Document_And_Entity_Informatio
Document And Entity Information (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Nov. 21, 2013 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'United American Petroleum Corp. | ' |
Document Type | '10-Q | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Amendment Flag | 'true | ' |
Amendment Description | 'This Amendment No.1 is filed to correct and update certain disclosure items. This Amendment No. 1 therefore supersedes the Original Filing in its entirety. | ' |
Entity Central Index Key | '0001321516 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Document Period End Date | 30-Sep-13 | ' |
Entity Common Stock, Par Value Per Share | $0.00 | ' |
Entity Common Stock, Shares Outstanding | ' | 55,335,367 |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2013 | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Cash | $624,267 | $572,784 |
Accounts receivable | 259,459 | 133,258 |
Related party receivables | 23,771 | 13,196 |
Total current assets | 907,497 | 719,238 |
Evaluated, net of accumulated depletion of $301,742 and $137,120 as of September 30, 2013 and December 31, 2012, respectively | 963,701 | 1,054,322 |
Unevaluated | 261,975 | 261,975 |
TOTAL ASSETS | 2,133,173 | 2,035,535 |
Accounts payable and accrued liabilities | 481,505 | 407,284 |
Convertible note payable as, of September 30, 2013 and December 31, 2012, respectively | 224,409 | ' |
Embedded derivative liability | 236,988 | ' |
Other payable | 592,524 | 451,939 |
Total current liabilities | 1,535,426 | 859,223 |
Asset retirement obligation | 53,671 | 69,316 |
TOTAL LIABILITIES | 1,589,097 | 928,539 |
Preferred Stock, Series B, $0.001 par value, 1,000 shares authorized, 1,000 shares issued and 1,000 shares outstanding and no shares issued and outstanding, respectively | 1 | 1 |
Common stock, $0.001 par value, 100,000,000 shares authorized, 55,335,367 and 50,339,442 shares issued and outstanding as of September 30 2013, and December 31 2012 | 55,335 | 50,339 |
Additional paid-in capital | 8,298,137 | 8,313,299 |
Accumulated deficit | -7,809,397 | -7,256,643 |
Total stockholders' deficit | 544,076 | 1,106,996 |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $2,133,173 | $2,035,535 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Condensed Consolidated Balance Sheets Parenthetical | ' | ' |
Accumulated depletion of evaluted oil and gas properties | $301,742 | $137,120 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 1,000 | 1,000 |
Preferred stock, shares issued | 1,000 | 0 |
Preferred stock, shares outstanding | 1,000 | 0 |
Common stock par value | $0.00 | $0.00 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 55,335,367 | 50,339,542 |
Common stock, shares outstanding | 55,335,367 | 50,339,542 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
REVENUE | ' | ' | ' | ' |
Oil and Gas sales | $106,634 | $194,723 | $475,145 | $376,140 |
Operator Income | 5,250 | 19,298 | 21,450 | 55,564 |
TOTAL REVENUE | 111,884 | 214,021 | 496,595 | 431,704 |
OPERATING EXPENSES (INCOME) | ' | ' | ' | ' |
Lease operating expenses | 82,518 | 98,023 | 354,930 | 320,467 |
Accretion expense | 1,000 | 1,757 | 3,000 | 5,271 |
Depletion expense | 14,769 | 21,922 | 89,022 | 57,224 |
General and administrative | 156,042 | 251,120 | 423,590 | 637,047 |
TOTAL OPERATING EXPENSES | 254,329 | 372,822 | 870,542 | 1,020,009 |
NET LOSS BEFORE OTHER EXPENSE | -142,445 | -158,801 | -373,947 | -588,305 |
OTHER INCOME (EXPENSE) | ' | ' | ' | ' |
Interest Income (Expense) | -193,956 | 21,548 | -274,895 | -2,252,939 |
Gain (Loss) on embedded derivatives | 29,186 | ' | 96,088 | -3,030,218 |
Total other Income (Expense) | -164,770 | 21,548 | -178,807 | -5,283,157 |
NET INCOME (LOSS) | ($307,215) | ($137,253) | ($552,754) | ($5,871,462) |
INCOME (LOSS) PER SHARE - BASIC | ($0.01) | $0 | ($0.01) | ($0.13) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING - BASIC | 51,010,765 | 50,034,543 | 50,565,742 | 46,803,104 |
INCOME (LOSS) PER SHARE - DILUTED | ($0.01) | $0 | ($0.01) | ($0.13) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING - DILUTED | 51,010,765 | 50,034,543 | 50,565,742 | 46,803,104 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Statement of Cash Flows [Abstract] | ' | ' |
Net (loss) | ($552,754) | ($5,871,462) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Depletion expense | 89,022 | 57,224 |
Accretion expense | 3,000 | 5,271 |
Amortization of debt discount and non-cash interest expense | 274,895 | 2,176,996 |
Loss (Gain) on embedded derivatives | -96,088 | 3,030,218 |
Change in assets and liabilities | ' | ' |
Accounts receivable | -126,201 | -39,840 |
Related party receivable | -10,575 | -3,799 |
Other receivable | ' | 160,302 |
Prepaid expenses | ' | -8,394 |
Accounts payable and accrued expenses | 74,221 | 179,316 |
Accrued interest | ' | -9,425 |
Other payable | 116,516 | ' |
Net cash (used in) operating activities | -227,964 | -323,593 |
CASH FLOWS USED IN INVESTING ACTIVITIES: | ' | ' |
Acquisition of oil and gas properties | ' | -274,527 |
Net cash used in investing activities | ' | -274,527 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' |
Proceeds from convertible notes | 279,447 | 615,000 |
Net cash provided by financing activities | 279,447 | 615,000 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 51,483 | 16,880 |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 572,784 | 593,469 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | 624,267 | 610,349 |
NON CASH TRANSACTIONS: | ' | ' |
Conversion of convertible notes payable | 117,656 | 2,800,000 |
Conversion of accrued interest | ' | 217,272 |
Discount from derivative liabilities | 210,250 | 615,000 |
Discount to additional paid-in capital from relative fair value of warrants | ' | 289,520 |
Reclassification of derivative liabilities from additional paid-in capital | 197,821 | ' |
Settlement of derivative liabilities to additional paid-in capital | $70,000 | $4,493,669 |
Nature_of_Operations_and_Basis
Nature of Operations and Basis of Presentation | 9 Months Ended |
Sep. 30, 2013 | |
Nature Of Operations And Basis Of Presentation | ' |
Nature of Operations and Basis of Presentation | ' |
1. Nature of Operations and Basis of Presentation | |
Nature of Operations | |
United American Petroleum Corp. is incorporated under the laws of the state of Nevada (“United”). United’s principal business is the acquisition and management of leasehold interests in petroleum and natural gas rights, either directly or indirectly, and the exploitation and development of properties subject to these leases. | |
Basis of Presentation | |
These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim consolidated financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q and Article 8 of SEC Regulation S-X. The principles for interim consolidated financial information do not require the inclusion of all the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. Therefore, these condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements on Form 10-K for the year ended December 31, 2012. The condensed consolidated financial statements included herein are unaudited; however, in the opinion of management, they contain all normal recurring adjustments necessary for a fair statement of the condensed results for the interim periods. Operating results for the nine month period ended September 30, 2013 are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. We made certain reclassifications to prior-period amounts to conform to the current presentation. | |
Going_Concern
Going Concern | 9 Months Ended |
Sep. 30, 2013 | |
Going Concern | ' |
Going Concern | ' |
2. Going Concern | |
The Company has incurred a net loss and negative operating cash flows since inception through September 30, 2013. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s management is implementing plans to sustain the Company’s cash flow from operating activities and/or acquire additional capital funding. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
Reclassification
Reclassification | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Reclassification | ' | ||||||||||||
Reclassification | ' | ||||||||||||
3. Reclassification | |||||||||||||
In accordance with the SEC’s Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB 108”), the Company recorded a reclassification adjustment for the three months and the nine months ended September 30, 2012 of $31,686 and $94,293 respectively which served to reduce Administrative income, Lease operating expenses and General & Administrative expenses. This non-cash adjustment had no effect on net income or EPS. The adjustment resulted from incorrectly recognizing revenue for administrative income collected from third party working interest owners of properties that were partially owned by the Company. As a result of the Company’s evaluation of this error under SAB 108, the Company determined that this error was not material in relation to the current year, but was material to the nine months ended September 30, 2012. Consequently, the September 30, 2012 income statement was adjusted to reflect the correction of this error. In evaluating materiality and determining the appropriateness of applying SAB 108 to this error, the Company considered materiality both qualitatively and quantitatively as prescribed by the SEC’s Staff Accounting Bulletin No. 99. The table noted below reflects the impact of the above error to the consolidated statements of operations as of and for the three months and nine months ended September 30, 2012. | |||||||||||||
Certain amounts disclosed in prior periods have been reclassified to conform to current presentation. Such reclassifications are for presentation purposes only and have no effect on the Company’s net loss or financial position in any of the periods presented. | |||||||||||||
A summary of these changes by category is as follows: | |||||||||||||
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2012 | Reclassification of Previously Reported Activity | ADJUSTED FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2012 | |||||||||||
Oil and Gas sales | 194,723 | 194,723 | |||||||||||
Operating Income | 50,984 | (31,686 | ) | 19,298 | |||||||||
TOTAL REVENUE | 245,707 | (31,686 | ) | 214,021 | |||||||||
OPERATING EXPENSES (INCOME) | |||||||||||||
Lease operating expenses | 105,827 | (7,804 | ) | 98,023 | |||||||||
Accretion expense | 1,757 | 1,757 | |||||||||||
Depletion expense | 21,922 | 21,922 | |||||||||||
General and administrative | 275,002 | (23,882 | ) | 251,120 | |||||||||
TOTAL OPERATING EXPENSES | 404,508 | (31,686 | ) | 372,822 | |||||||||
NET LOSS BEFORE OTHER EXPENSE | (158,801 | ) | (158,801 | ) | |||||||||
OTHER INCOME (EXPENSE) | |||||||||||||
Interest Expense | 21,548 | 21,548 | |||||||||||
Gain (Loss) on embedded derivatives | — | — | |||||||||||
21,548 | — | 21,548 | |||||||||||
NET INCOME (LOSS) | (137,253 | ) | — | (137,253 | ) | ||||||||
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2012 | Reclassification of Previously Reported Activity | ADJUSTED FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2012 | |||||||||||
Oil and Gas sales | 376,140 | 376,140 | |||||||||||
Operating Income | 149,857 | (94,293 | ) | 55,564 | |||||||||
TOTAL REVENUE | 525,997 | (94,293 | ) | 431,704 | |||||||||
OPERATING EXPENSES (INCOME) | |||||||||||||
Lease operating expenses | 343,531 | (23,064 | ) | 320,467 | |||||||||
Accretion expense | 5,271 | 5,271 | |||||||||||
Depletion expense | 57,224 | 57,224 | |||||||||||
General and administrative | 708,276 | (71,229 | ) | 637,047 | |||||||||
TOTAL OPERATING EXPENSES | 1,114,302 | (94,293 | ) | 1,020,009 | |||||||||
NET LOSS BEFORE OTHER EXPENSE | (588,305 | ) | (588,305 | ) | |||||||||
OTHER INCOME (EXPENSE) | |||||||||||||
Interest Expense | (2,252,939 | ) | (2,252,939 | ) | |||||||||
Gain (Loss) on embedded derivatives | (3,030,218 | ) | (3,030,218 | ) | |||||||||
Total other expense | (5,283,157 | ) | — | (5,283,157 | ) | ||||||||
NET INCOME (LOSS) | (5,871,462 | ) | — | (5,871,462 | ) | ||||||||
Related_Party_Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
4. Related Party Transactions | |
As of September 30, 2013 and December 31, 2012, the Company had a related party receivables of $23,771 and $13,196, respectively, related to working interest amounts payable. Our directors are also officers in the Company. |
Fair_Value_Measurements_and_De
Fair Value Measurements and Derivative Liabilities | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Fair Value Measurements And Derivative Liabilities | ' | ||||
Fair Value Measurements and Derivative Liabilities | ' | ||||
5. Fair Value Measurements and Derivative Liabilities | |||||
The Company measures fair value in accordance with a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: | |||||
Level 1 | Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; | ||||
Level 2 | Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and | ||||
Level 3 | Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). | ||||
During 2013, the Company issued debt instruments that were convertible into common stock at a conversion price equal to 60% of the lowest trading price per share during the previous 25 trading days. See Note 6. The conversion options embedded in these instruments contain no explicit limit to the number of shares to be issued upon settlement and as a result are classified as liabilities under ASC 815. Additionally, because the number of shares to be issued upon settlement is indeterminate, all other share settle-able instruments must also be classified as liabilities. As a result, the Company measured its outstanding warrants on January 31, 2013 at fair value and re-classified these amounts from additional paid-in capital to derivative liabilities. | |||||
The following is a reconciliation of the conversion option liability and embedded warrant liability for which Level 3 inputs were used in determining fair value: | |||||
Beginning balance January 1, 2013 | $ | — | |||
Additions due to new convertible debt | 346,846 | ||||
Reclassification of derivative liabilities from additional paid-in capital | 197,821 | ||||
Reclassification of derivative liabilities to additional paid-in capital due to conversion of related notes payable | (70,000 | ) | |||
Mark to market of debt derivative | (237,679 | ) | |||
Debt derivative as of September 30, 2013 | $ | 236,988 | |||
The gain on derivative liabilities in the consolidated statement of operations of $96,088 consists of the gain of $237,679 noted above and a loss on derivative liabilities of $141,591 which is the amount by which the derivative liabilities exceeded the principal balance of the related notes payable on issuance. | |||||
The Company’s conversion option liabilities are valued using pricing models and the Company generally uses similar models to value similar instruments. Where possible, the Company verifies the values produced by its pricing models to market prices. Valuation models require a variety of inputs, including contractual terms, market prices, yield curves, credit spreads, measures of volatility and correlations of such inputs. These consolidated financial liabilities do not trade in liquid markets, and as such, model inputs cannot generally be verified and do involve significant management judgment. Such instruments are typically classified within Level 3 of the fair value hierarchy. The Company uses the Black Scholes Option Pricing Model to value its derivatives based upon the following assumptions: dividend yield of -0-%, volatility of 129.70-143.41%, risk free rate of 0.14-0.42% and an expected term of 0.50 to 1 year. | |||||
Convertible_Note_Payable
Convertible Note Payable | 9 Months Ended |
Sep. 30, 2013 | |
OPERATING EXPENSES (INCOME) [Abstract] | ' |
Convertible Note Payable | ' |
6. Convertible Note Payable | |
Credit Facility – January 31, 2013 | |
On January 31, 2013, we entered into a Note Purchase Agreement with an investor pursuant to which the investor agreed to lend the Company up to $400,000 in multiple installments in exchange for a senior secured convertible promissory note with a conversion price equal to 60% of the lowest trading price per share during the previous 25 trading days. The first installment of $55,000 was delivered less a fee of $5,000 on the date of the Purchase Agreement. The second installment of $25,000 was delivered in April 2013. The notes mature on January 31, 2014, or upon default, whichever is earlier and bear interest at an annual rate of 12%. As described in Note 5, the embedded conversion feature qualified for liability classification at fair value. As a result, the Company recorded a full discount of $55,000 to the note payable on issuance. | |
On August 13, 2013, September 9, 2013 and September 26, 2013 the holder of the convertible note exercised a portion of the conversion rights of the note for 250,000, 300,000 and 600,000 shares of common respectively at stock prices of $0.03, $0.0265, and $0.01160 respectively for a total of $22,410 principal converted. | |
As a result of the exercise of the conversion option of the note, the Company fully amortized the remaining balance of the associated debt discount of $55,000 recognizing interest expense for the same amount. | |
Credit Facility – February 19, 2013 | |
On February 19, 2013, we entered into a credit facility with an investor unrelated to the investor described above pursuant to which the investor lent $103,500 to us in a single installment in exchange for a convertible promissory note with a conversion price equal to the average lowest trading price per share during the previous 10 trading days. The embedded conversion option cannot be exercised until 180 days from the date of the note and as such, will not be priced until exercisable. The total number of conversion shares is calculated by dividing the amount of the notes by the conversion price. | |
In May of 2013, we did not comply with the timely filing requirement on this loan. Pursuant to the promissory note, a penalty of 50% of the outstanding principal amount equaling $51,750 was added to the balance of the note. This additional sum will be eligible for conversion at the same terms as the original principal balance. | |
On August 26, 2013, September 6, 2013 and September 26, 2013 the holder of the convertible note exercised a portion of the conversion rights of the note for 478,469, 840,336 and 1,034,483 shares of common respectively at stock prices of $0.0418, $0.0357, and $0.145 respectively for a total of $90,250 principal converted. | |
As a result of the exercise of the conversion option of the note, the Company fully amortized the remaining balance of the associated debt discount of $155,250 recognizing interest expense for the same amount. | |
Credit Facility – April 22, 2013 | |
On April 22, 2013, we entered into a credit facility with an investor unrelated to the investor described above pursuant to which the investor lent $63,000 to us in a single installment in exchange for a convertible promissory note with a conversion price equal to the average lowest trading price per share during 5 of the previous 10 trading days. The embedded conversion option cannot be exercised until 180 days from the date of the note and as such, will not be priced until exercisable. The total number of conversion shares is calculated by dividing the amount of the notes by the conversion price. | |
On September 23, 2013 the investor lent an additional $47,000 in a single installment under the same terms agreement and terms as the previous installment made April 22, 2013. | |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
7. Subsequent Events | |
On October 7, 2013, the holder of the February 19, 2013 note exercised a portion of the conversion rights of the note for 1,492,537 shares of common stock at a stock price of $0.0134 for a total of $70,250 principal converted. | |
In addition, on October 16, 2013, October 31, 2013 and November 13, 2013 the holder of the January 31, 2013 convertible note exercised a portion of the conversion rights of the note for 1,200,000, 150,000 and 2,200,000 shares of common respectively at stock prices of $0.006, $0.004, and $0.003 respectively for a total of $18,650 principal converted. | |
Reclassification_Tables
Reclassification (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Reclassification Tables | ' | ||||||||||||
Summary schedule of reclassifications | ' | ||||||||||||
A summary of these changes by category is as follows: | |||||||||||||
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2012 | Reclassification of Previously Reported Activity | ADJUSTED FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2012 | |||||||||||
Oil and Gas sales | 194,723 | 194,723 | |||||||||||
Operating Income | 50,984 | (31,686 | ) | 19,298 | |||||||||
TOTAL REVENUE | 245,707 | (31,686 | ) | 214,021 | |||||||||
OPERATING EXPENSES (INCOME) | |||||||||||||
Lease operating expenses | 105,827 | (7,804 | ) | 98,023 | |||||||||
Accretion expense | 1,757 | 1,757 | |||||||||||
Depletion expense | 21,922 | 21,922 | |||||||||||
General and administrative | 275,002 | (23,882 | ) | 251,120 | |||||||||
TOTAL OPERATING EXPENSES | 404,508 | (31,686 | ) | 372,822 | |||||||||
NET LOSS BEFORE OTHER EXPENSE | (158,801 | ) | (158,801 | ) | |||||||||
OTHER INCOME (EXPENSE) | |||||||||||||
Interest Expense | 21,548 | 21,548 | |||||||||||
Gain (Loss) on embedded derivatives | — | — | |||||||||||
21,548 | — | 21,548 | |||||||||||
NET INCOME (LOSS) | (137,253 | ) | — | (137,253 | ) | ||||||||
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2012 | Reclassification of Previously Reported Activity | ADJUSTED FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2012 | |||||||||||
Oil and Gas sales | 376,140 | 376,140 | |||||||||||
Operating Income | 149,857 | (94,293 | ) | 55,564 | |||||||||
TOTAL REVENUE | 525,997 | (94,293 | ) | 431,704 | |||||||||
OPERATING EXPENSES (INCOME) | |||||||||||||
Lease operating expenses | 343,531 | (23,064 | ) | 320,467 | |||||||||
Accretion expense | 5,271 | 5,271 | |||||||||||
Depletion expense | 57,224 | 57,224 | |||||||||||
General and administrative | 708,276 | (71,229 | ) | 637,047 | |||||||||
TOTAL OPERATING EXPENSES | 1,114,302 | (94,293 | ) | 1,020,009 | |||||||||
NET LOSS BEFORE OTHER EXPENSE | (588,305 | ) | (588,305 | ) | |||||||||
OTHER INCOME (EXPENSE) | |||||||||||||
Interest Expense | (2,252,939 | ) | (2,252,939 | ) | |||||||||
Gain (Loss) on embedded derivatives | (3,030,218 | ) | (3,030,218 | ) | |||||||||
Total other expense | (5,283,157 | ) | — | (5,283,157 | ) | ||||||||
NET INCOME (LOSS) | (5,871,462 | ) | — | (5,871,462 | ) | ||||||||
Fair_Value_Measurements_and_De1
Fair Value Measurements and Derivative Liabilities (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Fair Value Measurements And Derivative Liabilities Tables | ' | ||||
Reconciliation of the conversion option liability and detachable warrant liability for Level 3 inputs | ' | ||||
The following is a reconciliation of the conversion option liability and embedded warrant liability for which Level 3 inputs were used in determining fair value: | |||||
Beginning balance January 1, 2013 | $ | — | |||
Additions due to new convertible debt | 346,846 | ||||
Reclassification of derivative liabilities from additional paid-in capital | 197,821 | ||||
Reclassification of derivative liabilities to additional paid-in capital due to conversion of related notes payable | (70,000 | ) | |||
Mark to market of debt derivative | (237,679 | ) | |||
Debt derivative as of September 30, 2013 | $ | 236,988 |
Reclassification_Details_Narra
Reclassification (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2012 | Sep. 30, 2012 | |
Reclassification Details Narrative | ' | ' |
Reclassification adjustment | $31,686 | $94,293 |
Reclassification_Reclassificat
Reclassification - Reclassification (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Oil and Gas sales | $106,634 | $194,723 | $475,145 | $376,140 |
Well operator income | 5,250 | 19,298 | 21,450 | 55,564 |
TOTAL REVENUE | 111,884 | 214,021 | 496,595 | 431,704 |
OPERATING EXPENSES (INCOME) | ' | ' | ' | ' |
Lease operating expenses | 82,518 | 98,023 | 354,930 | 320,467 |
Accretion expense | 1,000 | 1,757 | 3,000 | 5,271 |
Depletion expense | 14,769 | 21,922 | 89,022 | 57,224 |
General and administrative | 156,042 | 251,120 | 423,590 | 637,047 |
TOTAL OPERATING EXPENSES | 254,329 | 372,822 | 870,542 | 1,020,009 |
NET LOSS BEFORE OTHER EXPENSE | -142,445 | -158,801 | -373,947 | -588,305 |
OTHER INCOME (EXPENSE) | ' | ' | ' | ' |
Interest Expense | -193,956 | 21,548 | -274,895 | -2,252,939 |
Gain (Loss) on embedded derivatives | 29,186 | ' | 96,088 | -3,030,218 |
Total Other Income (Expense) | -164,770 | 21,548 | -178,807 | -5,283,157 |
NET INCOME (LOSS) | -307,215 | -137,253 | -552,754 | -5,871,462 |
Previously Reported | ' | ' | ' | ' |
Oil and Gas sales | ' | 194,723 | ' | 376,140 |
Well operator income | ' | 50,984 | ' | 149,857 |
TOTAL REVENUE | ' | 245,707 | ' | 525,997 |
OPERATING EXPENSES (INCOME) | ' | ' | ' | ' |
Lease operating expenses | ' | 105,827 | ' | 343,531 |
Accretion expense | ' | 1,757 | ' | 5,271 |
Depletion expense | ' | 21,922 | ' | 57,224 |
General and administrative | ' | 275,002 | ' | 708,276 |
TOTAL OPERATING EXPENSES | ' | 404,508 | ' | 1,114,302 |
NET LOSS BEFORE OTHER EXPENSE | ' | -158,801 | ' | -588,305 |
OTHER INCOME (EXPENSE) | ' | ' | ' | ' |
Interest Expense | ' | 21,548 | ' | -2,252,939 |
Gain (Loss) on embedded derivatives | ' | ' | ' | -3,030,218 |
Total Other Income (Expense) | ' | 21,548 | ' | -5,283,157 |
NET INCOME (LOSS) | ' | -137,253 | ' | -5,871,462 |
Reclassification of Previously Reported Activity | ' | ' | ' | ' |
Well operator income | ' | -31,686 | ' | -94,293 |
TOTAL REVENUE | ' | -31,686 | ' | -94,293 |
OPERATING EXPENSES (INCOME) | ' | ' | ' | ' |
Lease operating expenses | ' | -7,804 | ' | -23,064 |
General and administrative | ' | -23,882 | ' | -71,229 |
TOTAL OPERATING EXPENSES | ' | ($31,686) | ' | ($94,293) |
Related_Party_Transactions_Det
Related Party Transactions (Details Narrative) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Related Party Transactions Details Narrative | ' | ' |
Related party receivables | $23,771 | $13,196 |
Fair_Value_Measurements_and_De2
Fair Value Measurements and Derivative Liabilities (Details Narrative) (USD $) | 9 Months Ended | 0 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jan. 31, 2013 | |
Lower Range | Upper Range | Note Purchase Agreement - 1-31-2013 | ||
Conversion price, percentage of trading price | ' | ' | ' | 60.00% |
Debt conversion price, number of trading days to compute conversion price | ' | ' | ' | '25 days |
Mark to market of debt derivative | $237,679 | ' | ' | ' |
Loss on derivative liability | $141,591 | ' | ' | ' |
Fair Value Assumptions, Expected Dividend Rate | 0.00% | ' | ' | ' |
Fair Value Assumptions, Expected Volatility Rate | ' | 129.70% | 143.41% | ' |
Fair Value Assumptions, Risk Free Interest Rate | ' | 0.14% | 0.42% | ' |
Fair Value Assumptions, Expected Term | ' | '0 years 6 months | '1 year | ' |
Fair_Value_Measurements_and_De3
Fair Value Measurements and Derivative Liabilities (Details) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Fair Value Measurements And Derivative Liabilities Details | ' |
Conversion option liability and embedded warrant liability, beginning | ' |
Additions due to new convertible debt | 346,846 |
Reclassification of derivative liabilities from additional paid-in capital | 197,821 |
Reclassification of derivative liabilities to additional paid-in capital due to conversion of related notes payable | -70,000 |
Mark to market of debt derivative | -237,679 |
Conversion option liability and embedded warrant liability, ending | $446,988 |
Convertible_Note_Payable_Detai
Convertible Note Payable (Details Narrative) (USD $) | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | |||||||||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Nov. 13, 2013 | Oct. 31, 2013 | Oct. 16, 2013 | Sep. 26, 2013 | Sep. 09, 2013 | Aug. 13, 2013 | Jan. 31, 2013 | Sep. 30, 2013 | Oct. 07, 2013 | Sep. 26, 2013 | Sep. 06, 2013 | Aug. 26, 2013 | Feb. 19, 2013 | Sep. 30, 2013 | Sep. 23, 2013 | Apr. 22, 2013 | Sep. 26, 2013 | Sep. 06, 2013 | Aug. 26, 2013 | |
Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note 4-22-2013 | Convertible Promissory Note 4-22-2013 | Convertible Promissory Note 4-22-2013 | Convertible Promissory Note 4-22-2013 | Convertible Promissory Note 4-22-2013 | |||
Face amount | ' | ' | ' | ' | ' | ' | ' | ' | $55,000 | ' | ' | ' | ' | ' | $103,500 | ' | ' | ' | ' | ' | ' |
Date of issuance | ' | ' | ' | ' | ' | ' | ' | ' | 31-Jan-13 | ' | ' | ' | ' | ' | 19-Feb-13 | ' | ' | ' | ' | ' | ' |
Maturity date | ' | ' | ' | ' | ' | ' | ' | ' | 31-Jan-14 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate | ' | ' | ' | ' | ' | ' | ' | ' | 12.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt fee | ' | ' | ' | ' | ' | ' | ' | ' | 5,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
First installment of credit facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | 55,000 | ' | ' | ' | ' | ' | ' | 47,000 | 63,000 | ' | ' | ' |
Second installment of credit facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion price, percentage of trading price | ' | ' | ' | ' | ' | ' | ' | ' | 60.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt conversion price, number of trading days to compute conversion price | ' | ' | ' | ' | ' | ' | ' | ' | '25 days | ' | ' | ' | ' | ' | '10 days | ' | ' | '10 days | ' | ' | ' |
Debt conversion price, number of days for average price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 days | ' | ' | ' |
Debt conversion, shares issued | ' | ' | 2,200,000 | 150,000 | 1,200,000 | 600,000 | 300,000 | 250,000 | ' | ' | 1,492,537 | 1,034,483 | 840,336 | 478,469 | ' | ' | ' | ' | ' | ' | ' |
Total principal amount converted | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22,410 | 70,250 | ' | ' | ' | ' | 90,250 | ' | ' | ' | ' | ' |
Debt conversion price | ' | ' | $0.00 | $0.00 | $0.01 | $0.01 | $0.03 | $0.03 | ' | ' | $0.01 | ' | ' | ' | ' | ' | ' | ' | $0.14 | $0.04 | $0.04 |
Amortization of debt discount, recognized as interest expense | 274,895 | 2,176,996 | ' | ' | ' | ' | ' | ' | ' | 32,397 | ' | ' | ' | ' | ' | 155,250 | ' | ' | ' | ' | ' |
Debt conversion date restriction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '180 days | ' | ' | '180 days | ' | ' | ' |
Penalty percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' |
Penalty on Convertible Note | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 51,750 | ' | ' | ' | ' | ' | ' |
Total proceeds from credit facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $63,000 | ' | ' | ' |
Subsequent_Events_Details_Narr
Subsequent Events (Details Narrative) (USD $) | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | ||||||||
Oct. 07, 2013 | Sep. 26, 2013 | Sep. 06, 2013 | Aug. 26, 2013 | Sep. 30, 2013 | Nov. 13, 2013 | Oct. 31, 2013 | Oct. 16, 2013 | Sep. 26, 2013 | Sep. 09, 2013 | Aug. 13, 2013 | Sep. 30, 2013 | |
Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note - 2-19-2013 | Convertible Promissory Note - 2-19-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | Note Purchase Agreement - 1-31-2013 | |
Debt conversion, shares issued | 1,492,537 | 1,034,483 | 840,336 | 478,469 | ' | 2,200,000 | 150,000 | 1,200,000 | 600,000 | 300,000 | 250,000 | ' |
Total principal amount converted | $70,250 | ' | ' | ' | $90,250 | ' | ' | ' | ' | ' | ' | $22,410 |
Debt conversion price | $0.01 | ' | ' | ' | ' | $0.00 | $0.00 | $0.01 | $0.01 | $0.03 | $0.03 | ' |