Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Mar. 12, 2014 | Jun. 30, 2013 | |
Document and Entity Information [Abstract] | ' | ' | ' |
Entity Registrant Name | 'Emerald Oil, Inc. | ' | ' |
Entity Central Index Key | '0001283843 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Amendment Flag | 'false | ' | ' |
Entity Common Stock Shares Outstanding | ' | 66,283,464 | ' |
Entity Public Float | ' | ' | $238,000,000 |
Entity Well Known Seasoned Issuer | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Voluntary Filer | 'No | ' | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
CURRENT ASSETS | ' | ' |
Cash and Cash Equivalents | $144,255,438 | $10,192,379 |
Restricted Cash | 15,000,512 | ' |
Accounts Receivable - Oil and Natural Gas Sales | 8,715,821 | 8,514,865 |
Accounts Receivable - Joint Interest Partners | 31,523,204 | 4,058,291 |
Other Receivables | 577,409 | 1,133,849 |
Prepaid Expenses and Other Current Assets | 206,299 | 103,173 |
Total Current Assets | 200,278,683 | 24,002,557 |
Oil and Natural Gas Properties, Full Cost Method, at cost: | ' | ' |
Proved Oil and Natural Gas Properties | 211,015,067 | 167,618,422 |
Unproved Oil and Natural Gas Properties | 57,015,315 | 61,454,831 |
Equipment and Facilities | 1,837,744 | ' |
Other Property and Equipment | 890,811 | 385,023 |
Total Property and Equipment | 270,758,937 | 229,458,276 |
Less - Accumulated Depreciation, Depletion and Amortization | -48,176,522 | -80,230,517 |
Total Property and Equipment, Net | 222,582,415 | 149,227,759 |
Restricted Cash | 6,000,000 | ' |
Prepaid Drilling Costs | ' | 100,193 |
Fair Value of Commodity Derivatives | 68,396 | 25,397 |
Debt Issuance Costs, Net of Amortization | 475,157 | 269,681 |
Deposits on Acquisitions | 125,368 | ' |
Other Non-Current Assets | 357,644 | 260,775 |
Total Assets | 429,887,663 | 173,886,362 |
CURRENT LIABILITIES | ' | ' |
Accounts Payable | 63,168,422 | 39,169,037 |
Fair Value of Commodity Derivatives | 921,401 | 206,645 |
Accrued Expenses | 11,821,729 | 420,521 |
Advances from Joint Interest Partners | 2,205,538 | ' |
Total Current Liabilities | 78,117,090 | 39,796,203 |
LONG-TERM LIABILITIES | ' | ' |
Revolving Credit Facility | ' | 23,500,000 |
Asset Retirement Obligations | 692,137 | 296,074 |
Warrant Liability | 15,703,000 | ' |
Other Non-Current Liabilities | 56,327 | ' |
Total Liabilities | 94,568,554 | 63,592,277 |
COMMITMENTS AND CONTINGENCIES | ' | ' |
Preferred Stock - Par Value $.001; 20,000,000 Shares Authorized; | ' | ' |
Series B Voting Preferred Stock - 5,114,633 and 0 issued and outstanding at December 31, 2013 and December 31, 2012, respectively. Liquidation preference value of $5,115 and $0, as of December 31, 2013 and December 31, 2012, respectively. | 5,000 | ' |
STOCKHOLDERS' EQUITY | ' | ' |
Common Stock, Par Value $.001; 500,000,000 Shares Authorized, 65,840,370 and 24,734,643 Shares Issued and Outstanding, respectively | 65,840 | 24,735 |
Additional Paid-In Capital | 416,301,344 | 180,439,530 |
Accumulated Deficit | -81,053,075 | -70,170,180 |
Total Stockholders' Equity | 335,314,109 | 110,294,085 |
Total Liabilities and Stockholders' Equity | $429,887,663 | $173,886,362 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ' | ' |
Preferred Stock - Par Value (in Dollars per Share) | $0.00 | $0.00 |
Preferred Stock - Shares Authorized (in Shares) | 20,000,000 | 20,000,000 |
Preferred Stock - Shares Issued (in Shares) | 0 | 0 |
Preferred Stock - Shares Outstanding (in Shares) | 0 | 0 |
Preferred Stock - Liquidation Preference Value | $5,115 | $0 |
STOCKHOLDERS' EQUITY | ' | ' |
Common Stock, Par Value (in Dollars per Share) | $0.00 | $0.00 |
Common Stock, Shares Authorized (in Shares) | 500,000,000 | 500,000,000 |
Common Stock, Shares Issued (in Shares) | 65,840,370 | 24,734,643 |
Common Stock, Shares Outstanding (in Shares) | 65,840,370 | 24,734,643 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
REVENUES | ' | ' | ' |
Oil and Natural Gas Sales | $53,981,040 | $28,129,985 | $8,426,129 |
Net Losses on Commodity Derivatives | -2,656,535 | -215,439 | ' |
Total Revenues | 51,324,505 | 27,914,546 | 8,426,129 |
OPERATING EXPENSES | ' | ' | ' |
Production Expenses | 8,520,414 | 2,727,133 | 726,946 |
Production Taxes | 5,702,521 | 2,955,015 | 717,440 |
General and Administrative Expenses | 30,507,114 | 12,903,845 | 2,686,176 |
Depletion of Oil and Natural Gas Properties | 17,310,059 | 12,770,718 | 3,546,466 |
Impairment of Oil and Natural Gas Properties | ' | 61,900,692 | ' |
Depreciation and Amortization | 144,492 | 53,818 | 30,831 |
Accretion of Discount on Asset Retirement Obligations | 32,449 | 14,988 | 4,882 |
Gain on Sale of Oil and Natural Gas Properties | -7,371,804 | ' | ' |
Total Operating Expenses | 54,845,245 | 93,326,209 | 7,712,741 |
INCOME (LOSS) FROM OPERATIONS | -3,520,740 | -65,411,663 | 713,388 |
OTHER INCOME (EXPENSE) | ' | ' | ' |
Interest Expense | -287,934 | -2,614,240 | -2,036,032 |
Warrant Revaluation Expense | -7,077,000 | ' | ' |
Gain on Acquisition of Business, Net | ' | 5,758,048 | ' |
Other Income (Expense) | 2,779 | -28,244 | -22,410 |
Total Other Income (Expense), Net | -7,362,155 | 3,115,564 | -2,058,442 |
LOSS BEFORE INCOME TAXES | -10,882,895 | -62,296,099 | -1,345,054 |
INCOME TAX PROVISION | ' | ' | ' |
NET LOSS | -10,882,895 | -62,296,099 | -1,345,054 |
Less: Preferred Stock Dividends and Deemed Dividends | -20,279,197 | ' | ' |
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS | ($31,162,092) | ($62,296,099) | ($1,345,054) |
Net Loss Per Common Share - Basic and Diluted (in Dollars per Share) | ($0.75) | ($4.91) | ($0.17) |
Weighted Average Shares Outstanding - Basic and Diluted (in Shares) | 41,383,277 | 12,699,544 | 8,012,158 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net Loss | ($10,882,895) | ($62,296,099) | ($1,345,054) |
Adjustments to Reconcile Net Loss to Net Cash Provided By (Used For) Operating Activities: | ' | ' | ' |
Depletion of Oil and Natural Gas Properties | 17,310,059 | 12,770,718 | 3,546,466 |
Impairment of Oil and Natural Gas Properties | ' | 61,900,692 | ' |
Depreciation and Amortization | 144,492 | 53,818 | 30,831 |
Amortization of Debt Discount | ' | ' | 163,356 |
Amortization of Debt Issuance Costs | 127,857 | 1,929,561 | 82,191 |
Accretion of Discount on Asset Retirement Obligations | 32,449 | 14,988 | 4,882 |
Net Losses on Commodity Derivatives | 2,656,535 | 215,439 | ' |
Net Cash Settlements Paid on Commodity Derivatives | -1,984,778 | -34,191 | ' |
Gain on Sale of Oil and Natural Gas Properties | -7,371,804 | ' | ' |
Gain on Acquisition of Business | ' | -7,213,835 | ' |
Warrant Revaluation Expense | 7,077,000 | ' | ' |
Share-Based Compensation Expense | 12,885,209 | 7,318,690 | 728,546 |
Changes in Assets and Liabilities: | ' | ' | ' |
Increase in Trade Receivables - Oil and Natural Gas Revenues | -200,956 | -5,267,453 | -2,951,591 |
(Increase) Decrease in Accounts Receivable - Joint Interest Partners | -27,464,913 | -4,058,291 | ' |
Increase in Other Receivables | 556,440 | -1,133,849 | ' |
(Increase) Decrease in Prepaid Expenses and Other Current Assets | -103,126 | -54,843 | 90,123 |
Increase in Other Non-Current Assets | -96,869 | -100,100 | ' |
Increase (Decrease) in Accounts Payable | 2,831,342 | 30,123 | -319,349 |
Increase (Decrease) in Accrued Expenses | 8,412,533 | 214,399 | -183,557 |
Increase in Other Non-Current Liabilities | 56,327 | ' | ' |
Increases in Advances from Joint Interest Partners | 2,205,538 | ' | ' |
Net Cash Provided By (Used For) Operating Activities | 6,190,440 | 4,289,767 | -153,156 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchases of Other Property and Equipment | -505,788 | -172,785 | -157,892 |
Restricted Cash Deposited | -21,000,512 | ' | ' |
Increase in Deposits for Acquisitions | -125,368 | ' | ' |
Use of (Payments for) Prepaid Drilling Costs | 100,193 | -67,030 | 460,497 |
Proceeds from Sale of Oil and Natural Gas Properties, Net of Transaction Costs | 129,432,743 | ' | ' |
Proceeds from Sales of Available for Sale Securities | ' | ' | 242,070 |
Investment in Oil and Natural Gas Properties | -182,901,806 | -66,212,818 | -44,052,953 |
Net Cash Used For Investing Activities | -75,000,538 | -66,452,633 | -43,508,278 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Proceeds from the Issuance of Common Stock, Net of Transaction Costs | 238,354,687 | 72,167,012 | 46,602,251 |
Proceeds from Issuance of Preferred Stock, Net of Transaction Costs | 47,183,994 | ' | ' |
Payments on Preferred Stock | -50,000,000 | ' | ' |
Advances on Revolving Credit Facility and Term Loan | ' | 56,530,730 | ' |
Payments on Revolving Credit Facility | -23,500,000 | -33,030,730 | ' |
Payments of Senior Secured Promissory Notes | ' | -15,000,000 | ' |
Payment of Assumed Liabilities | ' | -20,303,903 | ' |
Cash Paid for Finance Costs | -333,333 | -1,935,131 | -389,030 |
Preferred Stock Dividends and Deemed Dividends | -8,832,191 | ' | ' |
Proceeds from Exercise of Stock Options and Warrants | ' | ' | 16,960 |
Net Cash Provided by Financing Activities | 202,873,157 | 58,427,978 | 46,230,181 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 134,063,059 | -3,734,888 | 2,568,747 |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 10,192,379 | 13,927,267 | 11,358,520 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | 144,255,438 | 10,192,379 | 13,927,267 |
Supplemental Disclosure of Cash Flow Information | ' | ' | ' |
Cash Paid During the Period for Interest | 255,776 | 1,154,943 | 1,800,000 |
Cash Paid During the Period for Income Taxes | ' | ' | ' |
Non-Cash Financing and Investing Activities: | ' | ' | ' |
Oil and Natural Gas Properties Included in Account Payable | 63,040,913 | 38,973,137 | 10,252,407 |
Stock-Based Compensation Capitalized to Oil and Natural Gas Properties | 1,193,960 | 582,040 | 418,414 |
Accretion on Preferred Stock Issuance Discount | 8,626,000 | ' | ' |
Accretion of Preferred Stock Issuance Costs | 2,816,000 | ' | ' |
Accrued Preferred Stock Dividend and Deemed Dividend | ' | ' | ' |
Asset Retirement Obligation Costs and Liabilities | 676,240 | 164,967 | 100,715 |
Asset Retirement Obligations Associated With Properties Sold | 312,625 | ' | ' |
Common Stock Issued for Oil and Natural Gas Properties | 6,736,935 | ' | ' |
Purchases through Issuance of Common Stock or Assumption of Liabilities: | ' | ' | ' |
Oil and Natural Gas Properties | ' | 40,787,238 | ' |
Other Property and Equipment | ' | 36,000 | ' |
Other Non-Current Assets | ' | 75,000 | ' |
Non-Cash Acquisition of Business Amounts: | ' | ' | ' |
Fair Market Value of Common Stock Issued | ' | 13,380,501 | ' |
Debt Assumed | ' | $20,303,903 | ' |
CONSOLIDATED_STATEMENTS_OF_STO
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] |
Balance, beginning of period at Dec. 31, 2010 | $32,720,824 | $6,477 | $39,243,374 | ($6,529,027) |
Balance, beginning of period (in Shares) at Dec. 31, 2010 | ' | 6,477,776 | ' | ' |
Issuance Pursuant to Exercise of Options | 16,960 | 1 | 16,959 | ' |
Issuance Pursuant to Exercise of Options (in Shares) | ' | 572 | ' | ' |
Net Proceeds from Equity Offering | 46,602,251 | 1,786 | 46,600,465 | ' |
Net Proceeds from Equity Offering (in Shares) | ' | 1,785,714 | ' | ' |
Restricted Stock Grant Compensation | 226,318 | ' | 226,318 | ' |
Compensation Related to Stock Warrant and Option Grants | 649,694 | ' | 649,694 | ' |
Director Fees Related to Stock Option Grants | 270,948 | ' | 270,948 | ' |
Net Loss | -1,345,054 | ' | ' | -1,345,054 |
Balance, end of period at Dec. 31, 2011 | 79,141,941 | 8,264 | 87,007,758 | -7,874,081 |
Balance, end of period (in Shares) at Dec. 31, 2011 | ' | 8,264,062 | ' | ' |
Common Shares Issued as Compensation | 3,838,122 | 910 | 3,837,212 | ' |
Common Shares Issued as Compensation (in Shares) | ' | 910,296 | ' | ' |
Restricted Stock Grants | ' | 74 | -74 | ' |
Restricted Stock Grants (in Shares) | ' | 74,285 | ' | ' |
Net Proceeds from Equity Offering | 72,167,012 | 13,878 | 72,153,134 | ' |
Net Proceeds from Equity Offering (in Shares) | ' | 13,877,555 | ' | ' |
Restricted Stock Grant Compensation | 1,178,559 | ' | 1,178,559 | ' |
Director Fees Related to Stock Option Grants | 1,104,147 | ' | 1,104,147 | ' |
Restricted Stock Forfeited | ' | -53 | 53 | ' |
Restricted Stock Forfeited (in Shares) | ' | -53,572 | ' | ' |
Compensation Related to Stock Option Grants | 1,779,901 | ' | 1,779,901 | ' |
Issuance of Common Shares for the Acquisition of Emerald Oil North America, Inc. | 13,380,501 | 1,662 | 13,378,839 | ' |
Issuance of Common Shares for the Acquisition of Emerald Oil North America, Inc. (in Shares) | ' | 1,662,174 | ' | ' |
Reverse Split Reconciliation Due to Fractional Shares (in Shares) | ' | -157 | ' | ' |
Net Loss | -62,296,099 | ' | ' | -62,296,099 |
Balance, end of period at Dec. 31, 2012 | 110,294,085 | 24,735 | 180,439,530 | -70,170,180 |
Balance, end of period (in Shares) at Dec. 31, 2012 | ' | 24,734,643 | ' | ' |
Common shares issued for oil and natural gas properties | 6,736,935 | 1,165 | 6,735,770 | ' |
Common shares issued for oil and natural gas properties (in Shares) | ' | 1,165,015 | ' | ' |
Stock-based compensation | 13,378,158 | ' | 13,378,158 | ' |
Restricted Stock Vesting, Net of Tax Withholding | -2,287,663 | 1,012 | -2,288,675 | ' |
Restricted Stock Vesting, Net of Tax Withholding (in Shares) | ' | 1,012,260 | ' | ' |
Net Proceeds from Equity Offering | 238,354,687 | 38,928 | 238,315,759 | ' |
Net Proceeds from Equity Offering (in Shares) | ' | 38,928,452 | ' | ' |
Issuance of Preferred Stock | ' | ' | ' | ' |
Redemption of Preferred Stock and Accretion of Issuance Discount | -17,697,007 | ' | -17,697,007 | ' |
Preferred Stock Dividends Paid | -2,582,191 | ' | -2,582,191 | ' |
Net Loss | -10,882,895 | ' | ' | -10,882,895 |
Balance, end of period at Dec. 31, 2013 | $335,314,109 | $65,840 | $416,301,344 | ($81,053,075) |
Balance, end of period (in Shares) at Dec. 31, 2013 | ' | 65,840,370 | ' | ' |
ORGANIZATION_AND_NATURE_OF_BUS
ORGANIZATION AND NATURE OF BUSINESS | 12 Months Ended |
Dec. 31, 2013 | |
Organization and Nature of Business [Abstract] | ' |
ORGANIZATION AND NATURE OF BUSINESS | ' |
NOTE 1 ORGANIZATION AND NATURE OF BUSINESS | |
Description of Operations — Emerald Oil, Inc. (the “Company”), a Montana corporation, is an independent oil and natural gas exploration and production company engaged in the business of acquiring acreage in prospective natural resource plays within the continental United States, primarily focused on the Williston Basin located in North Dakota and Montana. The Company builds net asset value by growing reserves and converting undeveloped assets into producing wells in repeatable and scalable shale oil plays. | |
The Company designs, drills and operates oil and natural gas wells on acreage where it holds a controlling working interest. The Company also participates in the drilling of oil and natural gas wells operated by other companies. | |
The Company added executive management that is experienced in exploration and production of oil and natural gas resources with the acquisition of Emerald Oil North America, Inc., formerly known as Emerald Oil, Inc. (“Emerald Oil North America”), on July 26, 2012 (see Note 3 – Acquisition of Business). The Company continues to add to these internal capabilities and leveraged best practices through partnering with industry experts. Currently, the Company has 30 employees and retains independent contractors to assist in operating and managing oil and natural gas development. |
BASIS_OF_PRESENTATION_AND_SIGN
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Basis of Presentation and Significant Accounting Policies [Abstract] | ' | ||||||||||||
SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||||
NOTE 2 BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | |||||||||||||
These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The accompanying consolidated financial statements include the accounts of Emerald Oil, Inc. and its direct and indirect wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. | |||||||||||||
Reverse Stock Split | |||||||||||||
On October 22, 2012, a majority of the Company’s shareholders approved a 1-for-7 reverse stock split pursuant to which all shareholders of record received one share of common stock for each seven shares of common stock owned (subject to minor adjustments as a result of fractional shares). This reverse stock split decreased the issued and outstanding common shares by approximately 140,339,000, the outstanding warrants by approximately 6,700,000 and the outstanding stock options by approximately 4,100,000. GAAP requires that the reverse stock split be applied retrospectively to all periods presented. As a result, all stock, warrant and option transactions described herein have been adjusted to reflect the 1-for-7 reverse stock split. | |||||||||||||
Cash and Cash Equivalents | |||||||||||||
The Company considers highly liquid investments with insignificant interest rate risk and original maturities of three months or less to be cash equivalents. Cash equivalents consist primarily of interest-bearing bank accounts and money market funds. The Company’s cash positions represent assets held in checking and money market accounts. These assets are generally available to the Company on a daily or weekly basis and are highly liquid in nature. Due to the balances being greater than their $250,000 insurance coverage, the Company does not have FDIC coverage on the entire amount of its bank deposits. The Company believes this risk to be minimal. In addition, the Company is subject to Security Investor Protection Corporation protection on a vast majority of its financial assets in the event one of the brokerage firms that the Company utilizes for its investments fails. | |||||||||||||
Restricted Cash | |||||||||||||
Restricted cash included in current and long-term assets on the consolidated balance sheets totaled $21 million and $0 at December 31, 2013 and December 31, 2012, respectively. At December 31, 2013, $11 million of restricted cash relates to cash held in escrow to meet certain post-closing requirements related to the sale of oil and natural gas properties during 2013 (see Note 4 – Oil and Natural Gas Properties). The remaining $10 million relate to a drilling commitment agreement entered into pursuant to oil and natural gas leases acquired during the period. | |||||||||||||
Accounts Receivable | |||||||||||||
The Company records estimated oil and natural gas revenue receivable from third parties at its net revenue interest. The Company also reflects costs incurred on behalf of joint interest partners in accounts receivable. Management periodically reviews accounts receivable amounts for collectability and records its allowance for uncollectible receivables under the specific identification method. The Company did not record any allowance for uncollectible receivables during the years ended December 31, 2013, 2012, or 2011. | |||||||||||||
Concentrations of Credit Risk | |||||||||||||
Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents, accounts receivable and derivative contracts. We control our exposure to credit risk associated with these instruments by (i) placing our assets and other financial interests with creditworthy financial institutions, (ii) maintaining policies over credit extension that include the evaluation of customers’ financial condition and monitoring payment history, although we do not have collateral requirements and (iii) netting derivative assets and liabilities for counterparties where we have a legal right of offset. | |||||||||||||
At December 31, 2013 and 2012, the cash and cash equivalents were concentrated in one financial institution. We periodically assess the financial condition of this institution and believe that any possible credit risk is minimal. | |||||||||||||
During the year ended December 31, 2013, 36% of the Company’s production was sold to two customers. However, the Company does not believe that the loss of a single purchaser, including these two, would materially affect the Company’s business because there are numerous other purchasers in the area in which the Company sells its production. For the years ended December 31, 2013, 2012 and 2011 purchases by the following companies exceeded 10% of the total oil and natural gas revenues of the Company. | |||||||||||||
For the Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Customer A | 24 | % | — | — | |||||||||
Customer B | 12 | % | — | — | |||||||||
Our customers are in the energy industry and they may be similarly affected by changes in economic or other conditions. | |||||||||||||
Full Cost Method | |||||||||||||
The Company follows the full cost method of accounting for oil and natural gas operations whereby all costs related to the exploration and development of oil and natural gas properties are initially capitalized into a single cost center (“full cost pool”). Such costs include land acquisition costs, a portion of employee salaries related to property development, geological and geophysical expenses, carrying charges on non-producing properties, costs of drilling directly related to acquisition, and exploration activities. For the years ended December 31, 2013, 2012 and 2011, the Company capitalized $3,443,462, $842,418 and $526,630, respectively, of internal salaries, which included $1,193,960, $582,040 and $418,414, respectively, of stock-based compensation. Internal salaries are capitalized based on employee time allocated to the acquisition of leaseholds and development of oil and natural gas properties. The Company capitalized interest of $362,688 for the year ended December 31, 2012. The Company did not capitalize interest for the years ended December 31, 2013 and 2011. | |||||||||||||
Proceeds from property sales will generally be credited to the full cost pool, with no gain or loss recognized, unless such a sale would significantly alter the relationship between capitalized costs and the proved reserves attributable to these costs. The Company closed property sales during the year ended December 31, 2013 in the Williston Basin and Sand Wash Basin (see Note 4 – Oil and Natural Gas Properties). A gain was recognized on one transaction that resulted in the sale of a significant portion of proved reserves as of the transaction date and significantly altered the relationship between capitalized costs and proved reserves attributable to the Williston Basin. No gain or loss was recognized on any other sales during the period. The Company engages in acreage trades in the Williston Basin, but these trades are generally for acreage that is similar both in terms of geographic location and potential resource value. | |||||||||||||
The Company assesses all items classified as unproved property on a quarterly basis for possible impairment or reduction in value. The assessment includes consideration of the following factors, among others: intent to drill, remaining lease term, geological and geophysical evaluations, drilling results and activity, the assignment of proved reserves, and the economic viability of development if proved reserves are assigned. During any period in which these factors indicate an impairment, the cumulative drilling costs incurred to date for such property and all or a portion of the associated leasehold costs are transferred to the full cost pool and are then subject to depletion and amortization. For the years ended December 31, 2013, 2012 and 2011, the Company included $3,020,485, $3,625,209 and $6,983,125, respectively, related to expiring leases within costs subject to the depletion calculation. | |||||||||||||
Capitalized costs associated with impaired properties and properties having proved reserves, estimated future development costs, and asset retirement costs under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 410-20-25 are depleted and amortized on the unit-of-production method based on the estimated gross proved reserves. The costs of unproved properties are withheld from the depletion base until such time as they are developed, impaired, or abandoned. | |||||||||||||
Under the full cost method of accounting, capitalized oil and natural gas property costs less accumulated depletion, net of deferred income taxes, may not exceed a ceiling amount equal to the present value, discounted at 10%, of estimated future net revenues from proved oil and natural gas reserves plus the cost of unproved properties not subject to amortization (without regard to estimates of fair value), or estimated fair value, if lower, of unproved properties that are subject to amortization. Should capitalized costs exceed this ceiling, which is tested on a quarterly basis, an impairment is recognized. The present value of estimated future net revenues is computed by applying prices based on a 12-month unweighted average of the oil and natural gas prices in effect on the first day of each month, less estimated future expenditures to be incurred in developing and producing the proved reserves (assuming the continuation of existing economic conditions), less any applicable future taxes. Based on calculated reserves at December 31, 2013, 2012 and 2011, the unamortized costs of the Company’s oil and natural gas properties exceeded the ceiling test limit by $0, $51,709,548 and $0 respectively. The Company also recognized that oil and natural gas properties exceeded the ceiling test limit as of June 30, 2012 by $10,191,234. As a result, the Company was required to record impairment of the net capitalized costs of its oil and natural gas properties in the amount of $0, $61,900,692 and $0 for the years ended December 31, 2013, 2012, and 2011, respectively. | |||||||||||||
Oil and Natural Gas Reserve Quantities | |||||||||||||
Emerald’s estimate of proved reserves is based on the quantities of oil and natural gas that engineering and geological analyses demonstrate, with reasonable certainty, to be recoverable from established reservoirs in the future under current operating and economic parameters. Emerald’s reserve estimates are prepared by the independent engineering firm, Netherland, Sewell & Associates, Inc. The estimate of Emerald’s proved reserves as of December 31, 2013, 2012 and 2011 have been prepared and presented in accordance with SEC rules and accounting standards. | |||||||||||||
Reserves and their relation to estimated future net cash flows impact Emerald’s depletion and impairment calculations. As a result, adjustments to depletion and impairment are made concurrently with changes to reserve estimates. Emerald prepares its reserve estimates, and the projected cash flows derived from these reserve estimates, in accordance with SEC guidelines on a quarterly basis. The independent engineering firm described above adheres to the same guidelines when preparing the year-end reserve report. The accuracy of Emerald’s reserve estimates is a function of many factors including the quality and quantity of available data, the interpretation of that data, the accuracy of various mandated economic assumptions, and the judgments of the individuals preparing the estimates. | |||||||||||||
Emerald’s proved reserve estimates are a function of many assumptions, all of which could deviate significantly from actual results. As such, reserve estimates may materially vary from the ultimate quantities of oil and natural gas eventually recovered. | |||||||||||||
Other Property and Equipment | |||||||||||||
Property and equipment that are not oil and natural gas properties are recorded at cost and depreciated using the straight-line method over their estimated useful lives of three to seven years. Expenditures for replacements, renewals, and betterments are capitalized. Maintenance and repairs are charged to expense as incurred. Depreciation expense was $144,492, $53,818 and $30,831 for the years ended December 31, 2013, 2012 and 2011, respectively. | |||||||||||||
ASC 360-10-35-21 requires that long-lived assets, other than oil and natural gas properties, be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The determination of impairment is based upon expectations of undiscounted future cash flows, before interest, of the related asset. If the carrying value of the asset exceeds the undiscounted future cash flows, the impairment would be computed as the difference between the carrying value of the asset and the fair value. The Company has not recognized any impairment losses on non-oil and natural gas long lived assets. | |||||||||||||
Asset Retirement Obligations | |||||||||||||
The Company records the fair value of a liability for an asset retirement obligation in the period in which the well is spud or the asset is acquired and a corresponding increase in the carrying amount of the related long-lived asset. The liability is accreted to its present value each period, and the capitalized cost is depleted using the units of production method. If the liability is settled for an amount other than the recorded amount, a gain or loss is recognized. | |||||||||||||
Revenue Recognition and Natural Gas Balancing | |||||||||||||
The Company recognizes oil and natural gas revenues from its interests in producing wells when production is delivered and title has transferred to the purchaser, to the extent the selling price is reasonably determinable. The Company uses the sales method of accounting for balancing of natural gas production and would recognize a liability if the existing proven reserves were not adequate to cover the current imbalance situation. As of December 31, 2013 and 2012, the Company’s natural gas production was in balance, i.e., its cumulative portion of natural gas production taken and sold from wells in which it has an interest equaled the Company’s entitled interest in natural gas production from those wells. | |||||||||||||
Stock-Based Compensation | |||||||||||||
The Company accounts for stock-based compensation under the provisions of ASC 718-10-55. The Company recognizes stock-based compensation expense in the financial statements over the vesting period of equity-classified employee stock-based compensation awards based on the grant date fair value of the awards, net of estimated forfeitures. For options and warrants the Company uses the Black-Scholes option valuation model to calculate the fair value of stock based compensation awards at the date of grant. Option pricing models require the input of highly subjective assumptions, including the expected price volatility. For the stock options and warrants granted, the Company has used a variety of comparable and peer companies to determine the expected volatility input based on the expected term of the options. The Company believes the use or peer company data fairly represents the expected volatility it would experience if it were in the oil and natural gas industry over the expected term of the options. The Company used the simplified method to determine the expected term of the options due to the lack of historical data. Changes in these assumptions can materially affect the fair value estimate. | |||||||||||||
On May 27, 2011, the shareholders of the Company approved the 2011 Equity Incentive Plan (the “2011 Plan”), under which 714,286 shares of common stock were reserved. On October 22, 2012, the shareholders of the Company approved an amendment to the 2011 Plan to increase the number of shares available for issuance under the 2011 Plan to 3,500,000 shares. On July 10, 2013, the shareholders of the Company approved an amendment to the 2011 Plan to increase the number of shares authorized for issuance under the 2011 Plan to 9,800,000 shares. The purpose of the 2011 Plan is to promote the success of the Company and its affiliates by facilitating the employment and retention of competent personnel and by furnishing incentives to those officers, directors and employees upon whose efforts the success of the Company and its affiliates will depend to a large degree. It is the intention of the Company to carry out the 2011 Plan through the granting of incentive stock options, nonqualified stock options, restricted stock awards, restricted stock unit awards, performance awards and stock appreciation rights. As of December 31, 2013, 1,101,726 stock options and 4,068,490 shares of common stock and restricted stock units had been issued to officers, directors and employees under the 2011 Plan net of cancelations and forfeitures, including 2,082,187 nonvested restricted stock units. As of December 31, 2013, there are 4,629,784 shares available for issuance under the 2011 Plan. | |||||||||||||
Income Taxes | |||||||||||||
The Company accounts for income taxes under ASC 740-10-30. Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Accounting standards require the consideration of a valuation allowance for deferred tax assets if it is “more likely than not” that some component or all of the benefits of deferred tax assets will not be realized. | |||||||||||||
The tax effects from an uncertain tax position can be recognized in the financial statements only if the position is more likely than not of being sustained if the position were to be challenged by a taxing authority. The Company has examined the tax positions taken in its tax returns and determined that there are no uncertain tax positions. As a result, the Company has recorded no uncertain tax liabilities in its consolidated balance sheet. | |||||||||||||
Net Income (Loss) Per Common Share | |||||||||||||
Basic net income (loss) per common share is based on the net income (loss) divided by the weighted average number of common shares outstanding during the period. Diluted earnings per share are computed using the weighted average number of common shares plus dilutive common share equivalents outstanding during the period using the treasury stock method. In the computation of diluted earnings per share, excess tax benefits that would be created upon the assumed vesting of nonvested restricted shares or the assumed exercise of stock options (i.e., hypothetical excess tax benefits) are included in the assumed proceeds component of the treasury stock method to the extent that such excess tax benefits are more likely than not to be realized. When a loss from continuing operations exists, all potentially dilutive securities are anti-dilutive and are therefore excluded from the computation of diluted earnings per share. As the Company had losses for the years ended December 31, 2013, 2012 and 2011, the potentially dilutive shares were anti-dilutive and were thus not included in the net loss per share calculation. | |||||||||||||
As of December 31, 2013, (i) 2,082,191 nonvested restricted stock units were issued and outstanding and represent potentially dilutive shares; (ii) 464,273 stock options that were issued and presently exercisable and represent potentially dilutive shares; (iii) 694,587 stock options that were granted but are not presently exercisable and represent potentially dilutive shares; (iv) 5,114,633 warrants were issued and presently exercisable, which have an exercise price of $5.77 and represent dilutive shares; (v) 223,293 warrants that were issued and presently exercisable, which have an exercise price of $6.86 and represent potentially dilutive shares; and (vi) 892,858 warrants that were issued and presently exercisable, which have an exercise price of $49.70 and represent potentially dilutive shares. | |||||||||||||
Derivative and Other Financial Instruments | |||||||||||||
Commodity Derivative Instruments | |||||||||||||
The Company has entered into commodity derivative instruments, utilizing oil derivative swap contracts to reduce the effect of price changes on a portion of future oil production. The Company’s commodity derivative instruments are measured at fair value and are included in the consolidated balance sheet as derivative assets and liabilities. Net gains and losses are recorded based on the changes in the fair values of the derivative instruments. The Company’s valuation estimate takes into consideration the counterparties’ credit worthiness, the Company’s credit worthiness, and the time value of money. The consideration of the factors results in an estimated exit price for each derivative asset or liability under a market place participant’s view. Management believes that this approach provides a reasonable, non-biased, verifiable, and consistent methodology for valuing commodity derivative instruments (see Note 14 – Derivative Instruments and Price Risk Management). | |||||||||||||
Warrant Liability | |||||||||||||
From time to time, the Company may have financial instruments such as warrants that may be classified as liabilities when either (a) the holders possess rights to net cash settlement, (b) physical or net equity settlement is not in the Company’s control, or (c) the instruments contain other provisions that causes the Company to conclude that they are not indexed to the Company’s equity. Such instruments are initially recorded at fair value and subsequently adjusted to fair value at the end of each reporting period through earnings. | |||||||||||||
As a part of the securities purchase agreement (“Securities Purchase Agreements”) with affiliates of White Deer Energy L.P. (“White Deer Energy”) (see Note 6 – Preferred and Common Stock), the Company issued warrants that contain a put and other liability type provisions. Accordingly, these warrants are accounted for as a liability. This warrant liability is accounted for at fair value with changes in fair value reported in the consolidated statement of operations. | |||||||||||||
New Accounting Pronouncements | |||||||||||||
From time to time, new accounting pronouncements are issued by FASB that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s consolidated financial statements upon adoption. | |||||||||||||
Joint Ventures | |||||||||||||
The consolidated financial statements as of December 31, 2013, 2012 and 2011 include the accounts of the Company and its proportionate share of the assets, liabilities, and results of operations of the joint ventures it is involved in. | |||||||||||||
Use of Estimates | |||||||||||||
The preparation of consolidated financial statements under GAAP in the United States 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. The most significant estimates relate to proved oil and natural gas reserve volumes, future development costs, estimates relating to certain oil and natural gas revenues and expenses, fair value of derivative instruments, valuation of share-based compensation and the valuation of deferred income taxes. Actual results may differ from those estimates. | |||||||||||||
Industry Segment and Geographic Information | |||||||||||||
The Company operates in one industry segment, which is the exploration, development and production of oil and natural gas with all of the Company’s operational activities having been conducted in the U.S. The Company’s current operational activities and the Company’s consolidated revenues are generated from markets exclusively in the U.S., and the Company has no long lived assets located outside the U.S. | |||||||||||||
Reclassifications | |||||||||||||
Certain reclassifications have been made to prior periods’ reported amounts in order to conform to the current period presentation. These reclassifications did not impact the Company’s net loss, stockholders’ equity or cash flows. |
ACQUISITION_OF_BUSINESS
ACQUISITION OF BUSINESS | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Acquisition of Business [Abstract] | ' | ||||||||
ACQUISITION OF BUSINESS | ' | ||||||||
NOTE 3 ACQUISITION OF BUSINESS | |||||||||
On July 9, 2012, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Emerald Oil & Gas NL (the “Parent”) and Emerald Oil North America, Inc., a wholly owned subsidiary of the Parent, pursuant to which the Company purchased all of the outstanding capital stock of Emerald Oil North America for approximately 19.9% of the total shares of the Company’s common stock outstanding as of the closing date. The Company completed the acquisition of Emerald Oil North America on July 26, 2012 and issued approximately 1.66 million shares to the Parent. The Company assumed Emerald Oil North America’s liabilities, including approximately $20.3 million in debt owed by Emerald Oil North America. The acquisition included approximately 10,600 net acres located in Dunn County, North Dakota and approximately 45,000 net acres in the Sand Wash Basin Niobrara shale oil play in northwestern Colorado and southwestern Wyoming. | |||||||||
In connection with the closing of the Emerald Oil North America acquisition, five existing members of the Company’s board of directors resigned, and their vacancies were filled with directors selected by the remaining members of the Company’s board of directors. Also in connection with the closing of the Emerald Oil North America acquisition, the Company entered into employment agreements with six members of management. Following the Emerald Oil North America acquisition, each of the Company’s directors and executive officers entered into indemnification agreements with the Company. | |||||||||
Emerald Oil North America’s $20.3 million in debt obligations assumed by the Company was comprised of $17.7 million to Hartz Energy Capital, LLC (“Hartz”) and $2.5 million plus accrued interest to Parent. Both were paid in full on September 28, 2012. | |||||||||
Interest on the Hartz credit agreement was in the form of an overriding royalty interest in and to all of the oil, gas and other liquid hydrocarbons produced and saved from certain of the Company’s oil and natural gas properties, free of any and all expenses of development, production, transportation, marketing and any other related or similar expenses. The overriding royalty interest was comprised of a 2.15% overriding royalty interest on Emerald Oil North America’s properties in the Williston Basin of North Dakota with a guaranteed 215 net mineral acres underlying the overriding royalty for a period of five years and a 0.9% overriding royalty interest in and to all of the oil, gas and other liquid hydrocarbons produced and saved from the Company’s properties in the Sand Wash Basin of Colorado and Wyoming with a guaranteed 382.5 net mineral acres underlying the overriding royalty for five years. On August 2, 2013, the Company terminated all surviving provisions of the credit agreement including the five year guarantee of providing net mineral acres that underlie the overriding royalty interest by assigning Hartz the Company’s working interest in certain leases of Emerald Oil North America. | |||||||||
The Emerald Oil North America acquisition has been accounted for using the acquisition method. Assets acquired and liabilities assumed were recorded at their estimated fair values as of the acquisition date. The allocation of the purchase price is based upon a valuation of certain assets acquired and liabilities assumed. The Company recorded a gain on the bargain purchase of Emerald Oil North America as a result of the decrease in the Company’s share price between the announcement date (July 10, 2012) and closing date (July 26, 2012) of the acquisition in accordance with GAAP. A summary of the acquisition is below: | |||||||||
(in thousands) | |||||||||
Proved Oil and Natural Gas Properties | $ | 6,839 | |||||||
Unproved Oil and Natural Gas Properties | 33,948 | ||||||||
Other Assets | 111 | ||||||||
Debt Assumed | (20,303 | ) | |||||||
Net Assets Acquired | 20,595 | ||||||||
Equity Issued to Emerald Oil NL | (13,381 | ) | |||||||
Gain on Acquisition | 7,214 | ||||||||
Less: Acquisition Costs | (1,456 | ) | |||||||
Gain on Acquisition, net | $ | 5,758 | |||||||
Pro Forma Operating Results | |||||||||
From July 26, 2012 to December 31, 2012, the Company recognized $194,417 in revenues and $136,196 of expenses relating to Emerald Oil North America, resulting in net income during the year ended December 31, 2012 of $58,221. For the year ended December 31, 2013, the Company recognized $290,126 in revenues and $79,179 of expenses relating to Emerald Oil North America, resulting in net income during the year of $210,947. | |||||||||
The following table reflects the unaudited pro forma results of operations as though the acquisition had occurred on January 1, 2011. The results of operations of the properties acquired during 2011 through 2013, as described above, have been included in the Company’s consolidated financial statements from the closing dates of the acquisitions forward. The pro forma amounts are not necessarily indicative of the results that may be reported in the future: | |||||||||
Years Ended December 31, | |||||||||
2012 | 2011 | ||||||||
Revenues | $ | 27,968,701 | $ | 8,569,107 | |||||
Net loss | $ | (64,707,199 | ) | $ | (1,977,350 | ) | |||
Net loss per share – basic and diluted | $ | (4.74 | ) | $ | (0.20 | ) | |||
Weighted Average Shares Outstanding – Basic and Diluted | 13,639,626 | 9,674,332 | |||||||
OIL_AND_NATURAL_GAS_PROPERTIES
OIL AND NATURAL GAS PROPERTIES | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Oil and Natural Gas Properties [Abstract] | ' | ||||
OIL AND NATURAL GAS PROPERTIES | ' | ||||
NOTE 4 OIL AND NATURAL GAS PROPERTIES | |||||
The value of the Company’s oil and natural gas properties consists of all acreage acquisition costs (including cash expenditures and the value of stock consideration), drilling costs and other associated capitalized costs. Acquisitions are accounted for as purchases and, accordingly, the results of operations are included in the accompanying consolidated statements of operations from the closing date of the acquisition. Purchase prices are allocated to acquired assets based on their estimated fair value at the time of the acquisition. The Company has historically funded acquisitions with internal cash flow and the issuance of equity securities. | |||||
Acquisitions | |||||
On January 9, 2013, the Company completed a transaction with an unrelated third party in which the Company acquired leases of oil and natural gas properties in McKenzie County, North Dakota. Pursuant to the purchase and sale agreement and as consideration for the approximate $4.7 million purchase price of the acquired leases, the Company issued 851,315 shares of its common stock at a per share value of $5.50 per share, based on the five-day trading volume-weighted average price of the Company’s common stock prior to closing. | |||||
On February 4, 2013, the Company completed a transaction with an unrelated third party in which the Company acquired leases of oil and natural gas properties in McKenzie County, North Dakota. Pursuant to the purchase and sale agreement and as consideration for the approximate $1.9 million purchase price of the acquired leases, the Company issued 313,700 shares of its common stock at a per share value of $6.058 per share, based on the five-day trading volume-weighted average price of the Company’s common stock prior to closing. | |||||
On May 8, 2013, the Company acquired approximately 5,874 net acres of undeveloped leasehold in McKenzie County, North Dakota from an unrelated third party for approximately $6.5 million in cash, or approximately $1,100 per net acre. | |||||
On August 2, 2013, the Company acquired approximately 3,500 net acres of partially developed leasehold in McKenzie County, North Dakota from an unrelated third party for approximately $10.4 million or approximately $3,000 per net acre. | |||||
On August 30, 2013, the Company acquired approximately 3,600 net undeveloped operated acres in McKenzie County, North Dakota from an unrelated third party for approximately $3.6 million, or approximately $1,000 per net acre. | |||||
On September 17, 2013, the Company leased approximately 30,672 net undeveloped leasehold acres in McKenzie, Billings and Stark Counties, North Dakota, for approximately $20.2 million, or approximately $660 per net acre. Pursuant to the lease acquired, the Company entered into an agreement with an unrelated third party in which the Company will drill at least five gross wells within the prospect area prior to September 17, 2015. The Company placed $10 million with an escrow agent, of which $2 million per well will be returned to the Company with each well drilled within the term of the escrow agreement. As of December 31, 2013, $4 million of the escrowed funds are classified as a current asset on the consolidated balance sheet, with the remaining $6 million classified as a long-term asset. | |||||
On October 9, 2013, the Company closed a transaction with an unrelated third party to acquire approximately 2,866 net acres of undeveloped leasehold in Williams County, North Dakota for approximately $3.2 million, or approximately $1,100 per net acre. On September 20, 2013, the Company leased 313 net acres of undeveloped lease hold in the same area in Williams County, North Dakota for approximately $1.3 million, or approximately $4,100 per net acre. | |||||
On December 16, 2013 we acquired approximately 1,101 net acres located in Williams County, North Dakota from an unrelated third party for approximately $5.3 million in cash, or approximately $4,850 per net acre. | |||||
Leasehold Sales | |||||
On March 28, 2013, the Company sold its undivided 45% working interest in and to certain oil and natural gas leaseholds in the Sand Wash Basin, comprising approximately 31,000 net acres located in Routt and Moffatt Counties, Colorado and Carbon County, Wyoming for an aggregate sale price of approximately $10.1 million in cash. No gain or loss was recognized as the sale did not significantly alter the relationship between capitalized costs and proved reserves. In December 2013, the Company sold its remaining oil and natural gas assets in the Sand Wash Basin, primarily comprised of 14,600 net acres in Routt County, Colorado to an unrelated third party for approximately $2.0 million. | |||||
On April 17, 2013, the Company sold its interest in approximately 970 net mineral acres in the Williston Basin to an unrelated third party for a total sale price of approximately $7.1 million, including sales price adjustments for development costs and production revenue and operating expenses during the effective period. The acreage was associated with non-operated working interests in Williston Basin Bakken and Three Forks wells. No gain or loss was recognized as the sale did not significantly alter the relationship between capitalized costs and proved reserves. | |||||
On September 6, 2013, the Company sold its interest in 413 non-operated net acres located in the Williston Basin for approximately $5.2 million in cash. The acreage was associated with non-operated working interests in Williston Basin Bakken and Three Forks wells. No gain or loss was recognized as the sale did not significantly alter the relationship between capitalized costs and proved reserves. | |||||
On September 6, 2013, the Company sold its interest in 26,579 non-operated net acres located in the Williston Basin and the associated oil and natural gas production to an unrelated third party for a total sales price of approximately $111.0 million in cash, including sales price adjustments for development costs and production revenue and operating expenses during the effective period and subject to certain post-closing adjustments. $11.0 million of the sales price will remain in escrow upon finalization of standard due diligence procedures. On February 21, 2014 $8.6 million was released to Emerald, with the remaining $2.4 million returned to the buyer for purchase price adjustments during the due diligence period. The acreage was associated with non-operated working interests in Williston Basin Bakken and Three Forks wells. Under the full cost method of accounting for oil and natural gas operations, sales of oil and natural gas properties, whether or not being amortized, are accounted for as adjustments of capitalized costs, with no gain or loss recognized, unless such adjustments would significantly alter the relationship between capitalized costs and proved reserves of oil and natural gas attributable to the cost center. The sale represented greater than 25 percent of the Company’s proved reserves of oil and natural gas attributable to the full cost pool. As a result, there was a significant alteration in the relationship between capitalized costs and proved reserves of oil and gas attributable to the full cost pool. Total capitalized costs within the full cost pool are allocated on the basis of the relative fair values of the properties sold and those retained due to substantial economic differences between the properties sold and those retained. Following this methodology, the following table represents a net sales price allocation of the transaction (in thousands): | |||||
Sale price | $ | 111,090 | |||
Add: Disposition of asset retirement obligations | 309 | ||||
Less: Sale expenses | (1,168 | ) | |||
Purchase price adjustments | (1,520 | ) | |||
Sale price, net | $ | 108,711 | |||
Proved oil and natural gas properties | $ | 137,279 | |||
Accumulated depletion | (49,508 | ) | |||
Unproved oil and natural gas properties | 13,568 | ||||
Gain on sale | 7,372 | ||||
Sale price, net | $ | 108,711 | |||
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2013 | |
Related Party Transactions [Abstract] | ' |
RELATED PARTY TRANSACTIONS | ' |
NOTE 5 RELATED PARTY TRANSACTIONS | |
Senior Secured Promissory Notes | |
On September 22, 2010, Steven Lipscomb and Michael Reger subscribed for $500,000 and $1,000,000 of senior secured promissory notes, respectively. The issuance of the senior secured promissory notes is described in Note 9 to the consolidated financial statements. Mr. Lipscomb is a former director of the Company. Mr. Reger is a brother of J.R. Reger, who is Executive Chairman of the Company and formerly the Chief Executive Officer. The Company’s Audit Committee, which consisted solely of independent directors, reviewed and approved this transaction. The senior secured promissory notes were paid in full on February 10, 2012. | |
White Deer Energy Investment | |
In February 2013, the Company entered into a securities purchase agreement with affiliates of White Deer Energy, pursuant to which the Company issued to White Deer Energy 500,000 shares of Series A Perpetual Preferred Stock (“Series A Preferred Stock”), 5,114,633 shares of Series B Voting Preferred Stock (“Series B Preferred Stock”) and warrants to purchase an initial aggregate amount of 5,114,633 shares of the Company’s common stock at an initial exercise price of $5.77 per share, or an aggregate $50 million. Pursuant to the purchase agreement, White Deer Energy obtained the right to designate one member of the Company’s Board, and White Deer Energy has designated Thomas J. Edelman as its initial director. Series A Preferred Stock shares were redeemed in full in several redemptions during the year, with the last on October 15, 2013. For additional information regarding the securities purchase agreement with White Deer Energy, see Note 6 — Preferred and Common Stock. | |
On June 4, 2013, the Company completed a private placement with White Deer Energy, issuing 2,785,600 shares of common stock for approximately $16.2 million after deducting placement agent fees. On October 17, 2013, the Company completed a private placement with White Deer, issuing 5,092,852 shares of common stock at a price of $6.39 per share for net proceeds of approximately $32.5 million. The Company’s Audit Committee, which consisted solely of independent directors, reviewed and approved both transactions. The issuance of the common stock was made in reliance upon an exemption from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(2) thereof, which exempts transactions by an issuer not involving any public offering. | |
In connection with both closings, the Company granted White Deer Energy certain registration rights. The registration rights agreement requires the Company to file a resale registration statement to register the shares of the Company’s common stock and the shares of common stock issuable upon exercise of the warrants held by White Deer Energy if, at any time on or after 90 days from the closing, White Deer Energy makes a written request to the Company for registration of the securities. Under the registration rights agreement, the Company is required to use its commercially reasonable efforts to cause such resale registration statement to become effective within 120 days after its filing. No such request has been made of the Company as of December 31, 2013. |
PREFERRED_AND_COMMON_STOCK
PREFERRED AND COMMON STOCK | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Preferred and Common Stock [Abstract] | ' | ||||||||
PREFERRED AND COMMON STOCK | ' | ||||||||
NOTE 6 PREFERRED AND COMMON STOCK | |||||||||
Preferred Stock | |||||||||
The Company has 20,000,000 shares of preferred stock authorized. No shares of preferred stock had been issued as of December 31, 2012. | |||||||||
On February 19, 2013, the Company completed a private offering with affiliates of White Deer Energy pursuant to the terms of the Securities Purchase Agreement, to which, in exchange for a cash investment of $50 million, the Company issued the following to White Deer Energy: | |||||||||
o | 500,000 shares of Series A Preferred Stock, $0.001 par value per share; | ||||||||
o | 5,114,633 shares of Series B Preferred Stock, $0.001 par value per share; and | ||||||||
o | warrants to purchase an initial aggregate 5,114,633 shares of the Company’s common stock, $0.001 par value per share, at an initial exercise price of $5.77 per share. These warrants are exercisable until December 31, 2019. | ||||||||
The Series A Preferred Stock had a cumulative dividend rate of 10% per annum, payable quarterly on each March 31, June 30, September 30 and December 31, commencing on March 31, 2013. If the Company voluntarily or involuntarily liquidated, dissolved or wound up its affairs, the Series A Preferred Stock would have been entitled to receive out of available assets, after satisfaction of liabilities to creditors, if any, and before any distribution of assets is made on the Company’s common stock or any other shares of junior stock, a liquidating distribution in the amount, with respect to each share of Series A Preferred Stock, equal to the sum of (a)(1) on or prior February 19, 2015, $112.50, (2) from February 20, 2015 through February 19, 2016, $110.00, (3) from February 20, 2016 through February 19, 2017, $105.00 and (4) thereafter, $100.00 and (b) the accrued and unpaid dividends thereon (the “Liquidation Preference”). Prior to April 1, 2015, the Company was allowed to pay dividends on the Series A Preferred Stock either (x) in cash or (y) by issuance of (A) additional shares of Series A Preferred Stock valued at the same value as the initial per share purchase price of the Series A Preferred Stock and (B) an additional warrant to purchase shares of common stock; provided that such dividends must be paid in cash unless and until the shareholder approval was obtained to authorize the issuance of any additional warrants and any shares of common stock issuable upon exercise of such additional warrants. On July 10, 2013, the shareholders of the Company authorized the Company to issue at its option additional warrants and shares of common stock issuable upon exercise of such additional warrants as dividends on the Series A Preferred Stock prior to April 1, 2015. | |||||||||
The Company had the option to redeem shares of Series A Preferred Stock in whole or in part at any time at the aggregate Liquidation Preference, subject to a minimum redemption amount equal to the lesser of 50,000 shares or the number of shares then outstanding. Upon a change of control, White Deer Energy had the right to require the Company to purchase the Series A Preferred Stock at the Liquidation Preference. The Series A Preferred Stock did not vote with the Company’s common stock, but had specified approval rights with respect to, among other things, changes to organizational documents that affect the Series A Preferred Stock, payment of dividends on the Company’s common stock or other junior stock, redemptions or repurchases of common stock or other capital stock and incurrence of certain indebtedness. Upon the occurrence of certain events of default under the revolving credit facility with Wells Fargo Bank, N.A. (“Wells Fargo”), White Deer Energy had additional specified approval rights with respect to, among other things, the incurrence or guarantee by the Company of any indebtedness, any change in compensation or benefits of employment or severance agreements with officers and any agreement or arrangement pursuant to which the Company or any of its subsidiaries would pay or incur liability in excess of $1,000,000 over the term of such agreement or arrangement. In addition, upon an event of default, White Deer Energy had the right to require the Company to purchase the Series A Preferred Stock at the Liquidation Preference. | |||||||||
On June 20, 2013, the Company redeemed 150,000 shares of the Series A Preferred Stock for $17,203,767 including $1,875,000 of redemption premium and $328,767 in accrued dividends on the redeemed shares. On August 30, 2013, the Company redeemed 200,000 shares of the Series A Preferred Stock for $22,828,767 including $2,500,000 of redemption premium and $328,767 of accrued dividends on the redeemed shares. On October 15, 2013, the Company redeemed the remaining 150,000 shares of the Series A Preferred Stock for $16,932,534 including $1,875,000 of redemption premium and $57,534 in accrued dividends on the redeemed shares. For each redemption, the redemption premium was treated as a dividend and recorded as a return of equity to White Deer Energy through a charge to the Company’s additional paid-in capital. | |||||||||
For the year ended December 31, 2013, the Company paid dividends on the Series A Preferred Stock of $2,582,191. No dividends were paid prior to 2013. | |||||||||
The Series B Preferred Stock is entitled to vote, until January 1, 2020, in the election of directors and on all other matters submitted to a vote of the holders of common stock as a single class. Each share of Series B Preferred Stock has one vote. The Series B Preferred Stock has no dividend rights and a liquidation preference of $0.001 per share. On and from time to time after January 1, 2020 the Company may redeem, in whole or in part, the then-outstanding shares of Series B Preferred Stock, at a redemption price per share equal to $0.001. Each share of Series B Preferred Stock was issued as part of a unit with a warrant to purchase one share of common stock and will be surrendered to the Company upon exercise of a warrant. | |||||||||
The warrants entitle White Deer Energy to acquire 5,114,633 shares of common stock at $5.77 per share and surrendering an equal number of shares of Series B Preferred Stock to the Company. See Note 14 – Derivative Instruments and Price Risk Management – Warrant Liability for further discussion of the warrants. | |||||||||
Upon a change of control or Liquidation Event, as defined in the Securities Purchase Agreement, the Investor has the right, but not the obligation, to elect to receive from the Company, in exchange for all, but not less than all, shares of Series A and Series B Preferred Stock and the warrants issued pursuant to the Securities Purchase Agreement and shares of common stock issued upon exercise thereof that are then held by the Investor, an additional cash payment necessary to achieve a minimum internal rate of return of 25% as calculated as defined. The calculation took into account all cash inflows from and cash outflows to the Investor. Upon the final Series A Preferred Stock redemption on October 15, 2013, the minimum internal rate of return was achieved and no additional cash payment was necessary. | |||||||||
The Company recorded the transaction by recognizing the fair value of the Series A Preferred Stock at $38,552,994 (net of offering costs of $2,816,006), Series B Preferred Stock at $5,000 and a warrant liability of $8,626,000 at time of issuance. The Company accreted the Series A Preferred Stock to the liquidation or redemption value when it became probable that the event or events underlying the liquidation or redemption were probable. The Company recognized all issuance discount accretion related to the partial redemptions of preferred stock on June 20, 2013, August 30, 2013 and October 15, 2013. There is no issuance discount remaining as of December 31, 2013. | |||||||||
A summary of the preferred stock transaction components as of December 31, 2013 and the issuance date is provided below: | |||||||||
31-Dec-13 | February 19, 2013 | ||||||||
(issuance date) | |||||||||
Series A Preferred Stock | $ | — | $ | 41,369,000 | |||||
Series B Preferred Stock | 5,000 | 5,000 | |||||||
Warrant Liability | 15,703,000 | 8,626,000 | |||||||
Total | $ | 15,708,000 | $ | 50,000,000 | |||||
Equity Issuances | |||||||||
On February 8, 2011, the Company completed a private placement of 1,785,714 units, which consisted of one share of common stock and a warrant to purchase one-half of a share of common stock, at a subscription price of $28.00 per unit for total gross proceeds of $50 million. The exercise price of the warrants is $49.70 per whole share of common stock for a period of five years from the date of closing. The total number of shares that are issuable upon exercise of warrants is 892,857. The Company incurred costs of $3,397,749 related to this transaction, which costs were netted against the proceeds of the transaction through additional paid-in capital. | |||||||||
On September 28, 2012, the Company completed a public offering of 13,392,857 shares of common stock at a price of $5.60 per share for total gross proceeds of $75 million. The Company incurred costs of approximately $5.3 million related to this transaction, which costs were netted against the proceeds of the transaction through additional paid-in capital. The underwriters elected to exercise the over-allotment option to sell an additional 484,698 shares of common stock at $5.60 per share. The gross proceeds from the over-allotment exercise were $2.7 million, and the net proceeds are approximately $2.5 million after deducting underwriting discounts and commissions. The over-allotment exercise closed on October 26, 2012. | |||||||||
The Company issued 851,315 and 313,700 shares of its common stock related to two acreage acquisitions completed on January 9, 2013 and February 4, 2013, respectively. See Note 4 – Oil and Natural Gas Properties – Acquisitions for additional details. | |||||||||
On May 22, 2013, the Company completed a public offering of 12,000,000 shares of common stock at a price of $6.10 per share for total net proceeds of approximately $69.3 million. The Company incurred costs of approximately $4.3 million related to this transaction, which costs were netted against the proceeds of the transaction through additional paid-in capital. The underwriters elected to exercise the over-allotment option to sell an additional 1,800,000 shares of common stock at $6.10 per share. The net proceeds from the over-allotment exercise were approximately $10.5 million after deducting underwriting discounts and commissions. | |||||||||
On June 4, 2013, the Company completed a private placement of 2,785,600 shares of common stock at a price of $5.87 per share for net proceeds of approximately $16.2 million after deducting placement agent fees of approximately $0.2 million. The Company’s Audit Committee, which consisted solely of independent directors, reviewed and approved this transaction. The issuance of the common stock was made in reliance upon an exemption from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(2) thereof, which exempts transactions by an issuer not involving any public offering. | |||||||||
On October 2, 2013, the Company completed a public offering of 15,000,000 shares of common stock at a price of $6.70 per share for total net proceeds of approximately $95.5 million. The Company incurred costs of approximately $5.0 million related to this transaction, which costs were netted against the proceeds of the transaction through additional paid-in capital. The underwriters elected to exercise the over-allotment option to sell an additional 2,250,000 shares of common stock at $6.70 per share. The net proceeds from the over-allotment exercise were approximately $14.4 million after deducting underwriting discounts and commissions. | |||||||||
On October 17, 2013, the Company completed a private placement of 5,092,852 shares of common stock at a price of $6.39 per share for net proceeds of approximately $32.5 million. The Company’s Audit Committee, which consisted solely of independent directors, reviewed and approved this transaction. The issuance of the common stock was made in reliance upon an exemption from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(2) thereof, which exempts transactions by an issuer not involving any public offering. | |||||||||
Restricted Stock Awards and Restricted Stock Unit Awards | |||||||||
The Company incurred compensation expense associated with restricted stock and restricted stock units granted of $10,903,696, $4,684,009 and $126,962 for the years ended December 31, 2013, 2012 and 2011, respectively. There were 2,082,187 nonvested restricted stock units and $8,007,835 associated remaining unrecognized compensation expense as of December 31, 2013 which is expected to be recognized over the weighted-average period of 0.90 years. The Company capitalized compensation expense associated with the restricted stock of $851,979, $332,673 and $99,358 to oil and natural gas properties for the years ended December 31, 2013, 2012 and 2011, respectively. Approximately $2,298,661 of the compensation expense associated with restricted stock and restricted stock units during the year ended December 31, 2013 related to the modification and accelerated vesting of restricted stock unit grants associated with severance to a prior officer of the Company. A total of 537,817 restricted stock units associated with the severance vested subsequent to year end on January 19, 2014, including 442,708 restricted stock units that were nonvested as of December 31, 2013 and 95,109 restricted common shares that were granted on January 17, 2014. There is no remaining unamortized expense associated with the severance as of December 31, 2013. A summary of the restricted stock units and restricted stock shares outstanding is as follows: | |||||||||
Number of Shares | Weighted | ||||||||
Average Grant | |||||||||
Date Fair Value | |||||||||
Non-vested restricted stock and restricted stock units at January 1, 2011 | — | $ | — | ||||||
Granted | — | — | |||||||
Canceled | — | — | |||||||
Forfeited | — | ||||||||
Vested | — | — | |||||||
Non-vested restricted stock and restricted stock units at December 31, 2011 | — | — | |||||||
Granted | 1,919,135 | 4.93 | |||||||
Canceled | — | ||||||||
Forfeited | (53,577 | ) | 21 | ||||||
Vested | (17,857 | ) | 21 | ||||||
Non-vested restricted stock and restricted stock units at December 31, 2012 | 1,847,701 | 4.31 | |||||||
Granted | 1,242,505 | 7.1 | |||||||
Canceled | (70,642 | ) | 4.19 | ||||||
Forfeited | (302,016 | ) | 4.86 | ||||||
Vested | (635,361 | ) | 4.88 | ||||||
Non-vested restricted stock and restricted stock units at December 31, 2013 | 2,082,187 | $ | 5.73 | ||||||
STOCK_OPTIONS_AND_WARRANTS
STOCK OPTIONS AND WARRANTS | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Stock Options and Warrants [Abstract] | ' | ||||||||||||||||
STOCK OPTIONS AND WARRANTS | ' | ||||||||||||||||
NOTE 7 STOCK OPTIONS AND WARRANTS | |||||||||||||||||
Stock Options | |||||||||||||||||
The total fair value of all stock options granted during the years ended December 31, 2013, 2012 and 2011 were calculated using the Black-Scholes valuation model based on factors present at the time the options were granted. | |||||||||||||||||
The impact on the Company’s statement of operations of stock-based compensation expense related to options granted for the years ended December 31, 2013, 2012, and 2011 was $1,600,924, $2,634,681 and $334,520, respectively, net of $0 tax. The Company capitalized $1,193,960, $249,367 and $109,688 in compensation to oil and natural gas properties related to outstanding options for the years ended December 31, 2013, 2012 and 2011, respectively. Approximately $456,741 of the compensation expense associated with stock options during the year ended December 31, 2013 related to the modification and accelerated vesting of stock options associated with severance to a prior officer of the Company. A total of 44,643 stock options associated with the severance vested subsequent to year end on January 19, 2014. There is no remaining unamortized expense associated with the severance as of December 31, 2013. | |||||||||||||||||
A summary of options for the years ended December 31, 2013, 2012, and 2011 is as follows: | |||||||||||||||||
Number of | Weighted | Remaining | Intrinsic | ||||||||||||||
Options | Average | Contractual | Value | ||||||||||||||
Exercise | Term | ||||||||||||||||
Price | (in Years) | ||||||||||||||||
Outstanding at January 1, 2011 | 139,857 | 20.51 | 8.9 | 2,420,660 | |||||||||||||
Granted | 39,284 | 22.4 | — | — | |||||||||||||
Exercised | (571 | ) | 29.68 | — | — | ||||||||||||
Forfeited or Expired | (28,570 | ) | 19.32 | — | — | ||||||||||||
Outstanding at December 31, 2011 | 150,000 | 20.44 | 7.2 | — | |||||||||||||
Granted | 685,713 | 8.11 | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Forfeited or Expired | — | — | — | — | |||||||||||||
Outstanding at December 31, 2012 | 835,713 | 10.43 | 7.7 | — | |||||||||||||
Granted | 505,301 | 7.18 | — | — | |||||||||||||
Exercised | (75,000 | ) | 4.43 | — | — | ||||||||||||
Forfeited or Expired | (107,143 | ) | 16.54 | — | — | ||||||||||||
Outstanding at December 31, 2013 | 1,158,871 | $ | 8.9 | 4.75 | $ | — | |||||||||||
Stock Options Exercisable at December 31, 2011 | 51,786 | $ | 18.9 | 6.9 | $ | 302,750 | |||||||||||
Stock Options Exercisable at December 31, 2012 | 424,997 | $ | 11.39 | 5.9 | $ | 121,500 | |||||||||||
Stock Options Exercisable at December 31, 2013 | 464,273 | $ | 11.12 | 3.1 | $ | 356,024 | |||||||||||
A summary of the status of the Company’s nonvested options as of December 31, 2013 and changes during the year then ended is as follows: | |||||||||||||||||
Number of | Weighted-Average | ||||||||||||||||
Options | Grant-Date | ||||||||||||||||
Fair Value | |||||||||||||||||
Nonvested at December 31, 2011 | 98,214 | $ | 13.09 | ||||||||||||||
Granted | 685,713 | 4.78 | |||||||||||||||
Vested | (373,211 | ) | 6.14 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Nonvested at December 31, 2012 | 410,716 | 5.87 | |||||||||||||||
Granted | 505,301 | 7.18 | |||||||||||||||
Vested | (200,000 | ) | 10.47 | ||||||||||||||
Forfeited | (21,430 | ) | 12.39 | ||||||||||||||
Nonvested at December 31, 2013 | 694,587 | $ | 7.41 | ||||||||||||||
For the year ended December 31, 2013, 2012 and 2011, other information pertaining to stock options was as follows: | |||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||
Weighted-average per share grant-date fair value of stock options granted | $ | 4.43 | $ | 4.62 | $ | 14.35 | |||||||||||
Total intrinsic value of options exercised | 211,250 | — | 3,520 | ||||||||||||||
Total grant-date fair value of stock options vested during the year | 2,093,999 | 2,159,307 | 349,875 | ||||||||||||||
The following assumptions were used for the Black-Scholes model to value the options granted during the years ended December 31, 2013, 2012 and 2011. | |||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||
Risk free rates | 0.48% to 2.12% | 0.17% to 1.20% | 0.91% to 0.96% | ||||||||||||||
Dividend Yield | 0% | 0% | 0% | ||||||||||||||
Expected volatility | 64.64% to 79.50% | 69.70% to 78.99% | 85.90% to 86.17% | ||||||||||||||
Weighted average expected life | 5 years | 4 years | 3 years | ||||||||||||||
There was $1,518,289 of total unrecognized compensation cost related to nonvested stock options granted as of December 31, 2013. At December 31, 2013, the remaining cost is expected to be recognized over a weighted-average period of 1.37 years. These estimates are subject to change based on a variety of future events which include, but are not limited to, changes in estimated forfeiture rates, cancelations and the issuance of new options. | |||||||||||||||||
Warrants | |||||||||||||||||
The impact on the Company’s consolidated statement of operations of stock-based compensation expense related to warrants granted for the years ended December 31, 2013, 2012, and 2011 was $0, $0 and $267,065, respectively, net of $0 tax. The Company capitalized $209,370 in compensation related to outstanding warrants to oil and natural gas properties for the year ended December 31, 2011. | |||||||||||||||||
A summary of warrants granted to employees, directors and consultants for the years ended December 31, 2013, 2012 and 2011 is as follows: | |||||||||||||||||
Number of | Weighted | Remaining | Intrinsic Value | ||||||||||||||
Warrants | Average | Contractual | |||||||||||||||
Exercise Price | Term (in Years) | ||||||||||||||||
Outstanding at December 31, 2010 | 223,293 | $ | 6.86 | 9.5 | $ | 6,908,681 | |||||||||||
Granted | — | — | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Outstanding at December 31, 2011 | 223,293 | 6.86 | 8 | 2,458,251 | |||||||||||||
Granted | — | — | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Outstanding at December 31, 2012 | 223,293 | 6.86 | 7 | — | |||||||||||||
Granted | — | — | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Outstanding at December 31, 2013 | 223,293 | $ | 6.86 | 7 | $ | 178,634 | |||||||||||
On February 8, 2011, in conjunction with the sale of 1,785,714 shares of common stock (see Note 6), the Company issued investors warrants to purchase a total of 892,858 shares of common stock exercisable at $49.70 per share. | |||||||||||||||||
For the years ended December 31, 2013, 2012 and 2011, other information pertaining to warrants was as follows: | |||||||||||||||||
2013 (1) | 2012 | 2011 | |||||||||||||||
Weighted-average grant-date fair value of warrants granted | $ | 1.69 | $ | — | $ | 2.02 | |||||||||||
Total intrinsic value of warrants exercised | $ | — | $ | — | $ | — | |||||||||||
Total grant-date fair value of warrants vested during the year | $ | — | $ | — | $ | 12,625,000 | |||||||||||
-1 | See Note 6 – Common and Preferred Stock – Preferred Stock for details on the warrants issued on February 19, 2013 associated with the preferred stock transaction. | ||||||||||||||||
The following assumptions were used for the Black-Scholes model to value the warrants granted during the years ended December 31, 2013, 2012 and 2011. | |||||||||||||||||
2013 (1) | 2012 | 2011 | |||||||||||||||
Risk free rates | — | — | 2.02 | % | |||||||||||||
Dividend yield | — | — | 0 | % | |||||||||||||
Expected volatility | — | — | 75.52 | % | |||||||||||||
Weighted average expected life | — | — | 5 years | ||||||||||||||
-1 | See Note 14 – Derivative Instruments and Price Risk Management – Warrant Liability for the method and assumptions used to value the warrants issued on February 19, 2013 associated with the preferred stock transaction. | ||||||||||||||||
The table below reflects the status of warrants outstanding at December 31, 2013: | |||||||||||||||||
Warrants | Exercise Price | Expiration Date | |||||||||||||||
1-Dec-09 | 37,216 | $ | 6.86 | 1-Dec-19 | |||||||||||||
31-Dec-09 | 186,077 | $ | 6.86 | 31-Dec-19 | |||||||||||||
8-Feb-11 | 892,858 | $ | 49.7 | 8-Feb-16 | |||||||||||||
19-Feb-13 | 5,114,633 | $ | 5.77 | 31-Dec-19 | |||||||||||||
Total | 6,230,784 | ||||||||||||||||
No warrants expired or were forfeited during the year ended December 31, 2013. All of the compensation expense related to the applicable vested warrants issued to employees has been expensed by the Company prior to 2012. All warrants outstanding were exercisable at December 31, 2013. |
REVOLVING_CREDIT_FACILITY
REVOLVING CREDIT FACILITY | 12 Months Ended |
Dec. 31, 2013 | |
Revolving Credit Facility [Abstract] | ' |
REVOLVING CREDIT FACILITY | ' |
NOTE 8 REVOLVING CREDIT FACILITY | |
Wells Fargo Facility | |
On November 20, 2012, the Company entered into a credit agreement (the “Credit Agreement”) with Wells Fargo, as administrative agent, and the lenders party thereto. The Credit Agreement is a senior secured reserve-based revolving credit facility with a maximum commitment of $400 million (the “Wells Fargo Facility”). As of December 31, 2013, the Wells Fargo Facility was undrawn and had a borrowing base of $75.0 million. | |
Amounts borrowed under the Wells Fargo Facility will mature on November 20, 2017, and upon such date, any amounts outstanding under the Wells Fargo Facility are due and payable. Redeterminations of the borrowing base will be on a semi-annual basis, with an option to elect an additional redetermination every six months between the semi-annual redeterminations. | |
The annual interest cost, which is dependent upon the percentage of the borrowing base utilized, is, at the Company’s option, based on either the Alternate Base Rate (as defined in the Credit Agreement) plus 0.75% to 1.75% or the London Interbank Offer Rate (LIBOR) plus 1.75% to 2.75%; provided, in no event may the interest exceed the maximum interest rate allowed by any current or future law. Interest on ABR Loans is due and payable on a quarterly basis, and interest on Eurodollar Loans is due and payable, at the Company’s option, at one-, two-, three-, six- (or in some cases nine- or twelve-) month intervals. The Company also pays a commitment fee ranging from 0.375% to 0.5%, depending on the percentage of the borrowing base utilized. As of December 31, 2013, the annual interest rate on the Wells Fargo Facility was 0.375% which is the minimum commitment fee, as no funds were drawn against the Wells Fargo Facility. | |
A portion of the Wells Fargo Facility not in excess of $5 million will be available for the issuance of letters of credit by Wells Fargo. The Company will pay a rate per annum ranging from 1.75% to 2.75% on the face amount of each letter of credit issued and will pay a fronting fee equal to the greater of $500 and 0.125% of the face amount of each letter of credit issued. As of December 31, 2013, the Company has not obtained any letters of credit under the Wells Fargo Facility. | |
Each of the Company’s subsidiaries is a guarantor under the Wells Fargo Facility. The Wells Fargo Facility is secured by first priority, perfected liens and security interests on substantially all assets of the Company and the guarantors, including a pledge of their ownership in their respective subsidiaries. | |
The Credit Agreement contains customary covenants that include, among other things: limitations on the ability of the Company to incur or guarantee additional indebtedness; create liens; pay dividends on or repurchase stock; make certain types of investments; enter into transactions with affiliates; and sell assets or merge with other companies. The Credit Agreement also requires compliance with certain financial covenants, including, (a) a ratio of current assets to current liabilities of at least 1.00 to 1.00, (b) a maximum ratio of debt to EBITDA for the preceding four fiscal quarters of no more than 3.50 to 1.00, and (c) a fixed charge coverage ratio for any four fiscal quarters of at least 3.00 to 1.00. The Company was in compliance for all covenants as of December 31, 2013. | |
The principal balance amount on the Credit Agreement was approximately $0 and $23.5 million at December 31, 2013 and December 31, 2012, respectively. | |
Macquarie Facility | |
On February 10, 2012, the Company entered into a revolving credit facility (the “Macquarie Facility”) with Macquarie Bank Limited (“MBL”). The Macquarie Facility provided up to a maximum of $150 million in principal amount of borrowings to be used as working capital for exploration and production operations. Initially, $15 million of financing was available under the Macquarie Facility based on reserves, with an additional $50 million available under a development tranche. | |
On July 26, 2012, the Company entered into an amended and restated credit agreement with MBL to expand the existing availability and outstanding balance under its existing Macquarie Facility and drew $15 million of additional debt on a new third tranche at an initial rate of 9% above the applicable LIBOR and had the potential to draw a maximum of $20 million. The $15 million drawn was used for existing development activities and was paid in full with proceeds from the equity offering completed on September 28, 2012. The remaining balance on the Macquarie Facility was paid in full on November 20, 2012. |
SENIOR_SECURED_PROMISSORY_NOTE
SENIOR SECURED PROMISSORY NOTES | 12 Months Ended |
Dec. 31, 2013 | |
Senior Secured Promissory Notes [Abstract] | ' |
SENIOR SECURED PROMISSORY NOTES | ' |
NOTE 9 SENIOR SECURED PROMISSORY NOTES | |
In September 2010, the Company issued senior secured promissory notes in the principal amount of $15 million (the “Notes”) in order to finance future drilling and development activities. Proceeds of the Notes were used primarily to fund developmental drilling on the Company’s significant acreage positions targeting the Williston Basin — Bakken/Three Forks area and the Niobrara formation located in the DJ Basin through the joint venture with Slawson. The Notes were paid in full on February 10, 2012 in conjunction with the Company entering into the Macquarie Facility (see Note 8 – Revolving Credit Facility). |
ASSET_RETIREMENT_OBLIGATION
ASSET RETIREMENT OBLIGATION | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Asset Retirement Obligation [Abstract] | ' | ||||||||||||
ASSET RETIREMENT OBLIGATION | ' | ||||||||||||
NOTE 10 ASSET RETIREMENT OBLIGATION | |||||||||||||
The Company has asset retirement obligations associated with the future plugging and abandonment of its proved oil and natural gas properties and related facilities. Under the provisions of ASC 410-20-25, the fair value of a liability for an asset retirement obligation is recorded in the period in which it is incurred and a corresponding increase in the carrying amount of the related long lived asset. The liability is accreted to its present value each period, and the capitalized cost is depleted using the units of production method. If the liability is settled for an amount other than the recorded amount, a gain or loss is recognized. The fair value of additions to the asset retirement obligations is estimated using valuation techniques that convert future cash flows to a single discounted amount. Significant inputs to the valuation include estimates of: (i) plug and abandon costs per well based on existing regulatory requirements; (ii) remaining life per well; (iii) future inflation factors (2.5% for each of the years in the three-year period ended December 31, 2013); and (iv) a credit-adjusted risk-free interest rate (average of 7.0% for each of the years in the three-year period ended December 31, 2013). These inputs require significant judgments and estimates by the Company’s management at the time of the valuation and are the most sensitive and subject to change. The Company has no assets that are legally restricted for purposes of settling asset retirement obligations. | |||||||||||||
The following table summarizes the Company’s asset retirement obligation transactions for the years ended December 31, 2013, 2012 and 2011: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Beginning Asset Retirement Obligation | $ | 296,074 | $ | 116,119 | $ | 10,522 | |||||||
Revision of Previous Estimates | 165,968 | — | — | ||||||||||
Liabilities Incurred or Acquired | 510,271 | 164,967 | 100,715 | ||||||||||
Accretion of Discount on Asset Retirement Obligations | 32,449 | 14,988 | 4,882 | ||||||||||
Liabilities Associated with Properties Sold | (312,625 | ) | — | — | |||||||||
Ending Asset Retirement Obligation | $ | 692,137 | $ | 296,074 | $ | 116,119 | |||||||
ACCRUED_LIABILITIES
ACCRUED LIABILITIES | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Accrued Liabilities [Abstract] | ' | ||||||||
ACCRUED LIABILITIES | ' | ||||||||
NOTE 11 ACCRUED LIABILITIES | |||||||||
The Company’s accrued liabilities consist of the following: | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Accrued Transaction Adjustments | $ | 2,067,150 | $ | — | |||||
Oil and Natural Gas Revenue Payable | 7,451,394 | 4,559 | |||||||
Other General and Administrative Expenses | 2,303,185 | 415,930 | |||||||
Total Accrued Liabilities | $ | 11,821,729 | $ | 420,489 | |||||
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Taxes [Abstract] | ' | ||||||||||||
INCOME TAXES | ' | ||||||||||||
NOTE 12 INCOME TAXES | |||||||||||||
The Company utilizes the asset and liability approach to measuring deferred tax assets and liabilities based on temporary differences existing at each balance sheet date using currently enacted tax rates in accordance with ASC 740-10-30. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. | |||||||||||||
The income tax expense (benefit) for the year ended December 31, 2013, 2012, and 2011 consists of the following: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Current Income Taxes | $ | — | $ | — | $ | — | |||||||
Deferred Income Taxes | |||||||||||||
Federal | — | — | — | ||||||||||
State | — | — | — | ||||||||||
Total Expense | $ | — | $ | — | $ | — | |||||||
The following is a reconciliation of the reported amount of income tax expense (benefit) for the years ended December 31, 2013, 2012 and 2011 to the amount of income tax expenses that would result from applying the statutory rate to pretax income. | |||||||||||||
Reconciliation of reported amount of income tax expense: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Loss Before Taxes | $ | (10,882,895 | ) | $ | (62,296,099 | ) | $ | (1,354,054 | ) | ||||
Federal Statutory Rate | 35 | % | 35 | % | 35 | % | |||||||
Benefit Computed at Federal Statutory Rates | (3,809,013 | ) | (21,803,635 | ) | (473,919 | ) | |||||||
State Benefit, Net of Federal Benefit | (102,503 | ) | (1,969,364 | ) | (68,416 | ) | |||||||
Effects of: | |||||||||||||
Warrant Revaluation | 2,476,950 | — | — | ||||||||||
Nondeductible Expenses | 366,203 | 10,941 | — | ||||||||||
Other | 125,956 | (119,872 | ) | 48,919 | |||||||||
Change in Valuation Allowance | 942,407 | 23,881,930 | 493,416 | ||||||||||
Reported Provision | $ | — | $ | — | $ | — | |||||||
The components of the Company’s deferred tax asset were as follows: | |||||||||||||
Year Ended December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Deferred Tax Assets: | |||||||||||||
Net Operating Loss Carryforwards (NOLs) | $ | 36,382,177 | $ | 19,654,346 | |||||||||
Stock-based Compensation | 3,245,308 | 1,672,296 | |||||||||||
Derivatives | 323,190 | 68,438 | |||||||||||
Equity Investments | 116,886 | 116,488 | |||||||||||
Oil and Natural Gas Properties | — | 6,522,543 | |||||||||||
Total Deferred Tax Assets | 40,067,561 | 28,034,111 | |||||||||||
Deferred Tax Liabilities: | |||||||||||||
Oil and Natural Gas Properties | 11,093,181 | — | |||||||||||
Other | 7,353 | 9,491 | |||||||||||
Total Deferred Tax Liabilities | 11,100,534 | 9,491 | |||||||||||
Less: Valuation Allowance | (28,967,027 | ) | (28,024,620 | ) | |||||||||
Total Net Deferred Tax Asset | $ | — | $ | — | |||||||||
At December 31, 2013, the Company has U.S. Federal net operating loss (NOL) carryovers of $102,402,000, which expire at various dates from 2029 through 2033. In addition, the Company had state NOL carryovers of approximately $85,332,000, which expire from 2016 through 2033. During 2012, the Company had a IRC Section 382 change of ownership. As a result of the ownership change, the Company’s utilization of pre-change U.S. Federal NOLs are subject to an annual limitation amount of approximately $1,754,000. Valuation allowances of $28,967,000 and $28,025,000 have been established to offset the Company's net deferred tax assets as of December 31, 2013 and December 31, 2012, respectively, as the realization of these deferred tax assets is not more likely than not. | |||||||||||||
Tax benefits are recognized only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized upon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in the Company's tax returns that do not meet these recognition and measurement standards. The Company has no liabilities for unrecognized tax benefits. | |||||||||||||
The Company's policy is to recognize potential interest and penalties accrued related to unrecognized tax benefits within income tax expenses. For the years ended December 31, 2013, 2012 and 2011, the Company did not recognize any interest or penalties in its statement of operations, nor did it have any interest or penalties accrued in its balance sheet at December 31, 2013 and 2012 relating to unrecognized benefits. | |||||||||||||
The tax years 2010 through 2013 remain open to examination for U.S. federal income tax purposes. The Company files tax returns with various state taxing authorities and these returns remain open to examination for the tax years 2009 through 2013. |
FAIR_VALUE
FAIR VALUE | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Fair Value [Abstract] | ' | ||||||||||||
FAIR VALUE | ' | ||||||||||||
NOTE 13 FAIR VALUE | |||||||||||||
ASC 820-10-55 defines fair value, establishes a framework for measuring fair value under GAAP and enhances disclosures about fair value measurements. Fair value is defined under ASC 820-10-55 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following: | |||||||||||||
Level 1 – Unadjusted quoted prices in active markets that are accessible at measurement date for identical assets or liabilities. | |||||||||||||
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |||||||||||||
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities and less observable from objective sources. | |||||||||||||
The level in the fair value hierarchy within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. The Company’s policy is to recognize transfer in and/or out of fair value hierarchy as of the end of the reporting period for which the event or change in circumstances caused the transfer. The Company has consistently applied the valuation techniques discussed below for the periods presented. These valuation policies are determined by the Company’s Vice President of Accounting and approved by the Chief Financial Officer. They are discussed with the Company’s Audit Committee as deemed appropriate. Each quarter, the Vice President of Accounting and Chief Financial Officer update the inputs used in the fair value measurement and internally review the changes from period to period for reasonableness. The Company uses data from peers as well as external sources in the determination of the volatility and risk free rates used in the Company’s fair value calculations. A sensitivity analysis is performed as well to determine the impact of inputs on the ending fair value estimate. | |||||||||||||
Fair Value on a Recurring Basis | |||||||||||||
The following schedule summarizes the valuation of financial instruments measured at fair value on a recurring basis in the consolidated balance sheet as of December 31, 2013: | |||||||||||||
Fair Value Measurements at | |||||||||||||
December 31, 2013 Using | |||||||||||||
Quoted Prices In Active | Significant Other Observable | Significant Unobservable | |||||||||||
Markets for Identical | Inputs | Inputs | |||||||||||
Assets | (Level 2) | (Level 3) | |||||||||||
(Level 1) | |||||||||||||
Warrant Liability – Long Term Liability | $ | — | $ | — | $ | (15,703,000 | ) | ||||||
Commodity Derivatives – Current Liability (oil swaps) | (921,401 | ) | |||||||||||
Commodity Derivatives – Long Term Asset (oil swaps) | — | 68,396 | — | ||||||||||
Total | $ | — | $ | (853,005 | ) | $ | (15,703,000 | ) | |||||
The following schedule summarizes the valuation of financial instruments measured at fair value on a recurring basis in the consolidated balance sheet as of December 31, 2012: | |||||||||||||
Fair Value Measurements at | |||||||||||||
December 31, 2012 Using | |||||||||||||
Quoted Prices In Active | Significant Other Observable | Significant Unobservable | |||||||||||
Markets for Identical | Inputs | Inputs | |||||||||||
Assets | (Level 2) | (Level 3) | |||||||||||
(Level 1) | |||||||||||||
Commodity Derivatives – Current Liability (oil swaps and collars) | $ | — | $ | (206,645 | ) | $ | — | ||||||
Commodity Derivatives – Long Term Asset (oil swaps and collars) | — | 25,397 | — | ||||||||||
Total | $ | — | $ | (181,248 | ) | $ | — | ||||||
Level 2 assets consist of commodity derivative assets and liabilities (see Note 14 – Derivative Instruments and Price Risk Management). The fair value of the commodity derivative assets and liabilities are estimated by the Company using the income valuation techniques utilizing an option pricing or discounted cash flow model, as appropriate, which take into account notional quantities, market volatility, market prices, contract parameters and discount rates based on published LIBOR rates. The Company validates the data provided by third parties by understanding the pricing models used, obtaining market values from other pricing sources, analyzing pricing data in certain situations and confirming that those securities trade in active markets. Assumed credit risk adjustments, based on published credit ratings, public bond yield spreads and credit default swap spreads, are applied to the Company’s commodity derivatives. Significant changes in the quoted forward prices for commodities and changes in market volatility generally leads to corresponding changes in the fair value measurement of the Company’s oil derivative contracts. The fair value of all derivative contracts is reflected on the consolidated balance sheets. | |||||||||||||
A rollforward of Level 3 warrants liability measured at fair value using Level 3 on a recurring basis is as follows (in thousands): | |||||||||||||
Balance, at December 31, 2012 | $ | — | |||||||||||
Purchases, issuances, and settlements | (8,626,000 | ) | |||||||||||
Change in Fair Value of Warrant Liability | (7,077,000 | ) | |||||||||||
Transfers | — | ||||||||||||
Balance, at December 31, 2013 | $ | (15,703,000 | ) | ||||||||||
The fair value of the warrants upon issuance to White Deer Energy on February 19, 2013 was recorded at $8,626,000. The warrant revaluation expense was $7,077,000 for the year ended December 31, 2013 and is included in Other Income/Expense on the accompanying Consolidated Statements of Operations. See discussion of assumptions used in valuing the warrants at Note 14 – Derivative Instruments and Price Risk Management. | |||||||||||||
Nonrecurring Fair Value Measurements | |||||||||||||
The Company follows the provisions of ASC 820-10 for nonfinancial assets and liabilities measured at fair value on a nonrecurring basis. As it relates to the Company, ASC 820-10 applies to certain nonfinancial assets and liabilities as may be acquired in a business combination and thereby measured at fair value and the initial recognition of asset retirement obligations for which fair value is used. | |||||||||||||
The asset retirement obligation estimates are derived from historical costs as well as management’s expectation of future cost environments. As there is no corroborating market activity to support the assumptions used, the Company has designated these liabilities as Level 3. A reconciliation of the beginning and ending balances of the Company’s asset retirement obligation is presented in Note 10 – Asset Retirement Obligation. | |||||||||||||
The Company’s non-derivative financial instruments include cash and cash equivalents, accounts receivable, accounts payable, and the Wells Fargo Facility. The carrying amount of cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of their immediate or short-term maturities. The book value of the Wells Fargo Facility approximates fair value because of its floating rate structure. The Company has classified the valuations of the Wells Fargo Facility under Level 2 item of the fair value hierarchy. |
DERIVATIVE_INSTRUMENTS_AND_PRI
DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Derivative Instruments and Price Risk Management [Abstract] | ' | ||||||||
DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT | ' | ||||||||
NOTE 14 DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT | |||||||||
Commodity | |||||||||
The Company utilizes oil swap contracts to (i) reduce the effects of volatility in price changes on the oil commodities it produces and sells, (ii) reduce commodity price risk and (iii) provide a base level of cash flow in order to assure it can execute at least a portion of its capital spending. | |||||||||
All derivative positions are carried at their fair value on the consolidated balance sheet and are marked-to-market at the end of each period. | |||||||||
The Company has a master netting agreement on each of the individual oil contracts and therefore the current asset and liability are netted on the consolidated balance sheet and the non-current asset and liability are netted on the consolidated balance sheet. | |||||||||
The following table reflects open commodity swap contracts as of December 31, 2013, the associated volumes and the corresponding weighted average NYMEX reference price: | |||||||||
Settlement Period | Oil (Bbls) | Fixed Price | |||||||
Oil Swaps | |||||||||
January 1, 2014 – December 31, 2014 | 103,267 | $ | 91 | ||||||
January 1, 2014 – December 31, 2014 | 31,000 | 90.05 | |||||||
January 1, 2014 – December 31, 2014 | 79,000 | 94.3 | |||||||
January 1, 2014 – December 31, 2014 | 44,200 | 94.18 | |||||||
2014 Total/Average | 257,467 | $ | 92.44 | ||||||
January 1, 2015 – February 28, 2015 | 13,876 | $ | 91 | ||||||
January 1, 2015 – February 28, 2015 | 5,000 | 90.05 | |||||||
January 1, 2015 – February 28, 2015 | 10,000 | 94.3 | |||||||
January 1, 2015 – February 28, 2015 | 8,100 | 94.18 | |||||||
2015 Total/Average | 36,976 | $ | 92.46 | ||||||
The following table sets forth a reconciliation of the changes in fair value of the Company’s commodity derivatives for the years ended December 31, 2013 and 2012. | |||||||||
2013 | 2012 | ||||||||
Beginning fair value of commodity derivatives | $ | (181,248 | ) | $ | — | ||||
Total losses on oil derivatives | (2,656,535 | ) | (215,439 | ) | |||||
Cash settlements paid on oil derivatives | 1,984,778 | 34,191 | |||||||
Ending fair value of commodity derivatives | $ | (853,005 | ) | $ | (181,248 | ) | |||
The use of derivative transactions involves the risk that the counterparties will be unable to meet the financial terms of such transactions. The Company has netting arrangements with Wells Fargo that provide for offsetting payables against receivables from separate derivative instruments. | |||||||||
Warrant Liability | |||||||||
The warrants issued to White Deer Energy pursuant to the Securities Purchase Agreement are classified as liabilities on the consolidated balance sheets because the warrants contain a contingent put and other liability type provisions (see Note 6 – Preferred and Common Stock). The shares underlying the warrants are contingently redeemable and are subject to remeasurement at each balance sheet date, and any changes in fair value will be recognized as a component of other (expense) income on the accompanying consolidated statements of operations. | |||||||||
The Company estimated the value of the warrants issued with the Securities Purchase Agreement on the date of issuance to be $8,626,000, or $1.69 per warrant, using the Monte Carlo model with the following assumptions: a term of 1,798 trading days, exercise price of $5.77, volatility rate of 40%, and a risk-free interest rate of 1.38%. The Company remeasured the warrants as of December 31, 2013, using the same Monte Carlo model, using the following assumptions: a term of 1,561 trading days, exercise price of $5.77, stock price of $7.66, volatility rate of 40%, and a risk-free interest rate of 2.5%. As of December 31, 2013, the fair value of the warrants was $15,703,000, and was recorded as a liability on the accompanying consolidated balance sheets. An increase in any of the variables would cause an increase in the fair value of the warrants. Likewise, a decrease in any variable would cause a decrease in the value of the warrants. | |||||||||
At December 31, 2013, the Company had derivative financial instruments recorded on the consolidated balance sheet as set forth below: | |||||||||
Type of Contract | Balance Sheet Location | ||||||||
Derivative Assets (Liabilities): | |||||||||
Swap Contracts | Current liabilities | $ | (921,401 | ) | |||||
Swap Contracts | Non-current assets | 68,396 | |||||||
Warrant Liability | Non-current liabilities | (15,703,000 | ) | ||||||
Total Derivative Liabilities | $ | (16,556,005 | ) | ||||||
At December 31, 2012, the Company had derivative financial instruments recorded on the consolidated balance sheet as set forth below: | |||||||||
Type of Contract | Balance Sheet Location | ||||||||
Derivative Assets: | |||||||||
Costless Collars | Non-current assets | $ | 630,441 | ||||||
Costless Collars | Non-current liabilities | (382,872 | ) | ||||||
Swap Contracts | Non-current liabilities | (222,172 | ) | ||||||
Total Derivative Assets | $ | 25,397 | |||||||
Derivative Liabilities: | |||||||||
Costless Collars | Current liabilities | $ | (194,810 | ) | |||||
Costless Collars | Current assets | 365,679 | |||||||
Swap Contracts | Current liabilities | (377,514 | ) | ||||||
Total Derivative Liabilities | $ | (206,645 | ) | ||||||
Net Derivative Position | $ | (181,248 | ) | ||||||
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2013 | |
Commitments and Contingencies [Abstract] | ' |
COMMITMENTS AND CONTINGENCIES | ' |
NOTE 15 COMMITMENTS AND CONTINGENCIES | |
The Company is subject to litigation claims and governmental and regulatory proceedings arising in the ordinary course of business. These claims and proceedings are subject to uncertainties inherent in any litigation. However, the Company believes that all such litigation matters are not likely to have a material adverse effect on the Company’s financial position, cash flows or results of operations. |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Subsequent Events [Abstract] | ' | ||||||||
SUBSEQUENT EVENTS | ' | ||||||||
NOTE 16 SUBSEQUENT EVENTS | |||||||||
Acreage Acquisitions | |||||||||
On February 13, 2014, the Company acquired approximately 19,500 net acres located in Williams and McKenzie Counties, North Dakota from an unrelated third party for approximately $69.3 million in cash. Net daily production from the acreage is approximately 300 barrels of oil equivalent per day as of January 1, 2014, the effective date of the transaction. The Company is currently determining the appropriate purchase price allocation for this transaction. | |||||||||
In connection with the acquisition, the Company drew $35.0 million on the Wells Fargo Facility on February 13, 2014. | |||||||||
In February 2014, the Company entered into a purchase and sale agreement to acquire approximately 5,900 net acres of undeveloped leasehold located in McKenzie and Billings Counties, North Dakota from an unrelated third party for approximately $10.3 million in cash, or $1,750 per acre. The Company paid a deposit of approximately $2.6 million upon execution of the agreement and the transaction is expected to close on or prior to April 1, 2014. | |||||||||
Derivative Instruments | |||||||||
On February 19, 2014, the Company executed the following NYMEX West Texas Intermediate oil derivative swap contract as indicated below: | |||||||||
Settlement Period | Oil (Bbls) | Fixed Price | |||||||
Oil Swaps | |||||||||
March 1, 2014 – December 31, 2014 | 251,200 | $ | 97.38 | ||||||
Total | 251,200 | $ | 97.38 | ||||||
QUARTERLY_RESULTS_OF_OPERATION
QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Quarterly Results of Operations (Unaudited) [Abstract] | ' | ||||||||||||||||
QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) | ' | ||||||||||||||||
NOTE 17 QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) | |||||||||||||||||
Quarterly data for the years ended December 31, 2013 and 2012 are as follows: | |||||||||||||||||
For the Year Ended December 31, 2013 | |||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||||
Total Revenue | $ | 7,449,377 | $ | 11,240,155 | $ | 14,596,398 | $ | 18,038,575 | |||||||||
Expenses | $ | 10,316,386 | $ | 12,248,325 | $ | 5,813,788 | $ | 26,466,746 | |||||||||
Income (Loss) from Operations | $ | (2,867,009 | ) | $ | (1,008,170 | ) | $ | 8,782,610 | $ | (8,428,171 | ) | ||||||
Other Income (Expense), Net | $ | (3,617,814 | ) | $ | (714,964 | ) | $ | (524,105 | ) | $ | (2,505,272 | ) | |||||
Net Income (Loss) | $ | (6,484,823 | ) | $ | (1,723,134 | ) | $ | 8,258,505 | $ | (10,933,443 | ) | ||||||
Net Loss Attributable to Common Stockholders | $ | (7,101,261 | ) | $ | (7,388,804 | ) | $ | (5,738,584 | ) | $ | (10,933,443 | ) | |||||
Net Cash Provided By (Used For) Operating Activities | $ | 377,822 | $ | 1,838,477 | $ | 7,322,429 | $ | (3,348,288 | ) | ||||||||
Net Cash Provided (Used in) Investing Activities | $ | (13,019,732 | ) | $ | (27,662,815 | ) | $ | 12,954,748 | $ | (47,272,739 | ) | ||||||
Net Cash Provided By (Used In) Financing Activities | $ | 38,243,906 | $ | 62,720,981 | $ | (23,440,287 | ) | $ | 125,348,557 | ||||||||
For the Year Ended December 31, 2012 | |||||||||||||||||
First Quarter | Second Quarter | Third Quarter (1) | Fourth Quarter | ||||||||||||||
Total Revenue | $ | 4,185,898 | $ | 9,014,972 | $ | 5,476,134 | $ | 9,237,542 | |||||||||
Expenses | $ | 3,926,478 | $ | 15,806,435 | $ | 7,835,013 | $ | 65,769,914 | |||||||||
Income (Loss) from Operations | $ | 259,420 | $ | (6,791,463 | ) | $ | (2,358,879 | ) | $ | (56,532,372 | ) | ||||||
Other Income (Expense), Net | $ | (515,790 | ) | $ | (169,445 | ) | $ | 4,353,721 | $ | (541,291 | ) | ||||||
Net Income (Loss) | $ | (256,370 | ) | $ | (6,960,908 | ) | $ | 1,994,842 | $ | (57,073,663 | ) | ||||||
Net Cash Provided By (Used In) Operating Activities | $ | 1,007,098 | $ | 2,329,819 | $ | 4,686,034 | $ | (3,733,184 | ) | ||||||||
Net Cash Provided Used in Investing Activities | $ | (12,176,316 | ) | $ | (3,604,988 | ) | $ | (20,858,711 | ) | $ | (29,812,618 | ) | |||||
Net Cash Provided By Financing Activities | $ | 2,181,567 | $ | 449,347 | $ | 45,341,484 | $ | 10,455,580 | |||||||||
-1 | A reclassification entry was made in 2013 for the Third Quarter of 2012 to reclassify the Gain on Acquisition of Business, Net from Operating Expense to Other Income (Expense), net. |
BASIS_OF_PRESENTATION_AND_SIGN1
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Basis of Presentation and Significant Accounting Policies [Abstract] | ' | ||||||||||||
Reverse Stock Split, Policy | ' | ||||||||||||
Reverse Stock Split | |||||||||||||
On October 22, 2012, a majority of the Company’s shareholders approved a 1-for-7 reverse stock split pursuant to which all shareholders of record received one share of common stock for each seven shares of common stock owned (subject to minor adjustments as a result of fractional shares). This reverse stock split decreased the issued and outstanding common shares by approximately 140,339,000, the outstanding warrants by approximately 6,700,000 and the outstanding stock options by approximately 4,100,000. GAAP requires that the reverse stock split be applied retrospectively to all periods presented. As a result, all stock, warrant and option transactions described herein have been adjusted to reflect the 1-for-7 reverse stock split. | |||||||||||||
Cash and Cash Equivalents, Policy | ' | ||||||||||||
Cash and Cash Equivalents | |||||||||||||
The Company considers highly liquid investments with insignificant interest rate risk and original maturities of three months or less to be cash equivalents. Cash equivalents consist primarily of interest-bearing bank accounts and money market funds. The Company’s cash positions represent assets held in checking and money market accounts. These assets are generally available to the Company on a daily or weekly basis and are highly liquid in nature. Due to the balances being greater than their $250,000 insurance coverage, the Company does not have FDIC coverage on the entire amount of its bank deposits. The Company believes this risk to be minimal. In addition, the Company is subject to Security Investor Protection Corporation protection on a vast majority of its financial assets in the event one of the brokerage firms that the Company utilizes for its investments fails. | |||||||||||||
Restricted Cash, Policy | ' | ||||||||||||
Restricted Cash | |||||||||||||
Restricted cash included in current and long-term assets on the consolidated balance sheets totaled $21 million and $0 at December 31, 2013 and December 31, 2012, respectively. At December 31, 2013, $11 million of restricted cash relates to cash held in escrow to meet certain post-closing requirements related to the sale of oil and natural gas properties during 2013 (see Note 4 – Oil and Natural Gas Properties). The remaining $10 million relate to a drilling commitment agreement entered into pursuant to oil and natural gas leases acquired during the period. | |||||||||||||
Accounts Receivable, Policy | ' | ||||||||||||
Accounts Receivable | |||||||||||||
The Company records estimated oil and natural gas revenue receivable from third parties at its net revenue interest. The Company also reflects costs incurred on behalf of joint interest partners in accounts receivable. Management periodically reviews accounts receivable amounts for collectability and records its allowance for uncollectible receivables under the specific identification method. The Company did not record any allowance for uncollectible receivables during the years ended December 31, 2013, 2012, or 2011. | |||||||||||||
Concentrations of Credit Risk, Policy | ' | ||||||||||||
Concentrations of Credit Risk | |||||||||||||
Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents, accounts receivable and derivative contracts. We control our exposure to credit risk associated with these instruments by (i) placing our assets and other financial interests with creditworthy financial institutions, (ii) maintaining policies over credit extension that include the evaluation of customers’ financial condition and monitoring payment history, although we do not have collateral requirements and (iii) netting derivative assets and liabilities for counterparties where we have a legal right of offset. | |||||||||||||
At December 31, 2013 and 2012, the cash and cash equivalents were concentrated in one financial institution. We periodically assess the financial condition of this institution and believe that any possible credit risk is minimal. | |||||||||||||
During the year ended December 31, 2013, 36% of the Company’s production was sold to two customers. However, the Company does not believe that the loss of a single purchaser, including these two, would materially affect the Company’s business because there are numerous other purchasers in the area in which the Company sells its production. For the years ended December 31, 2013, 2012 and 2011 purchases by the following companies exceeded 10% of the total oil and natural gas revenues of the Company. | |||||||||||||
For the Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Customer A | 24 | % | — | — | |||||||||
Customer B | 12 | % | — | — | |||||||||
Our customers are in the energy industry and they may be similarly affected by changes in economic or other conditions. | |||||||||||||
Full Cost Method, Policy | ' | ||||||||||||
Full Cost Method | |||||||||||||
The Company follows the full cost method of accounting for oil and natural gas operations whereby all costs related to the exploration and development of oil and natural gas properties are initially capitalized into a single cost center (“full cost pool”). Such costs include land acquisition costs, a portion of employee salaries related to property development, geological and geophysical expenses, carrying charges on non-producing properties, costs of drilling directly related to acquisition, and exploration activities. For the years ended December 31, 2013, 2012 and 2011, the Company capitalized $3,443,462, $842,418 and $526,630, respectively, of internal salaries, which included $1,193,960, $582,040 and $418,414, respectively, of stock-based compensation. Internal salaries are capitalized based on employee time allocated to the acquisition of leaseholds and development of oil and natural gas properties. The Company capitalized interest of $362,688 for the year ended December 31, 2012. The Company did not capitalize interest for the years ended December 31, 2013 and 2011. | |||||||||||||
Proceeds from property sales will generally be credited to the full cost pool, with no gain or loss recognized, unless such a sale would significantly alter the relationship between capitalized costs and the proved reserves attributable to these costs. The Company closed property sales during the year ended December 31, 2013 in the Williston Basin and Sand Wash Basin (see Note 4 – Oil and Natural Gas Properties). A gain was recognized on one transaction that resulted in the sale of a significant portion of proved reserves as of the transaction date and significantly altered the relationship between capitalized costs and proved reserves attributable to the Williston Basin. No gain or loss was recognized on any other sales during the period. The Company engages in acreage trades in the Williston Basin, but these trades are generally for acreage that is similar both in terms of geographic location and potential resource value. | |||||||||||||
The Company assesses all items classified as unproved property on a quarterly basis for possible impairment or reduction in value. The assessment includes consideration of the following factors, among others: intent to drill, remaining lease term, geological and geophysical evaluations, drilling results and activity, the assignment of proved reserves, and the economic viability of development if proved reserves are assigned. During any period in which these factors indicate an impairment, the cumulative drilling costs incurred to date for such property and all or a portion of the associated leasehold costs are transferred to the full cost pool and are then subject to depletion and amortization. For the years ended December 31, 2013, 2012 and 2011, the Company included $3,020,485, $3,625,209 and $6,983,125, respectively, related to expiring leases within costs subject to the depletion calculation. | |||||||||||||
Capitalized costs associated with impaired properties and properties having proved reserves, estimated future development costs, and asset retirement costs under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 410-20-25 are depleted and amortized on the unit-of-production method based on the estimated gross proved reserves. The costs of unproved properties are withheld from the depletion base until such time as they are developed, impaired, or abandoned. | |||||||||||||
Under the full cost method of accounting, capitalized oil and natural gas property costs less accumulated depletion, net of deferred income taxes, may not exceed a ceiling amount equal to the present value, discounted at 10%, of estimated future net revenues from proved oil and natural gas reserves plus the cost of unproved properties not subject to amortization (without regard to estimates of fair value), or estimated fair value, if lower, of unproved properties that are subject to amortization. Should capitalized costs exceed this ceiling, which is tested on a quarterly basis, an impairment is recognized. The present value of estimated future net revenues is computed by applying prices based on a 12-month unweighted average of the oil and natural gas prices in effect on the first day of each month, less estimated future expenditures to be incurred in developing and producing the proved reserves (assuming the continuation of existing economic conditions), less any applicable future taxes. Based on calculated reserves at December 31, 2013, 2012 and 2011, the unamortized costs of the Company’s oil and natural gas properties exceeded the ceiling test limit by $0, $51,709,548 and $0 respectively. The Company also recognized that oil and natural gas properties exceeded the ceiling test limit as of June 30, 2012 by $10,191,234. As a result, the Company was required to record impairment of the net capitalized costs of its oil and natural gas properties in the amount of $0, $61,900,692 and $0 for the years ended December 31, 2013, 2012, and 2011, respectively. | |||||||||||||
Oil and Natural Gas Reserve Quantities, Policy | ' | ||||||||||||
Oil and Natural Gas Reserve Quantities | |||||||||||||
Emerald’s estimate of proved reserves is based on the quantities of oil and natural gas that engineering and geological analyses demonstrate, with reasonable certainty, to be recoverable from established reservoirs in the future under current operating and economic parameters. Emerald’s reserve estimates are prepared by the independent engineering firm, Netherland, Sewell & Associates, Inc. The estimate of Emerald’s proved reserves as of December 31, 2013, 2012 and 2011 have been prepared and presented in accordance with SEC rules and accounting standards. | |||||||||||||
Reserves and their relation to estimated future net cash flows impact Emerald’s depletion and impairment calculations. As a result, adjustments to depletion and impairment are made concurrently with changes to reserve estimates. Emerald prepares its reserve estimates, and the projected cash flows derived from these reserve estimates, in accordance with SEC guidelines on a quarterly basis. The independent engineering firm described above adheres to the same guidelines when preparing the year-end reserve report. The accuracy of Emerald’s reserve estimates is a function of many factors including the quality and quantity of available data, the interpretation of that data, the accuracy of various mandated economic assumptions, and the judgments of the individuals preparing the estimates. | |||||||||||||
Emerald’s proved reserve estimates are a function of many assumptions, all of which could deviate significantly from actual results. As such, reserve estimates may materially vary from the ultimate quantities of oil and natural gas eventually recovered. | |||||||||||||
Other Property and Equipment, Policy | ' | ||||||||||||
Other Property and Equipment | |||||||||||||
Property and equipment that are not oil and natural gas properties are recorded at cost and depreciated using the straight-line method over their estimated useful lives of three to seven years. Expenditures for replacements, renewals, and betterments are capitalized. Maintenance and repairs are charged to expense as incurred. Depreciation expense was $144,492, $53,818 and $30,831 for the years ended December 31, 2013, 2012 and 2011, respectively. | |||||||||||||
ASC 360-10-35-21 requires that long-lived assets, other than oil and natural gas properties, be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The determination of impairment is based upon expectations of undiscounted future cash flows, before interest, of the related asset. If the carrying value of the asset exceeds the undiscounted future cash flows, the impairment would be computed as the difference between the carrying value of the asset and the fair value. The Company has not recognized any impairment losses on non-oil and natural gas long lived assets. | |||||||||||||
Asset Retirement Obligations, Policy | ' | ||||||||||||
Asset Retirement Obligations | |||||||||||||
The Company records the fair value of a liability for an asset retirement obligation in the period in which the well is spud or the asset is acquired and a corresponding increase in the carrying amount of the related long-lived asset. The liability is accreted to its present value each period, and the capitalized cost is depleted using the units of production method. If the liability is settled for an amount other than the recorded amount, a gain or loss is recognized. | |||||||||||||
Revenue Recognition and Natural Gas Balancing, Policy | ' | ||||||||||||
Revenue Recognition and Natural Gas Balancing | |||||||||||||
The Company recognizes oil and natural gas revenues from its interests in producing wells when production is delivered and title has transferred to the purchaser, to the extent the selling price is reasonably determinable. The Company uses the sales method of accounting for balancing of natural gas production and would recognize a liability if the existing proven reserves were not adequate to cover the current imbalance situation. As of December 31, 2013 and 2012, the Company’s natural gas production was in balance, i.e., its cumulative portion of natural gas production taken and sold from wells in which it has an interest equaled the Company’s entitled interest in natural gas production from those wells. | |||||||||||||
Stock-Based Compensation, Policy | ' | ||||||||||||
Stock-Based Compensation | |||||||||||||
The Company accounts for stock-based compensation under the provisions of ASC 718-10-55. The Company recognizes stock-based compensation expense in the financial statements over the vesting period of equity-classified employee stock-based compensation awards based on the grant date fair value of the awards, net of estimated forfeitures. For options and warrants the Company uses the Black-Scholes option valuation model to calculate the fair value of stock based compensation awards at the date of grant. Option pricing models require the input of highly subjective assumptions, including the expected price volatility. For the stock options and warrants granted, the Company has used a variety of comparable and peer companies to determine the expected volatility input based on the expected term of the options. The Company believes the use or peer company data fairly represents the expected volatility it would experience if it were in the oil and natural gas industry over the expected term of the options. The Company used the simplified method to determine the expected term of the options due to the lack of historical data. Changes in these assumptions can materially affect the fair value estimate. | |||||||||||||
On May 27, 2011, the shareholders of the Company approved the 2011 Equity Incentive Plan (the “2011 Plan”), under which 714,286 shares of common stock were reserved. On October 22, 2012, the shareholders of the Company approved an amendment to the 2011 Plan to increase the number of shares available for issuance under the 2011 Plan to 3,500,000 shares. On July 10, 2013, the shareholders of the Company approved an amendment to the 2011 Plan to increase the number of shares authorized for issuance under the 2011 Plan to 9,800,000 shares. The purpose of the 2011 Plan is to promote the success of the Company and its affiliates by facilitating the employment and retention of competent personnel and by furnishing incentives to those officers, directors and employees upon whose efforts the success of the Company and its affiliates will depend to a large degree. It is the intention of the Company to carry out the 2011 Plan through the granting of incentive stock options, nonqualified stock options, restricted stock awards, restricted stock unit awards, performance awards and stock appreciation rights. As of December 31, 2013, 1,101,726 stock options and 4,068,490 shares of common stock and restricted stock units had been issued to officers, directors and employees under the 2011 Plan net of cancelations and forfeitures, including 2,082,187 nonvested restricted stock units. As of December 31, 2013, there are 4,629,784 shares available for issuance under the 2011 Plan. | |||||||||||||
Income Taxes, Policy | ' | ||||||||||||
Income Taxes | |||||||||||||
The Company accounts for income taxes under ASC 740-10-30. Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Accounting standards require the consideration of a valuation allowance for deferred tax assets if it is “more likely than not” that some component or all of the benefits of deferred tax assets will not be realized. | |||||||||||||
The tax effects from an uncertain tax position can be recognized in the financial statements only if the position is more likely than not of being sustained if the position were to be challenged by a taxing authority. The Company has examined the tax positions taken in its tax returns and determined that there are no uncertain tax positions. As a result, the Company has recorded no uncertain tax liabilities in its consolidated balance sheet. | |||||||||||||
Net Income (Loss) Per Common Share, Policy | ' | ||||||||||||
Net Income (Loss) Per Common Share | |||||||||||||
Basic net income (loss) per common share is based on the net income (loss) divided by the weighted average number of common shares outstanding during the period. Diluted earnings per share are computed using the weighted average number of common shares plus dilutive common share equivalents outstanding during the period using the treasury stock method. In the computation of diluted earnings per share, excess tax benefits that would be created upon the assumed vesting of nonvested restricted shares or the assumed exercise of stock options (i.e., hypothetical excess tax benefits) are included in the assumed proceeds component of the treasury stock method to the extent that such excess tax benefits are more likely than not to be realized. When a loss from continuing operations exists, all potentially dilutive securities are anti-dilutive and are therefore excluded from the computation of diluted earnings per share. As the Company had losses for the years ended December 31, 2013, 2012 and 2011, the potentially dilutive shares were anti-dilutive and were thus not included in the net loss per share calculation. | |||||||||||||
As of December 31, 2013, (i) 2,082,191 nonvested restricted stock units were issued and outstanding and represent potentially dilutive shares; (ii) 464,273 stock options that were issued and presently exercisable and represent potentially dilutive shares; (iii) 694,587 stock options that were granted but are not presently exercisable and represent potentially dilutive shares; (iv) 5,114,633 warrants were issued and presently exercisable, which have an exercise price of $5.77 and represent dilutive shares; (v) 223,293 warrants that were issued and presently exercisable, which have an exercise price of $6.86 and represent potentially dilutive shares; and (vi) 892,858 warrants that were issued and presently exercisable, which have an exercise price of $49.70 and represent potentially dilutive shares. | |||||||||||||
Derivative and Other Financial Instruments, Policy | ' | ||||||||||||
Derivative and Other Financial Instruments | |||||||||||||
Commodity Derivative Instruments | |||||||||||||
The Company has entered into commodity derivative instruments, utilizing oil derivative swap contracts to reduce the effect of price changes on a portion of future oil production. The Company’s commodity derivative instruments are measured at fair value and are included in the consolidated balance sheet as derivative assets and liabilities. Net gains and losses are recorded based on the changes in the fair values of the derivative instruments. The Company’s valuation estimate takes into consideration the counterparties’ credit worthiness, the Company’s credit worthiness, and the time value of money. The consideration of the factors results in an estimated exit price for each derivative asset or liability under a market place participant’s view. Management believes that this approach provides a reasonable, non-biased, verifiable, and consistent methodology for valuing commodity derivative instruments (see Note 14 – Derivative Instruments and Price Risk Management). | |||||||||||||
Warrant Liability | |||||||||||||
From time to time, the Company may have financial instruments such as warrants that may be classified as liabilities when either (a) the holders possess rights to net cash settlement, (b) physical or net equity settlement is not in the Company’s control, or (c) the instruments contain other provisions that causes the Company to conclude that they are not indexed to the Company’s equity. Such instruments are initially recorded at fair value and subsequently adjusted to fair value at the end of each reporting period through earnings. | |||||||||||||
As a part of the securities purchase agreement (“Securities Purchase Agreements”) with affiliates of White Deer Energy L.P. (“White Deer Energy”) (see Note 6 – Preferred and Common Stock), the Company issued warrants that contain a put and other liability type provisions. Accordingly, these warrants are accounted for as a liability. This warrant liability is accounted for at fair value with changes in fair value reported in the consolidated statement of operations. | |||||||||||||
New Accounting Pronouncements, Policy | ' | ||||||||||||
New Accounting Pronouncements | |||||||||||||
From time to time, new accounting pronouncements are issued by FASB that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s consolidated financial statements upon adoption. | |||||||||||||
Joint Ventures, Policy | ' | ||||||||||||
Joint Ventures | |||||||||||||
The consolidated financial statements as of December 31, 2013, 2012 and 2011 include the accounts of the Company and its proportionate share of the assets, liabilities, and results of operations of the joint ventures it is involved in. | |||||||||||||
Use of Estimates, Policy | ' | ||||||||||||
Use of Estimates | |||||||||||||
The preparation of consolidated financial statements under GAAP in the United States 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. The most significant estimates relate to proved oil and natural gas reserve volumes, future development costs, estimates relating to certain oil and natural gas revenues and expenses, fair value of derivative instruments, valuation of share-based compensation and the valuation of deferred income taxes. Actual results may differ from those estimates. | |||||||||||||
Industry Segment and Geographic Information, Policy | ' | ||||||||||||
Industry Segment and Geographic Information | |||||||||||||
The Company operates in one industry segment, which is the exploration, development and production of oil and natural gas with all of the Company’s operational activities having been conducted in the U.S. The Company’s current operational activities and the Company’s consolidated revenues are generated from markets exclusively in the U.S., and the Company has no long lived assets located outside the U.S. | |||||||||||||
Reclassifications, Policy | ' | ||||||||||||
Reclassifications | |||||||||||||
Certain reclassifications have been made to prior periods’ reported amounts in order to conform to the current period presentation. These reclassifications did not impact the Company’s net loss, stockholders’ equity or cash flows. |
BASIS_OF_PRESENTATION_AND_SIGN2
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Basis of Presentation and Significant Accounting Policies [Abstract] | ' | ||||||||||||
Schedule of Concentration Risk by Risk Factor | ' | ||||||||||||
For the Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Customer A | 24 | % | — | — | |||||||||
Customer B | 12 | % | — | — |
ACQUISITION_OF_BUSINESS_Tables
ACQUISITION OF BUSINESS (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Acquisition of Business [Abstract] | ' | ||||||||
Schedule of Business Acquisition | ' | ||||||||
A summary of the acquisition is below: | |||||||||
(in thousands) | |||||||||
Proved Oil and Natural Gas Properties | $ | 6,839 | |||||||
Unproved Oil and Natural Gas Properties | 33,948 | ||||||||
Other Assets | 111 | ||||||||
Debt Assumed | (20,303 | ) | |||||||
Net Assets Acquired | 20,595 | ||||||||
Equity Issued to Emerald Oil NL | (13,381 | ) | |||||||
Gain on Acquisition | 7,214 | ||||||||
Less: Acquisition Costs | (1,456 | ) | |||||||
Gain on Acquisition, net | $ | 5,758 | |||||||
Schedule of Business Acquisition, Pro Forma Results | ' | ||||||||
The pro forma amounts are not necessarily indicative of the results that may be reported in the future: | |||||||||
Years Ended December 31, | |||||||||
2012 | 2011 | ||||||||
Revenues | $ | 27,968,701 | $ | 8,569,107 | |||||
Net loss | $ | (64,707,199 | ) | $ | (1,977,350 | ) | |||
Net loss per share – basic and diluted | $ | (4.74 | ) | $ | (0.20 | ) | |||
Weighted Average Shares Outstanding – Basic and Diluted | 13,639,626 | 9,674,332 | |||||||
OIL_AND_NATURAL_GAS_PROPERTIES1
OIL AND NATURAL GAS PROPERTIES (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Oil and Natural Gas Properties [Abstract] | ' | ||||
Schedule of Oil and Gas Property Net Sales Price Allocation | ' | ||||
Following this methodology, the following table represents a net sales price allocation of the transaction (in thousands): | |||||
Sale price | $ | 111,090 | |||
Add: Disposition of asset retirement obligations | 309 | ||||
Less: Sale expenses | (1,168 | ) | |||
Purchase price adjustments | (1,520 | ) | |||
Sale price, net | $ | 108,711 | |||
Proved oil and natural gas properties | $ | 137,279 | |||
Accumulated depletion | (49,508 | ) | |||
Unproved oil and natural gas properties | 13,568 | ||||
Gain on sale | 7,372 | ||||
Sale price, net | $ | 108,711 | |||
PREFERRED_AND_COMMON_STOCK_Tab
PREFERRED AND COMMON STOCK (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Preferred and Common Stock [Abstract] | ' | ||||||||
Schedule of Components of Preferred Stock Transaction | ' | ||||||||
A summary of the preferred stock transaction components as of December 31, 2013 and the issuance date is provided below: | |||||||||
31-Dec-13 | February 19, 2013 | ||||||||
(issuance date) | |||||||||
Series A Preferred Stock | $ | — | $ | 41,369,000 | |||||
Series B Preferred Stock | 5,000 | 5,000 | |||||||
Warrant Liability | 15,703,000 | 8,626,000 | |||||||
Total | $ | 15,708,000 | $ | 50,000,000 | |||||
Schedule of Restricted Stock Units and Restricted Stock Shares Outstanding | ' | ||||||||
A summary of the restricted stock units and restricted stock shares outstanding is as follows: | |||||||||
Number of Shares | Weighted | ||||||||
Average Grant | |||||||||
Date Fair Value | |||||||||
Non-vested restricted stock and restricted stock units at January 1, 2011 | — | $ | — | ||||||
Granted | — | — | |||||||
Canceled | — | — | |||||||
Forfeited | — | ||||||||
Vested | — | — | |||||||
Non-vested restricted stock and restricted stock units at December 31, 2011 | — | — | |||||||
Granted | 1,919,135 | 4.93 | |||||||
Canceled | — | ||||||||
Forfeited | (53,577 | ) | 21 | ||||||
Vested | (17,857 | ) | 21 | ||||||
Non-vested restricted stock and restricted stock units at December 31, 2012 | 1,847,701 | 4.31 | |||||||
Granted | 1,242,505 | 7.1 | |||||||
Canceled | (70,642 | ) | 4.19 | ||||||
Forfeited | (302,016 | ) | 4.86 | ||||||
Vested | (635,361 | ) | 4.88 | ||||||
Non-vested restricted stock and restricted stock units at December 31, 2013 | 2,082,187 | $ | 5.73 | ||||||
STOCK_OPTIONS_AND_WARRANTS_Tab
STOCK OPTIONS AND WARRANTS (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Stock Options and Warrants [Abstract] | ' | ||||||||||||||||
Schedule of Stock Options, Roll Forward | ' | ||||||||||||||||
A summary of options for the years ended December 31, 2013, 2012, and 2011 is as follows: | |||||||||||||||||
Number of | Weighted | Remaining | Intrinsic | ||||||||||||||
Options | Average | Contractual | Value | ||||||||||||||
Exercise | Term | ||||||||||||||||
Price | (in Years) | ||||||||||||||||
Outstanding at January 1, 2011 | 139,857 | 20.51 | 8.9 | 2,420,660 | |||||||||||||
Granted | 39,284 | 22.4 | — | — | |||||||||||||
Exercised | (571 | ) | 29.68 | — | — | ||||||||||||
Forfeited or Expired | (28,570 | ) | 19.32 | — | — | ||||||||||||
Outstanding at December 31, 2011 | 150,000 | 20.44 | 7.2 | — | |||||||||||||
Granted | 685,713 | 8.11 | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Forfeited or Expired | — | — | — | — | |||||||||||||
Outstanding at December 31, 2012 | 835,713 | 10.43 | 7.7 | — | |||||||||||||
Granted | 505,301 | 7.18 | — | — | |||||||||||||
Exercised | (75,000 | ) | 4.43 | — | — | ||||||||||||
Forfeited or Expired | (107,143 | ) | 16.54 | — | — | ||||||||||||
Outstanding at December 31, 2013 | 1,158,871 | $ | 8.9 | 4.75 | $ | — | |||||||||||
Stock Options Exercisable at December 31, 2011 | 51,786 | $ | 18.9 | 6.9 | $ | 302,750 | |||||||||||
Stock Options Exercisable at December 31, 2012 | 424,997 | $ | 11.39 | 5.9 | $ | 121,500 | |||||||||||
Stock Options Exercisable at December 31, 2013 | 464,273 | $ | 11.12 | 3.1 | $ | 356,024 | |||||||||||
Schedule of Nonvested Options | ' | ||||||||||||||||
A summary of the status of the Company’s nonvested options as of December 31, 2013 and changes during the year then ended is as follows: | |||||||||||||||||
Number of | Weighted-Average | ||||||||||||||||
Options | Grant-Date | ||||||||||||||||
Fair Value | |||||||||||||||||
Nonvested at December 31, 2011 | 98,214 | $ | 13.09 | ||||||||||||||
Granted | 685,713 | 4.78 | |||||||||||||||
Vested | (373,211 | ) | 6.14 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Nonvested at December 31, 2012 | 410,716 | 5.87 | |||||||||||||||
Granted | 505,301 | 7.18 | |||||||||||||||
Vested | (200,000 | ) | 10.47 | ||||||||||||||
Forfeited | (21,430 | ) | 12.39 | ||||||||||||||
Nonvested at December 31, 2013 | 694,587 | $ | 7.41 | ||||||||||||||
Schedule of Stock Options, Additional Information | ' | ||||||||||||||||
For the year ended December 31, 2013, 2012 and 2011, other information pertaining to stock options was as follows: | |||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||
Weighted-average per share grant-date fair value of stock options granted | $ | 4.43 | $ | 4.62 | $ | 14.35 | |||||||||||
Total intrinsic value of options exercised | 211,250 | — | 3,520 | ||||||||||||||
Total grant-date fair value of stock options vested during the year | 2,093,999 | 2,159,307 | 349,875 | ||||||||||||||
Schedule of Stock Options Granted, Valuation Assumptions | ' | ||||||||||||||||
The following assumptions were used for the Black-Scholes model to value the options granted during the years ended December 31, 2013, 2012 and 2011. | |||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||
Risk free rates | 0.48% to 2.12% | 0.17% to 1.20% | 0.91% to 0.96% | ||||||||||||||
Dividend Yield | 0% | 0% | 0% | ||||||||||||||
Expected volatility | 64.64% to 79.50% | 69.70% to 78.99% | 85.90% to 86.17% | ||||||||||||||
Weighted average expected life | 5 years | 4 years | 3 years | ||||||||||||||
Schedule of Warrants, Roll Forward | ' | ||||||||||||||||
A summary of warrants granted to employees, directors and consultants for the years ended December 31, 2013, 2012 and 2011 is as follows: | |||||||||||||||||
Number of | Weighted | Remaining | Intrinsic Value | ||||||||||||||
Warrants | Average | Contractual | |||||||||||||||
Exercise Price | Term (in Years) | ||||||||||||||||
Outstanding at December 31, 2010 | 223,293 | $ | 6.86 | 9.5 | $ | 6,908,681 | |||||||||||
Granted | — | — | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Outstanding at December 31, 2011 | 223,293 | 6.86 | 8 | 2,458,251 | |||||||||||||
Granted | — | — | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Outstanding at December 31, 2012 | 223,293 | 6.86 | 7 | — | |||||||||||||
Granted | — | — | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Outstanding at December 31, 2013 | 223,293 | $ | 6.86 | 7 | $ | 178,634 | |||||||||||
Schedule of Warrants, Additional Information | ' | ||||||||||||||||
For the years ended December 31, 2013, 2012 and 2011, other information pertaining to warrants was as follows: | |||||||||||||||||
2013 (1) | 2012 | 2011 | |||||||||||||||
Weighted-average grant-date fair value of warrants granted | $ | 1.69 | $ | — | $ | 2.02 | |||||||||||
Total intrinsic value of warrants exercised | $ | — | $ | — | $ | — | |||||||||||
Total grant-date fair value of warrants vested during the year | $ | — | $ | — | $ | 12,625,000 | |||||||||||
-1 | See Note 6 – Common and Preferred Stock – Preferred Stock for details on the warrants issued on February 19, 2013 associated with the preferred stock transaction. | ||||||||||||||||
Schedule of Warrants, Valuation Assumptions | ' | ||||||||||||||||
The following assumptions were used for the Black-Scholes model to value the warrants granted during the years ended December 31, 2013, 2012 and 2011. | |||||||||||||||||
2013 (1) | 2012 | 2011 | |||||||||||||||
Risk free rates | — | — | 2.02 | % | |||||||||||||
Dividend yield | — | — | 0 | % | |||||||||||||
Expected volatility | — | — | 75.52 | % | |||||||||||||
Weighted average expected life | — | — | 5 years | ||||||||||||||
-1 | See Note 14 – Derivative Instruments and Price Risk Management – Warrant Liability for the method and assumptions used to value the warrants issued on February 19, 2013 associated with the preferred stock transaction. | ||||||||||||||||
Schedule of Status of Warrants Outstanding | ' | ||||||||||||||||
The table below reflects the status of warrants outstanding at December 31, 2013: | |||||||||||||||||
Warrants | Exercise Price | Expiration Date | |||||||||||||||
1-Dec-09 | 37,216 | $ | 6.86 | 1-Dec-19 | |||||||||||||
31-Dec-09 | 186,077 | $ | 6.86 | 31-Dec-19 | |||||||||||||
8-Feb-11 | 892,858 | $ | 49.7 | 8-Feb-16 | |||||||||||||
19-Feb-13 | 5,114,633 | $ | 5.77 | 31-Dec-19 | |||||||||||||
Total | 6,230,784 | ||||||||||||||||
ASSET_RETIREMENT_OBLIGATION_Ta
ASSET RETIREMENT OBLIGATION (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Asset Retirement Obligation [Abstract] | ' | ||||||||||||
Schedule of Change in Asset Retirement Obligation | ' | ||||||||||||
The following table summarizes the Company’s asset retirement obligation transactions for the years ended December 31, 2013, 2012 and 2011: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Beginning Asset Retirement Obligation | $ | 296,074 | $ | 116,119 | $ | 10,522 | |||||||
Revision of Previous Estimates | 165,968 | — | — | ||||||||||
Liabilities Incurred or Acquired | 510,271 | 164,967 | 100,715 | ||||||||||
Accretion of Discount on Asset Retirement Obligations | 32,449 | 14,988 | 4,882 | ||||||||||
Liabilities Associated with Properties Sold | (312,625 | ) | — | — | |||||||||
Ending Asset Retirement Obligation | $ | 692,137 | $ | 296,074 | $ | 116,119 | |||||||
ACCRUED_LIABILITIES_Tables
ACCRUED LIABILITIES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Accrued Liabilities [Abstract] | ' | ||||||||
Schedule of Accrued Liabilities | ' | ||||||||
The Company’s accrued liabilities consist of the following: | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Accrued Transaction Adjustments | $ | 2,067,150 | $ | — | |||||
Oil and Natural Gas Revenue Payable | 7,451,394 | 4,559 | |||||||
Other General and Administrative Expenses | 2,303,185 | 415,930 | |||||||
Total Accrued Liabilities | $ | 11,821,729 | $ | 420,489 | |||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Taxes [Abstract] | ' | ||||||||||||
Schedule of Income Tax Expense (Benefit) | ' | ||||||||||||
The income tax expense (benefit) for the year ended December 31, 2013, 2012, and 2011 consists of the following: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Current Income Taxes | $ | — | $ | — | $ | — | |||||||
Deferred Income Taxes | |||||||||||||
Federal | — | — | — | ||||||||||
State | — | — | — | ||||||||||
Total Expense | $ | — | $ | — | $ | — | |||||||
Schedule of Income Tax Expense Reconciliation | ' | ||||||||||||
Reconciliation of reported amount of income tax expense: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Loss Before Taxes | $ | (10,882,895 | ) | $ | (62,296,099 | ) | $ | (1,354,054 | ) | ||||
Federal Statutory Rate | 35 | % | 35 | % | 35 | % | |||||||
Benefit Computed at Federal Statutory Rates | (3,809,013 | ) | (21,803,635 | ) | (473,919 | ) | |||||||
State Benefit, Net of Federal Benefit | (102,503 | ) | (1,969,364 | ) | (68,416 | ) | |||||||
Effects of: | |||||||||||||
Warrant Revaluation | 2,476,950 | — | — | ||||||||||
Nondeductible Expenses | 366,203 | 10,941 | — | ||||||||||
Other | 125,956 | (119,872 | ) | 48,919 | |||||||||
Change in Valuation Allowance | 942,407 | 23,881,930 | 493,416 | ||||||||||
Reported Provision | $ | — | $ | — | $ | — | |||||||
Schedule of Deferred Tax Assets | ' | ||||||||||||
The components of the Company’s deferred tax asset were as follows: | |||||||||||||
Year Ended December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Deferred Tax Assets: | |||||||||||||
Net Operating Loss Carryforwards (NOLs) | $ | 36,382,177 | $ | 19,654,346 | |||||||||
Stock-based Compensation | 3,245,308 | 1,672,296 | |||||||||||
Derivatives | 323,190 | 68,438 | |||||||||||
Equity Investments | 116,886 | 116,488 | |||||||||||
Oil and Natural Gas Properties | — | 6,522,543 | |||||||||||
Total Deferred Tax Assets | 40,067,561 | 28,034,111 | |||||||||||
Deferred Tax Liabilities: | |||||||||||||
Oil and Natural Gas Properties | 11,093,181 | — | |||||||||||
Other | 7,353 | 9,491 | |||||||||||
Total Deferred Tax Liabilities | 11,100,534 | 9,491 | |||||||||||
Less: Valuation Allowance | (28,967,027 | ) | (28,024,620 | ) | |||||||||
Total Net Deferred Tax Asset | $ | — | $ | — | |||||||||
FAIR_VALUE_Tables
FAIR VALUE (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Fair Value [Abstract] | ' | ||||||||||||
Schedule of Fair Value of Financial Instruments Measured on Recurring Basis | ' | ||||||||||||
The following schedule summarizes the valuation of financial instruments measured at fair value on a recurring basis in the consolidated balance sheet as of December 31, 2013: | |||||||||||||
Fair Value Measurements at | |||||||||||||
December 31, 2013 Using | |||||||||||||
Quoted Prices In Active | Significant Other Observable | Significant Unobservable | |||||||||||
Inputs | Inputs | ||||||||||||
Markets for Identical | (Level 2) | (Level 3) | |||||||||||
Assets | |||||||||||||
(Level 1) | |||||||||||||
Warrant Liability – Long Term Liability | $ | — | $ | — | $ | (15,703,000 | ) | ||||||
Commodity Derivatives – Current Liability (oil swaps) | (921,401 | ) | |||||||||||
Commodity Derivatives – Long Term Asset (oil swaps) | — | 68,396 | — | ||||||||||
Total | $ | — | $ | (853,005 | ) | $ | (15,703,000 | ) | |||||
The following schedule summarizes the valuation of financial instruments measured at fair value on a recurring basis in the consolidated balance sheet as of December 31, 2012: | |||||||||||||
Fair Value Measurements at | |||||||||||||
December 31, 2012 Using | |||||||||||||
Quoted Prices In Active | Significant Other Observable | Significant Unobservable | |||||||||||
Markets for Identical | Inputs | Inputs | |||||||||||
Assets | (Level 2) | (Level 3) | |||||||||||
(Level 1) | |||||||||||||
Commodity Derivatives – Current Liability (oil swaps and collars) | $ | — | $ | (206,645 | ) | $ | — | ||||||
Commodity Derivatives – Long Term Asset (oil swaps and collars) | — | 25,397 | — | ||||||||||
Total | $ | — | $ | (181,248 | ) | $ | — | ||||||
Schedule of Fair Value of Warrants Liability Measured on Recurring Basis, Unobservable Inputs | ' | ||||||||||||
A rollforward of Level 3 warrants liability measured at fair value using Level 3 on a recurring basis is as follows (in thousands): | |||||||||||||
Balance, at December 31, 2012 | $ | — | |||||||||||
Purchases, issuances, and settlements | (8,626,000 | ) | |||||||||||
Change in Fair Value of Warrant Liability | (7,077,000 | ) | |||||||||||
Transfers | — | ||||||||||||
Balance, at December 31, 2013 | $ | (15,703,000 | ) | ||||||||||
DERIVATIVE_INSTRUMENTS_AND_PRI1
DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Derivative Instruments and Price Risk Management [Abstract] | ' | ||||||||
Schedule of Open Commodity Swap Contracts | ' | ||||||||
The following table reflects open commodity swap contracts as of December 31, 2013, the associated volumes and the corresponding weighted average NYMEX reference price: | |||||||||
Settlement Period | Oil (Bbls) | Fixed Price | |||||||
Oil Swaps | |||||||||
January 1, 2014 – December 31, 2014 | 103,267 | $ | 91 | ||||||
January 1, 2014 – December 31, 2014 | 31,000 | 90.05 | |||||||
January 1, 2014 – December 31, 2014 | 79,000 | 94.3 | |||||||
January 1, 2014 – December 31, 2014 | 44,200 | 94.18 | |||||||
2014 Total/Average | 257,467 | $ | 92.44 | ||||||
January 1, 2015 – February 28, 2015 | 13,876 | $ | 91 | ||||||
January 1, 2015 – February 28, 2015 | 5,000 | 90.05 | |||||||
January 1, 2015 – February 28, 2015 | 10,000 | 94.3 | |||||||
January 1, 2015 – February 28, 2015 | 8,100 | 94.18 | |||||||
2015 Total/Average | 36,976 | $ | 92.46 | ||||||
Schedule of a Reconciliation of the Changes in Fair Value of Commodity Derivatives | ' | ||||||||
The following table sets forth a reconciliation of the changes in fair value of the Company’s commodity derivatives for the years ended December 31, 2013 and 2012. | |||||||||
2013 | 2012 | ||||||||
Beginning fair value of commodity derivatives | $ | (181,248 | ) | $ | — | ||||
Total losses on oil derivatives | (2,656,535 | ) | (215,439 | ) | |||||
Cash settlements paid on oil derivatives | 1,984,778 | 34,191 | |||||||
Ending fair value of commodity derivatives | $ | (853,005 | ) | $ | (181,248 | ) | |||
Schedule of Derivative Instruments in Statement of Financial Position | ' | ||||||||
At December 31, 2013, the Company had derivative financial instruments recorded on the consolidated balance sheet as set forth below: | |||||||||
Type of Contract | Balance Sheet Location | ||||||||
Derivative Assets (Liabilities): | |||||||||
Swap Contracts | Current liabilities | $ | (921,401 | ) | |||||
Swap Contracts | Non-current assets | 68,396 | |||||||
Warrant Liability | Non-current liabilities | (15,703,000 | ) | ||||||
Total Derivative Liabilities | $ | (16,556,005 | ) | ||||||
At December 31, 2012, the Company had derivative financial instruments recorded on the consolidated balance sheet as set forth below: | |||||||||
Type of Contract | Balance Sheet Location | ||||||||
Derivative Assets: | |||||||||
Costless Collars | Non-current assets | $ | 630,441 | ||||||
Costless Collars | Non-current liabilities | (382,872 | ) | ||||||
Swap Contracts | Non-current liabilities | (222,172 | ) | ||||||
Total Derivative Assets | $ | 25,397 | |||||||
Derivative Liabilities: | |||||||||
Costless Collars | Current liabilities | $ | (194,810 | ) | |||||
Costless Collars | Current assets | 365,679 | |||||||
Swap Contracts | Current liabilities | (377,514 | ) | ||||||
Total Derivative Liabilities | $ | (206,645 | ) | ||||||
Net Derivative Position | $ | (181,248 | ) | ||||||
SUBSEQUENT_EVENTS_Tables
SUBSEQUENT EVENTS (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Subsequent Events [Abstract] | ' | ||||||||
Schedule of Oil Derivative Swap Contract | ' | ||||||||
On February 19, 2014, the Company executed the following NYMEX West Texas Intermediate oil derivative swap contract as indicated below: | |||||||||
Settlement Period | Oil (Bbls) | Fixed Price | |||||||
Oil Swaps | |||||||||
March 1, 2014 – December 31, 2014 | 251,200 | $ | 97.38 | ||||||
Total | 251,200 | $ | 97.38 | ||||||
QUARTERLY_RESULTS_OF_OPERATION1
QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Quarterly Results of Operations (Unaudited) [Abstract] | ' | ||||||||||||||||
Schedule of Quarterly Financial Information | ' | ||||||||||||||||
Quarterly data for the years ended December 31, 2013 and 2012 are as follows: | |||||||||||||||||
For the Year Ended December 31, 2013 | |||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||||
Total Revenue | $ | 7,449,377 | $ | 11,240,155 | $ | 14,596,398 | $ | 18,038,575 | |||||||||
Expenses | $ | 10,316,386 | $ | 12,248,325 | $ | 5,813,788 | $ | 26,466,746 | |||||||||
Income (Loss) from Operations | $ | (2,867,009 | ) | $ | (1,008,170 | ) | $ | 8,782,610 | $ | (8,428,171 | ) | ||||||
Other Income (Expense), Net | $ | (3,617,814 | ) | $ | (714,964 | ) | $ | (524,105 | ) | $ | (2,505,272 | ) | |||||
Net Income (Loss) | $ | (6,484,823 | ) | $ | (1,723,134 | ) | $ | 8,258,505 | $ | (10,933,443 | ) | ||||||
Net Loss Attributable to Common Stockholders | $ | (7,101,261 | ) | $ | (7,388,804 | ) | $ | (5,738,584 | ) | $ | (10,933,443 | ) | |||||
Net Cash Provided By (Used For) Operating Activities | $ | 377,822 | $ | 1,838,477 | $ | 7,322,429 | $ | (3,348,288 | ) | ||||||||
Net Cash Provided (Used in) Investing Activities | $ | (13,019,732 | ) | $ | (27,662,815 | ) | $ | 12,954,748 | $ | (47,272,739 | ) | ||||||
Net Cash Provided By (Used In) Financing Activities | $ | 38,243,906 | $ | 62,720,981 | $ | (23,440,287 | ) | $ | 125,348,557 | ||||||||
For the Year Ended December 31, 2012 | |||||||||||||||||
First Quarter | Second Quarter | Third Quarter (1) | Fourth Quarter | ||||||||||||||
Total Revenue | $ | 4,185,898 | $ | 9,014,972 | $ | 5,476,134 | $ | 9,237,542 | |||||||||
Expenses | $ | 3,926,478 | $ | 15,806,435 | $ | 7,835,013 | $ | 65,769,914 | |||||||||
Income (Loss) from Operations | $ | 259,420 | $ | (6,791,463 | ) | $ | (2,358,879 | ) | $ | (56,532,372 | ) | ||||||
Other Income (Expense), Net | $ | (515,790 | ) | $ | (169,445 | ) | $ | 4,353,721 | $ | (541,291 | ) | ||||||
Net Income (Loss) | $ | (256,370 | ) | $ | (6,960,908 | ) | $ | 1,994,842 | $ | (57,073,663 | ) | ||||||
Net Cash Provided By (Used In) Operating Activities | $ | 1,007,098 | $ | 2,329,819 | $ | 4,686,034 | $ | (3,733,184 | ) | ||||||||
Net Cash Provided Used in Investing Activities | $ | (12,176,316 | ) | $ | (3,604,988 | ) | $ | (20,858,711 | ) | $ | (29,812,618 | ) | |||||
Net Cash Provided By Financing Activities | $ | 2,181,567 | $ | 449,347 | $ | 45,341,484 | $ | 10,455,580 | |||||||||
-1 | A reclassification entry was made in 2013 for the Third Quarter of 2012 to reclassify the Gain on Acquisition of Business, Net from Operating Expense to Other Income (Expense), net. | ||||||||||||||||
ORGANIZATION_AND_NATURE_OF_BUS1
ORGANIZATION AND NATURE OF BUSINESS (Narrative) (Details) | Dec. 31, 2013 |
Organization and Nature of Business [Abstract] | ' |
Entity, number of employees (in Employees) | 30 |
BASIS_OF_PRESENTATION_AND_SIGN3
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) (USD $) | 0 Months Ended | 12 Months Ended | ||||
Oct. 22, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jun. 30, 2012 | 27-May-11 | |
Stock split (in Ratio) | 0.14 | ' | ' | ' | ' | ' |
Reverse stock split, shares of common stock issued for each seven shares of common stock owned (in Shares) | 1 | ' | ' | ' | ' | ' |
Reverse stock split, number of shares owned to receive one common stock (in Shares) | 7 | ' | ' | ' | ' | ' |
Cash FDIC insured amount | ' | $250,000 | ' | ' | ' | ' |
Allowance for uncollectible receivables | ' | 0 | 0 | 0 | ' | ' |
Number of financial institutions cash and cash equivalents concentrated in (in Institutions) | ' | 1 | 1 | ' | ' | ' |
Internal Salaries Capitalized | ' | 3,443,462 | 842,418 | 526,630 | ' | ' |
Stock-based Compensation included in internal salaries capitalized | ' | 1,193,960 | 582,040 | 418,414 | ' | ' |
Capitalized interest | ' | 0 | 362,688 | 0 | ' | ' |
Expiring leases, costs reclassified to full cost pool | ' | 3,020,485 | 3,625,209 | 6,983,125 | ' | ' |
Discount applied to the present value of future net revenues to determine capitalized cost ceiling (in Percent) | ' | 10.00% | ' | ' | ' | ' |
Amount by which the company's oil and natural gas properties exceeded the ceiling test limit | ' | 0 | 51,709,458 | 0 | 10,191,234 | ' |
Impairment of Oil and Natural Gas Properties | ' | ' | 61,900,692 | ' | ' | ' |
Depreciation expense | ' | 144,492 | 53,818 | 30,831 | ' | ' |
Stock-based compensation, equity incentive plan, shares authorized for issuance (in Shares) | ' | ' | ' | ' | ' | 714,286 |
Number of operating industry segments (in Industries) | ' | 1 | ' | ' | ' | ' |
Sales Revenue [Member] | ' | ' | ' | ' | ' | ' |
Number of customers 36% of the Company's production was sold to (in Customers) | ' | 2 | ' | ' | ' | ' |
Percentage of oil and natural gas revenues exceeded by two customers (in Percent) | ' | 10.00% | 10.00% | 10.00% | ' | ' |
Foreign [Member] | ' | ' | ' | ' | ' | ' |
Long lived assets | ' | 0 | ' | ' | ' | ' |
Stock Options Presently Exercisable [Member] | ' | ' | ' | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share (in Shares) | ' | 464,273 | ' | ' | ' | ' |
Stock Options Not Presently Exercisable [Member] | ' | ' | ' | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share (in Shares) | ' | 694,587 | ' | ' | ' | ' |
Restricted Stock Units [Member] | ' | ' | ' | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share (in Shares) | ' | 2,082,191 | ' | ' | ' | ' |
Warrants - Group 1 [Member] | ' | ' | ' | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share (in Shares) | ' | 5,114,633 | ' | ' | ' | ' |
Warrants issued and exercisable, exercise price (in Dollars per Unit) | ' | 5.77 | ' | ' | ' | ' |
Warrants - Group 2 [Member] | ' | ' | ' | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share (in Shares) | ' | 223,293 | ' | ' | ' | ' |
Warrants issued and exercisable, exercise price (in Dollars per Unit) | ' | 6.86 | ' | ' | ' | ' |
Warrants - Group 3 [Member] | ' | ' | ' | ' | ' | ' |
Anti-dilutive securities excluded from computation of earnings per share (in Shares) | ' | 892,858 | ' | ' | ' | ' |
Warrants issued and exercisable, exercise price (in Dollars per Unit) | ' | 49.7 | ' | ' | ' | ' |
2011 Equity Incentive Plan (the "2011 Plan") [Member] | ' | ' | ' | ' | ' | ' |
Stock-based compensation, equity incentive plan, shares available for issuance (in Shares) | ' | 4,629,784 | ' | ' | ' | ' |
2011 Equity Incentive Plan (the "2011 Plan") [Member] | Stock Option [Member] | ' | ' | ' | ' | ' | ' |
Stock-based compensation, equity incentive plan, shares issued (in Shares) | ' | 1,101,726 | ' | ' | ' | ' |
2011 Equity Incentive Plan (the "2011 Plan") [Member] | Common Stock and Restricted Stock Units [Memeber] | ' | ' | ' | ' | ' | ' |
Stock-based compensation, equity incentive plan, shares issued (in Shares) | ' | 4,068,490 | ' | ' | ' | ' |
2011 Equity Incentive Plan (the "2011 Plan") [Member] | Restricted Stock Units [Member] | ' | ' | ' | ' | ' | ' |
Stock-based compensation, equity incentive plan, unvested shares (in Shares) | ' | 2,082,187 | ' | ' | ' | ' |
2011 Equity Incentive Plan - October 22, 2012 Amendment [Member] | ' | ' | ' | ' | ' | ' |
Stock-based compensation, equity incentive plan, shares authorized for issuance (in Shares) | ' | 3,500,000 | ' | ' | ' | ' |
2011 Equity Incentive Plan - July 10, 2013 Amendment [Member] | ' | ' | ' | ' | ' | ' |
Stock-based compensation, equity incentive plan, shares authorized for issuance (in Shares) | ' | 9,800,000 | ' | ' | ' | ' |
Current and long-term assets [Member] | ' | ' | ' | ' | ' | ' |
Restricted cash | ' | 21,000,000 | 0 | ' | ' | ' |
Cash held in escrow subject to certain post-closing adjustments, oil and gas leasehold sales [Member] | ' | ' | ' | ' | ' | ' |
Restricted cash | ' | 11,000,000 | ' | ' | ' | ' |
Cash held in escrow related to drilling commitment agreement [Member] | ' | ' | ' | ' | ' | ' |
Restricted cash | ' | $10,000,000 | ' | ' | ' | ' |
Common stock, issued and outstanding [Member] | ' | ' | ' | ' | ' | ' |
Reverse stock split, reduction in shares (in Shares) | 140,339,000 | ' | ' | ' | ' | ' |
Warrant [Member] | ' | ' | ' | ' | ' | ' |
Reverse stock split, reduction in shares (in Shares) | 6,700,000 | ' | ' | ' | ' | ' |
Stock Option [Member] | ' | ' | ' | ' | ' | ' |
Reverse stock split, reduction in shares (in Shares) | 4,100,000 | ' | ' | ' | ' | ' |
BASIS_OF_PRESENTATION_AND_SIGN4
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Schedule of Revenue by Major Customers) (Details) (Credit Concentration Risk [Member]) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Customer A [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk percentage (in Percent) | 24.00% | ' | ' |
Customer B [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk percentage (in Percent) | 12.00% | ' | ' |
ACQUISITION_OF_BUSINESS_Narrat
ACQUISITION OF BUSINESS (Narrative) (Details) (USD $) | 0 Months Ended | 5 Months Ended | 12 Months Ended | |
Jul. 09, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
Emerald Oil North America [Member] | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Date company entered into Securities Purchase Agreement with Emerald Oil & Gas NL and Target (Date) | 9-Jul-12 | ' | ' | ' |
Percentage of Emerald common stock equal to amount of stock purchased (in Percent) | 19.90% | ' | ' | ' |
Number of shares issued to acquire Emerald Oil North America (in Shares) | 1,660,000 | ' | ' | ' |
Number of directors resigned in connection with acquisition of Emerald Oil North America (in Directors) | ' | ' | 5 | ' |
Number of management members which entered into employment agreements (in Managers) | ' | ' | 6 | ' |
Debt obligations assumed | $20,300,000 | ' | ' | ' |
Revenues recognized related to Emerald Oil North America | ' | ' | ' | ' |
Revenues recognized related to Emerald Oil North America | ' | 194,417 | 290,126 | ' |
Expenses recognized related to Emerald Oil North America | ' | 136,196 | 79,179 | ' |
Net income recognized related to Emerald Oil North America | ' | ' | 210,947 | 58,221 |
Emerald Oil North America [Member] | Dunn County [Member] | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Acres acquired in purchase (in Acres) | 10,600 | ' | ' | ' |
Emerald Oil North America [Member] | Sandwash Basin Niobrara [Member] | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Acres acquired in purchase (in Acres) | 45,000 | ' | ' | ' |
Emerald Oil [Member] | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Debt obligations assumed | 2,500,000 | ' | ' | ' |
Hartz Energy Capital [Member] | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Debt obligations assumed | $17,700,000 | ' | ' | ' |
Hartz Energy Capital [Member] | Sandwash Basin Niobrara [Member] | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Royalty interest percentage serving as interest on assumed debt agreement (in Percent) | 0.90% | ' | ' | ' |
Number of guaranteed net mineral acres underlying overriding royalty interest serving as interest on assumed debt (in Acres) | 382.5 | ' | ' | ' |
Period of royalty interest serving as interest on assumed debt (in Duration) | '5 years | ' | ' | ' |
Hartz Energy Capital [Member] | Williston Basin [Member] | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Royalty interest percentage serving as interest on assumed debt agreement (in Percent) | 2.15% | ' | ' | ' |
Number of guaranteed net mineral acres underlying overriding royalty interest serving as interest on assumed debt (in Acres) | 215 | ' | ' | ' |
Period of royalty interest serving as interest on assumed debt (in Duration) | '5 years | ' | ' | ' |
ACQUISITION_OF_BUSINESS_Schedu
ACQUISITION OF BUSINESS (Schedule of Business Acquisition) (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jul. 09, 2012 | |
Emerald Oil North America [Member] | ||||
Business Acquisition [Line Items] | ' | ' | ' | ' |
Proved Oil and Natural Gas Properties | ' | ' | ' | $6,839,000 |
Unproved Oil and Natural Gas Properties | ' | ' | ' | 33,948,000 |
Other Assets | ' | ' | ' | 111,000 |
Debt Assumed | ' | ' | ' | -20,303,000 |
Net Assets Acquired | ' | ' | ' | 20,595,000 |
Equity Issued to Emerald Oil & Gas NL | ' | ' | ' | -13,381,000 |
Gain on Acquisition | ' | 7,213,835 | ' | 7,213,835 |
Less: Acquisition Costs | ' | ' | ' | -1,456,000 |
Gain on Acquisition, net | ' | ' | ' | $5,758,000 |
ACQUISITION_OF_BUSINESS_Schedu1
ACQUISITION OF BUSINESS (Schedule of Business Acquisition, Pro Forma Results) (Details) (Emerald Oil North America [Member], USD $) | 12 Months Ended | |
Dec. 31, 2012 | Dec. 31, 2011 | |
Emerald Oil North America [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Pro forma revenues, acquisition | $27,968,701 | $8,569,107 |
Pro forma net loss available to common shareholders, acquisition | ($64,707,199) | ($1,977,350) |
Pro forma net loss per share, basic and diluted (in Dollars per Share) | -4.74 | -0.2 |
Pro forma weighted average shares outstanding, basic and diluted (in Shares) | 13,639,626 | 9,674,332 |
OIL_AND_NATURAL_GAS_PROPERTIES2
OIL AND NATURAL GAS PROPERTIES (Narrative) (Details) (USD $) | 12 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | |||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Aug. 30, 2013 | Aug. 02, 2013 | 8-May-13 | Feb. 04, 2013 | Jan. 09, 2013 | Feb. 24, 2013 | Sep. 17, 2013 | Dec. 31, 2013 | Dec. 16, 2013 | Oct. 09, 2013 | Sep. 20, 2013 | Mar. 28, 2013 | Dec. 31, 2013 | Feb. 21, 2014 | Dec. 31, 2013 | Sep. 06, 2013 | Apr. 17, 2013 | Sep. 06, 2013 | |
McKenzie County, ND [Member] | McKenzie County, ND [Member] | McKenzie County, ND [Member] | McKenzie County, ND [Member] | McKenzie County, ND [Member] | McKenzie County, ND [Member] | McKenzie, Billings and Stark Counties, ND [Member] | McKenzie, Billings and Stark Counties, ND [Member] | Williams County, ND [Member] | Williams County, ND [Member] | Williams County, ND [Member] | Sand Wash Basin, Routt and Moffatt Counties, CO and Carbon County, WY [Member] | Sand Wash Basin, Routt County, CO [Member] | Williston Basin [Member] | Williston Basin [Member] | Williston Basin [Member] | Williston Basin [Member] | Williston Basin and Associated Oil and Natural Gas Production [Member] | ||||
Oil and Gas in Process Activities [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, purchase price | ' | ' | ' | $3,600,000 | $10,400,000 | $6,500,000 | $1,900,000 | $4,700,000 | ' | $20,200,000 | ' | $5,300,000 | $3,200,000 | $1,300,000 | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, undeveloped acreage acquired (in Acres) | ' | ' | ' | 3,600 | 3,500 | 5,874 | ' | ' | ' | 30,672 | ' | 1,101 | 2,866 | 313 | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, common stock issued (in Shares) | ' | ' | ' | ' | ' | ' | ' | 851,315 | 313,700 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, common stock issued (in Dollars per Share) | ' | ' | ' | ' | ' | ' | ' | $5.50 | $6.06 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, purchase price of acreage acquired | ' | ' | ' | 1,000 | 3,000 | 1,100 | ' | ' | ' | 660 | ' | 4,850 | 1,100 | 4,100 | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, pre-closing period over which volume-weighted trading price of stock was averaged to arrive at per share price (in Duration) | ' | ' | ' | ' | ' | ' | '5 days | '5 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, minimum gross wells required to be drilled within two years of acquisition date by Company under purchase agreement (in Wells) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, funds Company placed with escrow agent under the purchase agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, escrowed monies refundable to to Company with each gross well drilled under purchase agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, amount of escrowed monies carried on the balance sheet as a current asset | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of oil and gas property, amount of escrowed monies carried on the balance sheet as a long-term asset | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Oil and gas leasehold sales, acreage sold (in Net Acres) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 31,000 | 14,600 | ' | 26,579 | 413 | 970 | ' |
Oil and gas leasehold percent of undivided working interest sold (in Percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 45.00% | ' | ' | ' | ' | ' | ' |
Oil and gas leasehold sales, sale price | 129,432,743 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,100,000 | 2,000,000 | ' | ' | 5,200,000 | 7,100,000 | 111,000,000 |
Oil and gas leasehold sales, gain recognized | 7,371,804 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | 0 | 7,372,000 | 0 | 0 | 0 |
Oil and gas leasehold sales, sale price, amount escrowed subject to certain post-closing adjustments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 111,090,000 | ' | ' | ' |
Oil and gas leasehold sales, sale price, amount previously escrowed and subsequently released to Company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,600,000 |
Oil and gas leasehold sales, sale price, amount previously escrowed and subsequently returned to Buyer for purchase price adjustments during the due diligence period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,400,000 |
Percentage of proved reserves of oil and natural gas attributable to Company's full cost pool (in Percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | ' | ' | ' |
OIL_AND_NATURAL_GAS_PROPERTIES3
OIL AND NATURAL GAS PROPERTIES (Schedule of Oil and Gas Property Net Sales Price Allocation) (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 21, 2014 | Dec. 31, 2013 | Sep. 06, 2013 | Apr. 17, 2013 | |
Williston Basin [Member] | Williston Basin [Member] | Williston Basin [Member] | Williston Basin [Member] | ||||
Oil and Gas in Process Activities [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Sale price | ' | ' | ' | ' | $111,090,000 | ' | ' |
Add: Disposition of asset retirement obligations | ' | ' | ' | ' | 309,000 | ' | ' |
Less: Sales expenses | ' | ' | ' | ' | -1,168,000 | ' | ' |
Purchase price adjustments | ' | ' | ' | -1,520,000 | ' | ' | ' |
Sale price, net | ' | ' | ' | ' | 108,711,000 | ' | ' |
Proved oil and natural gas properties | ' | ' | ' | ' | 137,279,000 | ' | ' |
Accumulated depletion | ' | ' | ' | ' | -49,508,000 | ' | ' |
Unproved oil and natural gas properties | ' | ' | ' | ' | 13,568,000 | ' | ' |
Gain on sale | 7,371,804 | ' | ' | 0 | 7,372,000 | 0 | 0 |
Sale price, net | ' | ' | ' | ' | $108,711,000 | ' | ' |
RELATED_PARTY_TRANSACTIONS_Nar
RELATED PARTY TRANSACTIONS (Narrative) (Details) (USD $) | 12 Months Ended | 1 Months Ended | 0 Months Ended | |||
Dec. 31, 2013 | Sep. 22, 2010 | Sep. 22, 2010 | Feb. 28, 2013 | Oct. 17, 2013 | Jun. 04, 2013 | |
Steven Lipscomb [Member] | Michael Reger [Member] | Affiliates of White Deer Energy [Member] | White Deer Energy [Member] | White Deer Energy [Member] | ||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' |
Related party transaction, value of promissory notes subscribed | ' | $500,000 | $1,000,000 | ' | ' | ' |
Related party transaction, Series A Preferred stock issued (in Shares) | ' | ' | ' | 500,000 | ' | ' |
Related party transaction, Series B Preferred stock issued (in Shares) | ' | ' | ' | 5,114,633 | ' | ' |
Related party transaction, common stock purchased (in Shares) | ' | ' | ' | 5,114,633 | ' | ' |
Related party transaction, common stock purchased (in Dollars per Share) | ' | ' | ' | $5.77 | ' | ' |
Related party transaction, common stock purchased, aggregate value | ' | ' | ' | $50,000,000 | $32,500,000 | $16,200,000 |
Related party transaction, shares of common stock issued (in Shares) | ' | ' | ' | ' | 5,092,852 | 2,785,600 |
Related party transaction, shares of common stock issued (in Dollars per Share) | ' | ' | ' | ' | $6.39 | ' |
Period of time on or after closing the registration rights agreement requires the Company to file a resale registration statement to register for shares of the Company's common stock and common stock issuable upon exercise of warrants (in Duration) | '90 days | ' | ' | ' | ' | ' |
Period of time after filing under the registration rights agreement, the Company is required to use its commercially reasonable efforts to cause such resale registration statement to become effective (in Duration) | '120 days | ' | ' | ' | ' | ' |
PREFERRED_AND_COMMON_STOCK_Nar
PREFERRED AND COMMON STOCK (Narrative) (Details) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 0 Months Ended | ||||||||||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 19, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Feb. 04, 2013 | Jan. 09, 2013 | Dec. 31, 2013 | Feb. 19, 2014 | Feb. 19, 2013 | Feb. 19, 2014 | Oct. 17, 2013 | Jun. 04, 2013 | Feb. 08, 2011 | Oct. 02, 2013 | 22-May-13 | Sep. 28, 2012 | Oct. 15, 2013 | Aug. 30, 2013 | Jun. 20, 2013 | Dec. 31, 2013 | Feb. 19, 2014 | Feb. 19, 2013 | Feb. 19, 2013 | Feb. 19, 2013 | Feb. 19, 2013 | Feb. 19, 2013 | Feb. 19, 2014 | Feb. 19, 2013 | |
Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock Units [Member] | Restricted Stock and Restricted Stock Units [Member] | Restricted Stock and Restricted Stock Units [Member] | Restricted Stock and Restricted Stock Units [Member] | Restricted Stock and Restricted Stock Units [Member] | Common Stock [Member] | Common Stock [Member] | Common Stock [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | Public Offering [Member] | Public Offering [Member] | Public Offering [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series B Preferred Stock [Member] | Series B Preferred Stock [Member] | |||||
Warrants to purchase common stock [Member] | Common Stock [Member] | Common Stock [Member] | Common Stock and Warrant Unit [Member] | Common Stock [Member] | Common Stock [Member] | Common Stock [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | Private Placement [Member] | ||||||||||||||||||||||
On or prior February 19, 2015 [Member] | From February 20, 2015 through February 19, 2016 [Member] | From February 20, 2016 through February 19, 2017 [Member] | After February 19, 2017 [Member] | |||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock authorized (in Shares) | 20,000,000 | 20,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock issued (in Shares) | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 500,000 | ' | ' | ' | ' | ' | 5,114,633 | ' |
Proceeds from issuance of private placement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $50,000,000 | ' | ' | $32,500,000 | $16,200,000 | $50,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, par value (in Dollars per Share) | $0.00 | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.00 | ' | ' | ' | ' | ' | $0.00 | ' |
Shares of common stock called by warrants (in Shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,114,633 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' |
Common stock, called by warrants, par value (in Dollars per Share) | $0.00 | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants issued in private placement, exercise price (in Dollars per Unit) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.77 | ' | ' | 49.7 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.77 | ' |
Preferred stock, cumulative dividend rate per annum (in Percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' |
Dividends payable, nature (in Description) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'Quarterly | ' | ' | ' | ' | ' | ' | ' |
Dividend payable, date to be paid (Date) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 31-Mar-13 | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, liquidation preference (in Dollars per Share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $112.50 | $110 | $105 | $100 | $0.00 | ' |
Company option to redeem shares, minimum redemption amount (in Shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' |
Maximum amount of payment or liability company may make or incur without investor approval | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000 | ' | ' | ' | ' | ' | ' | ' |
Shares of stock redeemed (in Shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 150,000 | 200,000 | 150,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payment for redemption of stock | 50,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,932,534 | 22,828,767 | 17,203,767 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, redemption premium | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,875,000 | 2,500,000 | 1,875,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, accrued dividends | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 57,534 | 328,767 | 328,767 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividends paid | 8,832,191 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,582,191 | ' | ' | ' | ' | ' | ' | ' | ' |
Dividends paid, prior to 2013 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, redemption price per share (in Dollars per Share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.00 | ' |
Investor option, under change of control or liquidating event, to receive cash payment in exchange for all then held stock, minimum internal rate of return (in Percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | ' |
Fair value of stock recognized, net of offering costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 38,552,994 | ' | ' | ' | ' | ' | 5,000 |
Offering costs on transaction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,397,749 | 5,000,000 | 4,300,000 | 5,300,000 | ' | ' | ' | ' | ' | 2,816,006 | ' | ' | ' | ' | ' | ' |
Warrant Liability | 15,703,000 | ' | ' | 8,626,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,626,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock transaction, shares issued (in Shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,092,852 | 2,785,600 | 1,785,714 | 15,000,000 | 12,000,000 | 13,392,857 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock transaction, price per share (in Dollars per Share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6.39 | $5.87 | ' | $6.70 | $6.10 | $5.60 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Subscription price per unit (in Dollars per Unit) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from stock issued in public offering | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 95,500,000 | 69,300,000 | 75,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issuable upon exercise of warrants (in Shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 892,857 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,114,633 | ' |
Number of votes each share of Series B Preferred stock entitles holder to (in Votes) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' |
Issuance discount remaining | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Over-allotment exercised for sale in public offering, shares (in Shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,250,000 | 1,800,000 | 484,698 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Over-allotment exercised for sale in public offering, price per share (in Dollars per Share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6.70 | $6.10 | $5.60 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from sale of common stock over allotment, gross | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from sale of common stock over allotment, net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14,400,000 | 10,500,000 | 2,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock issued related to acreage acquisitions (in Shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 313,700 | 851,315 | 1,165,015 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of acreage acquisitions for which common stock was issued (In Integer) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Private placement, agent fees | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-Based Compensation Expense | 12,885,209 | 7,318,690 | 728,546 | ' | 851,979 | 332,673 | 99,358 | ' | 10,903,696 | 4,684,009 | 126,962 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unvested restricted stock (in Shares) | ' | ' | ' | ' | ' | ' | ' | ' | 2,082,187 | 1,847,701 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized share-based compensation cost | ' | ' | ' | ' | ' | ' | ' | 8,007,835 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period for recognition of unrecognized compensation costs related to nonvested share based compensation (Duration) | ' | ' | ' | ' | '10 months 24 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation capitalized to oil and natural gas properties | 332,673 | 99,358 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Compensation expense associated with vesting of restricted stock units vesting, granted pursuant to severance of an officer | 2,298,661 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restricted stock units associated with severance of an officer, vested subsequent to year end on January 19, 2014 (in Shares) | 537,817 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Nonvested restricted stock units included in total RSUs vested subsequent to year end on January 19, 2014 associated with vesting of restricted unit grants to severance of an officer (in Shares) | 442,708 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restricted common shares granted on January 17, 2014, included in total RSUs vested subsequent to year end on January 19, 2014 associated with vesting of stock units granted upon severance of an officer (in Shares) | 95,109 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining unamortized expense associated with severance of an officer | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
PREFERRED_AND_COMMON_STOCK_Sch
PREFERRED AND COMMON STOCK (Schedule of Preferred Stock Transaction) (Details) (USD $) | Dec. 31, 2013 | Feb. 19, 2013 | Dec. 31, 2012 | Feb. 19, 2014 | Dec. 31, 2013 | Feb. 19, 2014 | Dec. 31, 2013 |
Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series B Preferred Stock [Member] | Series B Preferred Stock [Member] | ||||
Class Of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Value | $5,000 | ' | ' | $41,369,000 | ' | $5,000 | $5,000 |
Warrant Liability | 15,703,000 | 8,626,000 | ' | ' | ' | ' | ' |
Preferred stock transaction components, total | $15,708,000 | $50,000,000 | ' | ' | ' | ' | ' |
PREFERRED_AND_COMMON_STOCK_Sch1
PREFERRED AND COMMON STOCK (Schedule of Restricted Stock Units and Restricted Stock Shares Outstanding) (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Non-vested restricted stock and restricted stock units | ' | ' | ' | |
Weighted-average Grant Date Fair Value, Granted (in Dollars per Share) | $1.69 | [1] | ' | $2.02 |
Restricted Stock and Restricted Stock Units [Member] | ' | ' | ' | |
Non-vested restricted stock and restricted stock units | ' | ' | ' | |
Number of Shares, Non-vested, beginning balance (in Shares) | 1,847,701 | ' | ' | |
Number of Shares, Granted (in Shares) | 1,242,505 | 1,919,135 | ' | |
Number of Shares, Canceled (in Shares) | -70,642 | ' | ' | |
Number of Shares, Forfeited (in Shares) | -302,016 | -53,577 | ' | |
Number of Shares, Vested (in Shares) | -635,361 | -17,857 | ' | |
Number of Shares, Non-vested, ending balance (in Shares) | 2,082,187 | 1,847,701 | ' | |
Weighted Average Grant Date Fair Value, beginning balance (in Dollars per Share) | $4.31 | ' | ' | |
Weighted-average Grant Date Fair Value, Granted (in Dollars per Share) | $7.10 | ' | ' | |
Weighted-average Grant Date Fair Value, Canceled (in Dollars per Share) | $4.19 | $4.93 | ' | |
Weighted Average Grant Date Fair Value, Forfeited (in Dollars per Share) | $4.86 | $21 | ' | |
Weighted Average Grant Date Fair Value, Vested (in Dollars per Share) | $4.88 | $21 | ' | |
Weighted Average Grant Date Fair Value, ending balance (in Dollars per Share) | $5.73 | $4.31 | ' | |
[1] | See Note 6 b Common and Preferred Stock b Preferred Stock for details on the warrants issued on February 19, 2013 associated with the preferred stock transaction. |
STOCK_OPTIONS_AND_WARRANTS_Nar
STOCK OPTIONS AND WARRANTS (Narrative) (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||
Feb. 08, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jan. 19, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock Option [Member] | Stock Option [Member] | Stock Option [Member] | Stock Option [Member] | Stock Option [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | ||
Prior Officer of Company [Member] | Prior Officer of Company [Member] | ||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share based compensation | ' | $1,600,924 | $2,634,681 | $334,520 | ' | $456,741 | $0 | $0 | $267,065 |
Share based compensation, tax | ' | 0 | 0 | 0 | ' | ' | 0 | 0 | 0 |
Share based compensation, capitalized | ' | 1,193,960 | 249,367 | 109,688 | ' | ' | 209,370 | ' | ' |
Share based compensation, prior officer of company, options vested subsequent to year end (in Shares) | ' | ' | ' | ' | 44,643 | ' | ' | ' | ' |
Share based compensation, prior officer of company, remaining unamortized expense | ' | $1,518,289 | ' | ' | ' | $0 | ' | ' | ' |
Share based compensation, unrecognized expense, expected period for recognition (in Duration) | ' | '1 year 4 months 13 days | ' | ' | ' | ' | ' | ' | ' |
Common stock sold (in Shares) | 1,785,714 | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants issued in conjunction with sale of common stock (in Shares) | 892,858 | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants expired or forfeited (in Shares) | ' | ' | ' | ' | ' | ' | 0 | ' | ' |
STOCK_OPTIONS_AND_WARRANTS_Sch
STOCK OPTIONS AND WARRANTS (Schedule of Stock Options, Roll Forward) (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Deferred Compensation Arrangement With Individual Share Based Payments [Line Items] | ' | ' | ' | ' |
Stock options granted (in Shares) | 505,301 | 685,713 | ' | ' |
Stock options exercisable at end of period (in Shares) | 521,416 | ' | ' | ' |
Stock options outstanding, Remaining contractual term (in Years) (in Duration) | '4 years 9 months | ' | ' | ' |
Stock options exercisable, Remaining contractual term (in Years) (in Duration) | '2 years 7 months 6 days | ' | ' | ' |
Stock Option [Member] | ' | ' | ' | ' |
Deferred Compensation Arrangement With Individual Share Based Payments [Line Items] | ' | ' | ' | ' |
Stock options outstanding at beginning of period (in Shares) | 835,713 | 150,000 | 139,857 | ' |
Stock options granted (in Shares) | 505,301 | 685,713 | 39,284 | ' |
Stock options exercised (in Shares) | -75,000 | ' | -571 | ' |
Stock options forfeited or expired (in Shares) | -107,143 | ' | -28,570 | ' |
Stock options outstanding at end of period (in Shares) | 1,158,871 | 835,713 | 150,000 | 139,857 |
Stock options exercisable at end of period (in Shares) | 464,273 | 424,997 | 51,786 | ' |
Stock options outstanding weighted average exercise price at beginning of period (in Dollars per Share) | $10.43 | $20.44 | $20.51 | ' |
Stock options granted weighted average exercise price (in Dollars per Share) | $7.18 | $8.11 | $22.40 | ' |
Stock options exercised weighted average exercise price (in Dollars per Share) | $4.43 | ' | $29.68 | ' |
Stock options forfeited or expired weighted average exercise price (in Dollars per Share) | $16.54 | ' | $19.32 | ' |
Stock options outstanding weighted average exercise price at end of period (in Dollars per Share) | $8.90 | $10.43 | $20.44 | $20.51 |
Stock options exercisable, weighted average exercise price at end of period (in Dollars per Share) | $11.12 | $11.39 | $18.90 | ' |
Stock options outstanding, Remaining contractual term (in Years) (in Duration) | '4 years 9 months | '7 years 8 months 12 days | '7 years 2 months 12 days | '8 years 10 months 24 days |
Stock options exercisable, Remaining contractual term (in Years) (in Duration) | '3 years 1 month 6 days | '5 years 10 months 24 days | '6 years 10 months 24 days | ' |
Stock options outstanding intrinsic value | ' | ' | ' | $2,420,660 |
Stock options exercisable intrinsic value | $356,024 | $121,500 | $302,750 | ' |
STOCK_OPTIONS_AND_WARRANTS_Sch1
STOCK OPTIONS AND WARRANTS (Schedule of Nonvested Stock Options, Roll Forward) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock Options and Warrants [Abstract] | ' | ' | ' |
Number of Options Nonvested, beginning balance (in Shares) | 410,716 | 98,214 | ' |
Nonvested stock options, granted (in Shares) | 505,301 | 685,713 | ' |
Nonvested stock options, vested (in Shares) | -200,000 | -373,211 | ' |
Nonvested stock options, forfeited (in Shares) | -21,430 | ' | ' |
Number of Options Nonvested, ending balance (in Shares) | 694,587 | 410,716 | ' |
Nonvested options, weighted-average grant-date fair value, beginning balance (in Dollars per Share) | 5.87 | $13.09 | ' |
Nonvested options, weighted-average grant-date fair value, granted (in Dollars per Share) | 7.18 | $4.78 | ' |
Nonvested options, weighted-average grant-date fair value, vested (in Dollars per Share) | 10.47 | $6.14 | ' |
Nonvested options, weighted-average grant-date fair value, forfeited (in Dollars per Share) | 12.39 | ' | ' |
Nonvested options, weighted-average grant-date fair value, ending balance (in Dollars per Share) | 7.41 | $5.87 | ' |
Stock Option [Member] | ' | ' | ' |
Stock Options and Warrants [Abstract] | ' | ' | ' |
Nonvested stock options, granted (in Shares) | 505,301 | 685,713 | 39,284 |
Nonvested options, weighted-average grant-date fair value, granted (in Dollars per Share) | ' | $4.62 | $14.35 |
STOCK_OPTIONS_AND_WARRANTS_Sch2
STOCK OPTIONS AND WARRANTS (Schedule of Stock Options, Additional Information) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock Options and Warrants [Abstract] | ' | ' | ' |
Weighted-average per share grant-date fair value of stock options granted (in Dollars per Share) | $4.43 | $4.62 | $14.35 |
Total intrinsic value of options exercised | $211,250 | ' | $3,520 |
Total grant-date fair value of stock options vested during the year | 2,093,999 | 2,159,307 | 349,875 |
Stock Option [Member] | ' | ' | ' |
Stock Options and Warrants [Abstract] | ' | ' | ' |
Total intrinsic value of options exercised | ' | ' | 3,520 |
Total grant-date fair value of stock options vested during the year | ' | $2,159,307 | $349,875 |
STOCK_OPTIONS_AND_WARRANTS_Sch3
STOCK OPTIONS AND WARRANTS (Schedule of Stock Options Granted, Valuation Assumptions) (Details) (Stock Option [Member]) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock Option [Member] | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' |
Risk free rates, min (in Percent) | 0.48% | 0.17% | 0.91% |
Risk free rates, max (in Percent) | 2.12% | 1.20% | 0.96% |
Dividend yield (in Percent) | 0.00% | 0.00% | 0.00% |
Expected volatility, min (in Percent) | 64.64% | 69.70% | 85.90% |
Expected volatility, max (in Percent) | 79.50% | 78.99% | 86.17% |
Weighted average expected life (in Duration) | '5 years | '4 years | '3 years |
STOCK_OPTIONS_AND_WARRANTS_Sch4
STOCK OPTIONS AND WARRANTS (Schedule of Warrants Granted, Roll Forward) (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Stock Options and Warrants [Abstract] | ' | ' | ' | ' |
Number of warrants, outstanding, beginning balance (in Shares) | 223,293 | 223,293 | 223,293 | ' |
Number of warrants, granted (in Shares) | ' | ' | ' | ' |
Number of warrants, exercised (in Shares) | ' | ' | ' | ' |
Number of warrants, outstanding, ending balance (in Shares) | 223,293 | 223,293 | 223,293 | 223,293 |
Warrants outstanding, weighted average exercise price (in Dollars per Share) | $6.86 | $6.86 | $6.86 | $6.86 |
Warrants outstanding, remaining contractual term (in Years) (in Duration) | '7 years | '7 years | '8 years | '9 years 6 months |
Warrants outstanding, intrinsic value | $178,634 | ' | $2,458,251 | $6,908,681 |
STOCK_OPTIONS_AND_WARRANTS_Sch5
STOCK OPTIONS AND WARRANTS (Schedule of Warrants, Additional Information) (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Stock Options and Warrants [Abstract] | ' | ' | ' | |
Weighted-average Grant Date Fair Value, Granted (in Dollars per Share) | $1.69 | [1] | ' | $2.02 |
Total intrinsic value of warrants exercised | ' | [1] | ' | ' |
Total grant-date fair value of warrants vested during the year | ' | [1] | ' | $12,625,000 |
[1] | See Note 6 b Common and Preferred Stock b Preferred Stock for details on the warrants issued on February 19, 2013 associated with the preferred stock transaction. |
STOCK_OPTIONS_AND_WARRANTS_Sch6
STOCK OPTIONS AND WARRANTS (Schedule of Warrants Granted, Valuation Assumptions) (Details) (Warrant [Member]) | 12 Months Ended | 24 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 | ||
Warrant [Member] | ' | ' | ' | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | |
Risk free rates (in Percent) | ' | [1] | 2.02% | ' |
Dividend yield (in Percent) | ' | [1] | 0.00% | ' |
Expected volatility (in Percent) | ' | [1] | 75.52% | ' |
Weighted average expected life (in Duration) | ' | [1] | '5 years | ' |
[1] | See Note 14 b Derivative Instruments and Price Risk Management b Warrant Liability for the method and assumptions used to value the warrants issued on February 19, 2013 associated with the preferred stock transaction. |
STOCK_OPTIONS_AND_WARRANTS_Sch7
STOCK OPTIONS AND WARRANTS (Schedule of the Status of Warrants Outstanding) (Details) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
Warrant [Member] | December 1, 2009 [Member] | December 31, 2009 [Member] | February 8, 2011 [Member] | February 19, 2013 [Member] | |||||
Warrant [Member] | Warrant [Member] | Warrant [Member] | Warrant [Member] | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Warrants Outstanding (in Units) | 223,293 | 223,293 | 223,293 | 223,293 | 6,230,784 | 37,216 | 186,077 | 892,858 | 5,114,633 |
Expiration Date, Warrants Outstanding (in Date) | ' | ' | ' | ' | ' | 1-Dec-19 | 31-Dec-19 | 8-Feb-16 | 31-Dec-19 |
Exercise Price, Warrants Outstanding (in Dollars per Unit) | ' | ' | ' | ' | ' | 6.86 | 6.86 | 49.7 | 5.77 |
REVOLVING_CREDIT_FACILITY_Narr
REVOLVING CREDIT FACILITY (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Macquerie Facility [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Date credit facility was entered into (in Date) | 10-Feb-12 | ' |
Maximum amount available under credit facility | $150,000,000 | ' |
Initial borrowing base under credit facility | 15,000,000 | ' |
Remaining amount available under credit facility | 50,000,000 | ' |
Macquarie Facility Third Tranche [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Date credit facility was entered into (in Date) | 26-Jul-12 | ' |
Maximum amount available under credit facility | 20,000,000 | ' |
Initial borrowing base under credit facility | 15,000,000 | ' |
Macquarie Facility Third Tranche [Member] | London Interbank Offered Rate (LIBOR) [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Debt instrument basis spread on variable rate (in Percent) | 9.00% | ' |
Wells Fargo Credit Agreement [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Date credit facility was entered into (in Date) | 20-Nov-12 | ' |
Maximum amount available under credit facility | 400,000,000 | ' |
Date credit facility terminates (in Date) | 20-Nov-17 | ' |
Facility covenant, minimum current ratio (in Ratio) | 1 | ' |
Facility covenant, maximum debt coverage ratio (in Ratio) | 3.5 | ' |
Facility covenant, maximum interest coverage ratio (in Ratio) | 3 | ' |
Initial borrowing base under credit facility | 75,000,000 | ' |
Interest rate per annum (in Percent) | 0.38% | ' |
Credit facility outstanding balance | 0 | 23,500,000 |
Wells Fargo Credit Agreement [Member] | Minimum [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Commitment fee percentage (in Percent) | 0.38% | ' |
Wells Fargo Credit Agreement [Member] | Maximum [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Commitment fee percentage (in Percent) | 0.50% | ' |
Wells Fargo Credit Agreement [Member] | Alternate Base Rate [Member] | Minimum [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Debt instrument basis spread on variable rate (in Percent) | 0.75% | ' |
Wells Fargo Credit Agreement [Member] | Alternate Base Rate [Member] | Maximum [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Debt instrument basis spread on variable rate (in Percent) | 1.75% | ' |
Wells Fargo Credit Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Debt instrument basis spread on variable rate (in Percent) | 1.75% | ' |
Wells Fargo Credit Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Debt instrument basis spread on variable rate (in Percent) | 2.75% | ' |
Wells Fargo Credit Agreement Letters of Credit [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Initial borrowing base under credit facility | 5,000,000 | ' |
Fronting fee to be paid if this value exceeds point one two five percent of the face amount of the letter of credit to be issued | $500 | ' |
Fronting fee to be paid if this value times the Letter of credit face amount exceeds five hundred dollars (in Percent) | 0.13% | ' |
Wells Fargo Credit Agreement Letters of Credit [Member] | Minimum [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Interest rate per annum (in Percent) | 1.75% | ' |
Wells Fargo Credit Agreement Letters of Credit [Member] | Maximum [Member] | ' | ' |
Line Of Credit Facility [Line Items] | ' | ' |
Interest rate per annum (in Percent) | 2.75% | ' |
SENIOR_SECURED_PROMISSORY_NOTE1
SENIOR SECURED PROMISSORY NOTES (Narrative) (Details) (Senior Secured Promissory Notes [Member], USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Senior Secured Promissory Notes [Member] | ' |
Debt Instrument [Line Items] | ' |
Senior secured promissory notes issuance date (Date) | 30-Sep-10 |
Senior secured promissory notes, amount issued | $15,000,000 |
ASSET_RETIREMENT_OBLIGATION_Na
ASSET RETIREMENT OBLIGATION (Narrative) (Details) | 12 Months Ended |
Dec. 31, 2013 | |
Asset Retirement Obligation [Abstract] | ' |
Significant input to assumption, asset retirement obligation valuation, future inflation factor (in Percent) | 2.50% |
Significant input to assumption, asset retirement obligation valuation, interest rate credit-adjusted risk-free (in Percent) | 7.00% |
ASSET_RETIREMENT_OBLIGATION_Sc
ASSET RETIREMENT OBLIGATION (Schedule of Asset Retirement Obligation, Roll Forward) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Asset Retirement Obligation [Abstract] | ' | ' | ' |
Beginning Asset Retirement Obligation | $296,074 | $116,119 | $10,522 |
Revision of Previous Estimates | 165,968 | ' | ' |
Liabilities Incurred or Acquired | 510,271 | 164,967 | 100,715 |
Accretion of Discount on Asset Retirement Obligations | 32,449 | 14,988 | 4,882 |
Liabilities Associated with Properties Sold | -312,625 | ' | ' |
Ending Asset Retirement Obligation | $692,137 | $296,074 | $116,119 |
ACCRUED_LIABILITIES_Schedule_o
ACCRUED LIABILITIES (Schedule of Accrued Liabilities) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Accrued Liabilities [Abstract] | ' | ' |
Accrued Transaction Adjustments | $2,067,150 | ' |
Oil and Natural Gas Revenue Payable | 7,451,394 | 4,559 |
Other General and Administrative Expenses | 2,303,185 | 415,930 |
Total Accrued Liabilities | $11,821,729 | $420,489 |
INCOME_TAXES_Narrative_Details
INCOME TAXES (Narrative) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
U.S. Federal NOLs subject to an annual limitation | ' | $1,754,000 | ' |
Valuation Allowance | 28,967,027 | 28,024,620 | ' |
Unrecognized tax benefits | 0 | 0 | 0 |
Penalties and interest expense | 0 | 0 | 0 |
Penalties and interest accrued | 0 | 0 | ' |
U.S. Federal [Member] | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
Net operating loss (NOL) carryovers | 102,402,000 | ' | ' |
U.S. Federal [Member] | Minimum [Member] | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
Operating loss carryforward, expiration date (Date) | 1-Jan-29 | ' | ' |
U.S. Federal [Member] | Maximum [Member] | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
Operating loss carryforward, expiration date (Date) | 1-Jan-33 | ' | ' |
State And Local Jurisdiction [Member] | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
Net operating loss (NOL) carryovers | $85,332,000 | ' | ' |
State And Local Jurisdiction [Member] | Minimum [Member] | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
Operating loss carryforward, expiration date (Date) | 1-Jan-16 | ' | ' |
State And Local Jurisdiction [Member] | Maximum [Member] | ' | ' | ' |
Operating Loss Carryforwards [Line Items] | ' | ' | ' |
Operating loss carryforward, expiration date (Date) | 1-Jan-33 | ' | ' |
INCOME_TAXES_Schedule_of_the_I
INCOME TAXES (Schedule of the Income Tax Expense (Benefit)) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Taxes [Abstract] | ' | ' | ' |
Current Income Taxes | ' | ' | ' |
Deferred Income Taxes | ' | ' | ' |
Federal | ' | ' | ' |
State | ' | ' | ' |
Total Expense | ' | ' | ' |
INCOME_TAXES_Schedule_of_Repor
INCOME TAXES (Schedule of Reported Income Tax Expense (Benefit) Reconciliation) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Taxes [Abstract] | ' | ' | ' |
Loss Before Taxes | ($10,882,895) | ($62,296,099) | ($1,345,054) |
Federal Statutory Rate (in Percent) | 35.00% | 35.00% | 35.00% |
Benefit Computed at Federal Statutory Rates | -3,809,013 | -21,803,635 | -473,919 |
State Benefit, Net of Federal Benefit | -102,503 | -1,969,364 | -68,416 |
Effects of: | ' | ' | ' |
Warrant Revaluation | 2,476,950 | ' | ' |
Nondeductible expenses | 366,203 | 10,941 | ' |
Other | 125,956 | -119,872 | 48,919 |
Change in Valuation Allowance | 942,407 | 23,881,930 | 493,416 |
Total Expense | ' | ' | ' |
INCOME_TAXES_Schedule_of_the_C
INCOME TAXES (Schedule of the Components of the Deferred Tax Asset) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Deferred Tax Assets | ' | ' |
Net Operating Loss Carryforwards (NOLs) | $36,382,177 | $19,654,346 |
Stock-based Compensation | 3,245,308 | 1,672,296 |
Derivatives | 323,190 | 68,438 |
Equity Investments | 116,886 | 116,488 |
Oil and Natural Gas Properties | ' | 6,522,543 |
Total Deferred Tax Assets | 40,067,561 | 28,034,111 |
Deferred Tax Liabilites: | ' | ' |
Oil and Natural Gas Properties | 11,093,181 | ' |
Other | 7,353 | 9,491 |
Total Deferred Tax Liabilities | 11,100,534 | 9,491 |
Less: Valuation Allowance | -28,967,027 | -28,024,620 |
Total Net Deferred Tax Asset | ' | ' |
FAIR_VALUE_Narrative_Details
FAIR VALUE (Narrative) (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 19, 2013 | |
Fair Value [Abstract] | ' | ' | ' | ' |
Warrant Liability | $15,703,000 | ' | ' | $8,626,000 |
Warrant Revaluation Expense | $7,077,000 | ' | ' | ' |
FAIR_VALUE_Schedule_of_Fair_Va
FAIR VALUE (Schedule of Fair Value of Financial Instruments Measured on Recurring Basis) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ' | ' | ' |
Total | ($853,005) | ($181,248) | ' |
Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | Fair Value, Measurements, Recurring [Member] | ' | ' | ' |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ' | ' | ' |
Warrant Liability - Long Term Liability | ' | ' | ' |
Commodity Derivatives - Current Liability (oil swaps and collars) | ' | ' | ' |
Commodity Derivatives - Long Term Asset (oil swaps and collars) | ' | ' | ' |
Total | ' | ' | ' |
Significant Other Observable Inputs (Level 2) [Member] | Fair Value, Measurements, Recurring [Member] | ' | ' | ' |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ' | ' | ' |
Warrant Liability - Long Term Liability | ' | ' | ' |
Commodity Derivatives - Current Liability (oil swaps and collars) | -921,401 | -206,645 | ' |
Commodity Derivatives - Long Term Asset (oil swaps and collars) | 68,396 | 25,397 | ' |
Total | -853,005 | -181,248 | ' |
Significant Unobservable Inputs (Level 3) [Member] | Fair Value, Measurements, Recurring [Member] | ' | ' | ' |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ' | ' | ' |
Warrant Liability - Long Term Liability | -15,703,000 | ' | ' |
Commodity Derivatives - Current Liability (oil swaps and collars) | ' | ' | ' |
Commodity Derivatives - Long Term Asset (oil swaps and collars) | ' | ' | ' |
Total | ($15,703,000) | ' | ' |
FAIR_VALUE_Schedule_of_Fair_Va1
FAIR VALUE (Schedule of Fair Value of Warrants Liability Measured on Recurring Basis, Unobservable Inputs) (Details) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Rollforward of Level 3 warrants liability measured at fair value using level 3 on a recurring basis | ' |
Balance at beginning of period | ' |
Purchases, issuances, and settlements | -8,626,000 |
Change in Fair Value of Warrant Liability | -7,077,000 |
Transfers | ' |
Balance at end of period | ($15,703,000) |
DERIVATIVE_INSTRUMENTS_AND_PRI2
DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT (Narrative) (Details) (USD $) | 0 Months Ended | 12 Months Ended |
Feb. 19, 2013 | Dec. 31, 2013 | |
Derivative Instruments and Price Risk Management [Abstract] | ' | ' |
Warrant Liability | $8,626,000 | $15,703,000 |
Warrants issued, price per warrant (in Dollars per Unit) | 1.69 | 7.66 |
Expected volatility rate (in Percent) | 40.00% | 40.00% |
Risk-free interest rate (in Percent) | 1.38% | 2.50% |
Expected term (in Duration) | '1798 days | '1561 days |
Exercise price of warrants (in Dollars per Share) | $5.77 | $5.77 |
DERIVATIVE_INSTRUMENTS_AND_PRI3
DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT (Schedule of Open Commodity Swap Contracts) (Details) (Oil [Member], Swap [Member]) | 12 Months Ended |
Dec. 31, 2013 | |
bbl | |
January 1, 2014 - December 31, 2014 [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 103,267 |
Fixed Price (Dollars per Unit) | 91 |
January 1, 2014 - December 31, 2014 [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 31,000 |
Fixed Price (Dollars per Unit) | 90.05 |
January 1, 2014 - December 31, 2014 [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 79,000 |
Fixed Price (Dollars per Unit) | 94.3 |
January 1, 2014 - December 31, 2014 [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 44,200 |
Fixed Price (Dollars per Unit) | 94.18 |
2014 Total/Average [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 257,467 |
Fixed Price (Dollars per Unit) | 92.44 |
January 1, 2015 - February 28, 2015 [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 13,876 |
Fixed Price (Dollars per Unit) | 91 |
January 1, 2015 - February 28, 2015 [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 5,000 |
Fixed Price (Dollars per Unit) | 90.05 |
January 1, 2015 - February 28, 2015 [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 10,000 |
Fixed Price (Dollars per Unit) | 94.3 |
January 1, 2015 - February 28, 2015 [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 8,100 |
Fixed Price (Dollars per Unit) | 94.18 |
2015 Total/Average [Member] | ' |
Derivative [Line Items] | ' |
Oil (Barrels) | 36,976 |
Fixed Price (Dollars per Unit) | 92.46 |
DERIVATIVE_INSTRUMENTS_AND_PRI4
DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT (Schedule of Commodity Derivatives, Changes in Fair Value, Reconciliation) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Derivative Instruments and Price Risk Management [Abstract] | ' | ' | ' |
Beginning fair value of commodity derivatives | ($181,248) | ' | ' |
Total losses on oil derivatives | -2,656,535 | -215,439 | ' |
Cash settlements paid on oil derivatives | 1,984,778 | 34,191 | ' |
Ending fair value of commodity derivatives | ($853,005) | ($181,248) | ' |
DERIVATIVE_INSTRUMENTS_AND_PRI5
DERIVATIVE INSTRUMENTS AND PRICE RISK MANAGEMENT (Schedule of Derivative Instruments in Statement of Financial Position) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Derivative [Line Items] | ' | ' | ' |
Total Derivative Assets | ' | $25,397 | ' |
Total Derivative Liabilities | -16,556,005 | -206,645 | ' |
Total | -853,005 | -181,248 | ' |
Swap Contracts [Member] | Current liabilities [Member] | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' |
Total Derivative Liabilities | -921,401 | -377,514 | ' |
Swap Contracts [Member] | Non-current assets [Member] | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' |
Total Derivative Assets | 68,396 | ' | ' |
Swap Contracts [Member] | Non-current liabilities [Member] | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' |
Total Derivative Liabilities | ' | -222,172 | ' |
Costless Collars [Member] | Current liabilities [Member] | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' |
Total Derivative Liabilities | ' | -194,810 | ' |
Costless Collars [Member] | Non-current assets [Member] | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' |
Total Derivative Assets | ' | 630,441 | ' |
Costless Collars [Member] | Non-current liabilities [Member] | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' |
Total Derivative Liabilities | ' | -382,872 | ' |
Costless Collars [Member] | Current assets [Member] | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' |
Total Derivative Assets | ' | 365,679 | ' |
Warrant Liabilty [Member] | Non-current liabilities [Member] | ' | ' | ' |
Derivative [Line Items] | ' | ' | ' |
Total Derivative Liabilities | ($15,703,000) | ' | ' |
SUBSEQUENT_EVENTS_Narrative_De
SUBSEQUENT EVENTS (Narrative) (Details) (USD $) | 0 Months Ended | 1 Months Ended | |
Feb. 13, 2014 | Feb. 28, 2014 | Dec. 31, 2013 | |
bbl | |||
Subsequent Events [Abstract] | ' | ' | ' |
Subsequent event, acres acquired (in Acres) | 19,500 | ' | ' |
Subsequent event, acres acquired, aggregate amount | $69,300,000 | ' | ' |
Subsequent event, daily production of oil equivalent (in Barrels) | ' | ' | 300 |
Subsequent event, draw on credit facility in conjunction with acquired acreage | 35,000,000 | ' | ' |
Subsequent event, purchase and sale agreement entered into to acquire undeveloped leasehold (in Acres) | ' | 5,900 | ' |
Subsequent event, agreed approximate purchase price of acreage under purchase and sale agreement | ' | 10,300,000 | ' |
Subsequent event, agreed approximate purchase price per acre of acreage under purchase and sale agreement (in Dollars per Acre) | ' | 1,750 | ' |
Subsequent event, deposit paid for acreage under purchase and sale agreement | ' | $2,600,000 | ' |
SUBSEQUENT_EVENTS_Schedule_of_
SUBSEQUENT EVENTS (Schedule of Oil Derivative Swap Contract) (Details) (Oil Derivative Swap Contract [Member]) | 12 Months Ended |
Dec. 31, 2013 | |
bbl | |
January 1, 2014 - December 31, 2014 [Member] | ' |
Subsequent Event [Line Items] | ' |
Oil (Barrels) | 251,200 |
Fixed Price (Dollars per Unit) | 97.38 |
Total [Member] | ' |
Subsequent Event [Line Items] | ' |
Oil (Barrels) | 251,200 |
Fixed Price (Dollars per Unit) | 97.38 |
QUARTERLY_RESULTS_OF_OPERATION2
QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (Schedule of Quarterly Financial Information) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Quarterly Results of Operations (Unaudited) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Revenue | $18,038,575 | $14,596,398 | $11,240,155 | $7,449,377 | $9,237,542 | $5,476,134 | [1] | $9,014,972 | $4,185,898 | $51,324,505 | $27,914,546 | $8,426,129 |
Expenses | 26,466,746 | 5,813,788 | 12,248,325 | 10,316,386 | 65,769,914 | 7,835,013 | [1] | 15,806,435 | 3,926,478 | 54,845,245 | 93,326,209 | 7,712,741 |
Income (Loss) from Operations | -8,428,171 | 8,782,610 | -1,008,170 | -2,867,009 | -56,532,372 | -2,358,879 | [1] | -6,791,463 | 259,420 | -3,520,740 | -65,411,663 | 713,388 |
Other Income (Expense), Net | -2,505,272 | -524,105 | -714,964 | -3,617,814 | -541,291 | 4,353,721 | [1] | -169,445 | -515,790 | 2,779 | -28,244 | -22,410 |
Net Income (Loss) | -10,933,443 | 8,258,505 | -1,723,134 | -6,484,823 | -57,073,663 | 1,994,842 | [1] | -6,960,908 | -256,370 | -10,882,895 | -62,296,099 | -1,345,054 |
Net Loss Attributable to Common Stockholders | -10,933,443 | -5,738,584 | -7,388,804 | -7,101,261 | ' | ' | ' | ' | -31,162,092 | -62,296,099 | -1,345,054 | |
Net Cash Provided By (Used For) Operating Activities | 3,348,288 | 7,322,429 | 1,838,477 | 377,822 | -3,733,184 | 4,686,034 | [1] | 2,329,819 | 1,007,098 | 6,190,440 | 4,289,767 | -153,156 |
Net Cash Provided (Used in) Investing Activities | -47,272,739 | 12,954,748 | -27,662,815 | -13,019,732 | -29,812,618 | -20,858,711 | [1] | -3,604,988 | -12,176,316 | -75,000,538 | -66,452,633 | -43,508,278 |
Net Cash Provided By (Used In) Financing Activities | $125,348,557 | ($23,440,287) | $62,720,981 | $38,243,906 | $10,455,580 | $45,341,484 | [1] | $449,347 | $2,181,567 | $202,873,157 | $58,427,978 | $46,230,181 |
[1] | A reclassification entry was made in 2013 for the Third Quarter of 2012 to reclassify the Gain on Acquisition of Business, Net from Operating Expense to Other Income (Expense), net. |