Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | 7-May-14 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'Petron Energy II, Inc. | ' |
Entity Central Index Key | '0001467434 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
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 | ' | 3,106,934,040 |
Document Fiscal Period Focus | 'Q1 | ' |
Document Fiscal Year Focus | '2014 | ' |
Consolidated_Balance_Sheets_Un
Consolidated Balance Sheets (Unaudited) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Current Assets | ' | ' |
Cash | $332 | $105 |
Accounts Receivable | 4,745 | 24,342 |
Total Current Assets | 5,077 | 24,447 |
Pipeline, net of accumulated depreciation of $337,407 and $320,452, respectively | 680,593 | 697,548 |
Producing Oil & Gas Properties, net of accumulated depletion of $863,795 and $837,759, respectively | 1,787,546 | 1,803,632 |
Other Depreciable Equipment, net of accumulated depreciation of $163,664 and $125,309, respectively | 575,752 | 609,732 |
Other Assets | 1,532 | 1,532 |
TOTAL ASSETS | 3,050,500 | 3,136,891 |
Current Liabilities | ' | ' |
Bank Overdraft | 21,002 | 57,942 |
Accounts Payable--Trade | 1,251,831 | 1,282,779 |
Accounts Payable--Related Party | 26,812 | 224,425 |
Accrued Liabilities | 388,362 | 219,649 |
Derivative Liability | 1,313,544 | 960,047 |
Notes Payable-- current | 1,460,244 | 1,432,731 |
Total Current Liabilities | 4,461,795 | 4,177,573 |
Asset Retirement Obligation | 126,687 | 220,347 |
Common Stock Issuance Liability | 628,809 | 946,551 |
TOTAL LIABILITIES | 5,217,291 | 5,344,471 |
STOCKHOLDERS' EQUITY | ' | ' |
Series A, $0.001 par value, 1,000 shares designated, issued and outstanding | 1 | 1 |
Series B, $0.001 par value, 5,910,000 shares designated, 629,438 and 947,498 shares issued and outstanding, respectively | 629 | 947 |
Common Stock, $0.0001 par value, 15,000,000,000 shares authorized; 1,624,744,353 and 442,085,940 issued and outstanding, respectively | 162,474 | 44,209 |
Additional Paid-In Capital | 24,041,379 | 21,869,581 |
Accumulated Deficit | -26,371,274 | -24,122,318 |
Total Stockholders' Deficit | -2,166,791 | -2,207,580 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $3,050,500 | $3,136,891 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Statement of Financial Position [Abstract] | ' | ' |
Accumulated depreciation of Pipeline | $337,407 | $320,452 |
Accumulated depletion of Producing Oil and Gas Properties | 863,795 | 837,759 |
Other Depreciable Equipment, net of accumulated depreciation | $163,664 | $125,309 |
Series B Preferred stock, par value | $0.00 | $0.00 |
Series B Preferred stock, authorized | 5,910,000 | 5,910,000 |
Series B Preferred stock, issued | 629,438 | 947,498 |
Series B Preferred stock, outstanding | 629,438 | 947,498 |
Series A Preferred stock, par value | $0.00 | $0.00 |
Series A Preferred stock, authorized | 1,000 | 1,000 |
Series A Preferred stock, issued | 1,000 | 1,000 |
Series A Preferred stock, outstanding | 1,000 | 1,000 |
Common stock, par value | $0.00 | $0.00 |
Common stock, authorized | 15,000,000,000 | 15,000,000,000 |
Common stock, issued | 1,624,744,353 | 442,085,940 |
Common stock, outstanding | 1,624,744,353 | 442,085,940 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Revenues | ' | ' |
Oil & Gas Sales | $78,326 | $106,874 |
Costs and Expenses | ' | ' |
Cost of Revenue | 172,695 | 103,300 |
Depletion and Depreciation | 81,310 | 49,980 |
Derivative Expense | 1,333,973 | 82,300 |
General and Administrative | 598,288 | 200,321 |
Interest Expense | 141,016 | 54,562 |
Total Expenses | 2,327,282 | 490,463 |
Loss from Operations Before Income Taxes | -2,248,956 | -383,589 |
Income Taxes | ' | ' |
Net Loss | ($2,248,956) | ($383,589) |
Loss per share--basic and diluted | $0 | ($0.02) |
Weighted average number of shares--basic and diluted | 1,010,241,896 | 22,870,985 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders Equity (Unaudited) (USD $) | Series A | Series B | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Beginning balance, Amount at Dec. 31, 2012 | $1 | $5,910 | $1,198 | $14,649,439 | ($19,821,223) | ($5,164,675) |
Beginning balance, Shares at Dec. 31, 2012 | 1,000 | 5,910,000 | 11,976,942 | ' | ' | ' |
Common stock and warrants issued for services, Shares | ' | ' | 8,422,130 | ' | ' | ' |
Common stock and warrants issued for services, Amount | ' | ' | 842 | 136,233 | ' | 137,075 |
Common stock issued in lawsuit settlement, Shares | ' | ' | 2,950,477 | ' | ' | ' |
Common stock issued in lawsuit settlement, Amount | ' | ' | 296 | 137,704 | ' | 138,000 |
Common stock issued for loan fees, Shares | ' | ' | 3,333,334 | ' | ' | ' |
Common stock issued for loan fees, Amount | ' | ' | 333 | 159,967 | ' | 160,300 |
Common Stock Sales, Shares | ' | ' | 41,141,643 | ' | ' | ' |
Common Stock Sales, Amount | ' | ' | 4,114 | 521,036 | ' | 525,150 |
Conversion of notes payable, Shares | ' | ' | 231,608,094 | ' | ' | ' |
Conversion of notes payable, Amount | ' | ' | 23,161 | 563,615 | ' | 586,776 |
Derivative Expense | ' | ' | ' | 731,266 | ' | 731,266 |
Conversion of preferred stock, Shares | ' | -4,962,505 | 142,653,320 | ' | ' | ' |
Conversion of preferred stock, Amount | ' | -4,963 | 14,265 | 4,948,237 | ' | 4,957,539 |
Imputed interest on shareholder notes | ' | ' | ' | 22,084 | ' | 22,084 |
Net Income (loss) | ' | ' | ' | ' | -4,301,095 | -4,301,095 |
Ending balance, Amount at Dec. 31, 2013 | 1 | 947 | 44,209 | 21,869,581 | -24,122,318 | -2,207,580 |
Ending balance, Shares at Dec. 31, 2013 | 1,000 | 947,498 | 442,085,940 | ' | ' | ' |
Common Stock Issued for Services, Shares | ' | ' | 44,192,158 | ' | ' | ' |
Common Stock Issued for Services, Amount | ' | ' | 4,419 | 108,180 | ' | 112,600 |
Common Stock Sales, Shares | ' | ' | 239,841,679 | ' | ' | ' |
Common Stock Sales, Amount | ' | ' | 23,984 | 263,826 | ' | 287,810 |
Conversion of notes payable, Shares | ' | ' | 744,557,582 | ' | ' | ' |
Conversion of notes payable, Amount | ' | ' | 74,456 | 514,814 | ' | 589,270 |
Derivative Expense | ' | ' | ' | 980,476 | ' | 980,476 |
Conversion of preferred stock, Shares | ' | -318,560 | 154,066,994 | ' | ' | ' |
Conversion of preferred stock, Amount | ' | -318 | 15,407 | 302,653 | ' | 317,742 |
Imputed interest on shareholder notes | ' | ' | ' | 1,849 | ' | 1,849 |
Net Income (loss) | ' | ' | ' | ' | -2,248,956 | -2,248,956 |
Ending balance, Amount at Mar. 31, 2014 | $1 | $629 | $162,474 | $24,041,379 | ($26,371,274) | ($2,166,791) |
Ending balance, Shares at Mar. 31, 2014 | 1,000 | 628,938 | 1,624,744,353 | ' | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | |
OPERATING ACTIVITIES | ' | ' | ' |
Net Loss | ($2,248,956) | ($383,589) | ($4,301,095) |
Adjustments to reconcile net loss to cash used by operating activitites: | ' | ' | ' |
Depletion, depreciation, and amortization | 81,310 | 49,980 | ' |
Accretion of asset retirement obligation | 4,195 | ' | ' |
Amortization of debt discount | 74,655 | ' | ' |
Derivative expense | 1,333,973 | 82,300 | ' |
Imputed interest on shareholder loans | 1,849 | ' | ' |
Penalty interest | ' | 45,250 | ' |
Common stock and warrants issued for services | 112,599 | 29,000 | ' |
Change in other asset and liabilities: | ' | ' | ' |
Decrease (Increase) in oil & gas receivables | 19,597 | -4,958 | ' |
Decrease (Increase) in other assets | ' | 3,237 | ' |
Increase in accounts payable | -30,948 | 2,681 | ' |
(Decrease) Increase in accrued liabilities | 31,748 | -69,959 | ' |
Increase (Decrease) in related party payable | -47,613 | ' | ' |
Decrease in asset retirement obligation | -97,855 | ' | ' |
Cash used in operating activities | -765,446 | -246,058 | ' |
INVESTING ACTIVITIES | ' | ' | ' |
Investment in oil & gas properties | -34,414 | ' | ' |
Proceeds from sale of equipment | 24,500 | ' | ' |
Purchase of other equipment | -4,375 | ' | ' |
Cash used in investing activities | -14,289 | ' | ' |
FINANCING ACTIVITIES | ' | ' | ' |
Bank overdraft | -36,940 | 65,849 | ' |
Proceeds from sales of common stock | 287,810 | 138,500 | ' |
Proceeds from notes payable | 653,483 | 25,000 | ' |
Payments on notes payable | -30,000 | ' | ' |
Increase in deposit to lender | -94,391 | ' | ' |
Cash from financing activities | 779,962 | 229,349 | ' |
Increase (Decrease) in cash | 227 | -16,709 | ' |
Cash at beginning of period | 105 | 17,089 | 17,089 |
Cash at end of period | 332 | 380 | 105 |
Non-Cash Investing and Financing Activities: | ' | ' | ' |
Notes Payable | -575,328 | -15,000 | ' |
Accrued liabilities | -13,942 | ' | ' |
Common Stock | 89,863 | 19,117 | ' |
Preferred Stock | -318 | -4,123 | ' |
Additional Paid-in Capital | 1,797,941 | 4,131,294 | ' |
Derivative liability | -980,475 | -8,300 | ' |
Common stock issuance liability | ($317,741) | ($4,122,988) | ' |
Incorporation_and_Nature_of_Op
Incorporation and Nature of Operations | 3 Months Ended |
Mar. 31, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Incorporation and Nature of Operations | ' |
1. INCORPORATION AND NATURE OF OPERATIONS | |
Petron Energy II, Inc. (“Petron” or the “Company”) was formerly known as Petron Energy Special Corp. and was incorporated in June 2007 under the laws of the State of Texas; and, on April 2011, was reincorporated in the state of Nevada. Pursuant to a Plan of Merger, the parent company, Petron Energy Special Corp. was merged into its wholly owned subsidiary, Petron Energy II, Inc. The surviving entity was Petron Energy II, Inc. The effective date of the Plan of Merger was January 3, 2012. | |
The Company is engaged primarily in the acquisition, development and production for and the sale of oil, gas and gas liquids in the United States. As of March 31, 2014 the Company is operating in the states of Texas and Oklahoma. In addition, the Company operates two gas gathering systems located in Tulsa, Wagoner, Rogers and Mayes counties of Oklahoma. The pipelines consist of approximately 132 miles of steel and poly pipe, a gas processing plant and other ancillary equipment. The Company sells its oil and gas products primarily to a domestic pipeline and to an oil company. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 3 Months Ended | |
Mar. 31, 2014 | ||
Accounting Policies [Abstract] | ' | |
Summary of Significant Accounting Policies | ' | |
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Basis of presentation | ||
The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries: | ||
Subsidiary Name | Organization Date | |
Petron Energy II Pipeline, Inc. | 1-Apr-08 | |
Petron Energy II Well Service, Inc. | 1-Jul-08 | |
The interim consolidated financial statements as of March 31, 2014 and 2013 have been prepared in accordance with generally accepted accounting principles for interim financial information. Accordingly, these consolidated financial statements do not include all of the disclosures required by generally accepted accounting principles for complete financial statements. These interim unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2013. In the opinion of management, the interim unaudited consolidated financial statements furnished herein include all adjustments, all of which are of a normal recurring nature, necessary for a fair statement of the results for the interim periods presented. | ||
The consolidated statements of operations and cash flows reflect the results of operations and the changes in cash flows of the Company for the three month period ended March 31, 2014 and 2013. Operating results for the three month period ended March 31, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. |
Subsequent_Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2014 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
3. SUBSEQUENT EVENTS | |
On April 25, 2014 the Company was notified by the SEC that its S-1 related to an Investment Agreement entered into with CP US Income Fund (“CPUS”) was effective. Under the terms of the Investment Agreement, we may, from time to time during the thirty-six (36) month period commencing from the effectiveness of the registration statement, deliver a drawdown notice to CPUS which states the dollar amount that we intend to sell to CPUS on a date specified in the put notice. The maximum investment amount per notice shall be no more than two hundred seventy five percent (275%) of the average daily volume of the common stock for the ten consecutive trading days immediately prior to date of the applicable put notice. The purchase price per share to be paid by CPUS shall be calculated at a thirty percent (30%) discount to the lowest closing price of the common stock during the ten (10) consecutive trading days immediately prior to the receipt by CPUS of the drawdown notice. CPUS must purchase the shares requested as long as their ownership in the Company is 4.99% or less The Company and CPUS must mutually agree to any purchase by CPUS which results in the ownership by CPUS of greater than 4.99% of the then issued and outstanding common stock of the Company. | |
In April 2014 the Texas Railroad Commission acknowledged the satisfactory completion of the plugging operations by the Company in Knox County, Texas. The Texas Railroad Commission had suspended the Company’s right to produce in Texas pending the completion of this plugging project. The Company expects to receive and complete the forms necessary to resume production operations in Texas in May and resume production activities in June. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended | |
Mar. 31, 2014 | ||
Accounting Policies [Abstract] | ' | |
Basis of Presentation | ' | |
Basis of presentation | ||
The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries: | ||
Subsidiary Name | Organization Date | |
Petron Energy II Pipeline, Inc. | 1-Apr-08 | |
Petron Energy II Well Service, Inc. | 1-Jul-08 | |
The interim consolidated financial statements as of March 31, 2014 and 2013 have been prepared in accordance with generally accepted accounting principles for interim financial information. Accordingly, these consolidated financial statements do not include all of the disclosures required by generally accepted accounting principles for complete financial statements. These interim unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2013. In the opinion of management, the interim unaudited consolidated financial statements furnished herein include all adjustments, all of which are of a normal recurring nature, necessary for a fair statement of the results for the interim periods presented. | ||
The consolidated statements of operations and cash flows reflect the results of operations and the changes in cash flows of the Company for the three month period ended March 31, 2014 and 2013. Operating results for the three month period ended March 31, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. |