Lilis Energy (LLEX) 10-Q 14 Nov 13 2013 Q3 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	9 Months Ended
	Sep. 30, 2013	Nov. 08, 2013
Document and Entity Information [Abstract]	'	'
Entity Registrant Name	'RECOVERY ENERGY, INC.	'
Entity Central Index Key	'0001437557	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--12-31	'
Document Type	'10-Q	'
Document Period End Date	30-Sep-13	'
Document Fiscal Year Focus	'2013	'
Document Fiscal Period Focus	'Q3	'
Entity Filer Category	'Smaller Reporting Company	'
Entity Common Stock, Shares Outstanding	'	19,477,337

Consolidated_Balance_Sheets_Un

Consolidated Balance Sheets (Unaudited) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Current assets:	'	'
Cash	$353,934	$970,035
Restricted cash	584,746	671,382
Accounts receivable (net of allowance of $50,000 at September 30, 2013 and December 31, 2012, respectively)	482,115	934,591
Prepaid assets	351,542	13,458
Total current assets	1,772,337	2,589,466
Oil and gas properties (full cost method), at cost:	'	'
Developed properties	58,223,296	58,610,095
Undeveloped acreage, excluded from amortization	28,258,138	28,067,005
Wells in progress, excluded from amortization	180,153	193,515
Total oil and gas properties, at cost	86,661,587	86,870,615
Less accumulated depreciation, depletion, amortization, and impairment	-44,989,495	-43,187,962
Total oil and gas properties, net	41,672,092	43,682,653
Other assets:	'	'
Office equipment, net	95,006	90,630
Deferred financing costs, net	443,116	974,856
Restricted cash and deposits	215,541	215,435
Total other assets	753,663	1,280,921
Total assets	44,198,092	47,553,040
Current liabilities:	'	'
Accounts payable	771,275	1,831,590
Commodity price derivative liability	40,955	'
Accrued expenses	1,684,030	1,411,016
Short term loans payable	18,967,191	388,351
Convertible notes payable, net of discount	13,128,936	'
Convertible notes conversion derivative liability	1,150,000	'
Total current liabilities	35,742,387	3,630,957
Long term liabilities:	'	'
Asset retirement obligation	1,028,831	911,546
Term loans payable	'	18,947,963
Convertible notes payable, net of discount	'	10,300,361
Convertible notes conversion derivative liability	'	1,680,000
Total long-term liabilities	1,028,831	31,839,870
Total liabilities	36,771,218	35,470,827
Commitments and contingencies Notes 2, 8 and 9	'	'
Shareholders' equity:	'	'
Preferred stock, 10,000,000 authorized, none issued and outstanding	'	'
Common stock, $0.0001 par value:100,000,000 shares authorized; 19,477,337 and 18,394,401 shares issued and outstanding as of September 30, 2013 and December 31, 2012, respectively	1,948	1,839
Additional paid in capital	120,836,115	118,296,679
Accumulated deficit	-113,411,189	-106,216,305
Total shareholders' equity	7,426,874	12,082,213
Total liabilities and shareholders' equity	$44,198,092	$47,553,040

Consolidated_Balance_Sheets_Un1

Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Balance Sheets [Abstract]	'	'
Allowance related to accounts receivable	$50,000	$50,000
Preferred Stock, shares authorized	10,000,000	10,000,000
Preferred Stock, shares issued	'	'
Preferred Stock, shares outstanding	'	'
Common stock, par value (In dollars per share)	$0.00	$0.00
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	19,477,337	18,394,401
Common stock, shares outstanding	19,477,337	18,394,401

Consolidated_Statements_of_Ope

Consolidated Statements of Operations (Unaudited) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Revenues	'	'	'	'
Oil sales	$1,003,745	$1,775,383	$3,320,083	$4,685,713
Gas sales	82,651	168,897	227,853	397,298
Operating fees	28,331	42,853	118,853	132,362
Realized gain (loss) on commodity price derivatives	-43,551	37,341	-23,661	49,729
Unrealized gain (loss) on commodity price derivatives	-20,000	-130,000	-20,000	445,609
Total revenues	1,051,176	1,894,474	3,623,128	5,710,711
Costs and expenses	'	'	'	'
Production costs	318,322	397,793	877,623	1,033,635
Production taxes	102,919	198,781	380,958	561,278
General and administrative	1,207,123	1,515,868	3,559,358	5,099,932
Depreciation, depletion and amortization	539,079	1,069,068	1,879,908	2,897,156
Impairment of evaluated properties	'	'	'	3,274,718
Total costs and expenses	2,167,443	3,181,510	6,697,847	12,866,719
Loss from operations	-1,116,267	-1,287,036	-3,074,719	-7,156,008
Other income (expense)	143	333	535	-372
Convertible notes conversion derivative gain (loss)	700,000	600,000	670,000	700,000
Interest expense	-1,485,022	-2,149,931	-4,790,700	-6,320,919
Net loss	($1,901,146)	($2,836,634)	($7,194,884)	($12,777,299)
Net loss per common share Basic and diluted	($0.09)	($0.16)	($0.38)	($0.72)
Weighted average shares outstanding: Basic and diluted	19,254,329	17,833,466	18,786,598	17,732,304

Consolidated_Statements_of_Cas

Consolidated Statements of Cash Flows (Unaudited) (USD $)	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Cash flows from operating activities:	'	'
Net loss	($7,194,884)	($12,777,299)
Adjustments to reconcile net loss to net cash used in operating activities:	'	'
Impairment provision, developed leases	'	3,274,718
Common stock issued for convertible note interest	830,660	686,934
Common stock for services and compensation	1,293,315	1,773,658
Changes in the fair value of commodity price derivatives	20,000	-445,609
Amortization of deferred financing costs	531,739	1,504,751
Change in fair value of convertible notes conversion derivative	-670,000	-700,000
Accretion of debt discount	1,809,175	1,651,772
Depreciation, depletion, amortization and accretion of asset retirement obligation	1,873,002	2,897,156
Changes in operating assets and liabilities:	'	'
Accounts receivable	452,476	-433,567
Restricted cash	86,636	-17,453
Other assets	77,486	-21,294
Accounts payable and other accrued expenses	-667,912	-140,846
Net cash used in operating activities	-1,558,307	-2,747,079
Cash flows from investing activities:	'	'
Sale of oil and gas properties	640,000	1,443,852
Additions to oil and gas properties	-303,814	-436,023
Drilling capital expenditures	-429,678	-4,278,785
Other investing activities	-25,081	-3,112
Net cash used in investing activities	-118,573	-3,274,068
Cash flows from financing activities:	'	'
Proceeds from issuance of debt	1,429,902	5,000,000
Repayment of debt	-369,123	-988,299
Net cash provided by financing activities	1,060,779	4,011,701
Change in cash and cash equivalents	-616,101	-2,009,446
Cash and cash equivalents at beginning of period	970,035	2,707,722
Cash and cash equivalents at end of period	$353,934	$698,276

Organization

Organization	9 Months Ended
	Sep. 30, 2013
Organization [Abstract]	'
ORGANIZATION	'
	NOTE 1 – ORGANIZATION
	Recovery Energy, Inc. (“Recovery”, “Recovery Energy”, “we”, “our”, and the “Company”) is an independent oil and gas exploration and production company focused on the Denver-Julesburg Basin (“DJ Basin”) where it holds 112,000 net acres.  Recovery drills for, operates and produces oil and natural gas through the Company’s land holdings located in Wyoming, Colorado, and Nebraska. On November 13, 2013, the shareholders of the company approved a change in the Company’s name to Lilis Energy Inc.
	All references to production, sales volumes and reserves quantities are net to our interest unless otherwise indicated.

Liquidity

Liquidity	9 Months Ended
	Sep. 30, 2013
Liquidity [Abstract]	'
LIQUIDITY	'
	NOTE 2 – LIQUIDITY
	We currently have $18.97 million outstanding under our term loans with Hexagon, LLC (“Hexagon”) and $14.83 million outstanding under our 8% Senior Secured Convertible Debentures. Both the term loans and the convertible debentures are considered current on our balance sheet and mature May 16, 2014.
	We have a history of sustained losses and cash used by operating activities, including losses of $7.19 million for the nine months ended September 30, 2013, $1.90 million for the three months ended September 30, 2013, and $37.7 million for the year ended 2012, and cash used by operating activities of $1.56 million for the nine months ended September 30, 2013 and $2.75 million for the nine months ended September 30, 2012.  In addition, as of September 30, 2013 we had a net working capital deficit of $33.97 million, which includes the current classification effect of both our term loans and our convertible debentures, all of which mature on May 16, 2014.
	In order to continue as a going concern beyond May 16, 2014, the Company will need to secure refinancing of these debts, sell assets to repay these debts, or otherwise negotiate terms with Hexagon and holders of its convertible debentures to extend the maturity of such indebtedness. Principally as a result of the current maturity date of these debts, the Company currently does not have enough working capital to cover its current liabilities.
	In addition to the above, the Company will require additional capital to fund its capital budget plans, to help fund its ongoing overhead, to provide for payment of minimum interest and principal payments required by term loans, and to provide additional capital to generally improve its working capital position.
	In April 2013, we received approval from our existing secured debt and convertible debenture holders to issue up to $5.00 million of additional convertible debentures with terms substantially identical to our existing convertible debentures.   As of November 8, 2013 we have issued $2.2 million of such convertible debt.  Two officers of the Company participated in the additional convertible debentures for a combined total of $0.43 million.  Proceeds from the issuance of this convertible debt have been used toward the development of certain specific properties, and to a lesser extent, general corporate purposes.  The recent commitments were subject to certain yield enhancements, including a 25% carried interest in certain properties scheduled to be developed with the proceeds.
	The Company may, but is not obligated to, seek completion of the remainder of the $5.00 million offering of additional debt that was approved in April 2013.   However, there is no assurance that the Company will be successful in securing additional convertible debenture funding.
	The Company will require additional funding for those purposes described above.  We anticipate that such additional funding will be provided by a combination of capital raising activities, including the selling of additional debt and/or equity securities, the selling of certain assets and by the development of certain of our undeveloped properties via arrangements with joint venture partners. If we are not successful in obtaining sufficient cash sources to fund the aforementioned capital requirements, we may be required to curtail our expenditures, restructure our operations, sell assets on terms which may not be deemed favorable and/or curtail other aspects of our operations, including deferring portions of capital budget.  There is no assurance that any such funding will be available to the Company.
	Pursuant to our credit agreements with Hexagon, a substantial portion of our monthly net revenues derived from our producing properties is required to be used for debt and interest payments for our term loans.  In addition, our debt instruments contain provisions that, absent consent of Hexagon, may restrict our ability to raise additional capital.

Summary_of_Significant_Account

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2013
Summary of Significant Accounting Policies [Abstract]	'
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	'
	NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	Basis of Presentation
	The accompanying financial statements were prepared by Recovery in accordance with generally accepted accounting principles (“GAAP”) in the United States.  The financial statements reflect all normal recurring adjustments which are, in the opinion of management, necessary to provide a fair statement of the results of operations and financial position.
	Reclassification
	Certain amounts in the 2012 consolidated financial statements have been reclassified to conform to the September 30, 2013 consolidated financial statement presentation.  Such reclassifications had no effect on net income.
	Use of Estimates
	The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of oil and gas reserves, 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 reporting period.  We evaluate our estimates on an ongoing basis and base our estimates on historical experience and on various other assumptions we believe to be reasonable under the circumstances.  Although actual results may differ from these estimates under different assumptions or conditions, we believe that our estimates are reasonable.
	Our most significant financial estimates are associated with our estimated proved oil and gas reserves, assessments of impairment imbedded in the carrying value of undeveloped acreage and proven properties, as well as valuation of common stock used in various issuances of common stock, options and warrants, and estimated derivative liabilities.
	Oil and Gas Producing Activities
	The Company follows the full cost method of accounting for oil and gas operations whereby all costs related to the exploration, development and acquisition of oil and natural gas reserves are capitalized.  Such costs include land acquisition costs, geological and geophysical expenses, carrying charges on non-producing properties, costs of drilling, developing and completing productive wells and/or plugging and abandoning non-productive wells, and any other costs directly related to acquisition and exploration activities.  Proceeds from property sales are generally applied as a credit against capitalized exploration and development costs, with no gain or loss recognized, unless such a sale would significantly alter the relationship between capitalized costs and the proved reserves attributable to these costs.  A significant alteration would typically involve a sale of 25% or more of proved reserves.
	Depletion of exploration and development costs and depreciation of production equipment is computed using the units-of-production method based upon estimated proved oil and gas reserves.  Costs included in the depletion base to be amortized include (a) all proved capitalized costs including capitalized asset retirement costs net of estimated salvage values, less accumulated depletion, (b) estimated future development cost to be incurred in developing proved reserves; and (c) estimated dismantlement and abandonment costs, net of estimated salvage values, that are not otherwise included in capitalized costs.
	The costs of undeveloped acreage are withheld from the depletion base until it is determined whether or not proved reserves can be assigned to the properties.   When proved reserves are assigned to such properties or one or more specific properties are deemed to be impaired, the cost of such properties or the amount of the impairment is added to full cost pool which is subject to depletion calculations.
	Under the full cost method of accounting, capitalized oil and gas property costs less accumulated depletion and net of deferred income taxes may not exceed an amount equal to sum of i.) the present value, discounted at 10%, of estimated future net revenues from proved oil and gas reserves, plus ii.) the cost of unproved properties not subject to amortization (without regard to estimates of fair value), or estimated fair value, if lower, of unproved properties that are not subject to amortization.  Should capitalized costs exceed this ceiling, an impairment expense is recognized.
	The present value of estimated future net revenues was computed by applying a twelve month average of the first day of the month price of oil and gas to estimated future production of proved oil and gas reserves as of period-end, less estimated future expenditures to be incurred in developing and producing the proved reserves (assuming the continuation of existing economic conditions), less any applicable future taxes.
	The Company did not recognize impairment charges for the nine months ended September 30, 2013 compared to an impairment of $3.27 million for the nine months ended September 30, 2012.
	Wells in Progress
	Wells in progress represent wells that are currently in the process of being drilled or completed or otherwise under evaluation as to their potential to produce oil and gas reserves in commercial quantities.  Such wells continue to be classified as wells in progress and withheld from the depletion calculation and the ceiling test until such time as either proved reserves can be assigned, or the wells are otherwise abandoned.  Upon either the assignment of proved reserves or abandonment, the costs for these wells are then transferred to the full cost pool and become subject to both depletion and the ceiling test calculations.
	In June 2013, the Company purchased a 50% interest in approximately 1,200 contiguous gross acres in Laramie County, Wyoming, in an area considered strategic by the Company.  This tract included two existing wells, one of which has now been recompleted. The costs associated with the purchase and recompletion was transferred out of wells in progress in September 2013. The Company transferred $0.30 million into undeveloped acreage and $0.43 million into oil and gas properties.  As of September 30, 2013, the Company has $0.18 million in wells in progress compared to $0.19 million in wells in progress as of December 31, 2012.
	Loss per Common Share
	Earnings (losses) per share are computed based on the weighted average number of common shares outstanding during the period presented. Diluted earnings (losses) per share are computed using the weighted-average number of common shares outstanding plus the number of common shares that would be issued assuming exercise or conversion of all potentially dilutive common shares.  Potentially dilutive securities, such as conversion derivatives and stock purchase warrants, are excluded from the calculation when their effect would be anti-dilutive.  As of September 30, 2013, a total of 6,648,913 and 3,489,389, respectively, of shares underlying warrants and convertible debentures have been excluded from the diluted share calculations as they were anti-dilutive as a result of net losses incurred.  Accordingly, basic shares equal diluted shares for all periods presented.
	Recent Accounting Pronouncements
	Various accounting standards updates are issued, most of which represented technical corrections to the accounting literature or were applicable to specific industries, are not expected to a have a material impact on the Company's financial position, results of operations or cash flows.

Oil_and_Gas_Properties

Oil and Gas Properties	9 Months Ended
	Sep. 30, 2013
Oil And Gas Properties [Abstract]	'
OIL AND GAS PROPERTIES	'
	NOTE 4 – OIL AND GAS PROPERTIES
	In June 2013, the Company purchased a 50% working interest in a section in Laramie County, Wyoming for $0.60 million with an additional $0.13 million as additions to the well equipment and intangible equipment. The purchase was classified as $0.30 million into undeveloped acreage and $0.43 million into oil and gas properties.
	In February 2013, the Company completed the sale of certain oil and gas properties for $0.64 million.

Wells_in_Progress

Wells in Progress	9 Months Ended
	Sep. 30, 2013
Wells in Progress [Abstract]	'
WELLS IN PROGRESS	'
	NOTE 5 – WELLS IN PROGRESS
	As of September 30, 2013, the Company has $0.18 million in wells in progress compared to $0.19 million included in wells in progress as of December 31, 2012.

Financial_Instruments_and_Deri

Financial Instruments and Derivatives	9 Months Ended
	Sep. 30, 2013
Financial Instruments and Derivatives [Abstract]	'
FINANCIAL INSTRUMENTS AND DERIVATIVES	'
	NOTE 6 - FINANCIAL INSTRUMENTS AND DERIVATIVES
	The Company periodically enters into various commodity derivative financial instruments intended to hedge against exposure to market fluctuations of oil prices. As of September 30, 2013, the Company maintained an active commodity swap for 100 barrels of oil per day through January 31, 2014 at a price of $99.25 per barrel.
	The amounts of gains and losses recognized as a result of our derivative financial instruments were as follows:
		Three months ended						Nine months ended
		September 30,						September 30,
		2013			2012			2013			2012
	Realized gains (losses) on commodity price derivatives	$	(43,551	)	$	37,341		$	(23,661	)	$	49,729
	Unrealized gains (losses) on commodity price derivatives	$	(20,000	)	$	(130,000	)	$	(20,000	)	$	445,609
	Realized gains and losses are recorded  as individual swaps mature and settle.  These gains and losses are recorded as income or expenses in the periods during which applicable contracts settle.  Swaps which are unsettled as of a balance sheet date are carried at fair market value, either as an asset or liability (See Note 7 - Fair Value of Financial Instruments).  Unrealized gains and losses result from mark-to-market changes in the fair value of these derivatives between balance sheet dates.

Fair_Value_of_Financial_Instru

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2013
Fair Value of Financial Instruments [Abstract]	'
FAIR VALUE OF FINANCIAL INSTRUMENTS	'
	NOTE 7 - FAIR VALUE OF FINANCIAL INSTRUMENTS
	The Company measures fair value of its financial assets on a three-tier value hierarchy, which prioritizes the inputs, used in the valuation methodologies in measuring fair value:
	●         Level 1 – Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
	●         Level 2 – Other inputs that are directly or indirectly observable in the marketplace.
	●         Level 3 – Unobservable inputs which are supported by little or no market activity.
	The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
	The Company’s cash equivalents, short-term investments, accounts receivable, accounts payable, accrued expenses, interest payable and customer deposits approximate fair value due to the short-term nature or maturity of the instruments.  The Company’s fixed rate 10% and 8% term loans and convertible debentures, respectively, are measured using Level 1 inputs.
	Derivative Instruments
	The Company determines its estimate of the fair value of derivative instruments using a market approach based on several factors, including quoted market prices in active markets, quotes from third parties, and the credit rating of its counterparty.  The Company also performs an internal valuation to ensure the reasonableness of third-party quotes.
	The types of derivative instruments utilized by the Company included commodity swaps.  The oil derivative markets are highly active.  Although the Company’s economic hedges are valued using public indices, the instruments themselves are traded with third-party counterparties and are not openly traded on an exchange.  As such, the Company has classified these instruments as Level 2.
	In evaluating counterparty credit risk, the Company assessed the possibility of whether the counterparty to the derivative would default by failing to make any contractually required payments.  The Company considered that the counterparty is of substantial credit quality and has the financial resources and willingness to meet its potential repayment obligations associated with the derivative transactions.
	Asset Retirement Obligation
	The fair value of the Company’s asset retirement obligation liability is calculated at the point of inception by taking into account: 1) the cost of abandoning oil and gas wells, which is based on the Company’s historical experience for similar work, or estimates from independent third-parties; 2) the economic lives of its properties, which are based on estimates from reserve engineers; 3) the inflation rate; and 4) the credit adjusted risk-free rate, which takes into account the Company’s credit risk and the time value of money.  Given the unobservable nature of the inputs, the initial measurement of the asset retirement obligation liability is deemed to use Level 3 inputs.
	Convertible Debentures Payable Conversion Feature
	In February 2011, the Company issued in a private placement $8.40 million aggregate principal amount of three year 8% Senior Secured Convertible Debentures (“Debentures”) with a group of accredited investors.  During the year ended December 31, 2012, the Company issued an additional $5.00 million of Debentures, resulting in a total of $13.40 million of Debentures outstanding as of December 31, 2012.  Through September 30, 2013, the Company issued an additional $1.43 million of supplemental convertible debentures. As of September 30, 2013, the Debentures are convertible at any time at the holders’ option into shares of our common stock at $4.25 per share, subject to certain adjustments, including the requirement to reset the conversion price based upon any subsequent equity offering at a lower price per share amount.  The Company engaged a third party to complete a valuation of this conversion liability.
	The following table provides a summary of the fair values of assets and liabilities measured at fair value:
	30-Sep-13
		Level 1			Level 2			Level 3			Total
	Liability
	Commodity price derivative liability	$	-		$	(40,995	)	$	-		$	(40,995	)
	Convertible debentures conversion derivative liability	$	-		$	-		$	(1,150,000	)	$	(1,150,000	)
	Total liability, at fair value	$	-		$	(40,995	)	$	(1,150,000	)	$	(1,190,995	)
	31-Dec-12
		Level 1			Level 2			Level 3			Total
	Liability
	Convertible debentures conversion derivative liability	$	-		$	-		$	(1,680,000	)	$	(1,680,000	)
	Total liability, at fair value	$	-		$	-		$	(1,680,000	)	$	(1,680,000	)
	The following table provides a summary of changes in fair value of the Company’s Level 3 financial assets and liabilities as of September 30, 2013:
	Beginning balance, December 31, 2012	$	(1,680,000	)
	Convertible debentures conversion derivative gain/ loss		670,000
	Additions to derivative liability due to issuance of additional debentures		(140,000	)
	Ending balance, September 30, 2013	$	(1,150,000	)
	The Company did not have any transfers of assets or liabilities between Level 1, Level 2 or Level 3 of the fair value measurement hierarchy during the nine months ending September 30, 2013 or 2012.

Loan_Agreements

Loan Agreements	9 Months Ended
	Sep. 30, 2013
Loan Agreements [Abstract]	'
LOAN AGREEMENTS	'
	NOTE 8 – LOAN AGREEMENTS
	Term Loans
	The Company entered into three separate loan agreements with Hexagon in January, March and April 2010, each with an original maturity date of December 1, 2010.  All three loans originally bore annual interest of 15% (which has been reduced, as discussed below), currently mature on May 16, 2014, and have similar terms, including customary representations and warranties and indemnification, and require the Company to repay the loans with the proceeds of the monthly net revenues from the production of the acquired properties.  The loans contain cross collateralization and cross default provisions and are collateralized by mortgages against a portion of the Company’s developed and undeveloped leasehold acreage.
	In April 2013, Hexagon agreed to amend all three loan agreements to extended the maturity date to May 16, 2014, reduce the annualized interest rate to 10% from 15% beginning retroactively with March 2013, decrease our minimum monthly payment under the term loans to $0.23 and allow us to make interest-only payments for March, April, May, and June. In consideration for the extended maturity date, reduced interest rate, and reduced minimum loan payment, we provided Hexagon an additional security interest in 15,000 acres of our undeveloped acreage.
	The Company is subject to certain non-financial covenants with respect to the Hexagon loan agreements.  As of September 30, 2013, the Company was in compliance with all covenants under the facilities.
	As of September 30, 2013, the total amount outstanding on the three loan agreements is $18.97 million, all of which is classified as current.
	Convertible Debentures Payable
	In February 2011, the Company completed a private placement of $8.40 million aggregate principal amount of the Debentures, secured by mortgages on several of our properties.  Initially, the Debentures were convertible at any time at the holders' option into shares of our common stock at $9.40 per share, subject to certain adjustments, including the requirement to reset the conversion price based upon any subsequent equity offering at a lower price per share amount. Interest at an annualized rate of 8% is payable quarterly on each May 15, August 15, November 15 and February 15 in cash or, at the Company's option, in shares of common stock, valued at 95% of the volume weighted average price of the common stock for the 10 trading days prior to an interest payment date.  The Company can redeem some or all of the Debentures at any time.  The redemption price is 115% of principal plus accrued interest.  If the holders of the Debentures elect to convert the Debentures, following notice of redemption, the conversion price will include a make-whole premium equal to the interest accruable through the 18 month anniversary of the original issue date of the Debenture less the amount of any interest paid on the portion of the Debenture being redeemed prior to the optional redemption date, payable in common stock. T.R. Winston & Company LLC (“TR Winston”) acted as placement agent for the private placement and received $0.40 million of Debentures equal to 5% of the gross proceeds from the sale.  The Company is amortizing the $0.40 million over the life of the loan as deferred financing costs.  The Company amortized $0.08 million of deferred financing costs into interest expense during the nine months ended September 30, 2013, and has $0.06 million of deferred financing cost to be amortized through May 2014.
	In December 2011, the Company agreed to amend the Debentures to lower the conversion price to $4.25 from $9.40 per share. This amendment was an inducement consideration to the Debenture holders for their agreement to release a mortgage on certain properties so the properties could be sold. The sale of these properties was effective December 31, 2011, and a final closing occurred during first quarter of 2012.
	On March 19, 2012, the Company entered into agreements with some of its existing Debenture holders to issue up to $5.0 million in additional debentures (the “Supplemental Debentures”).  Under the terms of the Supplemental Debenture agreements, proceeds derived from the issuance of Supplemental Debentures were used principally for the development of certain of the Company's proved undeveloped properties and other undeveloped acreage currently targeted by the Company for exploration, as well as for other general corporate purposes. Any new producing properties developed from the proceeds of Supplemental Debentures are to be pledged as collateral under a mortgage to secure future payment of the Debentures and Supplemental Debentures. All terms of the Supplemental Debentures are substantively identical to the Debentures.  The Agreements also provided for the payment of additional consideration to the purchasers of Supplemental Debentures in the form of a proportionately reduced 5% carried working interest in any properties developed with the proceeds of the Supplemental Debenture offering.
	Through July 2012, we received $3.04 million of proceeds from the issuance of Supplemental Debentures, which were used for the drilling and development of six new wells, resulting in a total investment of $3.69 million.  Five of these wells resulted in commercial production, and one well was plugged and abandoned.
	In August 2012, the Company and holders of the Supplemental Debentures agreed to renegotiate the terms of the Supplemental Debenture offering.  These negotiations concluded with the issuance of an additional $1.96 million of Supplemental Debentures.  The August 2012 modifications to the Supplemental Debenture agreements increased the carried working interest from 5% to 10% and also provided for a one-year, proportionately reduced net profits interest of 15% in the properties developed with the proceeds of the Supplemental Debenture offering, as well as the next four properties to be drilled and developed by the Company.  In conjunction with commitments to additional Debentures in June 2013 (see below), the commitment to provide a 10% carried interest  and  a 15%  one year net profits interest related to the development of four future properties was modified to a 15% carried interest in such properties.
	The Company has estimated the total value of consideration paid to Supplemental Debenture holders in the form of the modified net profits interest and carried working interest to be approximately $1.16 million, and recorded this amount as a debt discount to be amortized over the remaining life of the Supplemental Debentures.
	We periodically engage a third party valuation firm to complete a valuation of the conversion feature associated with the Debentures, and with respect to September 30, 2013, the Supplemental Debentures.  This valuation resulted in an estimated derivative liability as of September 30, 2013 and December 31, 2012 of $1.15 million and $1.68 million, respectively.  The portion of the derivative liability that is associated with the August 2012 Supplemental Debentures, in the approximate amount of $0.70 million has been recorded as a debt discount, and is being amortized over the remaining life of the Supplemental Debentures.
	During the nine months ended September 30, 2013 and 2012, the Company amortized $1.81 million and $1.65 million, respectively, of debt discounts.
	On September 8, 2012, the Company issued 50,000 shares, valued at $0.23 million, to T.R. Winston & Company LLC for acting as a placement agent of the Supplemental Debentures.  The Company is amortizing the $0.23 million over the life of the loan as deferred financing costs.  The Company amortized $0.03 million and $0.10 million of deferred financing costs into interest expense during the three and nine months ended September 30, 2013, and has $0.08 million of deferred financing costs to be amortized through May 2014.
	In April 2013, the holders of the Debentures agreed to extend their maturity date to May 16, 2014.  In consideration for the extended maturity date the Company provided an additional security interest in 15,000 acres of our undeveloped acreage, as additional collateral for the Debentures.
	In April 2013, we received approval from our existing secured debt and convertible debenture holders to issue up to $5.00 million of additional convertible debentures with terms substantially identical to our existing convertible debentures.   As of November 8, 2013 we have issued $2.20 million of such convertible debt, inclusive of $1.43 million that had been issued as of September 30, 2013.  Two officers of the Company participated in the additional convertible debentures for a combined total of $0.43 million.   Proceeds from the issuance of this convertible debt have been used toward the development of certain specific properties, and to a lesser extent, general corporate purposes.  The recent commitments were subject to certain yield enhancements, including a 25% carried interest in certain properties scheduled to be developed with the proceeds.
	The Company may, but is not obligated to, seek completion of the remainder of the $5.00 million offering of additional debt that was approved in April 2013.
	As of September 30, 2013, all of the outstanding Convertible Debentures are classified as current liabilities as a result of the May 14, 2014 due date. The additional debentures have increased the debt discount by $0.14 million which is amortized over the life of the debt.  As of September 30, 2013, the Company amortized $0.04 million.
	As of September 30, 2013 and December 31, 2012, the convertible debt is recorded as follows:
		As of			As of
		September 30,			December 31,
		2013			2012
	Convertible debentures	$	14,829,902		$	13,400,000
	Debt discount		(1,700,966	)		(3,099,639	)
	Total convertible debentures, net	$	13,128,936		$	10,300,361
	Annual debt maturities as of September 30, 2013 are as follows:
	Year 1	$	33,797,093
	Thereafter		-
	Total	$	33,797,093
	Failure to make periodic interest payments due under the Debentures (including the Supplemental Debentures) may result in acceleration of all principal and interest then outstanding under the Debentures, and may entitle the holders of the Debentures to exercise their rights to foreclose under the mortgages securing the Debentures. In addition, failure to make the required monthly payments under our term loans could result in immediate acceleration of both the term loans and the Debentures
	Interest Expense
	For the nine months ended September 30, 2013 and 2012, the Company incurred interest expense of approximately $4.79 million and $6.32 million, respectively, of which approximately $3.18 million and $3.89 million, respectively, were non-cash interest expense and amortization of the deferred financing costs, accretion of the convertible debentures payable discount, and convertible debentures interest paid in common stock.

Commitments_and_Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2013
Commitments and Contingencies [Abstract]	'
COMMITMENTS AND CONTINGENCIES	'
	NOTE 9 - COMMITMENTS AND CONTINGENCIES
	Environmental and Governmental Regulation
	At September 30, 2013, there were no known environmental or regulatory matters which are reasonably expected to result in a material liability to the Company.  Many aspects of the oil and gas industry are extensively regulated by federal, state, and local governments in all areas in which the Company has operations. Regulations govern such things as drilling permits, environmental protection and pollution control, spacing of wells, the unitization and pooling of properties, reports concerning operations, royalty rates, and various other matters including taxation.  Oil and gas industry legislation and administrative regulations are periodically changed for a variety of political, economic, and other reasons.  As of September 30, 2013 the Company had not been fined or cited for any violations of governmental regulations that would have a material adverse effect upon the financial condition of the Company.
	Legal Proceedings
	The Company may from time to time be involved in various legal actions arising in the normal course of business.  In the opinion of management, the Company’s liability, if any, in these pending actions would not have a material adverse effect on the financial position of the Company.  The Company’s general and administrative expenses would include amounts incurred to resolve claims made against the Company.
	Parker v. Tracinda Corporation, Denver District Court, Case No. 2011CV561.  In November 2012, the Company filed a motion to intervene in garnishment proceedings involving Roger Parker, the Company’s former Chief Executive Officer and Chairman.  The Defendant has served various writs of garnishment on the Company to enforce a judgment against Mr. Parker seeking, among other things, shares of unvested, restricted stock.  The Company has asserted rights to lawful set-offs and deductions in connection with certain tax consequences, which may be material to the Company.  As a result of bankruptcy proceedings filed by Mr. Parker, the garnishment proceedings have been stayed with respect to the Denver District Court case.  At this stage, we cannot express an opinion as to the probable outcome of this matter.
	In re Roger A. Parker: Tracinda Corp. v. Recovery Energy, Inc. and Roger A. Parker, United States Bankruptcy Court for the District of Colorado, Case No. 13-10897-EEB. On June 10, 2013, Tracinda Corp. (“Tracinda”) filed a complaint (Adversary No. 13-011301 EEB) against the Company and Roger Parker in connection with the personal bankruptcy proceedings of Roger Parker, alleging that the Company improperly failed to remit to Tracinda certain property in connection with a writs of garnishment issued by the Denver District Court (discussed above). The Company filed an answer to this complaint on July 10, 2013.

Shareholders_Equity

Shareholders' Equity	9 Months Ended
	Sep. 30, 2013
Shareholders' Equity [Abstract]	'
SHAREHOLDERS' EQUITY	'
	NOTE 10 - SHAREHOLDERS’ EQUITY
	Common Stock
	As of September 30, 2013, the Company had 100,000,000 shares of common stock and 10,000,000 shares of preferred stock authorized, of which 19,477,337 shares of common stock were issued and outstanding.  No preferred shares were issued or outstanding.
	During the nine months ended September 30, 2013, the Company issued 1,082,935 shares of common stock, including 471,720 shares to pay interest on convertible debentures, and 611,212 shares of common stock as restricted stock grants to employees, board members, or consultants.
	Investment Banking Agreement
	In May 2013, the Company entered into a one-year, non-exclusive investment banking agreement with TR Winston. The agreement provides for initial compensation to TR Winston in the amount of 100,000 common shares, and 900,000 common stock purchase warrants. All warrants have a term of three years and a strike price of $4.25 per share. The investment banking agreement also provides for additional commissions and compensation in the event that TR Winston arranges a successful equity or debt financing during the term of the agreement. The 900,000 warrants are valued at $0.38 million and the 100,000 common shares are valued at $0.16 million. Both equity instruments are classified as a prepaid asset and amortized over the life of the agreement. During the three month and nine month periods ended September 30, 2013, $0.09 million and $0.10 million, respectively, were included in general and administrative expense as amortization of the value of these grants.
	Convertible Debenture Interest
	During the nine months ended September 30, 2013, the Company issued 471,720 shares for payment of quarterly interest expense on the convertible debentures valued at $0.83 million.
	Warrants
	A summary of warrant activity for the nine months ended September, 2013 is presented below:
				Weighted-Average
		Warrants		Exercise Price
	Outstanding at December 31, 2012		5,638,900	$	7.04
	Granted		1,118,750		4.25
	Exercised, forfeited, or expired		-108,737		(6.00)
	Outstanding at September 30, 2013		6,648,913	$
	6.59
	In January 2013, the Company entered into two separate consulting agreements, one with a financial advisory firm and one with a public relations company.  Each agreement provided for the issuance by the Company of 200,000 warrants for a total of 400,000 warrants, with an exercise of $4.25 and a total valuation of $0.30 million. The shares vested 25% on March 31, 2013 and will vest 25% for each quarter thereafter. The Company is valuing the warrants each quarter based on their vesting schedule, and including the amount associated with such vesting warrants as an expense in the period of vesting.
	The aggregate intrinsic value associated with outstanding warrants as of September 30, 2013 and December 31, 2012 was $0, as the strike price of all warrants exceeded the market price for common stock, based on the Company’s closing common stock price of $2.08 and $1.99, respectively.  The weighted average remaining contract life as of September 30, 2013 was 1.81 years, and 2.56 years as of December 31, 2012.

Share_Based_Compensation

Share Based Compensation	9 Months Ended
	Sep. 30, 2013
Share Based Compensation [Abstract]	'
SHARE BASED COMPENSATION	'
	NOTE 11 - SHARE BASED COMPENSATION
	The costs of employee services received in exchange for an award of equity instruments are based on the grant-date fair value of the award, recognized over the period during which an employee is required to provide services in exchange for such award.
	During the nine months ended September 30, 2013, the Company granted 511,212 shares of restricted common stock to employees and directors, including 100,000 during the three months ended September 30, 2013. The Company also granted 3,200,000 stock options to employees and board members which are contingent on shareholder approval.
	A summary of restricted stock grant activity for the nine months ended September 30, 2013 is presented below:
		Shares
	Balance outstanding at December 31, 2012		1,730,710
	Granted		511,212
	Vested		(315,385	)
	Expired/ cancelled		(8,333	)
	Balance outstanding at September 30, 2013		1,918,204
	Total unrecognized compensation cost related to unvested stock grants was approximately $0.33 million as of September 30, 2013.  The cost at September 30, 2013 is expected to be recognized over a weighted-average service period of 3 years.
	Other Compensation
	We sponsor a 401(k) savings plan. All regular full-time employees are eligible to participate. We make contributions to match employee contributions up to 5% of compensation deferred into the plan. The Company made cash contributions of $0.02 million for the nine months ended September 30, 2013.
	Stock Options
	A summary of stock options activity for the nine months ended September 30, 2013 is presented below:
		Stock Options
	Outstanding at December 31, 2012		-
	Granted		3,200,000
	Exercised, forfeited, or expired		-
	Outstanding at September 30, 2013		3,200,000
	In June 2013, the Company entered into employment agreements with the CEO and the then President/CFO for non-cash compensation which consist of each individual receiving 300,000 stock options of which 100,000 vested immediately and 200,000 vests over the next 2 years, subject to approval by the Company’s shareholders. The options have a five year life and an exercise price of $1.60.  The 600,000 stock options are valued of $0.52 million at date of grant and are contingent on shareholder approval. During the nine months ended September 30, 2013, the Company recognized $0.22 million as non-cash compensation expense and $0.30 million is to be amortized over the remaining vesting period.
	These employment contracts also provide that some or all of the 2013 salaries of these individuals may be paid via the issuance of up to 93,750 shares of common stock in 2014 for each executive.
	In September 2013, the Company hired and entered into an employment agreement with a new President of the Company. The employment agreement provides, among other things, for the grant of 100,000 shares of the Company’s common stock which vested immediately as an inducement for joining the Company.  The employment agreement also provided for the grant of an option to purchase 600,000 shares of common stock of the Company, at a strike price of $2.45 per share, which will become exercisable upon the date the Company receives gross cash proceeds or drawing availability of at least $30,000,000, measured on a cumulative basis and including certain restructuring transactions.  The employment agreement also provided an incentive bonus package and an additional stock option grant of 2 million options, which will become exercisable once certain conditions specified in the employment agreement are met.  The Company recognized $.245 million of expense associated with the share grant.  The Company also valued the option grants at $0.77 million, and recognized $.02 million as non-cash compensation expense during the three months ended September 30, 2013. The remaining $0.75 million is to be amortized until December 31, 2014.

Summary_of_Significant_Account1

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2013
Summary of Significant Accounting Policies [Abstract]	'
Basis of Presentation	'
	Basis of Presentation
	The accompanying financial statements were prepared by Recovery in accordance with generally accepted accounting principles (“GAAP”) in the United States.  The financial statements reflect all normal recurring adjustments which are, in the opinion of management, necessary to provide a fair statement of the results of operations and financial position.
Reclassification	'
	Reclassification
	Certain amounts in the 2012 consolidated financial statements have been reclassified to conform to the September 30, 2013 consolidated financial statement presentation.  Such reclassifications had no effect on net income.
Use of Estimates	'
	Use of Estimates
	The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of oil and gas reserves, 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 reporting period.  We evaluate our estimates on an ongoing basis and base our estimates on historical experience and on various other assumptions we believe to be reasonable under the circumstances.  Although actual results may differ from these estimates under different assumptions or conditions, we believe that our estimates are reasonable.
	Our most significant financial estimates are associated with our estimated proved oil and gas reserves, assessments of impairment imbedded in the carrying value of undeveloped acreage and proven properties, as well as valuation of common stock used in various issuances of common stock, options and warrants, and estimated derivative liabilities.
Oil and Gas Producing Activities	'
	Oil and Gas Producing Activities
	The Company follows the full cost method of accounting for oil and gas operations whereby all costs related to the exploration, development and acquisition of oil and natural gas reserves are capitalized.  Such costs include land acquisition costs, geological and geophysical expenses, carrying charges on non-producing properties, costs of drilling, developing and completing productive wells and/or plugging and abandoning non-productive wells, and any other costs directly related to acquisition and exploration activities.  Proceeds from property sales are generally applied as a credit against capitalized exploration and development costs, with no gain or loss recognized, unless such a sale would significantly alter the relationship between capitalized costs and the proved reserves attributable to these costs.  A significant alteration would typically involve a sale of 25% or more of proved reserves.
	Depletion of exploration and development costs and depreciation of production equipment is computed using the units-of-production method based upon estimated proved oil and gas reserves.  Costs included in the depletion base to be amortized include (a) all proved capitalized costs including capitalized asset retirement costs net of estimated salvage values, less accumulated depletion, (b) estimated future development cost to be incurred in developing proved reserves; and (c) estimated dismantlement and abandonment costs, net of estimated salvage values, that are not otherwise included in capitalized costs.
	The costs of undeveloped acreage are withheld from the depletion base until it is determined whether or not proved reserves can be assigned to the properties.   When proved reserves are assigned to such properties or one or more specific properties are deemed to be impaired, the cost of such properties or the amount of the impairment is added to full cost pool which is subject to depletion calculations.
	Under the full cost method of accounting, capitalized oil and gas property costs less accumulated depletion and net of deferred income taxes may not exceed an amount equal to sum of i.) the present value, discounted at 10%, of estimated future net revenues from proved oil and gas reserves, plus ii.) the cost of unproved properties not subject to amortization (without regard to estimates of fair value), or estimated fair value, if lower, of unproved properties that are not subject to amortization.  Should capitalized costs exceed this ceiling, an impairment expense is recognized.
	The present value of estimated future net revenues was computed by applying a twelve month average of the first day of the month price of oil and gas to estimated future production of proved oil and gas reserves as of period-end, less estimated future expenditures to be incurred in developing and producing the proved reserves (assuming the continuation of existing economic conditions), less any applicable future taxes.
	The Company did not recognize impairment charges for the nine months ended September 30, 2013 compared to an impairment of $3.27 million for the nine months ended September 30, 2012.
Wells in Progress	'
	Wells in Progress
	Wells in progress represent wells that are currently in the process of being drilled or completed or otherwise under evaluation as to their potential to produce oil and gas reserves in commercial quantities.  Such wells continue to be classified as wells in progress and withheld from the depletion calculation and the ceiling test until such time as either proved reserves can be assigned, or the wells are otherwise abandoned.  Upon either the assignment of proved reserves or abandonment, the costs for these wells are then transferred to the full cost pool and become subject to both depletion and the ceiling test calculations.
	In June 2013, the Company purchased a 50% interest in approximately 1,200 contiguous gross acres in Laramie County, Wyoming, in an area considered strategic by the Company.  This tract included two existing wells, one of which has now been recompleted. The costs associated with the purchase and recompletion was transferred out of wells in progress in September 2013. The Company transferred $0.30 million into undeveloped acreage and $0.43 million into oil and gas properties.  As of September 30, 2013, the Company has $0.18 million in wells in progress compared to $0.19 million in wells in progress as of December 31, 2012.
Loss per Common Share	'
	Loss per Common Share
	Earnings (losses) per share are computed based on the weighted average number of common shares outstanding during the period presented. Diluted earnings (losses) per share are computed using the weighted-average number of common shares outstanding plus the number of common shares that would be issued assuming exercise or conversion of all potentially dilutive common shares.  Potentially dilutive securities, such as conversion derivatives and stock purchase warrants, are excluded from the calculation when their effect would be anti-dilutive.  As of September 30, 2013, a total of 6,648,913 and 3,489,389, respectively, of shares underlying warrants and convertible debentures have been excluded from the diluted share calculations as they were anti-dilutive as a result of net losses incurred.  Accordingly, basic shares equal diluted shares for all periods presented.
Recent Accounting Pronouncements	'
	Recent Accounting Pronouncements
	Various accounting standards updates are issued, most of which represented technical corrections to the accounting literature or were applicable to specific industries, are not expected to a have a material impact on the Company's financial position, results of operations or cash flows.

Financial_Instruments_and_Deri1

Financial Instruments and Derivatives (Tables)	9 Months Ended
	Sep. 30, 2013
Financial Instruments and Derivatives [Abstract]	'
Summary of amounts of gains (losses) recognized as a result of derivative financial instruments	'
		Three months ended						Nine months ended
		September 30,						September 30,
		2013			2012			2013			2012
	Realized gains (losses) on commodity price derivatives	$	(43,551	)	$	37,341		$	(23,661	)	$	49,729
	Unrealized gains (losses) on commodity price derivatives	$	(20,000	)	$	(130,000	)	$	(20,000	)	$	445,609

Fair_Value_of_Financial_Instru1

Fair Value of Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2013
Fair Value of Financial Instruments [Abstract]	'
Summary of fair value of assets and liabilities measured at fair value	'
	30-Sep-13
		Level 1			Level 2			Level 3			Total
	Liability
	Commodity price derivative liability	$	-		$	(40,995	)	$	-		$	(40,995	)
	Convertible debentures conversion derivative liability	$	-		$	-		$	(1,150,000	)	$	(1,150,000	)
	Total liability, at fair value	$	-		$	(40,995	)	$	(1,150,000	)	$	(1,190,995	)
	31-Dec-12
		Level 1			Level 2			Level 3			Total
	Liability
	Convertible debentures conversion derivative liability	$	-		$	-		$	(1,680,000	)	$	(1,680,000	)
	Total liability, at fair value	$	-		$	-		$	(1,680,000	)	$	(1,680,000	)
Summary of changes in fair value of Level 3 financial assets and liabilities	'
	Beginning balance, December 31, 2012	$	(1,680,000	)
	Convertible debentures conversion derivative gain/ loss		670,000
	Additions to derivative liability due to issuance of additional debentures		(140,000	)
	Ending balance, September 30, 2013	$	(1,150,000	)

Loan_Agreements_Tables

Loan Agreements (Tables)	9 Months Ended
	Sep. 30, 2013
Loan Agreements [Abstract]	'
Summary of convertible debt	'
		As of			As of
		September 30,			December 31,
		2013			2012
	Convertible debentures	$	14,829,902		$	13,400,000
	Debt discount		(1,700,966	)		(3,099,639	)
	Total convertible debentures, net	$	13,128,936		$	10,300,361
Summary of annual debt maturities	'
	Year 1	$	33,797,093
	Thereafter		-
	Total	$	33,797,093

Shareholders_Equity_Tables

Shareholders' Equity (Tables)	9 Months Ended
	Sep. 30, 2013
Shareholders' Equity [Abstract]	'
Summary of warrant activity	'
				Weighted-Average
		Warrants		Exercise Price
	Outstanding at December 31, 2012		5,638,900	$	7.04
	Granted		1,118,750		4.25
	Exercised, forfeited, or expired		-108,737		(6.00)
	Outstanding at September 30, 2013		6,648,913	$	6.59

Share_Based_Compensation_Table

Share Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2013
Share Based Compensation [Abstract]	'
Summary of restricted stock grant activity	'
		Shares
	Balance outstanding at December 31, 2012		1,730,710
	Granted		511,212
	Vested		(315,385	)
	Expired/ cancelled		(8,333	)
	Balance outstanding at September 30, 2013		1,918,204
Summary of stock options activity	'
		Stock Options
	Outstanding at December 31, 2012		-
	Granted		3,200,000
	Exercised, forfeited, or expired		-
	Outstanding at September 30, 2013		3,200,000

Organization_Details

Organization (Details)	9 Months Ended
	Sep. 30, 2013
	acre
Organization (Textual)	'
Area of land for crude oil and natural gas (In acres)	112,000

Liquidity_Details

Liquidity (Details) (USD $)	0 Months Ended		1 Months Ended	3 Months Ended		9 Months Ended			4 Months Ended
	Nov. 08, 2013	Mar. 19, 2012	Apr. 30, 2013	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Feb. 28, 2011	Apr. 30, 2010
									Hexagon [Member]
Liquidity (Textual)	'	'	'	'	'	'	'	'	'
Net loss	'	'	'	($1,901,146)	($2,836,634)	($7,194,884)	($12,777,299)	'	'
Net cash provided by (used in) operating activities	'	'	'	'	'	-1,558,307	-2,747,079	'	'
Net working capital deficit	'	'	'	33,970,000	'	33,970,000	'	'	'
Maturity date of loan	'	'	'	'	'	16-May-14	'	'	1-Dec-10
Aggregate additional debentures to be issued as per agreement	'	5,000,000	5,000,000	'	'	5,000,000	'	'	'
Term loan outstanding	'	'	'	18,970,000	'	18,970,000	'	'	'
Debenture outstanding	'	'	'	14,830,000	'	14,830,000	'	'	'
Amount of commitment has been funded to date	'	'	'	'	'	1,160,000	'	'	'
Officers' participation in additional convertible debentures	'	'	'	'	'	430,000	'	'	'
Additional convertible debentures, recent commitment terms	'	'	'	'	'	'The recent commitments were subject to certain yield enhancements, including a 25% carried interest in certain properties scheduled to be developed with the proceeds.	'	'	'
Senior secured convertible debentures, interest rate	'	'	'	8.00%	'	8.00%	'	8.00%	'
Issuance of convertible debt	$2,200,000	'	'	'	'	'	'	'	'

Summary_of_Significant_Account2

Summary of Significant Accounting Policies (Details) (USD $)	1 Months Ended	9 Months Ended
	Jun. 30, 2013	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
	acre
Summary of Significant Accounting Policies (Textual)	'	'	'	'
Description of sale proved reserves	'	'Sale of 25% or more of proved reserves.	'	'
Percentage of discounted estimated future net revenues	'	10.00%	'	'
Impairment Expense	'	'	$3,270,000	'
Area of land acquired	1,200	'	'	'
Wells in progress	'	180,153	'	193,515
Outstanding warrants excluded from the diluted share calculations	'	6,648,913	'	'
Shares related to convertible debentures payable excluded from the diluted share calculations	'	3,489,389	'	'
Gas and oil acreage undeveloped value	300,000	'	'	'
Oil and gas properties value	$430,000	'	'	'

Oil_and_Gas_Properties_Details

Oil and Gas Properties (Details) (USD $)	1 Months Ended
In Millions, unless otherwise specified	Jun. 30, 2013
Oil and Gas Properties (Textual)	'
Additional acquisition costs	$0.13
Proceed from sale of business	0.64
Gas And Oil Acreage Undeveloped Value	0.3
Oil And Gas Properties Value	$0.43

Wells_in_Progress_Details

Wells in Progress (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Wells in Progress (Textual)	'	'
Wells in progress	$180,153	$193,515

Financial_Instruments_and_Deri2

Financial Instruments and Derivatives (Details) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Summary of amounts of gains (losses) recognized as a result of derivative financial instruments	'	'	'	'
Realized gain (loss) on commodity price derivatives	($43,551)	$37,341	($23,661)	$49,729
Unrealized gains (loss) on commodity price derivatives	($20,000)	($130,000)	($20,000)	$445,609

Financial_Instruments_and_Deri3

Financial Instruments and Derivatives (Details Textual)	9 Months Ended
	Sep. 30, 2013
	bbl
Financial Instruments And Derivatives Textual [Abstract]	'
Quantity of commodity swap oil per day	100
Commodity swap strike price per barrel	99.25

Fair_Value_of_Financial_Instru2

Fair Value of Financial Instruments (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Liability	'	'
Commodity price derivative liability	$1,150,000	'
Convertible debentures conversion derivative liability	-1,150,000	-1,680,000
Total liability, at fair value	-1,190,995	-1,680,000
Level 1 [Member]	'	'
Liability	'	'
Commodity price derivative liability	'	'
Convertible debentures conversion derivative liability	'	'
Total liability, at fair value	'	'
Level 2 [Member]	'	'
Liability	'	'
Commodity price derivative liability	-40,995	'
Convertible debentures conversion derivative liability	'	'
Total liability, at fair value	-40,995	'
Level 3 [Member]	'	'
Liability	'	'
Convertible debentures conversion derivative liability	-1,150,000	-1,680,000
Total liability, at fair value	($1,150,000)	($1,680,000)

Fair_Value_of_Financial_Instru3

Fair Value of Financial Instruments (Details 1) (USD $)	9 Months Ended
	Sep. 30, 2013
Summary of changes in fair value of Level 3 financial assets and liabilities	'
Beginning Balance	($1,680,000)
Convertible debentures conversion derivative gain/ loss	670,000
Additions to derivative liability due to issuance of additional debentures	-140,000
Ending Balance	($1,150,000)

Fair_Value_of_Financial_Instru4

Fair Value of Financial Instruments (Details Textual) (USD $)	1 Months Ended
In Millions, except Per Share data, unless otherwise specified	Feb. 28, 2011	Sep. 30, 2013	Dec. 31, 2012	Dec. 31, 2011
Fair Value of Financial Instruments (Textual)	'	'	'	'
Interest rate on term loan	'	10.00%	'	'
Senior secured convertible debentures, interest rate	8.00%	8.00%	'	'
Convertible debentures issued through private placement	$8.40	'	'	'
Maturity period of senior secured convertible debentures	'3 years	'	'	'
Additional convertible debentures issued	'	'	5	'
Debentures outstanding, total	'	$1.43	$13.40	'
Debentures convertible conversion price (per share)	$9.40	'	$4.25	$4.25

Loan_Agreements_Details

Loan Agreements (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Summary of convertible debt	'	'
Convertible debentures	$14,829,902	$13,400,000
Debt discount	-1,700,966	-3,099,639
Total convertible debentures, net	$13,128,936	$10,300,361

Loan_Agreements_Details_1

Loan Agreements (Details 1) (USD $)	Sep. 30, 2013
Summary of annual debt maturities	'
Year 1	$33,797,093
Thereafter	'
Total	$33,797,093

Loan_Agreements_Details_Textua

Loan Agreements (Details Textual) (USD $)

0 Months Ended

1 Months Ended

3 Months Ended

9 Months Ended

1 Months Ended

4 Months Ended

Nov. 08, 2013

Sep. 08, 2012

Mar. 19, 2012

Jun. 30, 2013

Apr. 30, 2013

Aug. 31, 2012

Jul. 31, 2012

Feb. 28, 2011

Sep. 30, 2013

Sep. 30, 2013

Sep. 30, 2012

Dec. 31, 2012

Dec. 31, 2011

Apr. 30, 2013

Apr. 30, 2010

Officer

acre

Hexagon [Member]

Hexagon [Member]

LoanAgreement

Loan Agreements (Textual)

'

'

'

'

'

'

'

'

'

'

'

'

'

'

'

Number of separate loan agreements in January, March and April 2010

'

'

'

'

'

'

'

'

'

'

'

'

'

'

3

Maturity date of loan

'

'

'

'

'

'

'

'

'

16-May-14

'

'

'

'

1-Dec-10

Annual interest rate on loan (in percentage)

'

'

'

'

'

'

'

'

'

'

'

'

'

'

15.00%

Maturity date of term loan

'

'

'

'

'

'

'

'

'

'

'

'

'

'

'May 16, 2014

Extended maturity date of loan agreements

'

'

'

'

16-May-14

'

'

'

'

'

'

'

'

16-May-14

'

Term loan effective interest rate

'

'

'

'

15.00%

'

'

'

'

'

'

'

'

'

'

Term loan decreased interest rate

'

'

'

'

10.00%

'

'

'

'

'

'

'

'

'

'

Amount of loan agreement

'

'

'

'

$230,000

'

'

'

'

'

'

'

'

'

'

Deferred financing cost and amortized over the remaining term of the loan

'

'

'

'

'

'

'

'

60,000

60,000

'

'

'

'

'

Aggregate additional debentures to be issued as per agreement

'

'

5,000,000

'

5,000,000

'

'

'

'

5,000,000

'

'

'

'

'

Officers' participation in additional convertible debentures

'

'

'

'

'

'

'

'

'

430,000

'

'

'

'

'

Area of undeveloped acreage provided as additional security

'

'

'

'

15,000

'

'

'

'

'

'

'

'

'

'

Senior secured convertible debentures, interest rate

'

'

'

'

'

'

'

8.00%

8.00%

8.00%

'

'

'

'

'

Additional consideration to the purchasers of Supplemental Debentures

'

'

5.00%

'

'

'

'

'

'

'

'

'

'

'

'

Proceeds from private placement

'

'

'

'

'

'

'

8,400,000

'

'

'

'

'

'

'

Maturity period of senior secured convertible debentures

'

'

'

'

'

'

'

'3 years

'

'

'

'

'

'

'

Debentures convertible conversion price (per share)

'

'

'

'

'

'

'

$9.40

'

'

'

$4.25

$4.25

'

'

Description of interest payment on debentures other than cash

'

'

'

'

'

'

'

'

'

'Interest at an annualized rate of 8% is payable quarterly on each May 15, August 15, November 15 and February 15 in cash or, at the Company's option, in shares of common stock, valued at 95% of the volume weighted average price of the common stock for the 10 trading days prior to an interest payment date.

'

'

'

'

'

Description of redemption price of debenture

'

'

'

'

'

'

'

'

'

'115% of principal plus accrued interest.

'

'

'

'

'

Period of remaining interest of the original issue date

'

'

'

'

'

'

'

'18 months

'

'

'

'

'

'

'

Amount received by placement agent

'

'

'

'

'

'

'

400,000

'

'

'

'

'

'

'

Percentage of gross sales received by placement agent

'

'

'

'

'

'

'

5.00%

'

'

'

'

'

'

'

Additional supplemental debenture offering to secure funding

'

'

'

'

'

1,960,000

3,040,000

'

'

'

'

'

'

'

'

Proportionately reduced net profits interest rate

'

'

'

'

'

15.00%

'

'

'

'

'

'

'

'

'

Increased in the carried working interest of supplemental debenture agreements due to drilled of four properties, minimum

'

'

'

'

'

5.00%

'

'

'

'

'

'

'

'

'

Increased in the carried working interest of supplemental debenture agreements due to drilled of four properties, maximum

'

'

'

'

'

10.00%

'

'

'

'

'

'

'

'

'

Supplemental debentures period

'

'

'

'

'

'1 year

'

'

'

'

'

'

'

'

'

Amortization of deferred financing costs into interest expense under private placement

'

'

'

'

'

'

'

'

'

80,000

'

'

'

'

'

Amortization of deferred financing cost charged to interest expenses under agreement with T.R. Winston & Company LLC

'

230,000

'

'

'

'

'

'

'

1,430,000

'

'

'

'

'

Amount of deferred financing costs to be amortized

'

'

'

'

'

'

'

400,000

'

80,000

'

'

'

'

'

Additional consideration to the purchasers of Supplemental Debentures

2,200,000

'

'

'

'

'

'

'

'

'

'

'

'

'

'

Convertible debentures issued through private placement

'

'

'

'

'

'

'

8,400,000

'

'

'

'

'

'

'

Investment of issuance debenture

'

'

'

'

'

'

3,690,000

'

'

'

'

'

'

'

'

Debt discount associated with supplement debentures amortized over remaining life of debentures

'

'

'

'

'

'

'

'

'

700,000

'

'

'

'

'

Estimated derivative liability

'

'

'

'

'

'

'

'

40,955

40,955

'

'

'

'

'

Amortized debt discount

'

'

'

'

'

'

'

'

'

1,810,000

1,650,000

'

'

'

'

Shares issued by company acting as placement agent of supplemental debentures

'

50,000

'

'

'

'

'

'

'

'

'

'

'

'

'

Value of Shares issued by company to T.R. Winston & Company LLC for acting as placement agent of supplemental debentures

'

230,000

'

'

'

'

'

'

'

'

'

'

'

'

'

Amortization of deferred financing costs into interest expense

'

'

'

'

'

1,160,000

'

'

30,000

100,000

'

'

'

'

'

Interest expense incurred

'

'

'

'

'

'

'

'

'

4,710,000

6,320,000

'

'

'

'

Non-cash interest expense and amortization of the deferred financing costs

'

'

'

'

'

'

'

'

'

3,180,000

3,890

'

'

'

'

Number of officers participated in additional debentures

'

'

'

2

'

'

'

'

'

'

'

'

'

'

'

Interest rate carried in certain property

'

'

'

25.00%

'

'

'

'

'

'

'

'

'

'

'

Increase in debt discount due to additional debentures

'

'

'

'

'

'

'

'

'

140,000

'

'

'

'

'

Amortization expenses

'

'

'

'

'

'

'

'

40,000

40,000

'

'

'

'

'

Term loan outstanding

'

'

'

'

'

'

'

'

$18,970,000

$18,970,000

'

'

'

'

'

Shareholders_Equity_Details

Shareholders' Equity (Details) (Warrant [Member], USD $)	9 Months Ended
	Sep. 30, 2013
Warrant [Member]	'
Summary of warrant activity	'
Outstanding at December 31, 2012	5,638,900
Granted	1,118,750
Exercised, forfeited, or expired	-108,737
Outstanding at September 30, 2013	6,648,913
Weighted Average Exercise Price, Outstanding Beginning	$7.04
Weighted Average Exercise Price, Granted	$4.25
Weighted Average Exercise Price, Exercised, forfeited, or expired	($6)
Weighted Average Exercise Price, Outstanding Ending	$6.59

Shareholders_Equity_Details_Te

Shareholders' Equity (Details Textual) (USD $)	1 Months Ended	3 Months Ended	9 Months Ended	12 Months Ended	1 Months Ended			3 Months Ended	9 Months Ended
	Jan. 31, 2013	Sep. 30, 2013	Sep. 30, 2013	Dec. 31, 2012	31-May-13	Jan. 31, 2013	Jan. 31, 2013	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013
	ConsultingAgreements				T R Winston Company LLC [Member]	Financial Advisory Firm [Member]	Public Relations Company [Member]	Restricted Stock [Member]	Restricted Stock [Member]	Restricted Stock [Member]
					Investment Banking Agreement [Member]	ConsultingAgreements	ConsultingAgreements			Employees, Board Members and Consultants [Member]
Shareholders' Equity (Textual)	'	'	'	'	'	'	'	'	'	'
Common stock, shares authorized	'	100,000,000	100,000,000	100,000,000	'	'	'	'	'	'
Preferred Stock, shares authorized	'	10,000,000	10,000,000	10,000,000	'	'	'	'	'	'
Common stock, shares issued	'	19,477,337	19,477,337	18,394,401	'	'	'	1,082,935	1,082,935	'
Common stock, shares outstanding	'	19,477,337	19,477,337	18,394,401	'	'	'	'	'	'
Preferred Stock, shares issued	'	'	'	'	'	'	'	'	'	'
Preferred Stock, shares outstanding	'	'	'	'	'	'	'	'	'	'
Grant of restricted shares to employees or directors during the period	'	'	'	'	'	'	'	100,000	511,212	611,212
Amortization Of Value Of Common Stock And Warrants Granted	'	$90,000	$100,000	'	'	'	'	'	'	'
Term of non-exclusive investment banking agreement	'	'	'	'	'1 year	'	'	'	'	'
Common stock issued for initial compensation, shares	'	'	'	'	100,000	'	'	'	'	'
Common stock purchase warrants issued for initial compensation	'	'	'	'	900,000	'	'	'	'	'
Term of warrants	'	'	'	'	'3 years	'	'	'	'	'
Warrants strike price	'	'	'	'	$4.25	'	'	'	'	'
Common stock issued for initial compensation, value	'	'	'	'	160,000	'	'	'	'	'
Common stock purchase warrants issued for initial compensation, value	'	'	'	'	380,000	'	'	'	'	'
Shares issued for payment of quarterly interest expense on the convertible debentures	'	'	471,720	'	'	'	'	'	'	'
Shares issued for payment of quarterly interest expense on the convertible debentures, value	'	'	830,000	'	'	'	'	'	'	'
Number of consulting agreements	2	'	'	'	'	1	1	'	'	'
Warrants shares issued under consulting agreements	400,000	'	'	'	'	200,000	200,000	'	'	'
Grant price of warrants shares issued under consulting agreements	$4.24	'	'	'	'	'	'	'	'	'
Value of warrants shares issued under consulting agreements	30,000	'	'	'	'	'	'	'	'	'
Percentage of warrants vested	25.00%	'	'	'	'	'	'	'	'	'
Description of installment of vesting period	'Shares vest 25% on March 31, 2013 and 25% for each quarter thereafter.	'	'	'	'	'	'	'	'	'
Aggregate intrinsic value of warrants	'	$0	$0	$0	'	'	'	'	'	'
Common stock closing price	'	$2.08	$2.08	$1.99	'	'	'	'	'	'
Weighted average remaining contractual life (in years)	'	'	'1 year 9 months 22 days	'2 years 6 months 22 days	'	'	'	'	'	'

Share_Based_Compensation_Detai

Share Based Compensation (Details) (Restricted Stock [Member])	3 Months Ended	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2013
Restricted Stock [Member]	'	'
Summary of restricted stock grant activity	'	'
Beginning Balance	'	1,730,710
Granted	100,000	511,212
Vested	'	-315,385
Expired/ cancelled	'	-8,333
Ending Balance	1,918,204	1,918,204

Share_Based_Compensation_Detai1

Share Based Compensation (Details 1) (Stock Options [Member])	9 Months Ended
	Sep. 30, 2013
Stock Options [Member]	'
Summary of stock options activity	'
Outstanding at December 31, 2012	'
Granted	3,200,000
Exercised, forfeited, or expired	'
Outstanding at September 30, 2013	3,200,000

Share_Based_Compensation_Detai2

Share Based Compensation (Details Textual) (USD $)	9 Months Ended	3 Months Ended	9 Months Ended	1 Months Ended	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013	Jun. 30, 2013	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013	Sep. 30, 2013
		Restricted Stock [Member]	Restricted Stock [Member]	Stock Options [Member]	Stock Options [Member]	Stock Options [Member]	Stock Options [Member]	Stock Options [Member]
						President [Member]	Incentive Bonus [Member]	Performance Bonus [Member]
Share Based Compensation (Textual)	'	'	'	'	'	'	'	'
Grant of restricted shares to employees or directors during the period	'	100,000	511,212	'	'	'	'	'
Stock options granted to employees	'	'	'	'	3,200,000	'	100,000	2,000,000
Compensation expense	$220	'	'	'	'	$20,000	'	'
Share based compensation amortize date	'	'	'	'	'	31-Dec-14	'	'
Employer matching contribution, Percentage	5.00%	'	'	'	'	'	'	'
Cash contributions to employees plan	20,000	'	'	'	'	'	'	'
Unrecognized compensation cost, non-vested stock grants	330,000	'	'	'	'	'	'	'
Unrecognized compensation cost, non-vested stock grants, period for recognition (in years)	'3 years	'	'	'	'	'	'	'
Stock option received by CEO and the President/CFO	'	'	'	300,000	'	'	'	'
Stock option vested immediately	'	'	'	100,000	'	'	'	'
Stock option vested over next 2 years	'	'	'	200,000	'	'	'	'
Stock option vesting period	'	'	'	'	'5 years	'	'	'
Stock option exercise price	'	'	'	'	$1.60	'	'	'
Stock option granted to employee, value	'	'	'	'	520,000	'	'	'
Amortization of non-cash compensation expense	300,000	'	'	'	'	'	'	'
Common stock issued for salaries, shares	93,750	'	'	'	'	'	'	'
Minimum gross cash proceeds or drawing availability	$30,000,000	'	'	'	'	'	'	'