Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 16, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | Bluefire Renewables, Inc. | |
Entity Central Index Key | 1,370,489 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 413,904,405 | |
Trading Symbol | BFRE | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,016 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 3,066 | $ 26,922 |
Prepaid expenses | 3,977 | 9,291 |
Total current assets | 7,043 | 36,213 |
Property, plant and equipment, net of accumulated depreciation of $108,172 and $107,897, respectively | 109,109 | 109,384 |
Total assets | 116,152 | 145,597 |
Current liabilities: | ||
Accounts payable | 982,851 | 899,887 |
Accrued liabilities | 1,007,916 | 730,759 |
Notes payable | 420,000 | 420,000 |
Line of credit, related party | 69,230 | 45,230 |
Note payable to a related party | $ 200,000 | 200,000 |
Outstanding warrant liability | 199 | |
Total current liabilities | $ 2,679,997 | 2,296,075 |
Convertible notes payable, net of discount of $0 and $32,886, respectively | 20,084 | |
Derivative liability | 290,092 | |
Total liabilities | $ 2,679,997 | $ 2,606,251 |
Commitments and contingencies (Note 6) | ||
Redeemable noncontrolling interest | $ 864,135 | $ 865,614 |
Stockholders’ deficit: | ||
Preferred stock, no par value, 1,000,000 shares authorized; 51 and 51 shares issued and outstanding as of March 31, 2016 and December 31, 2015, respectively | ||
Common stock, $0.001 par value; 500,000,000 shares authorized; 404,993,005 and 308,163,005 shares issued; and 404,960,833 and 308,130,833 outstanding, as of March 31, 2016 and December 31, 2015, respectively | $ 404,994 | $ 308,163 |
Additional paid-in capital | 17,076,951 | 16,967,128 |
Treasury stock at cost, 32,172 shares at March 31, 2016 and December 31, 2015 | (101,581) | (101,581) |
Accumulated deficit | (20,808,344) | (20,499,978) |
Total stockholders’ deficit | (3,427,980) | (3,326,268) |
Total liabilities and stockholders’ deficit | $ 116,152 | $ 145,597 |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Property and equipment, accumulated depreciation | $ 108,172 | $ 107,897 |
Convertible notes payable, discount | $ 0 | $ 32,886 |
Preferred stock, no par value | ||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 51 | 51 |
Preferred stock, shares outstanding | 51 | 51 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 404,993,005 | 308,163,005 |
Common stock, shares outstanding | 404,993,005 | 308,163,005 |
Treasury stock, shares | 32,172 | 32,172 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenues: | ||
Department of Energy grant revenue | $ 38,125 | |
Total revenues | 38,125 | |
Cost of revenue | ||
Gross margin | 38,125 | |
Operating expenses: | ||
Project development | $ 100,297 | 210,844 |
General and administrative | 297,561 | 211,041 |
Total operating expenses | 397,858 | 421,885 |
Operating loss | (397,858) | (383,760) |
Other income and (expense): | ||
Amortization of debt discount | (32,866) | (40,116) |
Interest expense | (29,303) | (6,118) |
Related party interest expense | (1,440) | (1,357) |
Gain from change in fair value of warrant liability | 199 | $ 13,216 |
Gain from change in fair value of derivative liability | 151,576 | |
Total other income and (expense) | 88,166 | $ (34,375) |
Loss before income taxes | (309,692) | $ (418,135) |
Provision for income taxes | 153 | |
Net loss | (309,845) | $ (418,135) |
Net loss attributable to noncontrolling interest | (1,479) | (1,189) |
Net loss attributable to controlling interest | $ (308,366) | $ (416,946) |
Basic and diluted loss per common share | $ 0 | $ 0 |
Weighted average common shares outstanding, basic and diluted | 355,159,944 | 237,195,186 |
Consolidated Statements of Ope5
Consolidated Statements of Operations (Parenthetical) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
General And Administrative Expenses [Member] | ||
Stock based compensation | $ 0 | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (309,845) | $ (418,135) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Gain from change in the fair value of warrant liability | (199) | $ (13,216) |
Gain from change in fair value of derivative liability | (151,576) | |
Amortization of debt discounts | 32,866 | $ 40,116 |
Depreciation | 275 | $ 255 |
Excess fair value of common stock issued for accrued interest | 7,200 | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | 5,314 | $ (70,101) |
Accounts payable | 82,966 | 136,179 |
Accrued liabilities | 285,143 | 169,842 |
Net cash used in operating activities | $ (47,856) | (155,060) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock | $ 147,000 | |
Proceeds from related party line of credit/notes payable | $ 24,000 | |
Net cash provided by financing activities | 24,000 | $ 147,000 |
Net decrease in cash and cash equivalents | (23,856) | (8,060) |
Cash and cash equivalents beginning of period | 26,922 | 22,134 |
Cash and cash equivalents end of period | $ 3,066 | 14,074 |
Supplemental disclosures of cash flow information | ||
Interest | $ 1,368 | |
Supplemental schedule of non-cash investing and financing activities: | ||
Conversion of convertible notes payable into common stock | $ 52,950 | |
Accrued Interest converted to common stock | 7,700 | |
Derivative liability reclassed to additional paid-in capital | $ 139,303 |
Organization and Business
Organization and Business | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Going Concern The Company has incurred losses since Inception. Management has funded operations primarily through proceeds received in connection with the reverse merger, loans from its Chief Executive Officer, the private placement of the Companys common stock in December 2007 for net proceeds of approximately $14,500,000, the issuance of convertible notes with warrants in July and in August 2007, various convertible notes, and Department of Energy reimbursements from 2009 to 2015. The Company may encounter further difficulties in establishing operations due to the time frame of developing, constructing and ultimately operating the planned bio-refinery projects. As of March 31, 2016, the Company has negative working capital of approximately $2,673,000. Management has estimated that operating expenses for the next 12 months will be approximately $1,450,000 excluding engineering costs related to the development of bio-refinery projects. These matters raise substantial doubt about the Companys ability to continue as a going concern. The Company intends to fund its operations with any additional funding that can be secured in the form of equity or debt. As of May 16, 2016, the Company expects the current resources available to them will only be sufficient for a period of approximately one month unless significant additional financing is received. Management has determined that the general expenditures must be reduced and additional capital will be required in the form of equity or debt securities. In addition, if we cannot raise additional short term capital we may consume all of our cash reserved for operations. There are no assurances that management will be able to raise capital on terms acceptable to the Company or at all. If we are unable to obtain sufficient amounts of additional capital, we may be required to reduce the scope of our planned development, which could harm our business, financial condition and operating results. The financial statements do not include any adjustments that might result from these uncertainties. Additionally, the Companys engineering and design package for its Lancaster plant allows for almost immediate construction, upon receipt of funding and the renewal of its permits, and only requires minimal capital to maintain until funding is obtained for its construction. With no immediate funding sources in place, the Company sees this project on hold. As of December 31, 2010, the Company completed the detailed engineering on our proposed Fulton Project (Note 3), procured all necessary permits for construction of the plant, and began site clearing and preparation work, signaling the beginning of construction. All site preparation activities have been completed, including clearing and grating of the site, building access roads, completing railroad tie-ins to connect the site to the rail system, and finalizing the layout plan to prepare for the site foundation. As of December 31, 2013, the construction-in-progress through such date was deemed impaired due to the discontinuance of future funding from the DOE further described in Note 3. We estimate the total construction cost of the bio-refineries to be in the range of approximately $300 million for the Fulton Project and approximately $100 million to $125 million for the Lancaster Biorefinery. These cost approximations do not reflect any increase/decrease in raw materials or any fluctuation in construction cost that would be realized by the dynamic world metals markets or inflation of general costs of construction. The Company is currently in discussions with potential sources of financing for these facilities but no definitive agreements are in place. The Company cannot continue significant development or furtherance of the Fulton project until financing for the construction of the Fulton plant is obtained. Risks and Uncertainties The Company has a limited operating history and has not generated revenues from our planned principal operations. The Companys business and operations are very sensitive to general business and economic conditions in the U.S. and worldwide. Specifically, these conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general price of crude oil and gasoline. The risks related to the Companys plans to sell engineering services are that the Company currently has no sales and limited marketing capabilities. The Company has limited experience in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of our services. Developing a marketing and sales force is also time consuming and could delay launch of our future bio-ethanol plants. In addition, the Company will compete with other engineering companies that currently have extensive and well-funded marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these companies. In addition, the Company has limited capital to devote sales and marketing. The Companys business and industry is also subject to new innovations in technology. Significant technical changes can have an adverse effect on product lives. Design and development of new products and services are important elements to achieve profitability in the Companys industry segment. As a result, the Companys products may quickly become obsolete and unmarketable. The Companys future success will depend on its ability to adapt to technological advances, anticipate customer demands, develop new products and services and enhance our current products on a timely and cost-effective basis. The Companys products must remain competitive with those of other companies with substantially greater resources. The Company may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to adapt new or enhanced products to emerging industry standards, and the Companys new products may not be favorably received. Nor may we have the capital resources to further the development of existing and/or new ones. Lastly, the Company may be subject to federal, state and local environmental laws and regulations. The Company does not anticipate material expenditures to comply with such laws and does not believe that regulations will have a material impact on the Companys financial position, results of operations, or liquidity. The Company believes that its operations comply, in all material respects, with applicable federal, state, and local environmental laws and regulations. Basis of Presentation The accompanying unaudited consolidated interim financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities Exchange Commission. Certain information and disclosures normally included in the annual financial statements prepared in accordance with the accounting principles generally accepted in the Unites States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these consolidated financial statements have been included. Such adjustments consist of normal recurring adjustments. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2015. The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the full year. Principles of Consolidation The consolidated financial statements include the accounts of BlueFire Renewables, Inc., and its wholly-owned subsidiary, BlueFire Ethanol, Inc. BlueFire Ethanol Lancaster, LLC, BlueFire Fulton Renewable Energy LLC (excluding 1% interest sold) and SucreSource LLC are wholly-owned subsidiaries of BlueFire Ethanol, Inc. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reported periods. Actual results could materially differ from those estimates. Project Development Project development costs are either expensed or capitalized. The costs of materials and equipment that will be acquired or constructed for project development activities, and that have alternative future uses, both in project development, marketing or sales, will be classified as property and equipment and depreciated over their estimated useful lives. To date, project development costs include the research and development expenses related to the Companys future cellulose-to-ethanol production facilities. During the three months ended March 31, 2016 and 2015, research and development costs included in Project Development were approximately $100,000, and $211,000, respectively. Convertible Debt Convertible debt is accounted for under the guidelines established by Accounting Standards Codification (ASC) 470-20 Debt with Conversion and Other Options. ASC 470-20 governs the calculation of an embedded beneficial conversion, which is treated as an additional discount to the instruments where derivative accounting (explained below) does not apply. The amount of the value of warrants and beneficial conversion feature may reduce the carrying value of the instrument to zero, but no further. The discounts relating to the initial recording of the derivatives or beneficial conversion features are accreted over the term of the debt. The Company calculates the fair value of warrants and conversion features issued with the convertible instruments using the Black-Scholes valuation method, using the same assumptions used for valuing employee options for purposes of ASC 718 Compensation Stock Compensation, except that the contractual life of the warrant or conversion feature is used. Under these guidelines, the Company allocates the value of the proceeds received from a convertible debt transaction between the conversion feature and any other detachable instruments (such as warrants) on a relative fair value basis. The allocated fair value is recorded as a debt discount or premium and is amortized over the expected term of the convertible debt to interest expense. The Company accounts for modifications of its BCFs in accordance with ASC 470-50 Modifications and Extinguishments. ASC 470-50 requires the modification of a convertible debt instrument that changes the fair value of an embedded conversion feature and the subsequent recognition of interest expense on the associated debt instrument when the modification does not result in a debt extinguishment. F air Value of Financial Instruments The Company follows the guidance of ASC 820 Fair Value Measurement and Disclosure. Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Companys assumptions about the factors market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value: Level 1. Observable inputs such as quoted prices in active markets; Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The Company did not have any level 1 financial instruments at March 31, 2016 or December 31, 2015. As of March 31, 2016 and December 31, 2015, the Companys derivative and warrant liabilities are considered a level 2 item (see Notes 4 and 5). As of March 31, 2016 and December 31, 2015 the Companys redeemable noncontrolling interest is considered a level 3 item and changed during the three months ended March 31, 2016 as follows. Balance at December 31, 2015 $ 865,614 Net loss attributable to noncontrolling interest 1,479 Balance at March 31, 2016 $ 864,135 Loss per Common Share The Company presents basic loss per share (EPS) and diluted EPS on the face of the consolidated statement of operations. Basic loss per share is computed as net loss divided by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options, warrants, and other convertible securities. As of March 31, 2016 and 2015, the Company had 23,100,000 and 23,528,571 warrants, respectively, for which, in 2015, 428,571 warrants had an exercise price which was in excess of the average closing price of the Companys common stock during the corresponding quarter, and thus 23,100,000 and 23,100,000 warrants, respectively, are considered dilutive under the treasury stock method of accounting. However, due to the net loss in the periods presented, the warrants effects are antidilutive and therefore, excluded from diluted EPS calculations. Derivative Financial Instruments We do not use derivative financial instruments to hedge exposures to cash-flow risks or market-risks that may affect the fair values of our financial instruments. However, under the provisions ASC 815 Derivatives and Hedging certain financial instruments that have characteristics of a derivative, as defined by ASC 815, such as embedded conversion features on our Convertible Notes, that are potentially settled in the Companys own common stock, are classified as liabilities when either (a) the holder possesses rights to net-cash settlement or (b) physical or net-share settlement is not within our control. In such instances, net-cash settlement is assumed for financial accounting and reporting purposes, even when the terms of the underlying contracts do not provide for net-cash settlement. Derivative financial instruments are initially recorded, and continuously carried, at fair value each reporting period. The value of the embedded conversion feature is determined using the Black-Scholes option pricing model. All future changes in the fair value of the embedded conversion feature will be recognized currently in earnings until the note is converted or redeemed. Determining the fair value of derivative financial instruments involves judgment and the use of certain relevant assumptions including, but not limited to, interest rate risk, credit risk, volatility and other factors. The use of different assumptions could have a material effect on the estimated fair value amounts. Redeemable - Noncontrolling Interest Redeemable interest held by third parties in subsidiaries owned or controlled by the Company is reported on the consolidated balance sheets outside permanent equity. All non-controlling interest reported in the consolidated statements of operations reflects the respective interests in the income or loss after income taxes of the subsidiaries attributable to the other parties, the effect of which is removed from the net income or loss available to the Company. The Company accretes the redemption value of the redeemable non-controlling interest over the redemption period. New Accounting Pronouncements The Financial Accounting Standards Board (FASB) issues Accounting Standard Updates (ASU) to amend the authoritative literature in ASC. There have been a number of ASUs to date that amend the original text of ASC. The Company believes those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements Going Concern, which requires management to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about the entitys ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and interim periods thereafter. The guidance is not expected to have a material impact on the Companys financial statements. In April 2015, FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs, which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of debt issuance costs will continue to be reported as interest expense. ASU 2015-03 is effective for annual reporting periods beginning after December 15, 2015. The adoption did not have a material impact on the Companys financial statements. In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. The amendments in this update simplify the presentation of deferred taxes by requiring deferred tax assets and liabilities be classified as noncurrent on the balance sheet. These amendments may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The amendments are effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Earlier application is permitted for all entities as of the beginning of an interim or annual reporting period. The guidance is not expected to have a material impact on the Companys financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 840), 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. The amendments in this standard are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, for a public entity. Early adoption of the amendments in this standard is permitted for all entities and the Company must recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently in the process of evaluating the effect this guidance will have on its financial statements and related disclosures. Management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Going Concern The Company has incurred losses since Inception. Management has funded operations primarily through proceeds received in connection with the reverse merger, loans from its majority shareholder, the private placement of the Companys common stock in December 2007 for net proceeds of approximately $14,500,000, the issuance of convertible notes with warrants in July and in August 2007, various convertible notes, and Department of Energy reimbursements from 2009 to 2015. The Company may encounter further difficulties in establishing operations due to the time frame of developing, constructing and ultimately operating the planned bio-refinery projects. As of March 31, 2016, the Company has negative working capital of approximately $2,673,000. Management has estimated that operating expenses for the next 12 months will be approximately $1,450,000 excluding engineering costs related to the development of bio-refinery projects. These matters raise substantial doubt about the Companys ability to continue as a going concern. The Company intends to fund its operations with any additional funding that can be secured in the form of equity or debt. As of May [∙], 2016, the Company expects the current resources available to them will only be sufficient for a period of approximately one month unless significant additional financing is received. Management has determined that the general expenditures must be reduced and additional capital will be required in the form of equity or debt securities. In addition, if we cannot raise additional short term capital we may consume all of our cash reserved for operations. There are no assurances that management will be able to raise capital on terms acceptable to the Company or at all. If we are unable to obtain sufficient amounts of additional capital, we may be required to reduce the scope of our planned development, which could harm our business, financial condition and operating results. The financial statements do not include any adjustments that might result from these uncertainties. Additionally, the Companys Lancaster plant is currently shovel ready, except for the air permit which the Company will need to renew and only requires minimal capital to maintain until funding is obtained for the construction. This project shall continue once we receive the funding necessary to construct the facility. As of December 31, 2010, the Company completed the detailed engineering on our proposed Fulton Project (Note 8), procured all necessary permits for construction of the plant, and began site clearing and preparation work, signaling the beginning of construction. All site preparation activities have been completed, including clearing and grating of the site, building access roads, completing railroad tie-ins to connect the site to the rail system, and finalizing the layout plan to prepare for the site foundation. As of December 31, 2013, the construction-in-progress through such date was deemed impaired due to the discontinuance of future funding from the DOE further described in Note 3. We estimate the total construction cost of the bio-refineries to be in the range of approximately $300 million for the Fulton Project and approximately $100 million to $125 million for the Lancaster Biorefinery. These cost approximations do not reflect any increase/decrease in raw materials or any fluctuation in construction cost that would be realized by the dynamic world metals markets or inflation of general costs of construction. The Company is currently in discussions with potential sources of financing for these facilities but no definitive agreements are in place. The Company cannot continue significant development or furtherance of the Fulton project until financing for the construction of the Fulton plant is obtained. Risks and Uncertainties The Company has a limited operating history and has not generated revenues from our planned principal operations. The Companys business and operations are very sensitive to general business and economic conditions in the U.S. and worldwide. Specifically, these conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general price of crude oil and gasoline. The risks related to the Companys plans to sell engineering services are that the Company currently has no sales and limited marketing capabilities. The Company has limited experience in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of our services. Developing a marketing and sales force is also time consuming and could delay launch of our future bio-ethanol plants. In addition, the Company will compete with other engineering companies that currently have extensive and well-funded marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these companies. In addition, the Company has limited capital to devote sales and marketing. The Companys business and industry is also subject to new innovations in technology. Significant technical changes can have an adverse effect on product lives. Design and development of new products and services are important elements to achieve profitability in the Companys industry segment. As a result, the Companys products may quickly become obsolete and unmarketable. The Companys future success will depend on its ability to adapt to technological advances, anticipate customer demands, develop new products and services and enhance our current products on a timely and cost-effective basis. The Companys products must remain competitive with those of other companies with substantially greater resources. The Company may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to adapt new or enhanced products to emerging industry standards, and the Companys new products may not be favorably received. Nor may we have the capital resources to further the development of existing and/or new ones. Lastly, the Company may be subject to federal, state and local environmental laws and regulations. The Company does not anticipate material expenditures to comply with such laws and does not believe that regulations will have a material impact on the Companys financial position, results of operations, or liquidity. The Company believes that its operations comply, in all material respects, with applicable federal, state, and local environmental laws and regulations. Basis of Presentation The accompanying unaudited consolidated interim financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities Exchange Commission. Certain information and disclosures normally included in the annual financial statements prepared in accordance with the accounting principles generally accepted in the Unites States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these consolidated financial statements have been included. Such adjustments consist of normal recurring adjustments. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2015. The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the full year. Principles of Consolidation The consolidated financial statements include the accounts of BlueFire Renewables, Inc., and its wholly-owned subsidiary, BlueFire Ethanol, Inc. BlueFire Ethanol Lancaster, LLC, BlueFire Fulton Renewable Energy LLC (excluding 1% interest sold) and SucreSource LLC are wholly-owned subsidiaries of BlueFire Ethanol, Inc. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reported periods. Actual results could materially differ from those estimates. Project Development Project development costs are either expensed or capitalized. The costs of materials and equipment that will be acquired or constructed for project development activities, and that have alternative future uses, both in project development, marketing or sales, will be classified as property and equipment and depreciated over their estimated useful lives. To date, project development costs include the research and development expenses related to the Companys future cellulose-to-ethanol production facilities. During the three months ended March 31, 2016 and 2015, research and development costs included in Project Development were approximately $100,000, and $211,000, respectively. Convertible Debt Convertible debt is accounted for under the guidelines established by Accounting Standards Codification (ASC) 470-20 Debt with Conversion and Other Options. ASC 470-20 governs the calculation of an embedded beneficial conversion, which is treated as an additional discount to the instruments where derivative accounting (explained below) does not apply. The amount of the value of warrants and beneficial conversion feature may reduce the carrying value of the instrument to zero, but no further. The discounts relating to the initial recording of the derivatives or beneficial conversion features are accreted over the term of the debt. The Company calculates the fair value of warrants and conversion features issued with the convertible instruments using the Black-Scholes valuation method, using the same assumptions used for valuing employee options for purposes of ASC 718 Compensation Stock Compensation, except that the contractual life of the warrant or conversion feature is used. Under these guidelines, the Company allocates the value of the proceeds received from a convertible debt transaction between the conversion feature and any other detachable instruments (such as warrants) on a relative fair value basis. The allocated fair value is recorded as a debt discount or premium and is amortized over the expected term of the convertible debt to interest expense. The Company accounts for modifications of its BCFs in accordance with ASC 470-50 Modifications and Extinguishments. ASC 470-50 requires the modification of a convertible debt instrument that changes the fair value of an embedded conversion feature and the subsequent recognition of interest expense on the associated debt instrument when the modification does not result in a debt extinguishment. F air Value of Financial Instruments The Company follows the guidance of ASC 820 Fair Value Measurement and Disclosure. Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Companys assumptions about the factors market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value: Level 1. Observable inputs such as quoted prices in active markets; Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The Company did not have any level 1 financial instruments at March 31, 2016 or December 31, 2015. As of March 31, 2016 and December 31, 2015, the Companys derivative and warrant liabilities are considered a level 2 item (see Notes 4 and 5). As of March 31, 2016 and December 31, 2015 the Companys redeemable noncontrolling interest is considered a level 3 item and changed during the three months ended March 31, 2015 as follows. Balance at December 31, 2015 $ 865,614 Net loss attributable to noncontrolling interest 1,480 Balance at March 31, 2016 $ 864,134 Loss per Common Share The Company presents basic loss per share (EPS) and diluted EPS on the face of the consolidated statement of operations. Basic loss per share is computed as net loss divided by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options, warrants, and other convertible securities. As of March 31, 2016 and 2015, the Company had 23,100,000 and 23,528,571 warrants, respectively, for which, in 2015, 428,571 warrants had an exercise price which was in excess of the average closing price of the Companys common stock during the corresponding quarter, and thus 23,100,000 and 23,100,000 warrants, respectively, are considered dilutive under the treasury stock method of accounting. However, due to the net loss in the periods presented, the warrants effects are antidilutive and therefore, excluded from diluted EPS calculations. Derivative Financial Instruments We do not use derivative financial instruments to hedge exposures to cash-flow risks or market-risks that may affect the fair values of our financial instruments. However, under the provisions ASC 815 Derivatives and Hedging certain financial instruments that have characteristics of a derivative, as defined by ASC 815, such as embedded conversion features on our Convertible Notes, that are potentially settled in the Companys own common stock, are classified as liabilities when either (a) the holder possesses rights to net-cash settlement or (b) physical or net-share settlement is not within our control. In such instances, net-cash settlement is assumed for financial accounting and reporting purposes, even when the terms of the underlying contracts do not provide for net-cash settlement. Derivative financial instruments are initially recorded, and continuously carried, at fair value each reporting period. The value of the embedded conversion feature is determined using the Black-Scholes option pricing model. All future changes in the fair value of the embedded conversion feature will be recognized currently in earnings until the note is converted or redeemed. Determining the fair value of derivative financial instruments involves judgment and the use of certain relevant assumptions including, but not limited to, interest rate risk, credit risk, volatility and other factors. The use of different assumptions could have a material effect on the estimated fair value amounts. Redeemable - Noncontrolling Interest Redeemable interest held by third parties in subsidiaries owned or controlled by the Company is reported on the consolidated balance sheets outside permanent equity. All non-controlling interest reported in the consolidated statements of operations reflects the respective interests in the income or loss after income taxes of the subsidiaries attributable to the other parties, the effect of which is removed from the net income or loss available to the Company. The Company accretes the redemption value of the redeemable non-controlling interest over the redemption period. New Accounting Pronouncements The Financial Accounting Standards Board (FASB) issues Accounting Standard Updates (ASU) to amend the authoritative literature in ASC. There have been a number of ASUs to date that amend the original text of ASC. The Company believes those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements Going Concern, which requires management to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about the entitys ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and interim periods thereafter. The guidance is not expected to have a material impact on the Companys financial statements. In April 2015, FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs, which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of debt issuance costs will continue to be reported as interest expense. ASU 2015-03 is effective for annual reporting periods beginning after December 15, 2015. The adoption did not have a material impact on the Companys financial statements. In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. The amendments in this update simplify the presentation of deferred taxes by requiring deferred tax assets and liabilities be classified as noncurrent on the balance sheet. These amendments may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The amendments are effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Earlier application is permitted for all entities as of the beginning of an interim or annual reporting period. The guidance is not expected to have a material impact on the Companys financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 840), 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. The amendments in this standard are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, for a public entity. Early adoption of the amendments in this standard is permitted for all entities and the Company must recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently in the process of evaluating the effect this guidance will have on its financial statements and related disclosures. Management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements. |
Development Contract
Development Contract | 3 Months Ended |
Mar. 31, 2016 | |
Development Contract | |
Development Contracts | NOTE 3 - DEVELOPMENT CONTRACTS Department of Energy Awards 1 and 2 In February 2007, the Company was awarded a grant for up to $40 million from the U.S. Department of Energys (DOE) cellulosic ethanol grant program to develop a solid waste biorefinery project at a landfill in Southern California. During October 2007, the Company finalized Award 1 for a total approved budget of just under $10,000,000 with the DOE. This award was a 60%/40% cost share, whereby 40% of approved costs may be reimbursed by the DOE pursuant to the total $40 million award announced in February 2007. In December 2009, as a result of the American Recovery and Reinvestment Act, the DOE increased Award 2 to a total of $81 million for Phase II of its Fulton Project. This is in addition to a renegotiated Phase I funding for development of the biorefinery of approximately $7 million out of the previously announced $10 million total. This brought the DOEs total award to the Fulton project to approximately $88 million. In September 2012, Award 1 was officially closed. Since 2009, our operations had been financed to a large degree through funding provided by the DOE. We have relied on access to this funding as a source of liquidity for capital requirements not satisfied by the cash flow from our operations. If we are unable to access government funding our ability to finance our projects and/or operations and implement our strategy and business plan will be severely hampered. On December 23, 2013, the Company received notice from the DOE indicating that the DOE would no longer provide funding under Award 2 due to the Companys inability to comply with certain deadlines related to providing certain information to the DOE with respect to the Companys future financing arrangements for the Fulton Project. On March 17, 2015, the Company received a letter from the DOE stating that because of the upcoming September 2015 expiration date for expending American Recovery and Reinvestment Act (ARRA) funding, it cannot reconsider its decision, and the Company considers such decision to be final. In June of 2015, the DOE obligated additional funds totaling $873,332 for costs incurred but not reimbursed prior to September 30, 2014 as well as for program required compliance audits for years 2011-2014. As of September 30, 2015 the Company submitted all final invoices and final documents related to the termination of the grant by the DOE. The Company considers the grant closed out and completed. |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Notes Payable | NOTE 4 - NOTES PAYABLE From time-to-time, the Company enters into convertible notes with third parties as indicated below. Under the terms of these notes, the Company is to repay any principal balance and interest, at 8% per annum at a given maturity date which is generally less than one year. The Company has the option to prepay the convertible promissory notes prior to maturity at varying prepayment penalty rates specified under the agreement. The convertible promissory notes are convertible into shares of the Companys common stock after six months as calculated by multiplying 58% (42% discount to market) by the average of the lowest three closing bid prices during the 10 days prior to the conversion date. For the below convertible notes, the Company determined that since the conversion prices are variable and do not contain a floor, the conversion feature represents a derivative liability upon the ability to convert the loan after the six month period specified above. Since the conversion feature is only convertible after six months, there is no derivative liability upon issuance. However, the Company will account for the derivative liability upon the passage of time and the note becoming convertible if not extinguished. Vis Vires Group, Inc. On May 12, 2015, the Company issued a convertible note in favor of Vis Vires Group, Inc. in the principal amount of $59,000 with a $4,000 on-issuance discount pursuant to the terms identified above, with a maturity date of February 14, 2016. In accordance with the terms of the note, the note became convertible on November 8, 2015. As of December 31, 2015, the entire discount, including the on issuance discount, was amortized to interest expense, with no remaining unamortized discount and the note was fully converted into 26,072,727 shares of common stock. JMJ Convertible Note On April 2, 2015, the Company issued a convertible note in favor of JMJ Financial in the principal amount of $100,000 out of a total of a possible $250,000, with a maturity date of April 1, 2017 (the JMJ Note). The JMJ Note was issued with a 10% original issue discount, and is convertible at any time. The $10,000 on-issuance discount will be amortized over the life of the note. The Company is to repay any principal balance due under the note including a one-time charge of 12% interest on the principal balance outstanding if not repaid within 90 days. The Company has the option to prepay the JMJ Note prior to maturity. The JMJ Note is convertible into shares of the Companys common stock as calculated by multiplying 60% of the lowest trade price in the 25 trading days prior to the conversion date. Due to the variable conversion feature of the note, derivative accounting is required. The Company valued the derivative upon issuance and at each conversion, and reporting date. The initial value of the derivative liability was $412,212, resulting in a day one loss $312,212. The discount on the convertible note is being amortized over the life of the note. During the three months ended March 30, 2016, amortization of the discount was $32,866 with $0 remaining. March 31, 2016 April 2, 2015 Annual dividend yield - - Expected life (years) 1.00 2.00 Risk-free interest rate 0.73 % 0.55 % Expected volatility 188.24 % 301.07 % During the three months ended March 31, 2016, the Company issued 96,830,000 shares of common stock for the conversion of approximately $60,650, including approximately $52,950 of principal and $7,700 of accrued interest. Subsequent to March 31, 2016, a portion of the JMJ Note was converted into shares of Company stock and repaid in full (See Note 10). AKR Promissory Note On April 8, 2014, the Company issued a promissory note in favor of AKR Inc, (AKR) in the principal aggregate amount of $350,000 (the AKR Note). The AKR Note was due on April 8, 2015, but was subsequently extended to June 30, 2016, and requires the Company to (i) incur interest at five percent (5%) per annum; (ii) issue on April 8, 2014 to AKR warrants allowing them to buy 7,350,000 common shares of the Company at an exercise price of $0.007 per common share, such warrants to expire on April 8, 2016 (AKR Warrant A); (iii) issue on August 8, 2014 to AKR warrants allowing them to buy 7,350,000 common shares of the Company at an exercise price of $0.007 per common share, such warrants to expire on April 8, 2016 (AKR Warrant B); and (iv) issue on November 8, 2014 to AKR warrants allowing them to buy 8,400,000 common shares of the Company at an exercise price of $0.007 per common share, such warrants to expire on April 8, 2016 (AKR Warrant C, together with AKR Warrant A and AKR Warrant B the AKR Warrants). The Company may prepay the debt, prior to maturity with no prepayment penalty. The Company valued the AKR Warrants as of the date of the note and recorded a discount of $42,323 based on the relative fair value of the AKR Warrants compared to the debt. During the quarter ended March 31, 2016, the Company amortized $0 of the discount to interest expense. As of March 31, 2016 unamortized discount of $0 remains. The Company assessed the fair value of the AKR Warrants based on the Black-Scholes pricing model. See below for variables used in assessing the fair value. April 8, 2014 Annual dividend yield - Expected life (years) of 1.41 - 2.00 Risk-free interest rate 0.40% Expected volatility 183% - 206% On April 24, 2014, the Company issued a promissory note in favor of AKR in the principal aggregate amount of $30,000 (2 nd nd nd Kodiak Promissory Note On December 17, 2014, the Company entered into the equity Purchase Agreement with Kodiak. Pursuant to the terms of the Purchase Agreement, for a period of twenty-four (24) months commencing on the date of effectiveness of the registration statement, Kodiak shall commit to purchase up to $1,500,000 of Put Shares, pursuant to Puts (as defined in the Purchase Agreement), covering the Registered Securities (as defined in the Purchase Agreement). See Note 9 for more information. As further consideration for Kodiak entering into and structuring the Purchase Agreement, the Company issued Kodiak a promissory note in the principal aggregate amount of $60,000 (the Kodiak Note) that bears no interest and has maturity date of July 17, 2015. No funds were received for this note. As of March 31, 2016, the balance outstanding on the Kodiak Note was $40,000. Because the note was issued for no cash consideration, there was a full on-issuance discount, of which $60,000 was amortized as of March 31, 2016, and $0 remains to be amortized. |
Outstanding Warrant Liability
Outstanding Warrant Liability | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Outstanding Warrant Liability | NOTE 5 - OUTSTANDING WARRANT LIABILITY The Company assesses the fair value of the warrants quarterly based on the Black-Scholes pricing model. See below for variables used in assessing the fair value. The Company issued 428,571 warrants to purchase common stock in connection with a Stock Purchase Agreement entered into on January 19, 2011 with Lincoln Park Capital, LLC. These warrants expired in January 2016 and were accounted for as a liability under ASC 815 as they contain a ratchet provision in which the exercise price will be adjusted based on future issuances of common stock, excluding certain issuances; if issuances are at prices lower than the current exercise price. The Company assesses the fair value of the warrants quarterly based on the Black-Scholes pricing model. See below for variables used in assessing the fair value. January 19, 2016 December 31, 2015 Annual dividend yield - - Expected life (years) of 0 0.05 Risk-free interest rate 0 % 0.14 % Expected volatility 0 % 216 % In connection with these warrants, the Company recognized a gain on the change in fair value of warrant liability of approximately $199 and $13,200 during the three months ended March 31, 2016 and 2015, respectively. Expected volatility is based primarily on historical volatility. Historical volatility was computed using weekly pricing observations for recent periods that correspond to the expected life of the warrants. The Company believes this method produces an estimate that is representative of our expectations of future volatility over the expected term of these warrants. The Company currently has no reason to believe future volatility over the expected remaining life of these warrants is likely to differ materially from historical volatility. The expected life is based on the remaining term of the warrants. The risk-free interest rate is based on U.S. Treasury securities rates. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 6 - COMMITMENTS AND CONTINGENCIES Board of Director Arrangements On November 19, 2013, the Company renewed all of its existing Directors appointment, and accrued $5,000 to both of the two outside members. Pursuant to the Board of Director agreements, the Companys in-house board members (CEO and Vice-President) waived their annual cash compensation of $5,000. As of May 16, 2016, the Company had not yet issued the 6,000 shares issuable for compensation in 2013, 2014 or 2015 to each of its Board Members. Fulton Project Lease On July 20, 2010, the Company entered into a thirty year lease agreement with Itawamba County, Mississippi for the purpose of the development, construction, and operation of the Fulton Project. At the end of the primary 30 year lease term, the Company shall have the right for two additional thirty year terms. The current lease rate is computed based on a per acre rate per month that is approximately $10,300 per month. The lease stipulates the lease rate is to be reduced at the time of the construction start by a Property Cost Reduction Formula which can substantially reduce the monthly lease costs. The lease rate shall be adjusted every five years to the Consumer Price Index. Rent expense under non-cancellable leases was approximately $30,900, and $30,900 during the three months ended March 31, 2016 and 2015, respectively. As of March 31, 2016 and 2015, $205,840 and $82,336 of the monthly lease payments were included in accounts payable on the accompanying consolidated balance sheets, respectively. During 2014, the County of Itawamba forgave approximately $96,000 in lease payments. The Company is currently in default of the lease due to non payment and could be subject to lease cancellation if it cannot make payments or other arrangements with the County of Itawamba. As of March 31, 2016, the Company has accrued $16,033 of default interest due to the nonpayment of the lease. As of the date of this filing there have been no formal letters of default or demands from the County of Itawamba. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 7 - RELATED PARTY TRANSACTIONS Loan Agreement On December 15, 2010, the Company entered into a loan agreement (the Loan Agreement) by and between Arnold Klann, the Chief Executive Officer, Chairman of the board of directors and majority shareholder of the Company, as lender (the Lender), and the Company, as borrower. Pursuant to the Loan Agreement, the Lender agreed to advance to the Company a principal amount of Two Hundred Thousand United States Dollars ($200,000) (the Loan). The Loan Agreement requires the Company to (i) pay to the Lender a one-time amount equal to fifteen percent (15%) of the Loan (the Fee Amount) in cash or shares of the Companys common stock at a value of $0.50 per share, at the Lenders option; and (ii) issue the Lender warrants allowing the Lender to buy 500,000 common shares of the Company at an exercise price of $0.50 per common share. The Company has promised to pay in full the outstanding principal balance of any and all amounts due under the Loan Agreement within thirty (30) days of the Companys receipt of investment financing or a commitment from a third party to provide One Million United States Dollars ($1,000,000) to the Company or one of its subsidiaries (the Due Date), to be paid in cash. These warrants expired on December 15, 2013. Related Party Lines of Credit On November 10, 2011, the Company obtained a line of credit in the amount of $40,000 from its Chairman/Chief Executive Officer and majority shareholder to provide additional liquidity to the Company as needed, at his sole discretion. Under the terms of the note, the Company is to repay any principal balance and interest, at 12% per annum, within 30 days of receiving qualified investment financing of $100,000 or more. On April 10, 2014 the line of credit was increased to $55,000. On March 13, 2016, the line of credit was increased to $125,000. As of March 31, 2016 and December 31, 2015, the outstanding balance on the line of credit was approximately $69,230 and $45,230, respectively. On March 31, 2016, there was approximately $55,770 remaining under the line. Although the Company has received over $100,000 in financing since this agreement was put into place, Mr. Klann does not hold the Company in default at this time. As of March 31, 2016, $16,707 in accrued interest is owed under this line of credit and included with accrued liabilities. Accrued Salaries As of March 31, 2016 and December 31, 2015, accrued salary due to the Chief Executive Officer included within accrued liabilities was $188,333. |
Redeemable Non-controlling Inte
Redeemable Non-controlling Interest | 3 Months Ended |
Mar. 31, 2016 | |
Noncontrolling Interest [Abstract] | |
Redeemable Non-controlling Interest | NOTE 8 - REDEEMABLE NONCONTROLLING INTEREST On December 23, 2010, the Company sold a one percent (1%) membership interest in its operating subsidiary, BlueFire Fulton Renewable Energy, LLC (BlueFire Fulton or the Fulton Project), to an accredited investor for a purchase price of $750,000 (Purchase Price). The Company maintains a 99% ownership interest in the Fulton Project. In addition, the investor received a right to require the Company to redeem the 1% interest for $862,500, or any pro-rata amount thereon. The redemption is based upon future contingent events based upon obtaining financing for the construction of the Fulton Project. The third party equity interests in the consolidated joint ventures are reflected as redeemable noncontrolling interests in the Companys consolidated financial statements outside of equity. The Company accreted the redeemable noncontrolling interest for the total redemption price of $862,500 through the estimated forecasted financial close, originally estimated to be the end of the third quarter of 2011. Net loss attributable to the redeemable noncontrolling interest during for the three months ended March 31, 2016 and 2015 was $1,479 and $1,189, respectively which netted against the value of the redeemable non-controlling interest in temporary equity. The allocation of net loss was presented on the consolidated statements of operations. |
Stockholders' Deficit
Stockholders' Deficit | 3 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Deficit | NOTE 9 - STOCKHOLDERS DEFICIT Series A Preferred Stock We have authorized the issuance of a total of 1,000,000 shares of our Series A Preferred Stock. See Note 1 for rights and preferences. Kodiak Purchase Agreement and Registration Rights Agreement On December 17, 2014, the Company entered into the equity Purchase Agreement with Kodiak. Pursuant to the terms of the Purchase Agreement, for a period of twenty-four (24) months commencing on the date of effectiveness of the registration statement, Kodiak shall commit to purchase up to $1,500,000 of Put Shares, pursuant to Puts (as defined in the Purchase Agreement), covering the Registered Securities (as defined below). The Registered Securities means the (a) Put Shares, and (b) any securities issued or issuable with respect to any of the foregoing by way of exchange, stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization or otherwise. As to any particular Registered Securities, once issued such securities shall cease to be Registered Securities when (i) a Registration Statement has been declared effective by the SEC and such Registered Securities have been disposed of pursuant to a Registration Statement, (ii) such Registered Securities have been sold under circumstances under which all of the applicable conditions of Rule 144 are met, (iii) such time as such Registered Securities have been otherwise transferred to holders who may trade such shares without restriction under the Securities Act or (iv) in the opinion of counsel to the Company, which counsel shall be reasonably acceptable to Investor, such Registered Securities may be sold without registration under the Securities Act or the need for an exemption from any such registration requirements and without any time, volume or manner limitations pursuant to Rule 144(b)(i) (or any similar provision then in effect) under the Securities Act. As further consideration for Kodiak entering into and structuring the Purchase Agreement, the Company issued Kodiak a promissory note for no consideration, in the principal aggregate amount of $60,000 (the Kodiak Note) that bears no interest and has maturity date of July 17, 2015. See Note 4 for additional information. Concurrently with the Purchase Agreement, on December 17, 2014, the Company also entered into a registration rights agreement (the Registration Rights Agreement) with Kodiak. Pursuant to the terms of the Registration Rights Agreement, the Company is obligated to file a registration statement (the Registration Statement) with the SEC to cover the Registered Securities, within thirty (30) days of closing, and must use its commercially reasonable efforts to cause the Registration Statement to be declared effective by the SEC. The Registration was filed on January 2, 2015, and declared effective on February 11, 2015. On February 12, 2015, the Company issued a Put for 20,000,000 put shares. The lowest closing bid price during the valuation period was $0.0098. For the quarter ended March 31, 2016 and 2015, the Company received total funds, net of Kodiaks 25% discount, of $0 and $147,000, respectively. The Purchase Agreement, will terminate on the earlier of (i) on the date on which Kodiak shall have purchased Put Shares pursuant to this Agreement for an aggregate Purchase Price of the Maximum Commitment Amount or (ii) December 31, 2016. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 10 - SUBSEQUENT EVENTS Subsequent to March 31, 2016, the Company has issued a total of 8,911,400 shares of common stock to JMJ under the terms of the JMJ Note for conversion of approximately $5,347 in accrued interest. The JMJ Note is fully repaid as of April 5, 2016. Subsequent to March 31, 2016, the Company reached a settlement with James G Speirs and James N. Speirs in regards to the lawsuit filed in Orange County Superior Court and subsequently appealed by the Company. Under the settlement agreement, James G Speirs and James N Speirs have returned the 5,740,741 shares to the Company and they have been subsequently retired to treasury. The request to dismiss the case has been sent by both parties to the Orange County Superior Court and is awaiting the formal dismissal. |
Summary of Significant Accoun17
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Going Concern | Going Concern The Company has incurred losses since Inception. Management has funded operations primarily through proceeds received in connection with the reverse merger, loans from its majority shareholder, the private placement of the Companys common stock in December 2007 for net proceeds of approximately $14,500,000, the issuance of convertible notes with warrants in July and in August 2007, various convertible notes, and Department of Energy reimbursements from 2009 to 2015. The Company may encounter further difficulties in establishing operations due to the time frame of developing, constructing and ultimately operating the planned bio-refinery projects. As of March 31, 2016, the Company has negative working capital of approximately $2,673,000. Management has estimated that operating expenses for the next 12 months will be approximately $1,450,000 excluding engineering costs related to the development of bio-refinery projects. These matters raise substantial doubt about the Companys ability to continue as a going concern. The Company intends to fund its operations with any additional funding that can be secured in the form of equity or debt. As of May [∙], 2016, the Company expects the current resources available to them will only be sufficient for a period of approximately one month unless significant additional financing is received. Management has determined that the general expenditures must be reduced and additional capital will be required in the form of equity or debt securities. In addition, if we cannot raise additional short term capital we may consume all of our cash reserved for operations. There are no assurances that management will be able to raise capital on terms acceptable to the Company or at all. If we are unable to obtain sufficient amounts of additional capital, we may be required to reduce the scope of our planned development, which could harm our business, financial condition and operating results. The financial statements do not include any adjustments that might result from these uncertainties. Additionally, the Companys Lancaster plant is currently shovel ready, except for the air permit which the Company will need to renew and only requires minimal capital to maintain until funding is obtained for the construction. This project shall continue once we receive the funding necessary to construct the facility. As of December 31, 2010, the Company completed the detailed engineering on our proposed Fulton Project (Note 8), procured all necessary permits for construction of the plant, and began site clearing and preparation work, signaling the beginning of construction. All site preparation activities have been completed, including clearing and grating of the site, building access roads, completing railroad tie-ins to connect the site to the rail system, and finalizing the layout plan to prepare for the site foundation. As of December 31, 2013, the construction-in-progress through such date was deemed impaired due to the discontinuance of future funding from the DOE further described in Note 3. We estimate the total construction cost of the bio-refineries to be in the range of approximately $300 million for the Fulton Project and approximately $100 million to $125 million for the Lancaster Biorefinery. These cost approximations do not reflect any increase/decrease in raw materials or any fluctuation in construction cost that would be realized by the dynamic world metals markets or inflation of general costs of construction. The Company is currently in discussions with potential sources of financing for these facilities but no definitive agreements are in place. The Company cannot continue significant development or furtherance of the Fulton project until financing for the construction of the Fulton plant is obtained. |
Risks and Uncertainties | Risks and Uncertainties The Company has a limited operating history and has not generated revenues from our planned principal operations. The Companys business and operations are very sensitive to general business and economic conditions in the U.S. and worldwide. Specifically, these conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general price of crude oil and gasoline. The risks related to the Companys plans to sell engineering services are that the Company currently has no sales and limited marketing capabilities. The Company has limited experience in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of our services. Developing a marketing and sales force is also time consuming and could delay launch of our future bio-ethanol plants. In addition, the Company will compete with other engineering companies that currently have extensive and well-funded marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these companies. In addition, the Company has limited capital to devote sales and marketing. The Companys business and industry is also subject to new innovations in technology. Significant technical changes can have an adverse effect on product lives. Design and development of new products and services are important elements to achieve profitability in the Companys industry segment. As a result, the Companys products may quickly become obsolete and unmarketable. The Companys future success will depend on its ability to adapt to technological advances, anticipate customer demands, develop new products and services and enhance our current products on a timely and cost-effective basis. The Companys products must remain competitive with those of other companies with substantially greater resources. The Company may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to adapt new or enhanced products to emerging industry standards, and the Companys new products may not be favorably received. Nor may we have the capital resources to further the development of existing and/or new ones. Lastly, the Company may be subject to federal, state and local environmental laws and regulations. The Company does not anticipate material expenditures to comply with such laws and does not believe that regulations will have a material impact on the Companys financial position, results of operations, or liquidity. The Company believes that its operations comply, in all material respects, with applicable federal, state, and local environmental laws and regulations. |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated interim financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities Exchange Commission. Certain information and disclosures normally included in the annual financial statements prepared in accordance with the accounting principles generally accepted in the Unites States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these consolidated financial statements have been included. Such adjustments consist of normal recurring adjustments. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2015. The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the full year. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of BlueFire Renewables, Inc., and its wholly-owned subsidiary, BlueFire Ethanol, Inc. BlueFire Ethanol Lancaster, LLC, BlueFire Fulton Renewable Energy LLC (excluding 1% interest sold) and SucreSource LLC are wholly-owned subsidiaries of BlueFire Ethanol, Inc. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reported periods. Actual results could materially differ from those estimates. |
Project Development | Project Development Project development costs are either expensed or capitalized. The costs of materials and equipment that will be acquired or constructed for project development activities, and that have alternative future uses, both in project development, marketing or sales, will be classified as property and equipment and depreciated over their estimated useful lives. To date, project development costs include the research and development expenses related to the Companys future cellulose-to-ethanol production facilities. During the three months ended March 31, 2016 and 2015, research and development costs included in Project Development were approximately $100,000, and $211,000, respectively. |
Convertible Debt | Convertible Debt Convertible debt is accounted for under the guidelines established by Accounting Standards Codification (ASC) 470-20 Debt with Conversion and Other Options. ASC 470-20 governs the calculation of an embedded beneficial conversion, which is treated as an additional discount to the instruments where derivative accounting (explained below) does not apply. The amount of the value of warrants and beneficial conversion feature may reduce the carrying value of the instrument to zero, but no further. The discounts relating to the initial recording of the derivatives or beneficial conversion features are accreted over the term of the debt. The Company calculates the fair value of warrants and conversion features issued with the convertible instruments using the Black-Scholes valuation method, using the same assumptions used for valuing employee options for purposes of ASC 718 Compensation Stock Compensation, except that the contractual life of the warrant or conversion feature is used. Under these guidelines, the Company allocates the value of the proceeds received from a convertible debt transaction between the conversion feature and any other detachable instruments (such as warrants) on a relative fair value basis. The allocated fair value is recorded as a debt discount or premium and is amortized over the expected term of the convertible debt to interest expense. The Company accounts for modifications of its BCFs in accordance with ASC 470-50 Modifications and Extinguishments. ASC 470-50 requires the modification of a convertible debt instrument that changes the fair value of an embedded conversion feature and the subsequent recognition of interest expense on the associated debt instrument when the modification does not result in a debt extinguishment. |
Fair Value of Financial Instruments | F air Value of Financial Instruments The Company follows the guidance of ASC 820 Fair Value Measurement and Disclosure. Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. The guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Companys assumptions about the factors market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value: Level 1. Observable inputs such as quoted prices in active markets; Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The Company did not have any level 1 financial instruments at March 31, 2016 or December 31, 2015. As of March 31, 2016 and December 31, 2015, the Companys derivative and warrant liabilities are considered a level 2 item (see Notes 4 and 5). As of March 31, 2016 and December 31, 2015 the Companys redeemable noncontrolling interest is considered a level 3 item and changed during the three months ended March 31, 2016 as follows. Balance at December 31, 2015 $ 865,614 Net loss attributable to noncontrolling interest 1,479 Balance at March 31, 2016 $ 864,135 |
Loss Per Common Share | Loss per Common Share The Company presents basic loss per share (EPS) and diluted EPS on the face of the consolidated statement of operations. Basic loss per share is computed as net loss divided by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options, warrants, and other convertible securities. As of March 31, 2016 and 2015, the Company had 23,100,000 and 23,528,571 warrants, respectively, for which, in 2015, 428,571 warrants had an exercise price which was in excess of the average closing price of the Companys common stock during the corresponding quarter, and thus 23,100,000 and 23,100,000 warrants, respectively, are considered dilutive under the treasury stock method of accounting. However, due to the net loss in the periods presented, the warrants effects are antidilutive and therefore, excluded from diluted EPS calculations. |
Derivative Financial Instruments | Derivative Financial Instruments We do not use derivative financial instruments to hedge exposures to cash-flow risks or market-risks that may affect the fair values of our financial instruments. However, under the provisions ASC 815 Derivatives and Hedging certain financial instruments that have characteristics of a derivative, as defined by ASC 815, such as embedded conversion features on our Convertible Notes, that are potentially settled in the Companys own common stock, are classified as liabilities when either (a) the holder possesses rights to net-cash settlement or (b) physical or net-share settlement is not within our control. In such instances, net-cash settlement is assumed for financial accounting and reporting purposes, even when the terms of the underlying contracts do not provide for net-cash settlement. Derivative financial instruments are initially recorded, and continuously carried, at fair value each reporting period. The value of the embedded conversion feature is determined using the Black-Scholes option pricing model. All future changes in the fair value of the embedded conversion feature will be recognized currently in earnings until the note is converted or redeemed. Determining the fair value of derivative financial instruments involves judgment and the use of certain relevant assumptions including, but not limited to, interest rate risk, credit risk, volatility and other factors. The use of different assumptions could have a material effect on the estimated fair value amounts. |
Redeemable - Noncontrolling Interest | Redeemable - Noncontrolling Interest Redeemable interest held by third parties in subsidiaries owned or controlled by the Company is reported on the consolidated balance sheets outside permanent equity. All non-controlling interest reported in the consolidated statements of operations reflects the respective interests in the income or loss after income taxes of the subsidiaries attributable to the other parties, the effect of which is removed from the net income or loss available to the Company. The Company accretes the redemption value of the redeemable non-controlling interest over the redemption period. |
New Accounting Pronouncements | New Accounting Pronouncements The Financial Accounting Standards Board (FASB) issues Accounting Standard Updates (ASU) to amend the authoritative literature in ASC. There have been a number of ASUs to date that amend the original text of ASC. The Company believes those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements Going Concern, which requires management to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about the entitys ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and interim periods thereafter. The guidance is not expected to have a material impact on the Companys financial statements. In April 2015, FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs, which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of debt issuance costs will continue to be reported as interest expense. ASU 2015-03 is effective for annual reporting periods beginning after December 15, 2015. The adoption did not have a material impact on the Companys financial statements. In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. The amendments in this update simplify the presentation of deferred taxes by requiring deferred tax assets and liabilities be classified as noncurrent on the balance sheet. These amendments may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The amendments are effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Earlier application is permitted for all entities as of the beginning of an interim or annual reporting period. The guidance is not expected to have a material impacton the Companys financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 840), 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. The amendments in this standard are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, for a public entity. Early adoption of the amendments in this standard is permitted for all entities and the Company must recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently in the process of evaluating the effect this guidance will have on its financial statements and related disclosures. Management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements. |
Summary of Significant Accoun18
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of Redeemable Noncontrolling Interest Considered Level Three | As of March 31, 2016 and December 31, 2015 the Companys redeemable noncontrolling interest is considered a level 3 item and changed during the three months ended March 31, 2016 as follows. Balance at December 31, 2015 $ 865,614 Net loss attributable to noncontrolling interest 1,479 Balance at March 31, 2016 $ 864,135 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
JMJ Convertible Note [Member] | |
Short-term Debt [Line Items] | |
Schedule of Fair Market Value of the Conversion Features Using the Black-Scholes Pricing Model | March 31, 2016 April 2, 2015 Annual dividend yield - - Expected life (years) 1.00 2.00 Risk-free interest rate 0.73 % 0.55 % Expected volatility 188.24 % 301.07 % |
AKR Promissory Note [Member] | |
Short-term Debt [Line Items] | |
Schedule of Fair Market Value of the Conversion Features Using the Black-Scholes Pricing Model | April 8, 2014 Annual dividend yield - Expected life (years) of 1.41 - 2.00 Risk-free interest rate 0.40% Expected volatility 183% - 206% |
Outstanding Warrant Liability (
Outstanding Warrant Liability (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Black-Scholes Option Pricing Model Assumptions to Estimate Fair Value of Warrants | The Company assesses the fair value of the warrants quarterly based on the Black-Scholes pricing model. See below for variables used in assessing the fair value. January 19, 2016 December 31, 2015 Annual dividend yield - - Expected life (years) of 0 0.05 Risk-free interest rate 0 % 0.14 % Expected volatility 0 % 216 % |
Organization and Business (Deta
Organization and Business (Details Narrative) - $ / shares | Sep. 30, 2015 | Mar. 31, 2016 | Dec. 31, 2015 |
Preferred stock, no par value | |||
Series A Preferred Stock [Member] | |||
Preferred stock, no par value | |||
Preferred stock, voting rights | Among other things, each one (1) share of the Series A Preferred Stock shall have voting rights equal to(x) 0.019607 multiplied by the total issued and outstanding shares of common stock of the Company eligible to vote at the time of the respective vote (the Numerator), divided by (y) 0.49, minus (z) the Numerator. For purposes of illustration only, if the total issued and outstanding shares of common stock of the Company eligible to vote at the time of the respective vote is 5,000,000, the voting rights of one share of the Series A Preferred Stock shall be equal to 102,036 (0.019607 x 5,000,000) / 0.49) (0.019607 x 5,000,000) = 102,036). |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Dec. 31, 2007 | Mar. 31, 2016 | Mar. 31, 2015 | Dec. 23, 2010 | |
SignificantAccountingPoliciesLineItems [Line Items] | ||||
Proceeds from issuance of convertible debt | $ 14,500,000 | |||
Working capital deficit | $ 2,673,000 | |||
Estimated operating expenses | $ 397,858 | $ 421,885 | ||
Ownership interest | 1.00% | 1.00% | ||
Research and development costs | $ 100,000 | $ 211,000 | ||
Warrants | 428,571 | |||
Warrant [Member] | ||||
SignificantAccountingPoliciesLineItems [Line Items] | ||||
Antidilutive securities | 23,100,000 | 23,100,000 | ||
Fulton Project [Member] | ||||
SignificantAccountingPoliciesLineItems [Line Items] | ||||
Estimated construction costs | $ 300,000,000 | |||
Lancaster Biorefinery [Member] | Minimum [Member] | ||||
SignificantAccountingPoliciesLineItems [Line Items] | ||||
Estimated construction costs | 100,000,000 | |||
Lancaster Biorefinery [Member] | Maximum [Member] | ||||
SignificantAccountingPoliciesLineItems [Line Items] | ||||
Estimated construction costs | 125,000,000 | |||
Next Twelve Months [Member] | ||||
SignificantAccountingPoliciesLineItems [Line Items] | ||||
Estimated operating expenses | $ 1,450,000 |
Summary of Significant Accoun23
Summary of Significant Accounting Policies - Schedule of Redeemable Noncontrolling Interest Considered Level Three (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Accounting Policies [Abstract] | ||
Balance at the beginning | $ 865,614 | |
Net loss attributable to non-controlling interest | 1,479 | $ 1,189 |
Balance at the end | $ 864,134 |
Development Contract (Details N
Development Contract (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |||
Dec. 31, 2009 | Oct. 31, 2007 | Feb. 28, 2007 | Mar. 31, 2016 | Mar. 31, 2015 | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Revenue from grants | $ 38,125 | ||||
Reimbursements received amount | $ 873,332 | ||||
Company Cost Share [Member] | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Department of energy awards description | This award was a 60%/40% cost share, whereby 40% of approved costs may be reimbursed by the DOE pursuant to the total $40 million award announced in February 2007. | ||||
U.S. Department Of Energy [Member] | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Revenue from grants | $ 88,000,000 | $ 10,000,000 | |||
U.S. Department Of Energy [Member] | Phase II [Member] | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Revenue from grants | 81,000,000 | ||||
U.S. Department Of Energy [Member] | Phase I [Member] | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Revenue from grants | 7,000,000 | ||||
U.S. Department Of Energy [Member] | 40% Award [Member] | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Revenue from grants | $ 40,000,000 | ||||
U.S. Department Of Energy [Member] | Previously Announced [Member] | Phase I [Member] | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Revenue from grants | $ 10,000,000 | ||||
U.S. Department Of Energy [Member] | Company Cost Share [Member] | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Approved award, percentage | 40.00% | ||||
U.S. Department Of Energy [Member] | Maximum [Member] | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Revenue from grants | $ 40,000,000 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | May. 12, 2015 | Apr. 02, 2015 | Dec. 17, 2014 | Nov. 08, 2014 | Aug. 08, 2014 | Apr. 24, 2014 | Apr. 08, 2014 | Mar. 31, 2016 | Dec. 31, 2015 |
Short-term Debt [Line Items] | |||||||||
Percentage of debt interest rate | 8.00% | ||||||||
Percentage of convertible debt | 58.00% | ||||||||
Percentage of debt discount | 42.00% | ||||||||
Amortized discount on notes | $ 0 | $ 32,886 | |||||||
Accrued Interest | 16,707 | $ 46,033 | |||||||
AKR Warrants [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Amortization interest expense | 0 | ||||||||
Discount on notes payable | 42,323 | ||||||||
Vis Vires Group, Inc. [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Principal amount on notes payable | $ 59,000 | ||||||||
Notes payable maturity date | Feb. 14, 2016 | ||||||||
Amortized discount on notes | $ 4,000 | ||||||||
Vis Vires Group, Inc. [Member] | Common Stock [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Note converted into stock | 26,072,727 | ||||||||
JMJ Convertible Note [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Percentage of convertible debt | 60.00% | ||||||||
Percentage of debt discount | 10.00% | ||||||||
Principal amount on notes payable | $ 100,000 | 60,650 | |||||||
Notes payable maturity date | Apr. 1, 2017 | ||||||||
Fair value of derivative liability | $ 412,212 | ||||||||
Note converted into stock | 96,830,000 | ||||||||
Amortized discount on notes | $ 10,000 | ||||||||
Loss on derivative liabilities | $ 312,212 | ||||||||
Convertible note | $ 250,000 | ||||||||
Debt principal amount | 52,950 | ||||||||
Accrued Interest | 7,700 | ||||||||
AKR Promissory Note [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Percentage of debt interest rate | 5.00% | 5.00% | |||||||
Principal amount on notes payable | $ 30,000 | $ 350,000 | |||||||
Notes payable maturity date | Jul. 24, 2014 | Apr. 8, 2015 | |||||||
AKR Promissory Note [Member] | AKR Warrant B [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Warrants to buy common shares | 7,350,000 | ||||||||
Warrants exercise price per share | $ 0.007 | ||||||||
AKR Promissory Note [Member] | AKR Warrant B [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Warrants maturity date | Apr. 8, 2016 | ||||||||
AKR Promissory Note [Member] | AKR Warrant C [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Warrants to buy common shares | 8,400,000 | ||||||||
Warrants exercise price per share | $ 0.007 | ||||||||
Warrants maturity date | Apr. 8, 2016 | ||||||||
AKR Warrants [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Amortized discount on notes | 0 | ||||||||
Kodiak Promissory Note [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Principal amount on notes payable | $ 60,000 | 40,000 | |||||||
Notes payable maturity date | Jul. 17, 2015 | ||||||||
Remaining value of notes, net of discount | 0 | ||||||||
Debt instruments maturity date | Jul. 17, 2015 | ||||||||
Discount on notes payable | $ 60,000 | ||||||||
Purchase Agreement With Kodiak [Member] | |||||||||
Short-term Debt [Line Items] | |||||||||
Commitment to purchase put shares | $ 1,500,000 |
Notes Payable - Schedule of Fai
Notes Payable - Schedule of Fair Market Value of the Conversion Features Using the Black-Scholes Pricing Model (Details) | Apr. 02, 2015 | Apr. 08, 2014 | Mar. 31, 2016 |
JMJ Convertible Note [Member] | |||
Short-term Debt [Line Items] | |||
Annual dividend yield | 0.00% | 0.00% | |
Expected life (year) | 2 years | 1 year | |
Risk-free interest rate | 0.55% | 0.73% | |
Expected volatility | 301.07% | 188.24% | |
AKR Promissory Note [Member] | |||
Short-term Debt [Line Items] | |||
Annual dividend yield | |||
Risk-free interest rate | 0.40% | ||
AKR Promissory Note [Member] | Minimum [Member] | |||
Short-term Debt [Line Items] | |||
Expected life (year) | 1 year 4 months 28 days | ||
Expected volatility | 183.00% | ||
AKR Promissory Note [Member] | Maximum [Member] | |||
Short-term Debt [Line Items] | |||
Expected life (year) | 2 years | ||
Expected volatility | 206.00% |
Outstanding Warrant Liability27
Outstanding Warrant Liability (Details Narrative) - USD ($) | Jan. 19, 2011 | Mar. 31, 2016 | Mar. 31, 2015 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
Issuance of warrants to purchase of common stock | 428,571 | ||
Gain (Loss) from change in fair value of warrant liability | $ 199 | $ 13,216 |
Outstanding Warrant Liability -
Outstanding Warrant Liability - Schedule of Black-Scholes Option Pricing Model Assumptions to Estimate Fair Value of Warrants (Details) - Warrant [Member] | Jan. 19, 2016 | Dec. 31, 2015 |
Class of Warrant or Right [Line Items] | ||
Annual dividend yield | ||
Expected life (years) of | 0 years | 18 days |
Risk-free interest rate | 0.00% | 0.14% |
Expected volatility | 0.00% | 216.00% |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | Nov. 19, 2013 | Jul. 20, 2010 | Mar. 30, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2014 |
Primary lease term | 30 year | |||||
Lease rate per acre, per month | $ 10,300 | |||||
Lease rate renewal term | 5 years | |||||
Rent expense under non-cancellable leases | $ 30,900 | $ 30,900 | ||||
Accrued lease payments | 205,840 | $ 82,336 | $ 96,000 | |||
Itawamba [Member] | ||||||
Accrued lease payments | $ 16,033 | |||||
Independent Board Member 1 [Member] | ||||||
Accrued compensation | $ 5,000 | |||||
Independent Board Member 2 [Member] | ||||||
Accrued compensation | 5,000 | |||||
CEO and Vice-President [Member] | Board of Director Agreements [Member] | ||||||
Cash compensation | $ 5,000 | |||||
Board of Director [Member] | ||||||
Share based compensation number of shares un-issued to related parties | 6,000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Mar. 13, 2016 | Apr. 10, 2014 | Dec. 15, 2010 | Mar. 31, 2016 | Dec. 31, 2015 | Nov. 10, 2011 |
Net proceeds from related party notes payable | $ (200,000) | |||||
Remaining line of credit amount | $ 55,770 | |||||
Loan agreement, one-time fees as a percentage of loan | 15.00% | |||||
Loan agreement, one-time fees payable in shares of common stock, per-share value | $ 0.50 | |||||
Loan agreement, warrants issued | 500,000 | |||||
Warrants exercise price | $ 0.50 | |||||
Warrant expiration date | Dec. 15, 2013 | |||||
Loan amount received from a third party | $ 1,000,000 | |||||
Accrued Interest | 16,707 | $ 46,033 | ||||
Line of credit, amount outstanding | 69,230 | 45,230 | ||||
Line of credit, maximum amount of credit line | $ 125,000 | |||||
Accrued salary | $ 188,333 | $ 188,333 | ||||
Chief Executive Officer [Member] | ||||||
Line of credit, amount outstanding | $ 40,000 | |||||
Line of credit, additional borrowing | $ 100,000 | |||||
Notes, repayment of principal balance and interest | 12.00% | |||||
Minimum amount of financing to be received for repayment of principal and interest | $ 100,000 | |||||
Line of credit, maximum amount of credit line | $ 55,000 |
Redeemable Non-controlling In31
Redeemable Non-controlling Interest (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |||
Dec. 23, 2010 | Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2011 | |
Noncontrolling Interest [Abstract] | |||||
Ownership interest in BlueFire Fulton Renewable Energy LLC sold | 1.00% | 1.00% | |||
Proceeds from sale of LLC Unit | $ 750,000 | ||||
Ownership interest in BlueFire Fulton Renewable Energy LLC | 99.00% | ||||
Redeemable non-controlling interest | $ 862,500 | $ 864,134 | $ 865,614 | $ 862,500 | |
Net income (loss) attributable to redeemable noncontrolling interest | $ 1,479 | $ 1,189 |
Stockholders' Deficit (Details
Stockholders' Deficit (Details Narrative) - USD ($) | Feb. 12, 2015 | Dec. 17, 2014 | Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | |||
Percentage of debt discount | 42.00% | ||||
Amortization of debt dicount | $ 32,866 | $ 40,116 | |||
Purchase Agreement With Kodiak [Member] | |||||
Agreement term | 24 months | ||||
Maximum purchase under purchase agreement | $ 1,500,000 | ||||
Kodiak Promissory Note [Member] | |||||
Debt instruments maturity date | Jul. 17, 2015 | ||||
Promissory note principal amount | $ 60,000 | ||||
Kodiak Note [Member] | |||||
Note converted into stock | 20,000,000 | ||||
Debt conversion price per share | $ 0.0098 | ||||
Percentage of debt discount | 25.00% | ||||
Amortization of debt dicount | $ 0 | $ 147,000 | |||
Series A Preferred Stock [Member] | |||||
Preferred stock, shares authorized | 1,000,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] | 3 Months Ended |
Mar. 31, 2016USD ($)shares | |
James G Speirs and James N Speirs [Member] | |
Number of common stock have been return during the period | 5,740,741 |
JMJ Convertible Note [Member] | |
Note converted into shares | 8,911,400 |
Debt conversion | $ | $ 5,347 |
Debt instruments repaid date | Apr. 5, 2016 |