GulfSlope Energy (GSPE) 10-Q 14 Feb 20 2020 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Dec. 31, 2019	Feb. 13, 2020
Document And Entity Information
Entity Registrant Name	GULFSLOPE ENERGY, INC.
Entity Central Index Key	0001341726
Document Type	10-Q
Document Period End Date	Dec. 31, 2019
Entity File Number	000-51638
Entity Incorporation, State Code	DE
Amendment Flag	false
Current Fiscal Year End Date	--09-30
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		1,162,564,741
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2020

Condensed Balance Sheets (Unaud

Condensed Balance Sheets (Unaudited) - USD ($)	Dec. 31, 2019	Sep. 30, 2019
Current Assets
Cash	$ 3,771,395	$ 1,138,919
Accounts Receivable	2,739,785	8,493,308
Prepaid Expenses and Other Current Assets	214,900	137,173
Total Current Assets	6,726,080	9,769,400
Property and Equipment, net	11,479	13,014
Oil and Natural Gas Properties, Full Cost Method of Accounting, Unproved Properties	21,517,313	17,338,978
Other Non-Current Assets	24,785	3,662,231
Operating Lease Right of Use Asset	92,859
Total Non-Current Assets	21,646,436	21,014,223
Total Assets	28,372,516	30,783,623
Current Liabilities
Accounts Payable	9,330,170	12,747,382
Related Party Payable	380,784	365,904
Accrued Interest Payable	2,379,618	2,282,217
Accrued Expenses and Other Payables	268,862	1,949,360
Loans from Related Parties	8,725,500	8,725,500
Note Payable	468,035	267,000
Notes Payable, net of Debt Discount	1,702,641	1,197,966
Derivative Financial Instruments	3,025,708	3,534,456
Current Portion of Operating Lease Liability	75,647
Other		42,746
Total Current Liabilities	26,356,965	31,112,531
Operating Lease Liability	43,410
Total Non-Current Liabilities	43,410
Total Liabilities	26,400,375	31,112,531
Commitments and Contingencies (Note 9)
Stockholders' Equity (Deficit)
Preferred Stock; par value ($0.001); Authorized 50,000,000 shares none issued or outstanding
Common Stock; par value ($0.001); Authorized 1,500,000,000 shares; issued and outstanding 1,148,609,520 and 1,092,266,844 as of December 31, 2019 and September 30, 2019, respectively	1,148,609	1,092,266
Additional Paid-in-Capital	56,542,256	54,160,836
Accumulated Deficit	(55,718,724)	(55,582,010)
Total Stockholders' Equity (Deficit)	1,972,141	(328,908)
Total Liabilities and Stockholders' Equity (Deficit)	$ 28,372,516	$ 30,783,623

Condensed Balance Sheets (Una_2

Condensed Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Dec. 31, 2019	Sep. 30, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized	50,000,000	50,000,000
Preferred stock, issued	0	0
Preferred stock, outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized	1,500,000,000	1,500,000,000
Common stock, issued	1,148,609,520	1,148,609,520
Common stock, outstanding	1,092,266,844	1,092,266,844

Condensed Statements of Operati

Condensed Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Income Statement [Abstract]
Revenues
General and Administrative Expenses	476,922	$ 129,438
Net Loss from Operations	(476,922)	(129,438)
Other Income/(Expenses):
Interest Expense, net	(21,226)	(20,615)
Loss on Debt Extinguishment	(879,522)
Gain (Loss) on Derivative Financial Instruments	1,224,527	(196,266)
Net Loss Before Income Taxes	(153,143)	(346,319)
Provision for Income Taxes
Net Loss	$ (153,143)	$ (346,319)
Loss Per Share - Basic and Diluted (in dollars per share)	$ 0	$ 0
Weighted Average Shares Outstanding - Basic and Diluted (in shares)	1,105,662,883	832,013,373

Statements of Stockholders' Equ

Statements of Stockholders' Equity (Deficit) (unaudited) - USD ($)	Common Stock [Member]	Additional Paid-In Capital [Member]	Accumulated Deficit [Member]	Total
Balance at beginning at Sep. 30, 2018	$ 832,013	$ 36,640,009	$ (41,858,257)	$ (4,386,235)
Balance at beginning (in shares) at Sep. 30, 2018	832,013,272
Stock based compensation		393,000		393,000
Common stock and warrants issued for cash	$ 19,325	946,925		966,250
Common stock and warrants issued for cash (in shares)	19,325,000
Net Loss			(346,319)	(346,319)
Balance at end at Dec. 31, 2018	$ 851,338	37,979,934	(42,204,576)	(3,373,304)
Balance at end (in shares) at Dec. 31, 2018	851,338,272
Balance at beginning at Sep. 30, 2019	$ 1,092,266	54,160,836	(55,582,010)	$ (328,908)
Balance at beginning (in shares) at Sep. 30, 2019	1,092,266,844			1,092,266,844
Cumulative adjustment upon ASC 842 adoption			16,429	$ 16,429
Stock based compensation		367,841		367,841
Common stock issued for conversion of convertible note payable and accrued interest	$ 17,920	530,471		548,391
Common stock issued for conversion of convertible note payable and accrued interest (in shares)	17,919,455
Common stock registration costs		(15,398)		(15,398)
Stock Issued to extinguish liability	$ 38,423	1,498,506		1,536,929
Stock Issued to extinguish liability (in shares)	38,423,221
Net Loss			(153,143)	(153,143)
Balance at end at Dec. 31, 2019	$ 1,148,609	$ 56,542,256	$ (55,718,724)	$ 1,972,141
Balance at end (in shares) at Dec. 31, 2019	1,148,609,520			1,092,266,844

Condensed Statements of Cash Fl

Condensed Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
OPERATING ACTIVITIES
Net Loss	$ (153,143)	$ (346,319)
Adjustments to Reconcile Net Loss to Net Cash Provided By (Used In) Operating Activities:
Capitalization of Interest Expense	(442,338)	(77,542)
Depreciation	1,535	1,309
Stock Based Compensation	181,166	74,342
(Gain)Loss on Derivative Financial Instruments	(1,224,527)	196,266
Debt Discount Amortization	238,039
Loss Recorded to Interest Expense for Issuance of Convertible Notes	32,539
Loss on Debt Extinguishment	879,522
Changes in Operating Assets and Liabilities:
Accounts Receivable	5,769,927	(6,707,634)
Prepaid Expenses and Other Current Assets	142,902	38,883
Deposits from Joint Interest Owners		(2,622,000)
Accounts Payable	(3,086,387)	8,890,616
Related Party Payable	14,880	14,878
Accrued Interest	204,298	119,805
Other	(8,864)	30,317
Net Cash Provided By (Used In) Operating Activities	2,549,549	(387,079)
INVESTING ACTIVITIES
Insurance Proceeds Received	637,875
Expenditures for Oil and Gas Properties	(970,353)	(1,411,914)
Net Cash Provided by (Used in) Investing Activities	(332,478)	(1,411,914)
FINANCING ACTIVITIES
Proceeds from Issuance of Convertible Notes Payable	435,000
Payments on Note Payable	(19,594)	(26,035)
Net Cash Provided by (Used in) Financing Activities	415,406	(26,035)
Net Increase/(Decrease) in Cash	2,632,477	(1,825,028)
Beginning Cash Balance	1,138,919	5,621,814
Ending Cash Balance	3,771,395	3,796,786
Supplemental Schedule of Cash Flow Activities:
Cash Paid for Interest	1,030	1,335
Non-Cash Financing and Investing Activities:
Prepaid Asset Financed by Note Payable	220,629	146,310
Capital Expenditures Included in Accounts Payable	480,900	1,360,433
Stock-Based Compensation Capitalized to Unproved Properties	186,675
Accounts Receivable Exchanged for Working Interest in Oil and Natural Gas Properties	3,629,789
Accrued Expense Extinguished through Issuing Common Stock	1,536,929
Funds Received from Capital Raise Transferred to Equity		$ 965,800
Stock Issued to Settle Convertible Promissory Notes and Accrued Interest	548,391
Derivative Liability Related to Issuance of Convertible Debentures recorded as Debt Discount	433,425
Convertible Debenture Proceeds Retained by Lender to Settle Loan Issuance Costs	$ 65,000

ORGANIZATION AND NATURE OF BUSI

ORGANIZATION AND NATURE OF BUSINESS	3 Months Ended
	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND NATURE OF BUSINESS	NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS GulfSlope Energy, Inc. (the “Company” or “GulfSlope”) is an independent oil and natural gas exploration company whose interests are concentrated in the United States Gulf of Mexico federal waters offshore Louisiana. The Company has leased seven federal Outer Continental Shelf blocks (referred to as “prospect,” “portfolio” or “leases”) and licensed three-dimensional (3-D) seismic data in its area of concentration.

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Dec. 31, 2019
Accounting Policies [Abstract]
SIGNIFICANT ACCOUNTING POLICIES	NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES The condensed financial statements included herein are unaudited. However, these condensed financial statements include all adjustments (consisting of normal recurring adjustments), which, in the opinion of management are necessary for a fair presentation of financial position, results of operations and cash flows for the interim periods. The results of operations for interim periods are not necessarily indicative of the results to be expected for an entire year. The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the Company’s condensed financial statements and accompanying notes. Actual results could differ materially from those estimates. Certain information, accounting policies, and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted pursuant to certain rules and regulations of the Securities and Exchange Commission (“SEC”). The condensed financial statements should be read in conjunction with the audited financial statements for the year ended September 30, 2019, which were included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2019, and filed with the Securities and Exchange Commission on December 30, 2019. Cash GulfSlope considers highly liquid investments with original maturities to the Company of three months or less to be cash equivalents. There were no cash equivalents at December 31, 2019 and September 30, 2018. Liquidity/Going Concern The Company has incurred accumulated losses as of December 31, 2019 of $55.7 million, has negative working capital of $19.6 million and for the three months ended December 31, 2019 generated losses of $0.2 million. Further losses are anticipated in developing our business. As a result, there exists substantial doubt about our ability to continue as a going concern. As of December 31, 2019, we had $3.8 million of unrestricted cash on hand, $3.1 million of this amount is for the payment of joint payables from drilling operations. The Company estimates that it will need to raise a minimum of $10.0 million to meet its obligations and planned expenditures through February 2021. The $10.0 million is comprised primarily of capital project expenditures as well as general and administrative expenses. It does not include any amounts due under outstanding debt obligations, which amounted to $13.3 million of current principal and interest as of December 31, 2019. The Company plans to finance operations and planned expenditures through equity and/or debt financings and/or farm-out agreements. The Company also plans to extend the agreements associated with all loans, the accrued interest payable on these loans, as well as the Company’s accrued liabilities. There are no assurances that financing will be available with acceptable terms, if at all or that obligations can be extended. If the Company is not successful in obtaining financing or extending obligations, operations would need to be curtailed or ceased, or the Company would need to sell assets or consider alternative plans up to and including restructuring. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Accounts Receivable The Company records an accounts receivable for operations expense reimbursements due from joint interest partners. The Company estimates allowances for doubtful accounts based on the aged receivable balances and historical losses. If the Company determines any account to be uncollectible based on significant delinquency or other factors, the receivable and the underlying asset are assessed for recovery. As of December 31, 2019 and 2018, no allowance was recorded. Accounts receivable from oil and gas joint operations and joint ventures is $2.7 million and $8.5 million at December 31, 2019 and 2018, respectively. Full Cost Method The Company uses the full cost method of accounting for its oil and gas exploration and development activities. Under the full cost method of accounting, all costs associated with successful and unsuccessful exploration and development activities are capitalized on a country-by-country basis into a single cost center (“full cost pool”). Such costs include property acquisition costs, geological and geophysical (“G&G”) costs, carrying charges on non-producing properties, costs of drilling both productive and non-productive wells. Overhead costs, which includes employee compensation and benefits including stock-based compensation, incurred that are directly related to acquisition, exploration and development activities are capitalized. Interest expense is capitalized related to unevaluated properties and wells in process during the period in which the Company is incurring costs and expending resources to get the properties ready for their intended purpose. For significant investments in unproved properties and major development projects that are not being currently depreciated, depleted, or amortized and on which exploration or development activities are in progress, interest costs are capitalized. 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. A significant alteration would typically involve a sale of 25% or more of the proved reserves related to a single full cost pool. Proved properties are amortized on a country-by-country basis using the units of production method (“UOP”), whereby capitalized costs are amortized over total proved reserves. The amortization base in the UOP calculation includes the sum of proved property, net of accumulated depreciation, depletion and amortization (“DD&A”), estimated future development costs (future costs to access and develop proved reserves), and asset retirement costs, less related salvage value. The costs of unproved properties and related capitalized costs (such as G&G costs) are withheld from the amortization calculation until such time as they are either developed or abandoned. Unproved properties and properties under development are reviewed for impairment at least quarterly and are determined through an evaluation considering, among other factors, seismic data, requirements to relinquish acreage, drilling results, remaining time in the commitment period, remaining capital plan, and political, economic, and market conditions. In countries where proved reserves exist, exploratory drilling costs associated with dry holes are transferred to proved properties immediately upon determination that a well is dry and amortized accordingly. In countries where a reserve base has not yet been established, impairments are charged to earnings. Companies that use the full cost method of accounting for oil and natural gas exploration and development activities are required to perform a ceiling test calculation each quarter. The full cost ceiling test is an impairment test prescribed by SEC Regulation S-X Rule 4-10. The ceiling test is performed quarterly, on a country-by-country basis, utilizing the average of prices in effect on the first day of the month for the preceding twelve month period. The cost center ceiling is defined as the sum of (a) estimated future net revenues, discounted at 10% per annum, from proved reserves, (b) the cost of properties not being amortized, if any, and (c) the lower of cost or market value of unproved properties included in the cost being amortized. If such capitalized costs exceed the ceiling, the Company will record a write-down to the extent of such excess as a non-cash charge to earnings. Any such write-down will reduce earnings in the period of occurrence and results in a lower depreciation, depletion and amortization rate in future periods. A write-down may not be reversed in future periods even though higher oil and natural gas prices may subsequently increase the ceiling. The Company capitalizes exploratory well costs into oil and gas properties until a determination is made that the well has either found proved reserves or is impaired. If proved reserves are found, the capitalized exploratory well costs are reclassified to proved properties. The well costs are charged to expense if the exploratory well is determined to be impaired. The Company has drilled two well bores and is currently evaluating such wells for proved reserves. Accordingly such costs are included as suspended well costs at December 31, 2019 and it is expected that a final analysis will be completed in the next nine months at which time the costs will be transferred to the full cost pool. Asset Retirement Obligations The Company’s asset retirement obligations will represent the present value of the estimated future costs associated with plugging and abandoning oil and natural gas wells, removing production equipment and facilities and restoring the seabed in accordance with the terms of oil and gas leases and applicable state and federal laws. Determining asset retirement obligations requires estimates of the costs of plugging and abandoning oil and natural gas wells, removing production equipment and facilities and restoring the sea bed as well as estimates of the economic lives of the oil and gas wells and future inflation rates. The resulting estimate of future cash outflows will be discounted using a credit-adjusted risk-free interest rate that corresponds with the timing of the cash outflows. Cost estimates will consider historical experience, third party estimates, the requirements of oil and natural gas leases and applicable local, state and federal laws, but do not consider estimated salvage values. Asset retirement obligations will be recognized when the wells drilled reach total depth or when the production equipment and facilities are installed or acquired with an associated increase in proved oil and gas property costs. Asset retirement obligations will be accreted each period through depreciation, depletion and amortization to their expected settlement values with any difference between the actual cost of settling the asset retirement obligations and recorded amount being recognized as an adjustment to proved oil and gas property costs. Cash paid to settle asset retirement obligations will be included in net cash provided by operating activities from continuing operations in the statements of cash flows. On a quarterly basis, when indicators suggest there have been material changes in the estimates underlying the obligation, the Company reassesses its asset retirement obligations to determine whether any revisions to the obligations are necessary. At least annually, the Company will assess all of its asset retirement obligations to determine whether any revisions to the obligations are necessary. Future revisions could occur due to changes in estimated costs or well economic lives, or if federal or state regulators enact new requirements regarding plugging and abandoning oil and natural gas wells. The Company has drilled two well bores and is currently evaluating these wells. The two wellbores drilled in 2018 and 2019, were both plugged while the company continues to evaluate well log data and therefore the costs related to the asset retirement obligation were incurred. Such costs were recognized as capitalized oil and gas costs. The asset retirement obligation was completely extinguished in that if the wells prove not to be commercially viable, there is no further cost needed to remediate the site. Derivative Financial Instruments The accounting treatment of derivative financial instruments requires that the Company the Company Basic and Dilutive Earnings Per Share Basic loss per share (“EPS”) is computed by dividing net income (loss) (the numerator) by the weighted average number of common shares outstanding for the period (denominator). Diluted EPS is computed by dividing net income (loss) by the weighted average number of common shares and potential common shares outstanding (if dilutive) during each period. Potential common shares include stock options, warrants, restricted stock and convertible notes payable. The number of potential common shares outstanding relating to stock options, warrants, and restricted stock is computed using the treasury stock method. The number of potential common shares related to convertible notes payable is determined using the if-converted method. As the Company has incurred losses for the three months ended December 31, 2019 and 2018, the potentially dilutive shares are anti-dilutive and are thus not added into the loss per share calculations. As of December 31, 2019 and 2018, there were 437,801,338 and 223,537,733 potentially dilutive shares, respectively. Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “Leases,” and in March 2019, the FASB issued ASU No. 2019-01, “Leases: Codification Improvements”, which updated the accounting guidance related to leases to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. They also clarify implementation issues. These updates are effective for public companies for annual periods beginning after December 15, 2018, including interim periods therein. Accordingly, the standard was adopted by the Company on October 1, 2019. The standard was applied utilizing a modified retrospective approach and is reflected in these financial statements. See Note 10. In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718) The Company has evaluated all other recent accounting pronouncements and believes that none of them will have a significant effect on the Company’s financial statements.

OIL AND NATURAL GAS PROPERTIES

OIL AND NATURAL GAS PROPERTIES	3 Months Ended
	Dec. 31, 2019
Oil and Gas Exploration and Production Industries Disclosures [Abstract]
OIL AND NATURAL GAS PROPERTIES	NOTE 3 – OIL AND NATURAL GAS PROPERTIES The Company currently has under lease seven federal Outer Continental Shelf blocks and has licensed 2.2 million acres of three-dimensional (3-D) seismic data in its area of concentration. The Company, as the operator of two wells drilled in the Gulf of Mexico, has incurred tangible and intangible drilling costs for the wells in process and has billed its working interest partners for their respective shares of the drilling costs to date. GulfSlope drilled the first well, Canoe, to a total depth of 5,765 feet (5,670 feet TVD) and encountered no problems while drilling. The well completed drilling in August 2018 and based on Logging-While-Drilling (LWD) and Isotube analysis of hydrocarbon samples, oil sands were encountered. A full integration of the well information and seismic data is being performed for further evaluation of the shallow potential of the wellbore and the block, and to define commerciality of these oil pays. Multiple open hole plugs were set across several intervals and the well is equipped with a mud-line suspension system for possible future re-entry. A deeper subsalt prospect exists on the Canoe lease block, for which the block was originally leased. Calibration of seismic amplitudes, petrophysical analysis, reservoir engineering and scoping of development is currently underway to determine the commerciality of these sands, and that work is expected to be completed during the second calendar quarter of 2020. The second well, Tau, was drilled to a measured depth of 15,254 feet, as compared to the originally permitted 29,857 foot measured depth. Producible hydrocarbon zones were not established to that depth, but hydrocarbon shows were encountered. Complex geomechanical conditions required two by-pass wellbores, one sidetrack wellbore, and eight casing strings to reach that depth. Equipment limitations prevented further drilling. In addition, the drilling rig had contractual obligations related to another operator. The Company elected to abandon this well in a manner that would allow for re-entry at a later time. The drilling, pressure, and reservoir information has confirmed geophysical and geological models, and reinforces the Company’s confidence that there is resource potential. The Company is currently evaluating various options related to future operations in this wellbore and testing of the deeper Tau prospect. In January 2019, the Tau well experienced an underground control of well event and as a result, the Company filed an insurance claim pursuant to its insurance policy (the “Policy”) with its insurance underwriters (the “Underwriters”). The total amount of the claim was approximately $10.8 million for 100% working interest after the insurance deductible amount. The Company received approximately $2.5 million of this amount and credited wells in process for approximately $0.9 million for the Company’s portion, and recorded an accrued payable for approximately $1.6 million, pending evaluation of distributions to the working interest owners. During the quarter ended December 31, 2019, the accrued payable was settled by the issuance to the working interest partner of approximately 38.4 million shares of the Company’s common stock. In May 2019, the Tau well experienced a second underground control of well event and as a result, the Company filed an insurance claim. The Underwriters have acknowledged confirmation of coverage, subject to the Policy terms and conditions, related to a subsurface well occurrence that happened during the drilling of the Company's Tau on May 5, 2019, during drilling operations at a measured depth of 15,254 feet. The Company subsequently controlled the occurrence and ceased drilling operations and plugs were placed in the well to meet regulatory requirements prior to rig release. Pursuant to the Policy terms and conditions, the Underwriters will reimburse GulfSlope for qualified actual costs and expenses incurred to (i) regain control of the well, and (ii) restore or re-drill the well to 15,254 feet. Total costs and expenses to regain control of the well are estimated at approximately $4.8 million (net of deductible) for 100% working interest and approximately $2.6 million has been received as of December 31, 2019. GulfSlope’s share of this amount was approximately $0.6 million. As of December 31, 2019, the Company’s oil and natural gas properties consisted of unproved properties, wells in process and no proved reserves. During the three months ended December 31, 2019 and 2018, the company capitalized approximately $0.4 million and $0.1 million of interest expense to oil and natural gas properties, respectively, and approximately $0.3 million and $0.03 million of general and administrative expenses, capitalized to oil and natural gas properties.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	3 Months Ended
	Dec. 31, 2019
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	NOTE 4 – RELATED PARTY TRANSACTIONS During April 2013 through September 2017, the Company entered into convertible promissory notes whereby it borrowed a total of $8,675,500 from John Seitz, the chief executive officer (“CEO”). The notes are due on demand, bear interest at the rate of 5% per annum, and $5,300,000 of the notes are convertible into shares of common stock at a conversion price equal to $0.12 per share of common stock (the then offering price of shares of common stock to unaffiliated investors). As of December 31, 2019, the total amount owed to John Seitz is $8,675,500. This amount is included in loans from related parties within the balance sheet. There was a total of $2,191,739 of unpaid interest associated with these loans included in accrued interest payable within the balance sheet as of December 31, 2019. On November 15, 2016, a family member of the CEO entered into a $50,000 convertible promissory note with associated warrants (“Bridge Financing”) under the same terms received by other investors (see Note 5). Domenica Seitz CPA, related to John Seitz, has provided accounting consulting services to the Company. During the three month period ended December 31, 2019 and 2018, the services provided were valued at $14,880, respectively. The amount owed to this related party totals $380,784 and $365,904 at December 31, 2019 and September 30, 2019, respectively. The Company has accrued these amounts, and they have been reflected in related party payable in the December 31, 2019 financial statements. See Note 5 for a description of the Delek term loan replaced by convertible debenture.

TERM LOAN AND CONVERTIBLE PROMI

TERM LOAN AND CONVERTIBLE PROMISSORY NOTES	3 Months Ended
	Dec. 31, 2019
Debt Disclosure [Abstract]
TERM LOAN AND CONVERTIBLE PROMISSORY NOTES	NOTE 5 – TERM LOAN AND CONVERTIBLE PROMISSORY NOTES Bridge Financing Notes Between June and November 2016, the Company issued eleven convertible promissory notes (“Bridge Financing Notes”) with associated warrants in a private placement to accredited investors for total gross proceeds of $837,000, including $222,000 from related parties. These notes had a maturity of one year (which has been extended to April 30, 2020), an annual interest rate of 8% and can be converted at the option of the holder at a conversion price of $0.025 per share. In addition, the convertible notes will automatically convert if a qualified equity financing of at least $3 million occurs before maturity and such mandatory conversion price will equal the effective price per share paid in the qualified equity financing. The remaining note balances at December 31, 2019 and 2018 are $277,000, respectively, with remaining unamortized debt discounts of $56,620 and zero, respectively. Debt discount amortization for the three months ended December 31, 2019 and 2018 was approximately $43,000 and zero, respectively. Accrued interest for the quarter ended December 31, 2019, was approximately $6,000 and cumulative accrued interest was approximately $77,000. Delek Note On March 1, 2019, the Company entered into a term loan agreement with Delek, where Delek agreed to provide the Company with multiple draw term loans in an aggregate stated principal amount of up to $11.0 million, of which $10.0 million was initially advanced and subsequently converted to equity through the exercise of a warrant. The maturity date of the facility was September 4, 2019, and until such time any loans would bear interest at a rate per annum equal to 5.0% or 7% upon the occurrence of default. Amounts outstanding under the Term Loan Agreement are secured by a security interest in substantially all of the properties and assets of the Company. On April 19, 2019, the Company borrowed the remaining $1.0 million under this agreement. The term loan facility expired as of September 4, 2019, and in October 2019, the Company signed a Post-Drilling Agreement with Delek modifying this arrangement. The Post-Drilling Agreement states that as payoff for the Company’s outstanding obligations of $1,000,000 plus accrued interest (and additional fees of approximately $200,000), the Company shall issue a convertible note payable to Delek in the amount of $1,220,548. The new note is convertible at the option of Delek at a conversion price of $0.05 per share, and in the event of default the conversion rate adjusts to 60% of the lowest volume weighted average price in the previous 20 trading days. Interest on the note accrues at 12% per annum (15% upon default) and the maturity of the note is October 22, 2020. The Company has a right to prepay all principal and accrued interest prior to maturity. At December 31, 2019, the accrued interest payable related to this note was approximately $30,000. The Company accounted for this transaction as an extinguishment of the prior note given the addition of the substantive conversion feature discussed above. In addition, The Company concluded that the embedded conversion feature within the note requires derivative accounting treatment under ASC 815, Derivatives and Hedging due to the potential variable conversion feature which lacks an explicit limit on the number of shares that may require upon conversion. Accordingly, the Company valued the embedded conversion feature and host instrument at their fair values of $479,498 and $1,220,548, respectively, and recognized a loss on extinguishment of $676,785. The fair value of the host note was determined by discounting the future cash flows of the note at a market participant-based rate of interest. Further, since the embedded conversion feature is a derivative liability, it is subsequently remeasured to fair value each reporting period. The fair value of the embedded conversion option was $119,647 at December 31, 2019. The fair value of the embedded conversion feature was determined utilizing a Geometric Brownian Motion Stock Path Based Monte Carlo Simulation that utilized the following key assumptions: October 17, December 31, Stock Price $ 0.041 $ 0.025 Fixed Exercise Price $ 0.050 $ 0.050 Volatility 138 % 110 % Term (Years) 1.00 0.80 Risk Free Rate 1.59 % 1.59 % June 2019 Convertible Debenture On June 21, 2019, the Company entered into a securities purchase agreement to borrow up to $3,000,000 through the issuance convertible debentures (“ ”) and associated warrants. On June 21, 2019, approximately $2,100,000 of Convertible Debentures were purchased with other tranches closing on August 7, 2019 for $400,000 and November 6, 2019 for $500,000. All tranches In addition, the holder received warrants to purchase an aggregate of 50 million shares of common stock at an exercise price of $0.04 per share. Such warrants expire on the fifth anniversary of issuance. In total the offering costs incurred related to this convertible debenture were approximately $398,000 ($65,000 incurred during the three months ended December 31, 2019). The Company evaluated the conversion feature and concluded that it should be bifurcated and accounted for as a derivative liability due to the variable conversion feature which does not contain an explicit limit on the number of shares that are required to be issued. In addition, the Company concluded the warrants required treatment as derivative liabilities as the Company could not assert in has sufficient authorized but unissued shares to settle the warrants upon exercise when taking into account other stock-based commitments including the Convertible Debentures. Accordingly, the embedded conversion feature and warrants were recorded at fair value at issuance and are subsequently remeasured to fair value each reporting period. The Company recognized gains of approximately $770,000 and $131,000 for the three months ended December 31, 2019 related to the change in fair value of the embedded conversion feature and warrants, respectively. In addition, during the three months ended December 31, 2019, the lender converted $300,000 of principal and $83,637 of accrued interest. Given the embedded conversion feature for the debenture is bifurcated for accounting purposes, this represents the issuance of common stock to extinguish two liabilities. The common stock issued was recorded at its fair value on the dates of issuance ($548,391) and a loss on extinguishment of debt was recognized for approximately $279,584. The fair value of the embedded conversion feature was determined utilizing a Geometric Brownian Motion Stock Path Based Monte Carlo Simulation that utilized the following key assumptions: Conversion for the quarters December 31, Stock Price $ 0.030 – 0.034 $ 0.025 Fixed Exercise Price $ 0.050 $ 0.050 Volatility 77- 115 % 82 -111 % Term (Years) 0.5 - 0 .62 0.47 - 0.85 Risk Free Rate 1.58 – 1.62 % 1.59 – 1.60 % In addition to the fixed exercise price noted above, the model incorporates the variable conversion price which is simulated as 80% of the lowest trading price within the ten consecutive days preceding presumed conversion. The Company’s convertible promissory notes consisted of the following as of December 31, 2019. Notes Discount Notes, Net of Discount Convertible Notes Payable $ 4,147,548 $ (2,444,907 ) $ 1,702,641 Total $ 4,147,548 $ (2,444,907 ) $ 1,702,641

FAIR VALUE MEASUREMENT

FAIR VALUE MEASUREMENT	3 Months Ended
	Dec. 31, 2019
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENT	NOTE 6 – FAIR VALUE MEASUREMENT Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are classified and disclosed in one of the following categories: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. GulfSlope considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. This category includes those derivative instruments that GulfSlope values using observable market data. Substantially all of these inputs are observable in the marketplace throughout the term of the derivative instrument, can be derived from observable data, or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category include non-exchange traded derivative financial instruments as well as warrants to purchase common stock and long-term incentive plan liabilities calculated using the Black-Scholes model to estimate the fair value as of the measurement date. Level 3: Measured based on prices or valuation models that require inputs that are both significant to the fair value measurement and less observable from objective sources (i.e. supported by little or no market activity). As required by ASC 820-10, financial assets and liabilities are classified based on the lowest level of 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. Fair Value on a Recurring Basis The following table sets forth by level within the fair value hierarchy the Company’s derivative financial instruments that were accounted for at fair value on a recurring basis as of December 31, 2019: Description Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Fair Derivative Financial Instrument at September 30, 2019 $ — $ (3,534,456 ) $ — $ (3,534,456 ) Derivative financial instrument (1) — (715,779 ) — (715,779 ) Change in fair value for the three months ended December 31, 2019 1,224,527 1,224,527 Derivative Financial Instrument at December 31, 2019 $ — $ (3,025,708 ) $ — $ (3,025,708 ) (1) Represents derivatives recorded resulting from the embedded conversion feature and warrants associated with the convertible debentures purchased during the three months ended December 31, 2019. Non-recurring fair value assessments include impaired oil and natural gas property assessments and stock-based compensation. During the three months ended December 31, 2019, the Company recorded stock-based compensation expense of $367,841 of which $186,675 was capitalized to oil and gas properties.

COMMON STOCK_PAID IN CAPITAL

COMMON STOCK/PAID IN CAPITAL	3 Months Ended
	Dec. 31, 2019
Stockholders' Equity Note [Abstract]
COMMON STOCK/PAID IN CAPITAL	NOTE 7 – COMMON STOCK/PAID IN CAPITAL As discussed in Note 5, the Company issued 17,919,455 common shares with a fair value of $548,391 upon partial conversions of the notes and related accrued interest during the three months ended December 31, 2019. The common shares were valued based upon the closing common share prices on the respective conversion dates. The Company issued 38,423,221 common shares with a fair value of $1,536,929 to extinguish an accrued expense that totaled $1,613,775. The common shares were valued based upon the closing common share price on the date of settlement resulting in a gain on the extinguishment of the obligation of approximately $77,000. During the three months ended December 31, 2018, the Company issued approximately 19.3 million shares of common stock and approximately 9.7 million warrants to accredited investors in a private placement. The funds were received in the prior fiscal year and included as a liability because the transaction did not close until the current fiscal year and it was moved to equity during the quarter ended December 31, 2018. Based upon the allocation of proceeds between the common stock and the warrants, approximately $259,000 was allocated to the warrants. The fair value of the warrants was determined using the Black Scholes valuation model with the following key assumptions: Number of Warrants Issued 9,662,500 Stock Price $ 0.044 Exercise Price $ 0.09 Term 3 years Risk Free Rate 2.46 % Volatility 149 %

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	3 Months Ended
	Dec. 31, 2019
Share-based Payment Arrangement [Abstract]
STOCK-BASED COMPENSATION	NOTE 8 – STOCK-BASED COMPENSATION During the three months ended December 31, 2019, upon the passing of a member of the management team, the Company modified a stock option grant for three million shares made to said management team member in June 2018 to vest such award immediately. The Company recorded approximately $8,000 in additional compensation expense related to this modification. Stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award using the Black Scholes option pricing model, and is recognized over the vesting period. The Company recognized $367,841 and $393,000 in stock-based compensation expense for the quarters ended December 31, 2019 and 2018, respectively. A portion of these costs, $186,675 and $318,658 were capitalized to unproved properties for the three months ended December 31, 2019 and December 31, 2018, respectively, with the remainder recorded as general and administrative expenses for each respective period. The following table summarizes the Company’s stock option activity during the three months ended December 31, 2019: Number Weighted Weighted Average Outstanding at September 30, 2019 104,500,000 $ 0.0605 Granted — — Exercised — — Cancelled — — Outstanding at December 31, 2019 104,500,000 $ 0.0605 2.07 Vested and expected to vest 104,500,000 $ 0.0605 2.07 Exercisable at December 31, 2019 82,500,000 $ 0.0565 1.92 As of December 31, 2019, there was approximately $0.6 million of unrecognized stock-based compensation expense to be recognized over a period of four months.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 9 – COMMITMENTS AND CONTINGENCIES The Company reached an agreement with a vendor in August 2018 for the settlement of approximately $1 million in debt. The vendor was paid approximately $0.16 million in cash and 10 million shares of GulfSlope common stock. The agreement contains a provision that upon the sale of the common stock if the original debt is not fully satisfied, full payment will be made under a mutually agreed payment plan. If the stock is sold for a gain any surplus in excess of $1.3 million shall be a credit against future purchases from the vendor. The agreement was determined to meet the definition of a derivative in accordance with ASC 815. At December 31, 2019 there is a derivative financial instrument liability of approximately $0.6 million. In November 2019, the Company purchased a directors and officers’ insurance policy for approximately $241,000 and financed approximately $241,000 of the premium by executing a note payable. The balance of the note payable at December 31, 2019, is approximately $201,000.

LEASES

LEASES	3 Months Ended
	Dec. 31, 2019
Leases [Abstract]
LEASES	NOTE 10 – LEASES Effective October 1, 2019, we adopted ASU No. 2016-02, Leases (Topic 842), and all related amendments (“ASC 842”) using the modified retrospective approach. In July 2018, the FASB approved an optional transition method that removed the requirement to restate prior period financial statements upon adoption of the standard with a cumulative-effect adjustment to retained earnings in the period of adoption and we elected to apply this transition method. As a result, the comparative period information has not been restated and continues to be reported under the accounting standards in effect for the period presented. The adoption of ASC 842 had no impact to our previously reported results of operations or cash flows. The following table depicts the cumulative effect of the changes made to our September 30, 2019 balance sheet for the adoption of ASC 842 effective on October 1, 2019: Balance at Impact of Adoption Adjusted Balance at Assets: Operating lease right of use assets $0 $104,363 $104,363 Current Liabilities: Other (Deferred Credit Office Lease) $42,746 ($42,746) — Current portion of operating lease liabilities $0 $74,114 $74,114 Noncurrent Liabilities: Operating lease liabilities $0 $56,565 $56,565 Equity: Accumulated Deficit ($55,582,010) $16,429 ($55,565,581) The adoption of ASC 842 primarily resulted in the recognition of operating lease liabilities totaling $130,679, based upon the present value of the remaining minimum rental payments using discount rates as of the adoption date. In addition, we recorded corresponding right-of-use assets totaling $104,363 based upon the operating lease liabilities adjusted for deferred rent and lease incentives. In addition, we recorded a $16,429 cumulative effect of initially adopting ASC 842 as an adjustment to the opening balance of accumulated deficit.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Dec. 31, 2019
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 11 – SUBSEQUENT EVENTS Additional insurance proceeds of approximately $0.07 million were received in January 2020 for 100% working interest related to the Tau well incident (see Note 3).

SIGNIFICANT ACCOUNTING POLICI_2

SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Dec. 31, 2019
Accounting Policies [Abstract]
Cash	Cash GulfSlope considers highly liquid investments with original maturities to the Company of three months or less to be cash equivalents. There were no cash equivalents at December 31, 2019 and September 30, 2018.
Liquidity/Going Concern	Liquidity/Going Concern The Company has incurred accumulated losses as of December 31, 2019 of $55.7 million, has negative working capital of $19.6 million and for the three months ended December 31, 2019 generated losses of $0.2 million. Further losses are anticipated in developing our business. As a result, there exists substantial doubt about our ability to continue as a going concern. As of December 31, 2019, we had $3.8 million of unrestricted cash on hand, $3.1 million of this amount is for the payment of joint payables from drilling operations. The Company estimates that it will need to raise a minimum of $10.0 million to meet its obligations and planned expenditures through February 2021. The $10.0 million is comprised primarily of capital project expenditures as well as general and administrative expenses. It does not include any amounts due under outstanding debt obligations, which amounted to $13.3 million of current principal and interest as of December 31, 2019. The Company plans to finance operations and planned expenditures through equity and/or debt financings and/or farm-out agreements. The Company also plans to extend the agreements associated with all loans, the accrued interest payable on these loans, as well as the Company’s accrued liabilities. There are no assurances that financing will be available with acceptable terms, if at all or that obligations can be extended. If the Company is not successful in obtaining financing or extending obligations, operations would need to be curtailed or ceased, or the Company would need to sell assets or consider alternative plans up to and including restructuring. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Accounts Receivable	Accounts Receivable The Company records an accounts receivable for operations expense reimbursements due from joint interest partners. The Company estimates allowances for doubtful accounts based on the aged receivable balances and historical losses. If the Company determines any account to be uncollectible based on significant delinquency or other factors, the receivable and the underlying asset are assessed for recovery. As of December 31, 2019 and 2018, no allowance was recorded. Accounts receivable from oil and gas joint operations and joint ventures is $2.7 million and $8.5 million at December 31, 2019 and 2018, respectively.
Full Cost Method	Full Cost Method The Company uses the full cost method of accounting for its oil and gas exploration and development activities. Under the full cost method of accounting, all costs associated with successful and unsuccessful exploration and development activities are capitalized on a country-by-country basis into a single cost center (“full cost pool”). Such costs include property acquisition costs, geological and geophysical (“G&G”) costs, carrying charges on non-producing properties, costs of drilling both productive and non-productive wells. Overhead costs, which includes employee compensation and benefits including stock-based compensation, incurred that are directly related to acquisition, exploration and development activities are capitalized. Interest expense is capitalized related to unevaluated properties and wells in process during the period in which the Company is incurring costs and expending resources to get the properties ready for their intended purpose. For significant investments in unproved properties and major development projects that are not being currently depreciated, depleted, or amortized and on which exploration or development activities are in progress, interest costs are capitalized. 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. A significant alteration would typically involve a sale of 25% or more of the proved reserves related to a single full cost pool. Proved properties are amortized on a country-by-country basis using the units of production method (“UOP”), whereby capitalized costs are amortized over total proved reserves. The amortization base in the UOP calculation includes the sum of proved property, net of accumulated depreciation, depletion and amortization (“DD&A”), estimated future development costs (future costs to access and develop proved reserves), and asset retirement costs, less related salvage value. The costs of unproved properties and related capitalized costs (such as G&G costs) are withheld from the amortization calculation until such time as they are either developed or abandoned. Unproved properties and properties under development are reviewed for impairment at least quarterly and are determined through an evaluation considering, among other factors, seismic data, requirements to relinquish acreage, drilling results, remaining time in the commitment period, remaining capital plan, and political, economic, and market conditions. In countries where proved reserves exist, exploratory drilling costs associated with dry holes are transferred to proved properties immediately upon determination that a well is dry and amortized accordingly. In countries where a reserve base has not yet been established, impairments are charged to earnings. Companies that use the full cost method of accounting for oil and natural gas exploration and development activities are required to perform a ceiling test calculation each quarter. The full cost ceiling test is an impairment test prescribed by SEC Regulation S-X Rule 4-10. The ceiling test is performed quarterly, on a country-by-country basis, utilizing the average of prices in effect on the first day of the month for the preceding twelve month period. The cost center ceiling is defined as the sum of (a) estimated future net revenues, discounted at 10% per annum, from proved reserves, (b) the cost of properties not being amortized, if any, and (c) the lower of cost or market value of unproved properties included in the cost being amortized. If such capitalized costs exceed the ceiling, the Company will record a write-down to the extent of such excess as a non-cash charge to earnings. Any such write-down will reduce earnings in the period of occurrence and results in a lower depreciation, depletion and amortization rate in future periods. A write-down may not be reversed in future periods even though higher oil and natural gas prices may subsequently increase the ceiling. The Company capitalizes exploratory well costs into oil and gas properties until a determination is made that the well has either found proved reserves or is impaired. If proved reserves are found, the capitalized exploratory well costs are reclassified to proved properties. The well costs are charged to expense if the exploratory well is determined to be impaired. The Company has drilled two well bores and is currently evaluating such wells for proved reserves. Accordingly such costs are included as suspended well costs at December 31, 2019 and it is expected that a final analysis will be completed in the next nine months at which time the costs will be transferred to the full cost pool.
Asset Retirement Obligations	Asset Retirement Obligations The Company’s asset retirement obligations will represent the present value of the estimated future costs associated with plugging and abandoning oil and natural gas wells, removing production equipment and facilities and restoring the seabed in accordance with the terms of oil and gas leases and applicable state and federal laws. Determining asset retirement obligations requires estimates of the costs of plugging and abandoning oil and natural gas wells, removing production equipment and facilities and restoring the sea bed as well as estimates of the economic lives of the oil and gas wells and future inflation rates. The resulting estimate of future cash outflows will be discounted using a credit-adjusted risk-free interest rate that corresponds with the timing of the cash outflows. Cost estimates will consider historical experience, third party estimates, the requirements of oil and natural gas leases and applicable local, state and federal laws, but do not consider estimated salvage values. Asset retirement obligations will be recognized when the wells drilled reach total depth or when the production equipment and facilities are installed or acquired with an associated increase in proved oil and gas property costs. Asset retirement obligations will be accreted each period through depreciation, depletion and amortization to their expected settlement values with any difference between the actual cost of settling the asset retirement obligations and recorded amount being recognized as an adjustment to proved oil and gas property costs. Cash paid to settle asset retirement obligations will be included in net cash provided by operating activities from continuing operations in the statements of cash flows. On a quarterly basis, when indicators suggest there have been material changes in the estimates underlying the obligation, the Company reassesses its asset retirement obligations to determine whether any revisions to the obligations are necessary. At least annually, the Company will assess all of its asset retirement obligations to determine whether any revisions to the obligations are necessary. Future revisions could occur due to changes in estimated costs or well economic lives, or if federal or state regulators enact new requirements regarding plugging and abandoning oil and natural gas wells. The Company has drilled two well bores and is currently evaluating these wells. The two wellbores drilled in 2018 and 2019, were both plugged while the company continues to evaluate well log data and therefore the costs related to the asset retirement obligation were incurred. Such costs were recognized as capitalized oil and gas costs. The asset retirement obligation was completely extinguished in that if the wells prove not to be commercially viable, there is no further cost needed to remediate the site.
Derivative Financial Instruments	Derivative Financial Instruments The accounting treatment of derivative financial instruments requires that the Company the Company
Basic and Dilutive Earnings Per Share	Basic and Dilutive Earnings Per Share Basic loss per share (“EPS”) is computed by dividing net income (loss) (the numerator) by the weighted average number of common shares outstanding for the period (denominator). Diluted EPS is computed by dividing net income (loss) by the weighted average number of common shares and potential common shares outstanding (if dilutive) during each period. Potential common shares include stock options, warrants, restricted stock and convertible notes payable. The number of potential common shares outstanding relating to stock options, warrants, and restricted stock is computed using the treasury stock method. The number of potential common shares related to convertible notes payable is determined using the if-converted method. As the Company has incurred losses for the three months ended December 31, 2019 and 2018, the potentially dilutive shares are anti-dilutive and are thus not added into the loss per share calculations. As of December 31, 2019 and 2018, there were 437,801,338 and 223,537,733 potentially dilutive shares, respectively.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “Leases,” and in March 2019, the FASB issued ASU No. 2019-01, “Leases: Codification Improvements”, which updated the accounting guidance related to leases to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. They also clarify implementation issues. These updates are effective for public companies for annual periods beginning after December 15, 2018, including interim periods therein. Accordingly, the standard was adopted by the Company on October 1, 2019. The standard was applied utilizing a modified retrospective approach and is reflected in these financial statements. See Note 10. In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718) The Company has evaluated all other recent accounting pronouncements and believes that none of them will have a significant effect on the Company’s financial statements.

TERM LOAN AND CONVERTIBLE PRO_2

TERM LOAN AND CONVERTIBLE PROMISSORY NOTES (Tables)	3 Months Ended
	Dec. 31, 2019
Debt Disclosure [Abstract]
Schedule of fair value of the embedded conversion feature	The fair value of the embedded conversion feature was determined utilizing a Geometric Brownian Motion Stock Path Based Monte Carlo Simulation that utilized the following key assumptions: October 17, December 31, Stock Price $ 0.041 $ 0.025 Fixed Exercise Price $ 0.050 $ 0.050 Volatility 138 % 110 % Term (Years) 1.00 0.80 Risk Free Rate 1.59 % 1.59 % The fair value of the embedded conversion feature was determined utilizing a Geometric Brownian Motion Stock Path Based Monte Carlo Simulation that utilized the following key assumptions: Conversion for the quarters December 31, Stock Price $ 0.030 – 0.034 $ 0.025 Fixed Exercise Price $ 0.050 $ 0.050 Volatility 77- 115 % 82 -111 % Term (Years) 0.5 - 0 .62 0.47 - 0.85 Risk Free Rate 1.58 – 1.62 % 1.59 – 1.60 %
Schedule of convertible promissory notes	The Company’s convertible promissory notes consisted of the following as of December 31, 2019. Notes Discount Notes, Net of Discount Convertible Notes Payable $ 4,147,548 $ (2,444,907 ) $ 1,702,641 Total $ 4,147,548 $ (2,444,907 ) $ 1,702,641

FAIR VALUE MEASUREMENT (Tables)

FAIR VALUE MEASUREMENT (Tables)	3 Months Ended
	Dec. 31, 2019
Fair Value Disclosures [Abstract]
Schedule of fair value on recurring basis	The following table sets forth by level within the fair value hierarchy the Company’s derivative financial instruments that were accounted for at fair value on a recurring basis as of December 31, 2019: Description Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Other Unobservable Inputs (Level 3) Total Fair Derivative Financial Instrument at September 30, 2019 $ — $ (3,534,456 ) $ — $ (3,534,456 ) Derivative financial instrument (1) — (715,779 ) — (715,779 ) Change in fair value for the three months ended December 31, 2019 1,224,527 1,224,527 Derivative Financial Instrument at December 31, 2019 $ — $ (3,025,708 ) $ — $ (3,025,708 ) (1) Represents derivatives recorded resulting from the embedded conversion feature and warrants associated with the convertible debentures purchased during the three months ended December 31, 2019.

COMMON STOCK_PAID IN CAPITAL (T

COMMON STOCK/PAID IN CAPITAL (Tables)	3 Months Ended
	Dec. 31, 2019
Stockholders' Equity Note [Abstract]
Schedule of fair value of the warrants using the Black Scholes valuation model	The fair value of the warrants was determined using the Black Scholes valuation model with the following key assumptions: Number of Warrants Issued 9,662,500 Stock Price $ 0.044 Exercise Price $ 0.09 Term 3 years Risk Free Rate 2.46 % Volatility 149 %

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	3 Months Ended
	Dec. 31, 2019
Share-based Payment Arrangement [Abstract]
Schedule for summary of stock options activity	The following table summarizes the Company’s stock option activity during the three months ended December 31, 2019: Number Weighted Weighted Average Outstanding at September 30, 2019 104,500,000 $ 0.0605 Granted — — Exercised — — Cancelled — — Outstanding at December 31, 2019 104,500,000 $ 0.0605 2.07 Vested and expected to vest 104,500,000 $ 0.0605 2.07 Exercisable at December 31, 2019 82,500,000 $ 0.0565 1.92

LEASES (Tables)

LEASES (Tables)	3 Months Ended
	Dec. 31, 2019
Leases [Abstract]
Schedule of operating lease	The following table depicts the cumulative effect of the changes made to our September 30, 2019 balance sheet for the adoption of ASC 842 effective on October 1, 2019: Balance at Impact of Adoption Adjusted Balance at Assets: Operating lease right of use assets $0 $104,363 $104,363 Current Liabilities: Other (Deferred Credit Office Lease) $42,746 ($42,746) — Current portion of operating lease liabilities $0 $74,114 $74,114 Noncurrent Liabilities: Operating lease liabilities $0 $56,565 $56,565 Equity: Accumulated Deficit ($55,582,010) $16,429 ($55,565,581)

ORGANIZATION AND NATURE OF BU_2

ORGANIZATION AND NATURE OF BUSINESS (Details Narrative)	Dec. 31, 2019Number
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of licensed three-dimensional (3-D) seismic data	3
Number of leased federal outer continental shelf blocks	7

SIGNIFICANT ACCOUNTING POLICI_3

SIGNIFICANT ACCOUNTING POLICIES (Details Narrative)	3 Months Ended
	Dec. 31, 2019USD ($)Numbershares	Dec. 31, 2018USD ($)Numbershares	Oct. 02, 2019USD ($)	Sep. 30, 2019USD ($)	Sep. 30, 2018USD ($)
General and Administrative Expenses	$ 476,922	$ 129,438
Net Loss	(153,143)	$ (346,319)
Accumulated losses	$ (55,718,724)		$ (55,565,581)	$ (55,582,010)
Antidilutive securities excluded from EPS calculation | shares	437,801,338	223,537,733
Number of wellbores drilled | Number	2	2
Amount of working capital	$ 19,600,000
Short-term debt	13,300,000
Unrestricted cash	3,771,395	$ 3,796,786		$ 1,138,919	$ 5,621,814
Payment of joint payables from drilling operations	3,100,000
Minimum capital which company estimated to raise to meet its obligations and planned expenditures	10,000,000
Oil and Gas Joint Operations [Member]
Accounts receivable, net	$ 2,700,000	$ 8,500,000

OIL AND NATURAL GAS PROPERTIES

OIL AND NATURAL GAS PROPERTIES (Details Narrative)	1 Months Ended		3 Months Ended
	May 31, 2019USD ($)ft²	Jan. 31, 2019USD ($)	Dec. 31, 2019USD ($)ft²aNumber	Dec. 31, 2018USD ($)Number
Acres of three-dimensional (3-D) seismic data | a			2,200,000
Received insurance claim			$ 600,000
Wells in process			900,000
Accrued payable			1,600,000
Interest expense capitalized			$ 38,400,000
Number of licensed three-dimensional (3-D) seismic data | Number			3
Number of leased federal outer continental shelf blocks | Number			7
Number of wellbores drilled | Number			2	2
Oil and Natural Gas Properties [Member]
Amount of interest expense capitalized during period			$ 400,000	$ 100,000
Amount of general and administrative expenses capitalized during period			$ 300,000	$ 300,000
Number of licensed three-dimensional (3-D) seismic data | Number			3
Number of leased federal outer continental shelf blocks | Number			7
Gulf of Mexico Well Tau [Member]
Percent of working interest	100.00%	100.00%	100.00%
Estimated insurance claim		$ 10,800,000
Total depth of first drilled well | ft²	15,254		5,765
Total true vertical depth of first drilled well | ft²			5,670
Depth of second drilled well | ft²			15,254
Depth of originally permitted second drilled well | ft²			29,857
Received insurance claim	$ 2,600,000		$ 10,800,000
Total costs and expenses	$ 4,800,000
Number of wellbores drilled | Number			2

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	Nov. 15, 2016	Dec. 31, 2019	Dec. 31, 2018	Sep. 30, 2017	Sep. 30, 2019
Debt face amount		$ 4,147,548
John Seitz, CEO [Member] | Convertible Promissory Notes [Member]
Debt face amount				$ 8,675,500
Interest rate				5.00%
Debt conversion, price per share				$ 0.12
Debt maturity date		due on demand
Amount owed to related party		$ 8,675,500
Value of stock issued in conversion of notes payable				$ 5,300,000
Accrued interest payable		2,191,739
Related party [Member] | Promissory Notes [Member]
Proceeds from issuance of convertible notes and warrants	$ 50,000
Accounting Consulting Service [Member]
Amount owed to related party		380,784			$ 365,904
Accounting consulting services, included in related party payables		$ 14,880	$ 14,880

TERM LOAN AND CONVERTIBLE PRO_3

TERM LOAN AND CONVERTIBLE PROMISSORY NOTES (Details) - Delek Note [Member]	Dec. 31, 2019$ / shares	Oct. 17, 2019$ / shares
Stock Price	$ 0.025	$ 0.041
Fixed Exercise Price [Member]
Debt, measurement input	0.050	0.050
Price Volatility [Member]
Debt, measurement input	110	138
Risk Free Interest Rate [Member]
Debt, measurement input	1.59	1.59
Expected Term [Member]
Debt term	9 months 18 days	1 year

TERM LOAN AND CONVERTIBLE PRO_4

TERM LOAN AND CONVERTIBLE PROMISSORY NOTES (Details 1) - June 2019 Convertible Debenture [Member]	Dec. 31, 2019$ / shares	Jun. 21, 2019$ / shares
Stock Price	$ 0.025
Minimum [Member]
Stock Price		$ 0.030
Maximum [Member]
Stock Price		$ 0.034
Fixed Exercise Price [Member]
Debt, measurement input	0.050	0.050
Price Volatility [Member] | Minimum [Member]
Debt, measurement input	82	77
Price Volatility [Member] | Maximum [Member]
Debt, measurement input	111	115
Expected Term [Member] | Minimum [Member]
Debt term	4 months 19 days	6 months
Expected Term [Member] | Maximum [Member]
Debt term	10 months 2 days	7 months 13 days
Risk Free Interest Rate [Member] | Minimum [Member]
Debt, measurement input	1.59	1.58
Risk Free Interest Rate [Member] | Maximum [Member]
Debt, measurement input	1.60	1.62

TERM LOAN AND CONVERTIBLE PRO_5

TERM LOAN AND CONVERTIBLE PROMISSORY NOTES (Details 2)	Dec. 31, 2019USD ($)
Notes	$ 4,147,548
Discount	(2,444,907)
Notes, Net of Discount	1,702,641
Convertible Debentures [Member]
Notes	4,147,548
Discount	(2,444,907)
Notes, Net of Discount	$ 1,702,641

TERM LOAN AND CONVERTIBLE PRO_6

TERM LOAN AND CONVERTIBLE PROMISSORY NOTES (Details Narrative)	Nov. 04, 2019USD ($)	Aug. 07, 2019USD ($)	Jun. 21, 2019USD ($)$ / sharesshares	Mar. 01, 2019USD ($)	Oct. 31, 2019USD ($)$ / shares	Dec. 31, 2019USD ($)$ / shares	Dec. 31, 2018USD ($)	Nov. 30, 2016USD ($)Number$ / shares	Sep. 30, 2019$ / shares	Apr. 19, 2019USD ($)
Common stock par value (in dollars per shares) | $ / shares						$ 0.001			$ 0.001
Loss on Debt Extinguishment						$ (879,522)
Principal amount						4,147,548
Stock issued for extinguishment of debt						$ 1,536,929
Percentage of variable conversion price						80.00%
Amortization of debt discount						$ 238,039
Gain on change in fair value of warrants						(1,224,527)	$ 196,266
Bridge Financing Notes [Member]
Proceeds from issuance of convertible notes								$ 837,000
Number of convertible promissory notes issued | Number								11
Maturity term								1 year
Interest rate								8.00%
Qualified equity financing amount								$ 3,000,000
Debt discount						43,000	0
Debt amount converted						277,000	277,000
Accrued interest amount converted						6,000	87,000
Cumulative accrued interest						77,000
Amortization of debt discount						56,620	$ 0
Conversion price (in dollars per share) | $ / shares								$ 0.025
Bridge Financing Notes [Member] | Related Parties [Member]
Proceeds from issuance of convertible notes								$ 222,000
Securities Purchase Agreement [Member] | Convertible Debentures [Member]
Purchase of convertible debentures	$ 500,000	$ 400,000	$ 2,100,000
Interest rate			8.00%
Accrued interest amount converted						300,000
Cumulative accrued interest						83,637
Loss on Debt Extinguishment						279,584
Principal amount			$ 3,000,000
Stock issued for extinguishment of debt						548,391
Percentage of variable conversion price			80.00%
Maturity date			Jun. 21, 2020
Conversion price (in dollars per share) | $ / shares			$ 0.05
Offering costs			$ 398,000			65,000
Gain on change in fair value of embedded feature						770,000
Gain on change in fair value of warrants						131,000
Securities Purchase Agreement [Member] | Convertible Debentures [Member] | Warrants [Member]
Number of warrants issued | shares			50,000,000
Warrant exercise price (in dollars per share) | $ / shares			$ 0.04
Post Drilling Agreement [Member] | Delek GOM Investments, LLC [Member]
Interest rate					12.00%
Accrued interest amount converted					$ 1,000,000
Outstanding debt amount					479,498
Loss on Debt Extinguishment					676,785
Principal amount					$ 1,220,548	119,647
Default interest rate					15.00%
Maturity date					Oct. 22, 2020
Legal fees					$ 200,000
Term Loan Payoff					$ 1,220,548
Conversion price (in dollars per share) | $ / shares					$ 0.05
Conversion rate					60.00%
Accrued interest payable						$ 30,000
Term Loan Agreement [Member] | Delek GOM Investments, LLC [Member]
Principal amount				$ 11,000,000						$ 1,000,000
Initially advanced				$ 10,000,000
Interest rate				5.00%
Default interest rate				7.00%
Maturity date				Sep. 4, 2019

FAIR VALUE MEASUREMENT (Details

FAIR VALUE MEASUREMENT (Details) - Recurring [Member]	3 Months Ended
	Dec. 31, 2019USD ($)
Derivative Financial Instrument, beginning	$ (3,534,456)
Derivative Financial Instrument	(715,779)	[1]
Change in fair value for the three months ended December 31, 2019	1,224,527
Derivative Financial Instrument, ending	(3,025,708)
Significant Other Observable Inputs (Level 2) [Member]
Derivative Financial Instrument, beginning	(3,534,456)
Derivative Financial Instrument	(715,779)	[1]
Change in fair value for the three months ended December 31, 2019	1,224,527
Derivative Financial Instrument, ending	$ (3,025,708)
[1]	Represents derivatives recorded resulting from the embedded conversion feature and warrants associated with the convertible debentures purchased during the three months ended December 31, 2019.

FAIR VALUE MEASUREMENT (Detai_2

FAIR VALUE MEASUREMENT (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Fair Value Disclosures [Abstract]
Fair value of oil and gas properties	$ 186,675
Stock Based Compensation	$ 181,166	$ 74,342

COMMON STOCK_PAID IN CAPITAL (D

COMMON STOCK/PAID IN CAPITAL (Details)	Dec. 31, 2019$ / sharesyrshares
Warrants issued | shares	9,662,500
Share Price [Member]
Measurement Input	0.044
Fixed Exercise Price [Member]
Measurement Input	0.09
Expected Term [Member]
Measurement Input | yr	3
Risk Free Interest Rate [Member]
Measurement Input	2.46
Price Volatility [Member]
Measurement Input	149

COMMON STOCK_PAID IN CAPITAL _2

COMMON STOCK/PAID IN CAPITAL (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Number of shares issued for partial conversions of the notes	17,919,455
Number of shares issued for partial conversions of the notes, value	$ 548,391
Number of shares issued, value		$ 966,250
Gain on extinguishment of debt	(879,522)
Stock Issued to extinguish liability	1,536,929
Debt amount extinguised	1,613,775
Common Stock [Member]
Number of shares issued		19,325,000
Number of shares issued, value		$ 19,325
Stock Issued to extinguish liability	$ 38,423
Stock Issued to extinguish liability (in shares)	38,423,221
Private Placement [Member] | Accredited Investors [Member]
Number of shares issued		19,300,000
Number of shares issued, value		$ 9,700,000
Private Placement [Member] | Accredited Investors [Member] | Warrants [Member]
Proceeds from issuance		$ 259,000

STOCK-BASED COMPENSATION (Detai

STOCK-BASED COMPENSATION (Details)	3 Months Ended
	Dec. 31, 2019$ / sharesshares
Number of Options
Outstanding at beginning of period | shares	104,500,000
Outstanding at end of period | shares	104,500,000
Vested and expected to vest | shares	104,500,000
Exercisable at end of period | shares	82,500,000
Weighted Average Exercise Price
Outstanding at beginning of period | $ / shares	$ 0.0605
Outstanding at end of period | $ / shares	0.0605
Vested and expected to vest | $ / shares	0.0605
Exercisable at end of period | $ / shares	$ 0.0565
Weighted Average Remaining Contractual Term
Outstanding at end of period	2 years 8 months 12 days
Vested and expected to vest	2 years 8 months 12 days
Exercisable at end of period	11 months 1 day

STOCK-BASED COMPENSATION (Det_2

STOCK-BASED COMPENSATION (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Share-based Payment Arrangement [Abstract]
Stock-based compensation expense	$ 367,841	$ 393,000
Additional compensation expense	8,000
Unrecognized compensation expense related to stock options	600,000
Stock-based compensation expense capitalized to unproved properties	$ 186,675	$ 318,658

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($)	1 Months Ended
	Nov. 30, 2019	Aug. 31, 2018	Dec. 31, 2019
Principal amount			$ 4,147,548
Fair value liability			600,000
Vendor [Member]
Principal amount		$ 1,000,000
Repayment of debt		160,000
Common stock issued to vendor for settlement of debt		10,000,000
Vendor [Member] | Minimum [Member]
Gain on sale of stock by vendor in excess of		$ 1,300,000
Directors and Officers [Member] | Note Payable [Member]
Insurance policy	$ 241,000
Insurance policy premium	$ 241,000
Balance amount of debt			$ 201,000

LEASES (Details)

LEASES (Details) - USD ($)	Dec. 31, 2019	Oct. 02, 2019	Sep. 30, 2019
Assets:
Operating lease right of use assets	$ 92,859	$ 104,363
Current Liabilities:
Other (Deferred Credit Office Lease)			$ 42,746
Current portion of operating lease liabilities	75,647	74,114
Noncurrent Liabilities:
Operating lease liabilities	43,410	56,565
Equity:
Accumulated Deficit	$ (55,718,724)	$ (55,565,581)	(55,582,010)
Impact of Adoption of ASC 842 [Member]
Assets:
Operating lease right of use assets			104,363
Current Liabilities:
Other (Deferred Credit Office Lease)			(42,746)
Current portion of operating lease liabilities			74,114
Noncurrent Liabilities:
Operating lease liabilities			56,565
Equity:
Accumulated Deficit			$ 16,429

LEASES (Details Narrative)

LEASES (Details Narrative) - USD ($)	Dec. 31, 2019	Oct. 02, 2019	Sep. 30, 2019
Operating lease right of use assets	$ 92,859	$ 104,363
Accumulated Deficit	(55,718,724)	$ (55,565,581)	$ (55,582,010)
Impact of Adoption of ASC 842 [Member]
Operating lease liabilities	130,679
Operating lease right of use assets	104,363
Accumulated Deficit	$ 16,429

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative) - USD ($)	1 Months Ended		3 Months Ended
	Jan. 31, 2020	May 31, 2019	Dec. 31, 2019
Proceeds from insurance			$ 600,000
Gulf of Mexico Well Tau [Member]
Proceeds from insurance		$ 2,600,000	$ 10,800,000
Subsequent Event [Member] | Gulf of Mexico Well Tau [Member]
Proceeds from insurance	$ 70,000
Working interest insurance	100.00%