows (in thousands): 2023 $ 51 Thereafter - Total lease payments 51 Less imputed interest - Total lease liability $ 51 Leasehold Drilling Commitments The Company’s oil and gas leasehold acreage is subject to expiration of leases if the Company does not drill and hold such acreage by production or otherwise exercises options to extend such leases, if available, in exchange for payment of additional cash consideration. In the D-J Basin Asset, no net acres expire during the remainder of 2023, and no significant net acres expire within the next two-year period (net to our direct ownership interest only). In the Permian Basin Asset, 61 acres are due to expire during the remainder of 2023 and 40 net acres expire thereafter (net to our direct ownership interest only). The Company plans to hold significantly all of this acreage through a program of drilling and completing producing wells. If the Company is not able to drill and complete a well before lease expiration, the Company may seek to extend leases where able. Other Commitments Although the Company may, from time to time, be involved in litigation and claims arising out of its operations in the normal course of business, the Company is not currently a party to any material legal proceeding. In addition, the Company is not aware of any material legal or governmental proceedings against it or contemplated to be brought against it. As part of its regular operations, the Company may become party to various pending or threatened claims, lawsuits and administrative proceedings seeking damages or other remedies concerning its commercial operations, products, employees and other matters. Although the Company provides no assurance about the outcome of any future legal and administrative proceedings and the effect such outcomes may have on the Company, the Company believes that any ultimate liability resulting from the outcome of such proceedings, to the extent not otherwise provided for or covered by insurance, will not have a material adverse effect on the Company’s financial condition or results of operations.

SHAREHOLDERS EQUITY

SHAREHOLDERS EQUITY	3 Months Ended
	Mar. 31, 2023
Shareholders' equity:
Shareholders' Equity	NOTE 9 – SHAREHOLDERS’ EQUITY Common Stock During the three months ended March 31, 2023, the Company granted an aggregate of 1,250,000 restricted stock awards to various employees of the Company (see Note 10 below).

SHAREBASED COMPENSATION

SHAREBASED COMPENSATION	3 Months Ended
	Mar. 31, 2023
SHAREBASED COMPENSATION
Share-based Compensation	NOTE 10 – SHARE-BASED COMPENSATION The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award over the vesting period. Common Stock On January 23, 2023, an aggregate of 1,250,000 shares of restricted common stock were granted to officers of the Company under the Company’s 2021 Equity Incentive Plan. The grant of the 1,250,000 shares of restricted common stock vest as follows: 33.3% vest each subsequent year from the date of grant, contingent upon the recipient’s continued service with the Company. These shares have a total fair value of $1,363,000 based on the market price on the issuance date. Stock-based compensation expense recorded related to the vesting of restricted stock for the three months ended March 31, 2023, was $412,000. The remaining unamortized stock-based compensation expense at March 31, 2023 related to restricted stock was $1,829,000. Options On January 23, 2023, the Company granted options to purchase an aggregate of 540,000 shares of common stock to various Company employees at an exercise price of $1.09 per share under the Company’s 2021 Equity Incentive Plan. The options have a term of five years and fully vest in January 2026. 33.3% vest each subsequent year from the date of grant, contingent upon the recipient’s continued service with the Company. The aggregate fair value of the options on the date of grant, using the Black-Scholes model, was $429,000. Variables used in the Black-Scholes option-pricing model for the options issued include: (1) a discount rate of 3.61% based on the applicable US Treasury bill rate, (2) expected term of 3.5 years, (3) expected volatility of 113% based on the trading history of the Company, and (4) zero expected dividends. During the three months ended March 31, 2023, the Company recognized stock option expense of $106,000. The remaining amount of unamortized stock options expense at March 31, 2023 was $529,000. The intrinsic value of outstanding and exercisable options at March 31, 2023 was $-0-. Option activity during the three months ended March 31, 2023, was: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contract Term (Years) Outstanding at December 31, 2022 1,407,667 $ 1.51 2.7 Granted 540,000 $ 1.09 Expired/Canceled (21,666 ) $ 1.68 Outstanding at March 31, 2023 1,926,001 $ 1.39 3.1 Exercisable at March 31, 2023 949,334 $ 1.63 2.0

EARNINGS PER COMMON SHARE

EARNINGS PER COMMON SHARE	3 Months Ended
	Mar. 31, 2023
EARNINGS PER COMMON SHARE
Earnings Per Common Share	NOTE 11 – EARNINGS PER COMMON SHARE Earnings per common share-basic is calculated by dividing net income by the weighted average number of shares of common stock outstanding during the period. Net income per common share-diluted assumes the conversion of all potentially dilutive securities and is calculated by dividing net income by the sum of the weighted average number of shares of common stock, as defined above, outstanding plus potentially dilutive securities. Net income per common share-diluted considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential common shares, as defined above, would have an anti-dilutive effect. The calculation of earnings per share for the periods indicated below were as follows (amounts in thousands, except share and per share data): Numerator: March 31, 2023 March 31, 2022 Net income $ 1,762 $ 1,339 Effect of common stock equivalents - - Net income adjusted for common stock equivalents $ 1,762 $ 1,339 Denominator: Weighted average common shares – basic 86,720,823 86,066,070 Dilutive effect of common stock equivalents: Options - - Denominator: Weighted average common shares – diluted 86,720,823 86,066,070 Earnings per common share – basic $ 0.02 $ 0.02 Earnings per common share – diluted $ 0.02 $ 0.02 For the three months ended March 31, 2023, and 2022, share equivalents related to options to purchase 1,926,001 and 1,632,668 shares of common stock, respectively, were excluded from the computation of diluted net income per share as the inclusion of such shares would be anti-dilutive.

INCOME TAXES

INCOME TAXES	3 Months Ended
	Mar. 31, 2023
INCOME TAXES
Income Taxes	NOTE 12 – INCOME TAXES The Company has estimated that its effective tax rate for U.S. purposes will be zero for the 2023 and 2022 fiscal years as a result of prior net losses and a full valuation allowance against the net deferred tax assets. Consequently, the Company has recorded no provision or benefit for income taxes for the three months ended March 31, 2023, and 2022, respectively.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2023
SUBSEQUENT EVENTS
Subsequent Events	NOTE 13 – SUBSEQUENT EVENTS In April and May 2023, the Company acquired approximately 1,899 net lease acres in and around its existing footprint in the D -

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2023
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Recently Issued Accounting Pronouncements	On January 1, 2023, the Company adopted Accounting Standards Update (“ASU”) No. 2016-13, Measurement of Credit Losses on Financial Instruments
Subsequent Events	The Company has evaluated all transactions through the date the consolidated financial statements were issued for subsequent event disclosure consideration.

REVENUE FROM CONTRACTS WITH C_2

REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables)	3 Months Ended
	Mar. 31, 2023
REVENUE FROM CONTRACTS WITH CUSTOMERS
Revenue From Contract with Customers	Three Months Ended March 31, 2023 2022 Oil sales $ 7,460 $ 6,396 Natural gas sales 504 421 Natural gas liquids sales 200 273 Total revenue from customers $ 8,164 $ 7,090

CASH (Tables)

CASH (Tables)	3 Months Ended
	Mar. 31, 2023
CASH
Cash And Restricted Cash	March 31, 2023 December 31, 2022 Cash and Cash Equivalents* $ 14,139 $ 29,430 Restricted cash included in other assets 3,547 3,547 Total cash and cash equivalents and restricted cash $ 17,686 $ 32,977

OIL AND GAS PROPERTIES (Tables)

OIL AND GAS PROPERTIES (Tables)	3 Months Ended
	Mar. 31, 2023
OIL AND GAS PROPERTIES
Oil And Gas Properties	Balance at December 31, 2022 Additions Disposals Transfers Balance at March 31, 2023 Oil and gas properties, subject to amortization $ 176,253 $ 5,773 $ - $ - $ 182,026 Oil and gas properties, not subject to amortization 775 725 - - 1,500 Asset retirement costs 1,407 (6 ) - - 1,401 Accumulated depreciation, depletion and impairment (98,288 ) (2,447 ) - - (100,735 ) Total oil and gas assets $ 80,147 $ 4,045 $ - $ - $ 84,192

ASSET RETIREMENT OBLIGATIONS (T

ASSET RETIREMENT OBLIGATIONS (Tables)	3 Months Ended
	Mar. 31, 2023
ASSET RETIREMENT OBLIGATIONS
Asset Retirement Obligation	Three Months Ended March 31, 2023 Balance at the beginning of the period (1) $ 3,161 Accretion expense 131 Changes in estimates, net (6 ) Balance at end of period (2) $ 3,286

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	3 Months Ended
	Mar. 31, 2023
COMMITMENTS AND CONTINGENCIES
Supplemental Information Related To Operating Lease	Three Months Ended March 31, 2023 Cash paid for amounts included in the measurement of lease liabilities $ 31 Supplemental balance sheet information related to the Company’s operating sublease is included in the table below (in thousands): March 31, 2023 Operating lease – right-of-use asset $ 45 Operating lease liabilities - current $ 51 Operating lease liabilities - long-term - Total lease liability $ 51
Schedule Of Operating Lease	2023 $ 51 Thereafter - Total lease payments 51 Less imputed interest - Total lease liability $ 51

SHAREBASED COMPENSATION (Tables

SHAREBASED COMPENSATION (Tables)	3 Months Ended
	Mar. 31, 2023
SHAREBASED COMPENSATION
Stock Option Activity	Number of Options Weighted Average Exercise Price Weighted Average Remaining Contract Term (Years) Outstanding at December 31, 2022 1,407,667 $ 1.51 2.7 Granted 540,000 $ 1.09 Expired/Canceled (21,666 ) $ 1.68 Outstanding at March 31, 2023 1,926,001 $ 1.39 3.1 Exercisable at March 31, 2023 949,334 $ 1.63 2.0

EARNINGS PER COMMON SHARE (Tabl

EARNINGS PER COMMON SHARE (Tables)	3 Months Ended
	Mar. 31, 2023
EARNINGS PER COMMON SHARE
Earnings Per Share	Numerator: March 31, 2023 March 31, 2022 Net income $ 1,762 $ 1,339 Effect of common stock equivalents - - Net income adjusted for common stock equivalents $ 1,762 $ 1,339 Denominator: Weighted average common shares – basic 86,720,823 86,066,070 Dilutive effect of common stock equivalents: Options - - Denominator: Weighted average common shares – diluted 86,720,823 86,066,070 Earnings per common share – basic $ 0.02 $ 0.02 Earnings per common share – diluted $ 0.02 $ 0.02

REVENUE FROM CONTRACTS WITH C_3

REVENUE FROM CONTRACTS WITH CUSTOMERS (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Total revenue from customers	$ 8,164	$ 7,090
Oil Sales
Total revenue from customers	7,460	6,396
Natural Gas Sales
Total revenue from customers	504	421
Natural Gas Liquids Sales
Total revenue from customers	$ 200	$ 273

CASH AND CASH EQUIVALENTS (Deta

CASH AND CASH EQUIVALENTS (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Cash and Cash Equivalents	$ 14,139	$ 29,430
Restricted cash included in other assets	3,547	3,547
Total cash and cash equivalents and restricted cash	17,686	32,977
Cash and Cash Equivalents [Member]
Cash and Cash Equivalents	$ 14,139	$ 29,430

CASH AND CASH EQUIVALENTS (De_2

CASH AND CASH EQUIVALENTS (Details Narrative) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
CASH AND CASH EQUIVALENTS (Details)
U.S. Treasury Bill	$ 5	$ 0

OIL AND GAS PROPERTIES (Details

OIL AND GAS PROPERTIES (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Oil and gas properties, subject to amortization	$ 182,026	$ 176,253
Oil and gas properties, not subject to amortization	1,500	775
Asset retirement costs	1,401	1,407
Accumulated depreciation, depletion and impairment	(100,735)	(98,288)
Total oil and gas properties, net	84,192	$ 80,147
Additions
Oil and gas properties, subject to amortization	5,773
Oil and gas properties, not subject to amortization	725
Asset retirement costs	(6)
Accumulated depreciation, depletion and impairment	(2,447)
Total oil and gas properties, net	4,045
Disposals
Oil and gas properties, subject to amortization	0
Oil and gas properties, not subject to amortization	0
Asset retirement costs	0
Accumulated depreciation, depletion and impairment	0
Total oil and gas properties, net	0
Transfers
Oil and gas properties, subject to amortization	0
Oil and gas properties, not subject to amortization	0
Asset retirement costs	0
Accumulated depreciation, depletion and impairment	0
Total oil and gas properties, net	$ 0

OIL AND GAS PROPERTIES (Detai_2

OIL AND GAS PROPERTIES (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
OIL AND GAS PROPERTIES
Capital cost of drilling and completion	$ 4,940,000
Due deligance cost	291,000		$ 1,267,000
Depletion	$ 2,447,000	$ 1,745,000
Description of additional acquired	The Company also acquired approximately 187 net mineral acres, and 1,523 net lease

ASSET RETIREMENT OBLIGATIONS (D

ASSET RETIREMENT OBLIGATIONS (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2023 USD ($)
ASSET RETIREMENT OBLIGATIONS
Balance at the beginning of the period	$ 3,161
Accretion expense	131
Changes in estimates, net	(6)
Balance at end of period	$ 3,286

ASSET RETIREMENT OBLIGATIONS _2

ASSET RETIREMENT OBLIGATIONS (Details Narrative) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
ASSET RETIREMENT OBLIGATIONS
Cureent asset retirement	$ 658,000	$ 472,000

COMMITMENTS AND CONTINGENCIES_2

COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
COMMITMENTS AND CONTINGENCIES
Cash paid for amounts included in the measurement of lease liabilities	$ 31
Operating lease - right-of-use asset	45	$ 71
Operating lease liabilities - current	51
Operating lease liabilities - long-term	0
Total lease liability	$ 51

COMMITMENTS AND CONTINGENCIES_3

COMMITMENTS AND CONTINGENCIES (Details 1) $ in Thousands	Mar. 31, 2023 USD ($)
COMMITMENTS AND CONTINGENCIES
2023	$ 51
Thereafter	0
Total lease payments	51
Less imputed interest	0
Total lease liability	$ (51)

COMMITMENTS AND CONTINGENCIES_4

COMMITMENTS AND CONTINGENCIES (Details Narrative)	3 Months Ended
	Mar. 31, 2023 USD ($)
COMMITMENTS AND CONTINGENCIES
Expiry of lease date	Feb. 28, 2027
Security deposit and prepaid rent	$ 14,700
Base monthly rent	9,200
Base monthly rent increased amount	9,500
Rent expenses	$ 10,000
Weighted-average remaining lease term	4 months 24 days
Description of lease hold commitments	In the Permian Basin Asset, 61 acres are due to expire during the remainder of 2023 and 40 net acres expire thereafter (net to our direct ownership interest only).
Weighted-average discount rate	5.35%

SHAREHOLDERS EQUITY (Details Na

SHAREHOLDERS EQUITY (Details Narrative)	3 Months Ended
	Mar. 31, 2023 shares
Shareholders' equity:
Restricted stock awards granted	1,250,000

SHARE-BASED COMPENSATION (Detai

SHARE-BASED COMPENSATION (Details)	3 Months Ended
	Mar. 31, 2023 $ / shares shares
SHAREBASED COMPENSATION
Number of options outstanding,beginning | shares	1,407,667
Number of options granted | shares	540,000
Number of options expired/cancelled | shares	(21,666)
Number of options outstanding, Ending | shares	1,926,001
Number of options exercisable | shares	949,334
Weighted average exercise price outstanding, beginning	$ 1.51
Weighted average exercise price granted	1.09
Weighted average exercise price expired/cancelled	1.68
Weighted average exercise price exercised	0
Weighted average exercise price outstanding, ending	1.39
Weighted average exercise price exercisable	$ 1.63
Weighted average remaining contractual life (in years) outstanding, beginning	2 years 8 months 12 days
Weighted average remaining contractual life (in years) outstanding, ending	3 years 1 month 6 days
Weighted average remaining contractual life (in years) exercisable	2 years

SHAREBASED COMPENSATION (Detail

SHAREBASED COMPENSATION (Details Narrative) - USD ($)	1 Months Ended	3 Months Ended
	Jan. 23, 2023	Mar. 31, 2023	Mar. 31, 2022
Unamortized stock-based compensation expense, restricted stock		$ 1,829,000
Stock-based compensation expense		412,000
Intrinsic value of outstanding and exercisable		0
Stock-based compensation expense, stock option		106,000
Common stock, total fair value		1,000	$ 1,000
2021 Equity Incentive Plan [Member]
Description of restricted stock	The grant of the 1,250,000 shares of restricted common stock vest as follows: 33.3% vest each subsequent year from the date of grant
Common stock shares issued	1,250,000
Common stock, total fair value	$ 1,363,000
Option [Member]
Unamortized stock-based compensation expense, restricted stock		$ 529,000
Common stock shares	540,000
Common stock shares, exercise price	$ 1.09
Aggregate fair value of the options	$ 429,000
Fair value of the options discount rate	3.61%
Fair value of the options, expexted term	3 years 6 months
Fair value of the options, expected volatility	113%
Description of option term	The options have a term of five years and fully vest in January 2026. 33.3% vest each subsequent year from the date of grant, contingent upon the recipient’s continued service with the Company.

EARNINGS PER COMMON SHARE (Deta

EARNINGS PER COMMON SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Numerator
Net income	$ 1,762	$ 1,339
Effect Of Common Stock Equivalents	0	0
Net income adjusted for common stock equivalents	$ 1,762	$ 1,339
Weighted average common shares - basic	86,720,823	86,066,070
Dilutive Effect Of Common Stock Equivalents:
Dilutive effect of common stock equivalents: Options	$ 0	$ 0
Weighted average common shares - diluted	86,720,823	86,066,070
Earnings per common share - basic	$ 0.02	$ 0.02
Earnings per common share - diluted	$ 0.02	$ 0.02

EARNINGS PER COMMON SHARE (De_2

EARNINGS PER COMMON SHARE (Details Narrative) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2021
EARNINGS PER COMMON SHARE
Share Equivalents Related To Options To Purchase	1,926,001	1,632,668

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative)	2 Months Ended
	May 23, 2023 USD ($)
Subsequent Event [Member]
Acquisition and due diligence costs	$ 783,000