Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Jul. 31, 2014 | Sep. 12, 2014 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'BLACKSANDS PETROLEUM, INC. | ' |
Entity Central Index Key | '0001308137 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Jul-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--10-31 | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' |
Is Entity a Voluntary Filer? | 'No | ' |
Is Entity's Reporting Status Current? | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 18,756,199 |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2014 | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Jul. 31, 2014 | Oct. 31, 2013 |
Current Assets: | ' | ' |
Cash and cash equivalents | $719,586 | $1,335,237 |
Accounts receivable | 197,610 | 417,597 |
Prepaid expenses | 12,660 | ' |
Total Current Assets | 929,856 | 1,752,834 |
Oil and gas property costs (successful efforts method of accounting) | ' | ' |
Proved, net of accumulated depletion of 7,368,699 and 6,309,607 | 4,015,072 | 2,077,872 |
Other assets | 50,000 | 50,312 |
Total Assets | 4,994,928 | 3,881,018 |
Current Liabilities: | ' | ' |
Note payable | 60,000 | 280,000 |
Accounts payable | 478,650 | 523,365 |
Accrued expenses | 4,011,483 | 3,121,900 |
Total Current Liabilities | 4,550,133 | 3,925,265 |
Notes Payable, net of discount of $570,933 and $1,329,581 | 5,820,000 | 4,270,419 |
Convertible debenture net of discount of $1,337,497and $- | 162,503 | ' |
Asset Retirement obligation | 48,081 | 649,233 |
Total Liabilities | 10,580,717 | 8,844,917 |
Stockholders' Deficit: | ' | ' |
Preferred stock - $0.01 par value; 10,000,000 shares authorized: | ' | ' |
Series A - $.001 par value, 310,000 shares authorized, nil shares issued and outstanding | ' | ' |
Series B - $.001 par value, 2,217,281 shares authorized, 500,000 shares issued and outstanding | 500 | ' |
Common stock - $0.001 par value; 100,000,000 shares authorized; 17,725,610 and 17,719,360 shares issued and outstanding at July 31, 2014 and October 31, 2013, respectively | 17,726 | 17,720 |
Additional paid-in capital | 25,559,704 | 23,726,191 |
Accumulated deficit | -31,163,719 | -28,707,810 |
Total Stockholders' Deficit | -5,585,789 | -4,963,899 |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $4,994,928 | $3,881,018 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Jul. 31, 2014 | Oct. 31, 2013 |
Consolidated Balance Sheets Parenthetical | ' | ' |
Accumulated Depletion | $7,368,699 | $6,309,607 |
Notes Payable, net of discount | ' | 1,329,581 |
Convertible debenture net of discount | $1,337,497 | ' |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, authorized shares | 10,000,000 | 10,000,000 |
Series A Preferred stock, par value | $0.00 | $0.00 |
Series A Preferred stock, authorized shares | 310,000 | 310,000 |
Series A Preferred stock, issued shares | 0 | 0 |
Series A Preferred stock, outstanding shares | 0 | 0 |
Series B Preferred stock, par value | 0.001 | 0.001 |
Series B Preferred stock, authorized shares | 2,217,281 | 2,217,281 |
Series B Preferred stock, issued shares | 500,000 | 500,000 |
Series B Preferred stock, outstanding shares | 500,000 | 500,000 |
Common stock par value | $0.00 | $0.00 |
Common stock shares authorized | 100,000,000 | 100,000,000 |
Common stock shares issued | 17,725,610 | 17,719,360 |
Common stock shares outstanding | 17,725,610 | 17,719,360 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2014 | Jul. 31, 2013 | Jul. 31, 2014 | Jul. 31, 2013 | |
Revenue: | ' | ' | ' | ' |
Oil and gas revenue | $465,791 | $467,879 | $1,062,491 | $1,303,045 |
Expenses: | ' | ' | ' | ' |
Selling, general and administrative | 244,723 | 336,255 | 960,706 | 1,107,685 |
Depreciation and depletion | 69,924 | 138,211 | 366,501 | 375,257 |
Accretion expense | 1,707 | 8,525 | 15,648 | 31,287 |
Lease operating expenses | 129,902 | 152,460 | 430,473 | 507,585 |
Gain on sale of interest in CabezaCreek Field | ' | ' | -645,323 | ' |
Gain on transfer of interest to PIE Holdings | ' | ' | -1,760,390 | ' |
Oil and gas exploration costs | ' | 220,000 | ' | 220,000 |
Impairment of oil and gas property interest | ' | ' | 2,219,813 | ' |
Total expenses | 446,256 | 855,451 | 1,587,428 | 2,241,814 |
Gain (loss) from operations | 19,535 | -387,572 | -524,937 | -938,769 |
Other income and (expense): | ' | ' | ' | ' |
Interest expense | -769,317 | -360,411 | -1,941,519 | -955,918 |
Other income | 10,547 | ' | 10,547 | 27,763 |
Total other income (expense) | -758,770 | -360,411 | -1,930,972 | -928,155 |
(Loss) income before provision for income taxes | -739,235 | -747,983 | -2,455,909 | -1,866,924 |
Provision for income taxes | ' | ' | ' | ' |
Net loss | -739,235 | -747,983 | -2,455,909 | -1,866,924 |
Preferred stock Dividends | 2,500 | 50,000 | 2,500 | 150,000 |
Deemed dividend | 450,000 | ' | 450,000 | ' |
Net (loss) income attributable to common shareholders | ($1,191,735) | ($797,983) | ($2,908,409) | ($2,016,924) |
Loss per share attributable to common shareholders | ' | ' | ' | ' |
Basic | ($0.07) | ($0.04) | ($0.16) | ($0.12) |
Diluted | ($0.07) | ($0.04) | ($0.16) | ($0.12) |
Weighted Average Shares Outstanding | ' | ' | ' | ' |
Basic | 17,722,655 | 16,389,738 | 17,721,546 | 16,388,648 |
Diluted | 17,722,655 | 16,389,738 | 17,721,546 | 16,388,648 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (Unaudited) (USD $) | 9 Months Ended | |
Jul. 31, 2014 | Jul. 31, 2013 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ' | ' |
Net loss | ($2,455,909) | ($1,866,924) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ' | ' |
Impairment of oil and gas property costs | 2,219,813 | ' |
Equity compensation expense | -15,980 | 236,526 |
Amortization of debt discount | 1,342,084 | 433,032 |
Gain on transfer of interest to PIE Holdings | -1,760,392 | ' |
Depreciation, depletion and accretion | 382,148 | 406,544 |
Gain on sale of oil and gas properties | -645,323 | ' |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 219,987 | 161,185 |
Prepaid expense and other current assets | -12,660 | 169,611 |
Accounts payable | -12,753 | 315,562 |
Net cash flows from operating activities | -738,985 | -144,464 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' |
Oil and gas property costs | -1,926,666 | -390,401 |
Proceeds from the sale of Cabeza Creek | 50,000 | ' |
Net cash flows from investing activities | -1,876,666 | -390,401 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' |
Borrowings on debt | 1,500,000 | ' |
Proceeds from preferred stock subscription | 500,000 | ' |
Net cash flows from financing activities | 2,000,000 | ' |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | -615,651 | -534,865 |
CASH AND CASH EQUIVALENTS - Beginning of period | 1,335,237 | 1,160,320 |
CASH AND CASH EQUIVALENTS - End of period | 719,586 | 625,455 |
Cash paid for interest | 252,252 | 167,240 |
Cash paid for income taxes | ' | ' |
Supplemental non-cash activities: | ' | ' |
Oil and gas costs in accounts payable | 858,009 | ' |
Discount on debt | $1,350,000 | ' |
The_Company_and_Summary_of_Sig
The Company and Summary of Significant Accounting Policies | 9 Months Ended |
Jul. 31, 2014 | |
Notes to Financial Statements | ' |
Note 1. The Company and Summary of Significant Accounting Policies | ' |
Blacksands Petroleum, Inc. (hereinafter referred to as the “Company”) was incorporated in the State of Nevada on October 12, 2004. Since August 2007, the Company has been engaged in the exploration, development, exploitation and production of oil and natural gas. The Company sells its oil and gas products primarily to domestic pipelines and refineries. Its operations are presently focused in the States of Texas and New Mexico. | |
The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and rules of the Securities and Exchange Commission (“SEC”), and should be read in conjunction with the audited financial statements and notes thereto contained in annual report on Form 10-K for the year ended October 31, 2013 filed with the SEC on February 14, 2014. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the consolidated financial statements which would substantially duplicate the disclosure contained in the audited financial statements as reported in the 2013 annual report on Form 10-K have been omitted. | |
Oil and Gas Properties | |
The Company follows the successful efforts method of accounting for its oil and natural gas properties. Oil and gas properties are periodically assessed to determine whether they have been impaired. Any impairment in value of unproved properties is charged to exploration expense. The costs of unproved properties, which are determined to be productive, are transferred to prove oil and gas properties and amortized on an equivalent unit-of-production basis. Exploratory expenses, including geological and geophysical expenses and delay rentals for unevaluated oil and gas properties, are charged to expense as incurred. Exploratory drilling costs are initially capitalized as unproved property but charged to expense if and when the well is determined not to have found proved oil and gas reserves. In accordance with ASC No. 935, exploratory drilling costs are evaluated within a one-year period after the completion of drilling. For proved properties, we compare expected undiscounted future cash flows at a producing field level to the unamortized capitalized cost of the asset. If the future undiscounted cash flows, based on our estimate of future natural gas and crude oil prices, operating costs, anticipated production from proved reserves and other relevant date, are lower than the unamortized capitalized cost, the capitalized cost is reduced to fair value. Fair value is calculated by discounting the future cash flows at an appropriate risk-adjusted discount rate. | |
During the three months ended January 31, 2014, the Company impaired its oil and gas properties by $2,219,813, which is reflected in the consolidated statement of operations. This impairment was the result of the additional costs incurred in the AP Clark Field related to the three wells on which the drilling was commenced in November 2013. | |
Subsequently, during the three months ended April 30, 2014, the Company recorded income of $1,760,392 in connection with the transfer of some of the Company’s interest in three wells to PIE Holdings, LP on which drilling commenced in November 2013. This income is included in the income statement as an operating expense. | |
Going Concern | |
As shown in the accompanying consolidated financial statements, the Company has incurred an accumulated deficit of $31,163,719 through July 31, 2014. In addition, at July 31, 2014, the Company had a working capital deficit of $3,620,277, a stockholders’ deficit of $5,585,789 and cash and cash equivalents of $719,586. | |
The current rate of cash usage raises substantial doubt about the Company’s ability to continue as a going concern, absent the raising of additional capital, restructuring or extending the terms on its current debt and/or additional significant revenue from new oil production. The Company’s financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event that the Company cannot continue in existence. |
Asset_Retirement_Obligation
Asset Retirement Obligation | 9 Months Ended | |||
Jul. 31, 2014 | ||||
Notes to Financial Statements | ' | |||
Note 2. Asset Retirement Obligation | ' | |||
The following table summarizes the change in the asset retirement obligation (“ARO”) for the periods ended July 31, 2014: | ||||
Beginning balance at November 1, 2013 | $ | 649,233 | ||
Liabilities settled | -- | |||
Liabilities incurred through acquisition of assets | -- | |||
Liabilities settled through sale of assets | (616,800 | |||
Accretion expense | 15,648 | |||
Ending balance at July 31, 2014 | $ | 48,081 | ||
The ARO reflects the estimated present value of the amount of dismantlement, removal, site reclamation and similar activities associated with the Company’s oil and gas properties. Inherent in the fair value calculation of the ARO are numerous assumptions and judgments including the ultimate settlement amounts, inflation factors, credit adjusted discount rates, timing of settlement, and changes in the legal, regulatory, environmental and political environments. To the extent future revisions to these assumptions impact the fair value of the existing ARO liability, a corresponding adjustment is made to the oil and gas property balance. |
Contingencies
Contingencies | 9 Months Ended |
Jul. 31, 2014 | |
Notes to Financial Statements | ' |
Note 3. Contingencies | ' |
The Company, as an owner or lessee and operator of oil and gas properties, is subject to various federal, state and local laws and regulations relating to discharge of materials into, and protection of, the environment. These laws and regulations may, among other things, impose liability on the lessee under an oil and gas lease for the cost of pollution clean-up resulting from operations and subject the lessee to liability for pollution damages. In some instances, the Company may be directed to suspend or cease operations in the affected area. The Company maintains insurance coverage, which it believes is customary in the industry, although the Company is not fully insured against all environmental risks. The Company is not aware of any environmental claims existing as of July 31, 2014, which have not been provided for, covered by insurance or otherwise have a material impact on its financial position or results of operations. There can be no assurance, however, that current regulatory requirements will not change, or past noncompliance with environmental laws will not be discovered on the Company’s properties. | |
In June 2014, the Company received notice that it owed to PIE Holdings LP approximately $485,000 for the completion costs related to the three new wells in the AP Clark Field. According to the Joint Operating Agreement the Company has with PIE Holdings, LP, these amounts are required to be paid within seven days of the notification that fracking activities commenced. These amounts have not been paid to date. According to the Joint Operating Agreement, the Company could be forced to give up all or a portion of its interest in these wells for non-payment. The Company has not been notified to date of any actions to be taken for the non-payment of these completion costs. |
Stockholders_Equity
Stockholders' Equity | 9 Months Ended | ||||||||
Jul. 31, 2014 | |||||||||
Notes to Financial Statements | ' | ||||||||
Note 4. Stockholders' Equity | ' | ||||||||
Series B Convertible Preferred Stock | |||||||||
In June 2014, the Company designated 2,217,281 shares of preferred stock as non-voting Redeemable Convertible Series B Preferred Stock (“Series B Preferred”) (See Note 6). Each share of Series B Preferred is entitled to a dividend of 3% payable annually through the issuance of additional Series B Preferred. Each share of Series B Preferred may be converted at the option of the holder any time on or prior to May 30, 2017 into shares of the Company’s common stock at a conversion price of $1.00 per share, which is subject to adjustment. The Company has the right to redeem the shares, in whole or in part, any time after May 30, 2017 at $1.00 per share. | |||||||||
Under the terms set forth in the Certificate of Designation, the holders of Series B Preferred stock have the exclusive right, voting separately as a class, to elect one director of the Board (“Series B Director”), who must be reasonably acceptable to the Company. The Series B Director must be appointed by the holders of a majority of the issued and outstanding shares of Series B Preferred Stock. The Series B Director was appointed to the Board in June 2014. | |||||||||
Stock Options | |||||||||
A summary of the Company’s stock option activity and related information is as follows: | |||||||||
Number of | Weighted Average | ||||||||
Shares | Exercise Price | ||||||||
Outstanding at November 1, 2013 | 1,046,333 | $ | 3.13 | ||||||
Granted | - | - | |||||||
Exercised | - | - | |||||||
Cancelled | 27,500 | $ | 4.5 | ||||||
Outstanding at July 31, 2014 | 1,018,833 | $ | 3.09 | ||||||
Exercisable at July 31, 2014 | 1,018,833 | $ | 3.09 | ||||||
During the nine months ended July 31, 2014 and 2013, the Company recorded stock-based compensation of $(15,980) and $236,526, respectively, as general and administrative expenses. At July 31, 2014, the weighted average remaining life of the stock options is 6.02 years. | |||||||||
Warrants | |||||||||
A summary of the Company’s warrant activity and related information is as follows: | |||||||||
Number of | Weighted Average | ||||||||
Shares | Exercise Price | ||||||||
Outstanding at November 1, 2013 | 2,057,268 | $ | 4.5 | ||||||
Granted | - | - | |||||||
Exercised | - | - | |||||||
Expired | 2,057,268 | $ | 4.5 | ||||||
Outstanding at July 31, 2014 | - | - | |||||||
Exercisable at July 31, 2014 | - | - |
Sale_Of_Cabeza_Creek_Field
Sale Of Cabeza Creek Field | 9 Months Ended | ||||||||
Jul. 31, 2014 | |||||||||
Notes to Financial Statements | ' | ||||||||
Note 5. Sale of Cabeza Creek Field | ' | ||||||||
In January 2014, the Company sold its interest in all of the wells in the Cabeza Creek Field for all depths from the surface to 8,500 feet below the surface in exchange for $50,000 and the assumption of all future liabilities associated with the plugging and abandoning of all wells in the Cabeza Creek Field ($616,800). | |||||||||
The following is a summary of the pro forma information for the nine months ended July 31, 2014 and 2013 assuming the sale of the Cabeza Creek field had occurred as of the beginning of each fiscal year presented: | |||||||||
2014 | 2013 | ||||||||
Oil and gas revenue | $ | 1,062,491 | $ | 1,149,001 | |||||
Expenses | |||||||||
Selling, general and administrative | 1,018,271 | 1,107,685 | |||||||
Depreciation and depletion | 366,501 | 301,620 | |||||||
Accretion | 15,648 | 1,143 | |||||||
Lease operating expense | 430,473 | 447,579 | |||||||
Impairment of oil and gas property interest | 2,219,813 | - | |||||||
Oil and gas exploration costs | - | 220,000 | |||||||
Total expenses | 4,050,706 | 2,078,027 | |||||||
Loss from operations | (2,988,215 | ) | (929,026 | ) | |||||
Other income (expense) | (230,952 | ) | (928,155 | ) | |||||
Net loss | $ | (3,219,167 | ) | $ | (1,857,181 | ) |
Subscription_Agreement
Subscription Agreement | 9 Months Ended |
Jul. 31, 2014 | |
Notes to Financial Statements | ' |
Note 6. Subscription Agreement | ' |
On June 6, 2014, the Company entered into a subscription agreement with Pacific LNG Operations Ltd., a company incorporated in the British Virgin Islands (“Pacific LNG”), whereby the Company issued to Pacific LNG, in exchange for $2,000,000, a (i) $1,500,000 principal face amount 5% Convertible Debenture (“Debenture”) convertible into shares of Series B Preferred (Note 5) at a conversion price of $1.00 per share, and (ii) $500,000 in exchange for 500,000 shares of Series B Preferred. | |
The Debenture accrues interest at the rate of 5% per annum, payable semi-annually in arrears, and matures on June 6, 2017. Pacific LNG has the right, at any time prior to June 6, 2015, to convert the outstanding principal and interest, if any, of the Debenture into shares of Series B Preferred at a price of $1.00 per share of Series B Preferred. | |
Each share of Series B Preferred has a stated value of $1.00 (“Stated Value”) and accrues a dividend of 3% of the Stated Value per annum, which is payable in additional shares of Series B Preferred annually on December 31 in arrears. Each share of Series B Preferred may be converted at any time on or prior to May 30, 2017 into such number of shares of the Company’s common stock equal to the Stated Value divided by $1.00 per share. The Company has the right, at any time after May 30, 2017, to redeem the Series B Preferred at a price of $1.00 per share. Management has evaluated the Series B Preferred and its related terms and determined there are no embedded derivatives. | |
In connection with the issuance of the Debenture, the Company has reported a beneficial conversion feature for the difference between the conversion price pursuant to the Debenture and the quoted price of the Company’s common stock on the date of the agreement. On the date of the agreement, a discount totaling $1,350,000 was recorded. The unamortized discount which at July 31, 2014 was $1,337,497, will be amortized over the remaining term of the Debenture using the effective interest method. In addition, a deemed dividend totaling $450,000 was recorded in connection with the beneficial conversion feature associated with the conversion features in the Series B Preferred. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Jul. 31, 2014 | |
Notes to Financial Statements | ' |
Note 7. Subsequent Events | ' |
Amendment to Silver Bullet Notes Payable | |
In August 2014, the Company and Silver Bullet Property Holdings SDN BHD (“Silver Bullet”) entered into an Amendment and Exchange Agreement (the “August 2014 Amendment”). Pursuant to the August 2014 Amendment, all accrued and unpaid interest through June 30, 2014 on the outstanding notes issued to Silver Bullet, totaling $1,052,407, was exchanged for 1,052,407 shares of the Company’s common stock. In addition, interest accrued on the notes is to be paid quarterly in arrears in shares of the Company’s common stock based upon the average common stock price for the last five trading days of the quarter. The due dates on each of the notes payable to Silver Bullet were extended to December 31, 2015. | |
Development Agreement with Adwar Drilling Fund III | |
In August 2014, ApClark, LLC, a wholly-owned subsidiary of the Company, entered into a Participation and Development Agreement with Adwar Drilling Fund III, LP. (“Adwar III”). Pursuant to the agreement, Adwar III has the right to invest up to $7.5 million in contributions to acquire working interests of up to 50% in certain future development wells. | |
The_Company_and_Summary_of_Sig1
The Company and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Jul. 31, 2014 | |
Company And Summary Of Significant Accounting Policies Policies | ' |
Oil and Gas Properties | ' |
The Company follows the successful efforts method of accounting for its oil and natural gas properties. Oil and gas properties are periodically assessed to determine whether they have been impaired. Any impairment in value of unproved properties is charged to exploration expense. The costs of unproved properties, which are determined to be productive, are transferred to prove oil and gas properties and amortized on an equivalent unit-of-production basis. Exploratory expenses, including geological and geophysical expenses and delay rentals for unevaluated oil and gas properties, are charged to expense as incurred. Exploratory drilling costs are initially capitalized as unproved property but charged to expense if and when the well is determined not to have found proved oil and gas reserves. In accordance with ASC No. 935, exploratory drilling costs are evaluated within a one-year period after the completion of drilling. For proved properties, we compare expected undiscounted future cash flows at a producing field level to the unamortized capitalized cost of the asset. If the future undiscounted cash flows, based on our estimate of future natural gas and crude oil prices, operating costs, anticipated production from proved reserves and other relevant date, are lower than the unamortized capitalized cost, the capitalized cost is reduced to fair value. Fair value is calculated by discounting the future cash flows at an appropriate risk-adjusted discount rate. | |
During the three months ended January 31, 2014, the Company impaired its oil and gas properties by $2,219,813, which is reflected in the consolidated statement of operations. This impairment was the result of the additional costs incurred in the AP Clark Field related to the three wells on which the drilling was commenced in November 2013. | |
Subsequently, during the three months ended April 30, 2014, the Company recorded income of $1,760,392 in connection with the transfer of some of the Company’s interest in three wells to PIE Holdings, LP on which drilling commenced in November 2013. This income is included in the income statement as an operating expense. | |
Going Concern | ' |
As shown in the accompanying consolidated financial statements, the Company has incurred an accumulated deficit of $31,163,719 through July 31, 2014. In addition, at July 31, 2014, the Company had a working capital deficit of $3,620,277, a stockholders’ deficit of $5,585,789 and cash and cash equivalents of $719,586. | |
The current rate of cash usage raises substantial doubt about the Company’s ability to continue as a going concern, absent the raising of additional capital, restructuring or extending the terms on its current debt and/or additional significant revenue from new oil production. The Company’s financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event that the Company cannot continue in existence. |
Asset_Retirement_Obligation_Ta
Asset Retirement Obligation (Tables) | 9 Months Ended | |||
Jul. 31, 2014 | ||||
Asset Retirement Obligation Tables | ' | |||
Change in the asset retirement obligation | ' | |||
The following table summarizes the change in the asset retirement obligation (“ARO”) for the periods ended July 31, 2014: | ||||
Beginning balance at November 1, 2013 | $ | 649,233 | ||
Liabilities settled | -- | |||
Liabilities incurred through acquisition of assets | -- | |||
Liabilities settled through sale of assets | (616,800 | |||
Accretion expense | 15,648 | |||
Ending balance at July 31, 2014 | $ | 48,081 |
Stockholders_Equity_Tables
Stockholders Equity (Tables) | 9 Months Ended | ||||||||
Jul. 31, 2014 | |||||||||
Stock Options Activity | ' | ||||||||
A summary of the Company’s stock option activity and related information is as follows: | |||||||||
Number of | Weighted Average | ||||||||
Shares | Exercise Price | ||||||||
Outstanding at November 1, 2013 | 1,046,333 | $ | 3.13 | ||||||
Granted | - | - | |||||||
Exercised | - | - | |||||||
Cancelled | 27,500 | $ | 4.5 | ||||||
Outstanding at July 31, 2014 | 1,018,833 | $ | 3.09 | ||||||
Exercisable at July 31, 2014 | 1,018,833 | $ | 3.09 | ||||||
Warrant [Member] | ' | ||||||||
Stock Options Activity | ' | ||||||||
A summary of the Company’s warrant activity and related information is as follows: | |||||||||
Number of | Weighted Average | ||||||||
Shares | Exercise Price | ||||||||
Outstanding at November 1, 2013 | 2,057,268 | $ | 4.5 | ||||||
Granted | - | - | |||||||
Exercised | - | - | |||||||
Expired | 2,057,268 | $ | 4.5 | ||||||
Outstanding at July 31, 2014 | - | - | |||||||
Exercisable at July 31, 2014 | - | - |
Sale_of_Cabeza_Creek_Field_Tab
Sale of Cabeza Creek Field (Tables) | 9 Months Ended | ||||||||
Jul. 31, 2014 | |||||||||
Notes to Financial Statements | ' | ||||||||
Sale of Cabeza Creek Field | ' | ||||||||
2014 | 2013 | ||||||||
Oil and gas revenue | $ | 1,062,491 | $ | 1,149,001 | |||||
Expenses | |||||||||
Selling, general and administrative | 1,018,271 | 1,107,685 | |||||||
Depreciation and depletion | 366,501 | 301,620 | |||||||
Accretion | 15,648 | 1,143 | |||||||
Lease operating expense | 430,473 | 447,579 | |||||||
Impairment of oil and gas property interest | 2,219,813 | - | |||||||
Oil and gas exploration costs | - | 220,000 | |||||||
Total expenses | 4,050,706 | 2,078,027 | |||||||
Loss from operations | (2,988,215 | ) | (929,026 | ) | |||||
Other income (expense) | (230,952 | ) | (928,155 | ) | |||||
Net loss | $ | (3,219,167 | ) | $ | (1,857,181 | ) |
The_Company_and_Summary_of_Sig2
The Company and Summary of Significant Accounting Policies (Details Narrative) (USD $) | Jul. 31, 2014 | Oct. 31, 2013 |
Company And Summary Of Significant Accounting Policies Details Narrative | ' | ' |
Accumulated deficit | $31,163,719 | $28,707,810 |
Working capital deficit | 3,620,277 | ' |
Stockholders' deficit | 5,585,789 | 4,963,899 |
Cash and cash equivalents | $719,586 | $1,335,237 |
Asset_Retirement_Obligation_De
Asset Retirement Obligation (Details) (USD $) | 9 Months Ended |
Jul. 31, 2014 | |
Asset Retirement Obligation Details | ' |
Beginning balance | $649,233 |
Liabilities settled | ' |
Liabilities incurred through acquisition of assets | ' |
Liabilities transferred through sale of assets | -616,800 |
Accretion expense | 15,648 |
Ending balance | $48,081 |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 9 Months Ended |
Jul. 31, 2014 | |
Stock Option [Member] | ' |
Number of Shares | ' |
Beginning Balance | 1,046,333 |
Granted | ' |
Exercised | ' |
Cancelled/Expired | 27,500 |
Ending Balance | 1,018,833 |
Exercisable at July 31, 2014 | 1,018,833 |
Weighted Average Exercise Price | ' |
Beginning Balance | $3.13 |
Granted | ' |
Exercised | ' |
Cancelled/Expired | $4.50 |
Ending Balance | $3.09 |
Exercisable at July 31, 2014 | $3.09 |
Warrant [Member] | ' |
Number of Shares | ' |
Beginning Balance | 2,057,268 |
Granted | ' |
Exercised | ' |
Cancelled/Expired | 2,057,268 |
Ending Balance | ' |
Exercisable at July 31, 2014 | ' |
Weighted Average Exercise Price | ' |
Beginning Balance | $4.50 |
Granted | ' |
Exercised | ' |
Cancelled/Expired | $4.50 |
Ending Balance | ' |
Exercisable at July 31, 2014 | ' |
Stockholders_Equity_Details_Na
Stockholders' Equity (Details Narrative) (USD $) | 9 Months Ended | |
Jul. 31, 2014 | Jul. 31, 2013 | |
Stockholders Equity Details Narrative | ' | ' |
Stock-based compensation expenses | ($15,980) | $236,526 |
Weighted average remaining life of the stock options | '6 years 7 days | ' |
Sale_of_Cabeza_Creek_Field_Det
Sale of Cabeza Creek Field (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2014 | Jul. 31, 2013 | Jul. 31, 2014 | Jul. 31, 2013 | |
Oil and gas revenue | $465,791 | $467,879 | $1,062,491 | $1,303,045 |
Expenses: | ' | ' | ' | ' |
Selling, general and administrative | 244,723 | 336,255 | 960,706 | 1,107,685 |
Depreciation and depletion | 69,924 | 138,211 | 366,501 | 375,257 |
Accretion | 1,707 | 8,525 | 15,648 | 31,287 |
Lease operating expenses | 129,902 | 152,460 | 430,473 | 507,585 |
Impairment of oil and gas property interest | ' | ' | 2,219,813 | ' |
Oil and gas exploration costs | ' | 220,000 | ' | 220,000 |
Total expenses | 446,256 | 855,451 | 1,587,428 | 2,241,814 |
Loss from operations | 19,535 | -387,572 | -524,937 | -938,769 |
Other income (expense) | -758,770 | -360,411 | -1,930,972 | -928,155 |
Net loss | -739,235 | -747,983 | -2,455,909 | -1,866,924 |
Cabeza Creek Field [Member] | ' | ' | ' | ' |
Oil and gas revenue | ' | ' | 1,062,491 | 1,149,001 |
Expenses: | ' | ' | ' | ' |
Selling, general and administrative | ' | ' | 1,018,271 | 1,107,685 |
Depreciation and depletion | ' | ' | 366,501 | 301,620 |
Accretion | ' | ' | 15,648 | 1,143 |
Lease operating expenses | ' | ' | 430,473 | 447,579 |
Impairment of oil and gas property interest | ' | ' | 2,219,813 | ' |
Oil and gas exploration costs | ' | ' | ' | 220,000 |
Total expenses | ' | ' | 4,050,706 | 2,078,027 |
Loss from operations | ' | ' | -2,988,215 | -929,026 |
Other income (expense) | ' | ' | -230,952 | -928,155 |
Net loss | ' | ' | ($3,219,167) | ($1,857,181) |