Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Aug. 31, 2015 | Oct. 19, 2015 | |
Document And Entity Information | ||
Entity Registrant Name | STRONGBOW RESOURCES INC. | |
Entity Central Index Key | 1,382,231 | |
Document Type | 10-Q | |
Document Period End Date | Aug. 31, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --02-29 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 29,904,046 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,015 |
Balance Sheets
Balance Sheets - USD ($) | Aug. 31, 2015 | Feb. 28, 2015 |
CURRENT ASSETS | ||
Cash | $ 0 | $ 26,858 |
Receivable | 2,069 | 4,680 |
Prepaid expense and other | 81,972 | 72,578 |
Current Assets | 84,041 | 104,116 |
Equipment | 60,569 | 65,421 |
Oil and gas properties, full cost method | 579,590 | 587,770 |
Total Assets | 724,200 | 757,307 |
LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT) | ||
Accounts payable | 595,065 | 558,591 |
Accrued liabilities | 60,808 | 35,937 |
Due to related parties | 250,264 | 130,884 |
Notes payable | 19,003 | 19,965 |
Derivative financial liabilities | 28,116 | 379,463 |
Total current liabilities | 953,256 | 1,124,840 |
Asset retirement obligations | 21,500 | 21,515 |
Liabilities | 974,756 | 1,146,355 |
STOCKHOLDERS' EQUITY (DEFICIT) | ||
Capital Stock Authorized: 750,000,000 common shares, par value $0.001 per share Issued and outstanding: 29,904,046 common shares (29,881,824 at February 28, 2015) | 21,794 | 21,772 |
Additional paid in capital | 2,970,531 | 2,962,947 |
Accumulated other comprehensive loss | (111,638) | (123,371) |
Deficit accumulated during the exploration stage | (3,131,243) | (3,250,396) |
Total Stockholders' Equity (Deficit) | (250,556) | (389,048) |
Total Liabilities and Stockholders' Equity (Deficit) | $ 724,200 | $ 757,307 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Aug. 31, 2015 | Feb. 28, 2015 |
Stockholders equity: | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, authorized shares | 750,000,000 | 750,000,000 |
Common stock, issued shares | 29,904,046 | 29,881,824 |
Common stock, outstanding shares | 29,904,046 | 29,881,824 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2015 | Aug. 31, 2014 | Aug. 31, 2015 | Aug. 31, 2014 | |
GENERAL AND ADMINISTRATIVE EXPENSES | ||||
Accretion | $ 526 | $ 0 | $ (1,069) | $ 0 |
Consulting | 13,429 | 7,631 | 27,843 | 30,223 |
Depreciation | 874 | 800 | 1,776 | 1,600 |
Management fees | 23,463 | 27,705 | 47,688 | 54,984 |
Office, travel and general (recovery) | 35,279 | 23,375 | 45,371 | 31,088 |
Professional fees | 27,343 | 20,833 | 49,303 | 52,018 |
Salaries and benefits | 22,035 | 0 | 59,246 | 0 |
Loss from operations | (122,949) | (80,344) | (232,296) | (169,913) |
Gain on settlement of debt | 0 | 53,787 | 0 | 53,787 |
Interest income | 53 | 28 | 102 | 28 |
Gain on fair value adjustment of derivative financial liabilities | 229,111 | 0 | 351,347 | 0 |
Net income (loss) | 106,215 | (26,529) | 119,153 | (116,098) |
Foreign Currency Translation | 14,447 | (10,830) | 11,733 | (36,913) |
Comprehensive income (loss) | $ 120,662 | $ (37,359) | $ 130,886 | $ (153,011) |
Basic and diluted income (loss) per share | $ 0 | $ 0 | $ 0 | $ 0 |
Weighted average number of basic common shares outstanding | 29,884,360 | 28,234,523 | 29,886,896 | 28,085,718 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income (loss) | $ 119,153 | $ (116,098) |
Non-cash items | ||
Accretion | 1,069 | 0 |
Gain from settlement of debt | 0 | (53,787) |
Gain on fair value adjustment of derivative financial liabilities | (351,347) | 0 |
Depreciation | 1,776 | 1,600 |
Changes in non-cash working capital items | ||
Receivable | 2,611 | 1,702 |
Prepaid expenses | (9,394) | (28,350) |
Accounts payable and accrued liabilities | 83,045 | 17,325 |
Cash used in operating activities | (153,087) | (177,608) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Expenditures on oil and gas properties | (10,005) | (38,825) |
Cash used in investing activities | (10,005) | (38,825) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Common stock issued for cash | 7,606 | 145,657 |
Net proceeds from related parties | 131,428 | 13,796 |
Cash provided by financing activities | 139,034 | 159,453 |
EFFECT OF FOREIGN EXCHANGE | (2,800) | 26,561 |
CHANGE IN CASH | (26,858) | (30,419) |
CASH, BEGINNING OF PERIOD | 26,858 | 43,137 |
CASH, END OF PERIOD | 0 | 12,718 |
Non-cash transactions | ||
Accrued expenditures on oil and gas properties | 11,070 | 0 |
Common stock issued as settlement of accounts payable | $ 0 | $ 128,828 |
1. NATURE AND CONTINUANCE OF OP
1. NATURE AND CONTINUANCE OF OPERATIONS | 6 Months Ended |
Aug. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE AND CONTINUANCE OF OPERATIONS | Strongbow Resources Inc. (the Company) was incorporated in the State of Nevada on July 9, 2004. The Company focuses its business efforts on the acquisition, exploration, and development of oil and gas properties. The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As of August 31, 2015, the Company has not achieved profitable operations, has incurred losses in developing its business, and further losses are anticipated. The Company has an accumulated deficit of $3,131,243. As of August 31, 2015, one Statement of Claim totaling $213,791 (CAD$281,267) is outstanding against the Company and is recorded in accounts payable. The Companys ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and pay its liabilities when they come due. To date, the Company has funded operations through the issuance of capital stock and debt. Management plans to continue raising additional funds through equity or debt financings and loans from directors. There is no certainty that further funding will be available as needed. These factors raise substantial doubt about the ability of the Company to continue operating as a going concern. The ability of the Company to continue its operations as a going concern is dependent upon its ability to raise sufficient new capital to fund its operating commitments and ongoing losses and ultimately on generating profitable operations. |
2. SUMMARY OF SIGNIFICANT ACCOU
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Aug. 31, 2015 | |
Notes to Financial Statements | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Basis of Presentation The unaudited interim financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (GAAP) for interim financial information and the rules and regulations of the Securities and Exchange Commission (SEC). They do not include all information and footnotes required by GAAP for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended February 28, 2015 included in the Companys Annual Report on Form 10-K filed with the SEC. The interim unaudited financial statements should be read in conjunction with those financial statements included in the 10-K report. In the opinion of management, all adjustments considered necessary for fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the six months ended August 31, 2015 are not necessarily indicative of the results that may be expected for the year ending February 28, 2016. Recent Accounting Pronouncements Recent pronouncements with future effective dates are either not applicable or are not expected to be significant to the financial statements of the Company. |
3. OIL AND GAS PROPERTIES
3. OIL AND GAS PROPERTIES | 6 Months Ended |
Aug. 31, 2015 | |
Notes to Financial Statements | |
OIL AND GAS PROPERTIES | Effective February 21, 2012, the Company entered into a Farmout Agreement (the Agreement) with Harvest Operations Corp. (Farmor). The Agreement provided for the Companys acquisition of an undivided 100% working interest (Working Interest) in a petroleum and natural gas license covering land located in the Compeer Area in the Province of Alberta, Canada (the Farmout Lands). To earn the Working Interest the Company was required to drill, complete, equip or abandon a test well on the Farmout Lands (Test Well). On March 14, 2012, the Company obtained operator status and was transferred the well license relating to the Test Well. The Companys Working Interest in the Farmout Lands will be held subject to a non-convertible overriding royalty payable to the Farmor (Farmors Royalty). The Farmors Royalty on net crude oil revenues will be measured on a sliding scale from 5% to 15% over a range of production volumes from 1 to 150 barrels per day. The Farmors Royalty on net gas and other petroleum product revenues is 15%. The Test Well was spudded on May 27, 2012, and on September 5, 2012, the Company received an earning notice granting the Company a 100% working interest in the Farmout Lands. During the year ended February 28, 2015, the Company estimated that the net present value of future cash flows from the property is $587,770 and recorded an impairment charge of $221,648. During the period ended August 31, 2015, net proceeds of $nil (August 31, 2014 - $4,272) were received from the sales of oil less direct costs of $5,768 (August 31, 2014 - $7,055) was added to the carrying value of the oil and gas properties. As of August 31, 2015, the Company has incurred $579,590 (February 28, 2015 - $587,770) in exploration costs to drill, complete and equip the Test Well, net of impairment charges in prior periods. |
4. EQUIPMENT
4. EQUIPMENT | 6 Months Ended |
Aug. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
EQUIPMENT | August 31, 2015 Cost Accumulated Depreciation Net Book Value $ $ $ Oil and gas equipment 67,924 7,355 60,569 February 28, 2015 Cost Accumulated Depreciation Net Book Value $ $ $ Oil and gas equipment 71,364 5,943 65,421 |
5. ADVANCES AND NOTES PAYABLE
5. ADVANCES AND NOTES PAYABLE | 6 Months Ended |
Aug. 31, 2015 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | As at August 31, 2015, the Company had $19,003 (CAD$25,000) (February 28, 2015 - $19,965 (CAD$25,000)) in short term note obligations to an unrelated party. The note payable is unsecured, non-interest bearing and payable upon demand. |
6. ASSET RETIREMENT OBLIGATIONS
6. ASSET RETIREMENT OBLIGATIONS | 6 Months Ended |
Aug. 31, 2015 | |
Asset Retirement Obligation Disclosure [Abstract] | |
ASSET RETIREMENT OBLIGATIONS | The Companys asset retirement obligation consists of reclamation and closure costs associated with the Test Well in the Farmout Lands. The asset retirement obligation was estimated based on the Companys understanding of its requirements to reclaim currently disturbed areas. Significant reclamation and closure activities include land rehabilitation, water, removal of building and well facilities and tailings reclamation. The undiscounted estimate of this liability was $38,005 (CAD$50,000) (February 28, 2015 - $39,930 (CAD$50,000)) reflecting payments commencing in 2024. This estimate was adjusted for an inflation rate of 2.00% and then discounted at a rate of 10.00% for a net present value of $21,500 (CAD$28,286) (February 28, 2015 - $21,515 (CAD$26,941)) as at August 31, 2015. |
7. DERIVATIVE FINANCIAL LIABILI
7. DERIVATIVE FINANCIAL LIABILITIES | 6 Months Ended |
Aug. 31, 2015 | |
Notes to Financial Statements | |
DERIVATIVE FINANCIAL LIABILITIES | $ Balance, February 28, 2014 - Warrants issued 579,952 Fair value adjustment (200,489 ) Balance, February 28, 2015 379,463 Fair value adjustment (351,347 ) Balance, August 31, 2015 28,116 The derivative liability consists of the fair value of share purchase warrants that were issued in unit private placements that have an exercise price in a currency other than the functional currency of the Company. The derivative liability is a non-cash liability as the Company will not be required to expend any cash. The fair value of the warrants was determined using the Black-Scholes option pricing model using the following weighted average market assumptions: August 31, 2015 February 28, 2015 Volatility 139 % 126 % Risk-free interest rate 0.71 % 0.79 % Expected life 1.94 years 2.44 years Dividend yield nil nil |
8. SHARE CAPITAL
8. SHARE CAPITAL | 6 Months Ended |
Aug. 31, 2015 | |
Notes to Financial Statements | |
SHARE CAPITAL | In March 2014, the Company completed a one for four reverse stock split of the issued and outstanding common stock. All share and per share information in these financial statements has been retroactively restated to reflect the consolidation. In August 2015, the Company issued 22,222 shares for gross proceeds of $7,606 (CAD$10,000) in subscriptions for a private placement. Warrants A summary of the share purchase warrants outstanding and exercisable at August 31, 2015 is as follows: Exercise Price Number Outstanding Expiry Date $ 1.50 80,000 August 26, 2016 1.00 1,000,000 September 3, 2017 The weighted average exercise price is $1.04 and weighted average life of the warrants is 1.94 years. |
9. RELATED PARTY TRANSACTIONS
9. RELATED PARTY TRANSACTIONS | 6 Months Ended |
Aug. 31, 2015 | |
Notes to Financial Statements | |
RELATED PARTY TRANSACTIONS | During the six months ended August 31, 2015, the Company ● Incurred a total of $47,688 (August 31, 2014 - $54,984) in management fees to a director and officer of the Company. ● Incurred a total of $3,775 (August 31, 2014 - $5,223) in consulting fees to a director and officer of the Company. As at August 31, 2015, $36,000 (February 28, 2015 - $36,000) was owing to a former director and officer of the Company and has been included in accounts payable. The amounts are non-interest bearing and unsecured. Due to related parties consist of the following: August 31, 2015 February 28, 2015 $ $ Due to directors and officers of the Company 250,264 130,884 All of the Companys advances from related parties are non-interest bearing, unsecured, and payable upon demand. |
2. SUMMARY OF SIGNIFICANT ACC15
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Aug. 31, 2015 | |
Summary Of Significant Accounting Policies Policies | |
Basis of Presentation | The unaudited interim financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (GAAP) for interim financial information and the rules and regulations of the Securities and Exchange Commission (SEC). They do not include all information and footnotes required by GAAP for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended February 28, 2015 included in the Companys Annual Report on Form 10-K filed with the SEC. The interim unaudited financial statements should be read in conjunction with those financial statements included in the 10-K report. In the opinion of management, all adjustments considered necessary for fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the six months ended August 31, 2015 are not necessarily indicative of the results that may be expected for the year ending February 28, 2016. |
Recent Accounting Pronouncements | Recent pronouncements with future effective dates are either not applicable or are not expected to be significant to the financial statements of the Company. |
4. EQUIPMENT (Tables)
4. EQUIPMENT (Tables) | 6 Months Ended |
Aug. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Oil and gas equipment | August 31, 2015 Cost Accumulated Depreciation Net Book Value $ $ $ Oil and gas equipment 67,924 7,355 60,569 February 28, 2015 Cost Accumulated Depreciation Net Book Value $ $ $ Oil and gas equipment 71,364 5,943 65,421 |
7. DERIVATIVE FINANCIAL LIABI17
7. DERIVATIVE FINANCIAL LIABILITIES (Tables) | 6 Months Ended |
Aug. 31, 2015 | |
Derivative Financial Liabilities Tables | |
Schedule of derivative liabilities | $ Balance, February 28, 2014 - Warrants issued 579,952 Fair value adjustment (200,489 ) Balance, February 28, 2015 379,463 Fair value adjustment (351,347 ) Balance, August 31, 2015 28,116 |
Schedule of fair value of warrants and dividends | August 31, 2015 February 28, 2015 Volatility 139 % 126 % Risk-free interest rate 0.71 % 0.79 % Expected life 1.94 years 2.44 years Dividend yield nil nil |
8. SHARE CAPITAL (Tables)
8. SHARE CAPITAL (Tables) | 6 Months Ended |
Aug. 31, 2015 | |
Share Capital Tables | |
Schedule of warrants outstanding and exercisable | Exercise Price Number Outstanding Expiry Date $ 1.50 80,000 August 26, 2016 1.00 1,000,000 September 3, 2017 |
9. RELATED PARTY TRANSACTIONS (
9. RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Aug. 31, 2015 | |
Related Party Transactions Tables | |
Schedule of related party transactions | August 31, 2015 February 28, 2015 $ $ Due to directors and officers of the Company 250,264 130,884 |
3. OIL AND GAS PROPERTIES (Deta
3. OIL AND GAS PROPERTIES (Details Narrative) | 6 Months Ended |
Aug. 31, 2015USD ($) | |
Oil And Gas Properties Details Narrative | |
Exploration Costs | $ 579,590 |
Revenue - sales of oil | 0 |
Cost of sales of oil | $ 5,768 |
4. EQUIPMENT (Details)
4. EQUIPMENT (Details) - USD ($) | Aug. 31, 2015 | Feb. 28, 2015 |
Cost | ||
Oil and gas equipment | $ 67,924 | $ 71,364 |
Accumulated Depreciation | ||
Oil and gas equipment | 7,355 | 5,943 |
Net Book Value | ||
Oil and gas equipment | $ 60,569 | $ 65,421 |
5. NOTES PAYABLE (Details Narra
5. NOTES PAYABLE (Details Narrative) - USD ($) | Aug. 31, 2015 | Feb. 28, 2015 |
Notes Payable Details Narrative | ||
Notes payable | $ 19,003 | $ 19,965 |
6. ASSET RETIREMENT OBLIGATIO23
6. ASSET RETIREMENT OBLIGATIONS (Details Narrative) - USD ($) | Aug. 31, 2015 | Feb. 28, 2015 |
Asset Retirement Obligations Details Narrative | ||
Assets retirement obligation related to Test Well on Farmout Lands | $ 21,500 | $ 21,515 |
7. DERIVATIVE FINANCIAL LIABI24
7. DERIVATIVE FINANCIAL LIABILITIES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Aug. 31, 2015 | Aug. 31, 2014 | Aug. 31, 2015 | Aug. 31, 2014 | Feb. 28, 2015 | |
Derivative Financial Liabilities Details | |||||
Balance, beginning | $ 379,463 | $ 0 | $ 0 | ||
Warrants issued | 0 | 579,952 | |||
Fair value adjustment | $ (229,111) | $ 0 | (351,347) | $ 0 | (200,489) |
Balance, ending | $ 28,116 | $ 28,116 | $ 379,463 |
7. DERIVATIVE FINANCIAL LIABI25
7. DERIVATIVE FINANCIAL LIABILITIES (Details 1) | 6 Months Ended | 12 Months Ended |
Aug. 31, 2015 | Feb. 28, 2015 | |
Derivative Financial Liabilities Details 1 | ||
Volatility | 139.00% | 126.00% |
Risk-free interest rate | 0.71% | 0.79% |
Expected life | 1 year 11 months 8 days | 2 years 5 months 8 days |
Dividend yield | 0.00% | 0.00% |
8. SHARE CAPITAL (Details)
8. SHARE CAPITAL (Details) | 6 Months Ended |
Aug. 31, 2015$ / sharesshares | |
Warrant 1 | |
Exercise Price | $ 1.50 |
Number Outstanding | shares | 80,000 |
Expiry Date | 8/26/2016 |
Warrant 2 | |
Exercise Price | $ 1 |
Number Outstanding | shares | 1,000,000 |
Expiry Date | 9/3/2017 |
9. RELATED PARTY TRANSACTIONS27
9. RELATED PARTY TRANSACTIONS (Details) - USD ($) | Aug. 31, 2015 | Feb. 28, 2015 |
Director and officer of the Company | ||
Related party advances | $ 250,264 | $ 130,884 |