Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 14, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | Citadel Exploration, Inc. | |
Entity Central Index Key | 1,482,075 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2016 | |
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 | 38,814,000 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,016 | |
Trading Symbol | coil |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash | $ 0 | $ 146,555 |
Other receivable | 6,450 | 19,342 |
Prepaid expenses | 71,446 | 29,870 |
Product inventory | 4,881 | 4,881 |
Total current assets | 82,777 | 200,648 |
Deposits | 9,900 | 9,900 |
Restricted cash | 245,000 | 245,000 |
Oil and gas properties, successful efforts basis | 6,131,040 | 4,173,307 |
Fixed asset, net | 8,248 | 13,860 |
Total assets | 6,476,965 | 4,642,715 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 1,970,245 | 1,047,169 |
Bank overdraft | 9,701 | 0 |
Accrued interest payable | 365,509 | 227,945 |
Notes payable, net | 543,582 | 525,034 |
Notes payable, related party, net | 0 | 3,500,000 |
Total current liabilities | 2,889,037 | 5,300,148 |
Asset retirement obligation | 215,452 | 198,279 |
Production payment liability | 300,000 | 300,000 |
Total liabilities | 3,404,489 | 5,798,427 |
Stockholders' equity (deficit): | ||
Common stock, $0.001 par value, 100,000,000 shares authorized, 39,314,000 and 38,814,000 shares issued and outstanding as of September 30, 2016 and December 31, 2015, respectively | 43,814 | 38,814 |
Series A Preferred stock | 5,455,000 | 0 |
Additional paid-in capital | 5,785,560 | 5,690,560 |
Accumulated deficit | (8,211,898) | (6,885,086) |
Total stockholders' equity (deficit) | 3,072,476 | (1,155,712) |
Total liabilities and stockholders' equity (deficit) | $ 6,476,965 | $ 4,642,715 |
CONSOLIDATED BALANCE SHEETS (U3
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, issued | 39,314,000 | 38,814,000 |
Common stock, outstanding | 39,314,000 | 38,814,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Income Statement [Abstract] | ||||
Revenue | $ 23,973 | $ 20,287 | $ 50,735 | $ 80,428 |
Operating expenses: | ||||
Lease operating expense | 73,721 | 80,878 | 183,805 | 107,040 |
General and administrative | 325,711 | 57,084 | 456,768 | 244,799 |
Depreciation, amortization and accretion | 6,513 | 4,646 | 15,665 | 12,316 |
Professional fees | 38,669 | 26,514 | 176,928 | 44,749 |
Executive compensation | 124,590 | 317,253 | 386,289 | 641,430 |
Dry hole, abandonment, impairment, and exploration | 0 | 1,433,570 | 0 | 1,433,570 |
Total operating expenses | 569,204 | 1,919,945 | 1,219,454 | 2,483,904 |
Loss from operations | (545,231) | (1,899,658) | (1,168,719) | (2,403,476) |
Other expenses: | ||||
Loss - Contingency | 0 | 0 | 0 | (87,000) |
Loss - note payable settlement | 0 | 0 | 0 | (26,080) |
Interest expense | (18,862) | (69,862) | (151,415) | (106,163) |
Total other expenses | (18,862) | (69,862) | (151,415) | (219,243) |
Loss before provision for income taxes | (564,094) | (1,969,586) | (1,320,133) | (2,622,719) |
Provision for income taxes | (6,679) | 0 | (6,679) | 0 |
Net loss | $ (570,773) | $ (1,969,586) | $ (1,326,812) | $ (2,622,719) |
Weighted average number of common shares - outstanding - basic and diluted | 39,221,609 | 34,937,077 | 38,950,861 | 33,338,309 |
Net loss per share - basic and diluted | $ (0.01) | $ (0.06) | $ (0.03) | $ (0.08) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
OPERATING ACTIVITIES | ||
Net loss | $ (1,326,812) | $ (2,622,719) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation, amortization and accretion | 15,665 | 12,316 |
Abandonment and impairment | 0 | 1,433,570 |
Amortization of debt discount | 1,832 | 5,217 |
Loss on settlement of note payable | 0 | 26,080 |
Stock based compensation expense | 0 | 264,692 |
Loss contingency | 0 | 87,000 |
Changes in operating assets and liabilities: | ||
Increase/(Decrease) in other receivable | 12,892 | (24,923) |
Decrease in prepaid expenses | (41,576) | (14,023) |
Increase in deposits | 0 | (161,191) |
Increase in accounts payable and accrued payables | 923,077 | 325,126 |
Increase in accrued interest payable | 137,564 | 133,594 |
Net cash used in operating activities | (277,358) | (535,261) |
INVESTING ACTIVITIES | ||
Oil and gas properties | (1,950,614) | (2,612,437) |
Net cash used in investing activities | (1,950,614) | (2,612,437) |
FINANCING ACTIVITIES | ||
Proceeds from sale of common stock, net of costs | 100,000 | 239,244 |
Proceeds from sale of preferred stock, net of costs | 1,955,000 | 0 |
Increase in bank overdraft | 9,701 | 0 |
Proceeds from notes payable | 68,736 | 3,000,000 |
Repayments of notes payable | (52,020) | (113,308) |
Net cash provided by financing activities | 2,081,417 | 3,125,936 |
NET DECREASE IN CASH | (146,555) | (21,762) |
CASH AT BEGINNING OF YEAR | 146,555 | 270,298 |
CASH AT END OF PERIOD | 0 | 248,536 |
SUPPLEMENTAL INFORMATION: | ||
Interest paid | 0 | (651) |
Income taxes paid | 6,679 | 0 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Issuance of preferred stock for settlement of note payable - related party | 3,500,000 | 0 |
Issuance of common stock for settlement of notes payable and accrued interest | $ 0 | $ 25,494 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The interim condensed consolidated financial statements included herein, presented in accordance with United States generally accepted accounting principles and stated in US dollars, have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management, are necessary for fair presentation of the information contained therein. It is suggested that these interim condensed consolidated financial statements be read in conjunction with the financial statements of the Company for the year ended December 31, 2015 and notes thereto included in the Company’s 10-K annual report and all amendments. The Company follows the same accounting policies in the preparation of interim reports. Results of operations for the interim period are not indicative of annual results. Principles of consolidation The condensed consolidated financial statements include the accounts of Citadel Exploration, Inc., Citadel Exploration, LLC and Citadel Kern Bluff, LLC, the Company’s wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated. Citadel Exploration, Inc., Citadel Exploration, LLC and Citadel Kern Bluff, LLC will be collectively referred herein to as the “Company”. Nature of operations Currently, the Company is focused on the acquisition and development of oil and gas properties in California. Revenue Recognition Sales of oil are recognized when the product has been delivered to a custody transfer point, persuasive evidence of a sales arrangement exists, the rights and responsibility of ownership pass to the purchaser upon delivery, collection of revenue from the sale is reasonably assured, and the sales price is fixed or determinable. Impairment The Company evaluates the impairment of its proved oil and natural gas properties on a field-by-field basis whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The carrying values of proved properties are reduced to fair value when the expected undiscounted future cash flows are less than net book value. The fair values of proved properties are measured using valuation techniques consistent with the income approach, converting future cash flows to a single discounted amount. Significant inputs used to determine the fair values of proved properties include estimates of: (i) reserves; (ii) future operating and development costs; (iii) future commodity prices; and (iv) a market-based weighted average cost of capital rate. Use of estimates The preparation of condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ significantly from those estimates. Fair value of financial instruments The carrying value of the Company’s financial instruments, including cash, due to shareholders/related parties and accounts and other payables approximate their fair values due to the immediate or short-term maturity of these instruments. It is management’s opinion that the Company is not exposed to significant interest, price or credit risks arising from these financial instruments. Cash and cash equivalents The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents. The Company had no cash equivalents as of September 30, 2016 and December 31, 2015. Earnings per share The Company follows ASC Topic 260 to account for the earnings per share. Basic earnings per common share (“EPS”) calculations are determined by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per common share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding. During periods when common stock equivalents, if any, are anti-dilutive they are not considered in the computation. Recent pronouncements The Company has evaluated the recent accounting pronouncements through September 30, 2016 and believes that none of them will have a material effect on the company’s condensed consolidated financial statements. |
GOING CONCERN
GOING CONCERN | 9 Months Ended |
Sep. 30, 2016 | |
Notes to Financial Statements | |
GOING CONCERN | NOTE 2 – GOING CONCERN The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the recoverability of assets and the satisfaction of liabilities in the normal course of business. Since its inception, the Company has been engaged substantially in financing activities and developing its business plan and incurring startup costs and expenses. As a result, the Company incurred an accumulated deficit in the amount of $8,211,898 as of September 30, 2016. In addition, the Company’s development activities since inception have been financially sustained through debt and equity financing. The ability of the Company to continue as a going concern is dependent upon its ability to raise additional capital from the sale of common stock and, ultimately, the achievement of significant operating revenues. These condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty. |
OIL AND GAS PROPERTIES
OIL AND GAS PROPERTIES | 9 Months Ended |
Sep. 30, 2016 | |
Extractive Industries [Abstract] | |
Disclosure - OIL AND GAS PROPERTIES | NOTE 3 – OIL AND GAS PROPERTIES Oil and natural gas properties, buildings and equipment consist of the following: September 30, 2016 (unaudited) December 31, 2015 (audited) Oil and Natural Gas: Proved properties $ 3,347,096 $ 1,734,223 Unproved properties 2,794,611 2,444,608 6,141,707 4,178,831 Less accumulated depreciation, depletion, and amortization (10,667 ) (5,524 ) $ 6,131,040 $ 4,173,307 |
RESTRICTED CASH
RESTRICTED CASH | 9 Months Ended |
Sep. 30, 2016 | |
Receivables [Abstract] | |
RESTRICTED CASH | NOTE 4 – RESTRICTED CASH Restricted cash consists of three bonds totaling $245,000. The bonds are required in the normal course of business in the oil and gas industry. The two bonds totaling $45,000 were purchased in November 2013. A third bond totaling $200,000 was purchased in August 2015 following the acquisition of the Kern Bluff Oil Field. This was a blanket bond, which will cover 50 wells. As such, the Company is in the process of releasing the first two bonds totaling $45,000. |
DEPOSITS
DEPOSITS | 9 Months Ended |
Sep. 30, 2016 | |
Banking and Thrift [Abstract] | |
DEPOSITS | NOTE 5 – DEPOSITS The Company had deposits at December 31, 2015 and September 30, 2016 totaling $9,900. |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Sep. 30, 2016 | |
Notes to Financial Statements | |
NOTES PAYABLE | NOTE 6 – NOTES PAYABLE Notes payable consists of the following: September 30, 2016 (unaudited) December 31, 2015 (unaudited) Note payable to an entity for the financing of insurance premiums, unsecured; 7.75% interest, due April 2017 $ 37,644 $ 17,263 Two notes payable to investors, unsecured, 10% interest; due March 31, 2017 $ 500,000 500,000 Debt discount for 500,000 warrants issued relating to notes payable 5,938 7,771 Notes Payable - Total $ 543,582 $ 525,034 Notes Payable, Related Party Term loan with a related party investor executed July 30, 2015, unsecured, 10% interest; due July 30, 2016 $ — 3,500,000 Total – Notes Payable & Notes Payable, Related Party $ 543,582 $ 4,025,034 During the quarter ended March 31, 2016, the Company converted the $3,500,000 related party note payable with 175,000 of preferred shares valued at $3,500,000. Interest expense on the note payable was $91,300. In March 2014, the Company closed on a $500,000 bridge loan from two individuals. These notes originally had a 180 day term and bear interest of 10%.The $500,000 of notes were due on October 31, 2015. Additionally, the investors received 500,000 warrants to purchase the Company’s stock at $0.34 per share for a term of two years. In September of 2016, the maturity date of this bridge loan was extended until March 31, 2017, in return the exercise price of the warrant was reduced to $0.20 and the term of the warrants also extended to until March 31, 2017. |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) | 9 Months Ended |
Sep. 30, 2016 | |
Notes to Financial Statements | |
STOCKHOLDERS' EQUITY (DEFICIT) | NOTE 7 – STOCKHOLDERS’ EQUITY (DEFICIT) The Company is authorized to issue 100,000,000 shares of its $0.001 par value common stock. In March of 2015, the Company approved the issuance of 1,400,000 common stock shares for the conversion of a $100,000 promissory note, plus accrued interest of $2,164 and an additional capital investment of $107,836, all at $0.15 per share. In March of 2015, the Company issued 25,000 shares of common stock to settle the stock payable of $2,250 recorded as of December 31, 2014. In July of 2015, the Company issued 6,000,000 shares of common stock and paid $1,900,000 in cash for the Kern Bluff Oil Field. The Company had paid a $100,000 deposit on the property in May of 2015, upon execution of a letter of intent (LOI) on the field. In March of 2016, the Company approved the issuance of up to 250,000 shares of Series A Convertible Participating Preferred Stock. The Company issued 175,000 shares of Series A Convertible Participating Preferred Stock to convert its $3,500,000 related party note payable to preferred stock. In addition, the Company has sold 21,250 shares of Series A Convertible Participating Preferred Stock for cash in the amount of $425,000 through March 31, 2016. In June of 2016, the Company sold 50,000 shares of Series A Convertible Participating Preferred Stock for cash in the amount of $1,000,000. In September of 2016, the Company sold 26,500 shares of Series A Convertible Participating Preferred Stock for cash in the amount of $530,000. The Company issued 500,000 shares of common stock for cash in the amount of $100,000. |
STOCK OPTION PLAN
STOCK OPTION PLAN | 9 Months Ended |
Sep. 30, 2016 | |
Notes to Financial Statements | |
STOCK OPTION PLAN | NOTE 8 – STOCK OPTION PLAN Under the Stock Option Plan approved by Board of Directors on September 1, 2012 (the “2012 Stock Option”), the Company issued $264,494 worth of stock based compensation, or a total of 4,800,000 shares of options through December 31, 2014 expense. On July 29, 2015 as approved by the Board of Directors, the Company granted 4,700,000 stock options to three members of management and to one member of the Board of Directors. These options vest over a three year period, at $0.15 per share for a term of seven years. The total fair value of these options at the date of grant was estimated to be $376,490 and was determined using the Black Scholes option pricing model with an expected life of 7 years, risk free interest rate of 1.872%, dividend yield of 0%, and expected volatility of 333%. During the 3 month period ended September 30, 2015, $152,198 was recorded as a stock based compensation expense. The following is a summary of the status of all of the Company’s stock options as of September 30, 2016 and changes during the period ended on that date: Number of Options Weighted-Average Exercise Price Weighted-Average Remaining Life (Years) Outstanding at January 1, 2016 9,500,000 $ 0.20 4.51 — $ — — Exercised — $ — — Cancelled — $ — — Outstanding at September 30, 2016 9,500,000 $ 0.20 4.51 Exercisable at September 30,2016 7,533,000 $ 0.20 4.22 |
WARRANTS
WARRANTS | 9 Months Ended |
Sep. 30, 2016 | |
Notes to Financial Statements | |
WARRANTS | NOTE 9 – WARRANTS In September of 2014, the 500,000 warrants issued on November 15, 2012 and 100,000 warrants issued in September 2013 were exercised early at a reduced price of $0.34 per share. The following is a summary of the status of all of the Company’s stock warrants as of September 30, 2016 and changes during the period ended on that date: Number of Warrants Weighted-Average Exercise Price Weighted-Average Remaining Life (Years) Outstanding at January 1, 2016 500,000 $ 0.20 0.50 Granted — $ 0.00 — Exercised — $ 0.00 — Cancelled — $ 0.00 — Total Outstanding at September 30, 2016 500,000 $ 0.20 0.50 Exercisable at September 30, 2016 500,000 $ 0.20 0.50 |
OTHER LIABILITIES
OTHER LIABILITIES | 9 Months Ended |
Sep. 30, 2016 | |
Other Liabilities Disclosure [Abstract] | |
OTHER LIABILITIES | NOTE 10 – OTHER LIABILITIES In October of 2015, the company entered into a summary judgement with the County of San Benito to pay $262,500 in related costs regarding the Center for Biological Diversity litigation. The company is required to pay $25,000 per quarter beginning with the quarter ended September 30, 2016 through quarter ended December 31, 2017 and a lump sum payment of the remaining balance in the first quarter of 2018. The Company made its first quarterly payment on September 26, 2016 in the amount of $25,000. |
SUMMARY OF SIGNIFICANT ACCOUN16
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The interim condensed consolidated financial statements included herein, presented in accordance with United States generally accepted accounting principles and stated in US dollars, have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management, are necessary for fair presentation of the information contained therein. It is suggested that these interim condensed consolidated financial statements be read in conjunction with the financial statements of the Company for the year ended December 31, 2015 and notes thereto included in the Company’s 10-K annual report and all amendments. The Company follows the same accounting policies in the preparation of interim reports. Results of operations for the interim period are not indicative of annual results. |
Principles of consolidation | Principles of consolidation The condensed consolidated financial statements include the accounts of Citadel Exploration, Inc., Citadel Exploration, LLC and Citadel Kern Bluff, LLC, the Company’s wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated. Citadel Exploration, Inc., Citadel Exploration, LLC and Citadel Kern Bluff, LLC will be collectively referred herein to as the “Company”. |
Nature of operations | Nature of operations Currently, the Company is focused on the acquisition and development of oil and gas properties in California. |
Revenue recognition | Revenue Recognition Sales of oil are recognized when the product has been delivered to a custody transfer point, persuasive evidence of a sales arrangement exists, the rights and responsibility of ownership pass to the purchaser upon delivery, collection of revenue from the sale is reasonably assured, and the sales price is fixed or determinable. |
Impairment | Impairment The Company evaluates the impairment of its proved oil and natural gas properties on a field-by-field basis whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The carrying values of proved properties are reduced to fair value when the expected undiscounted future cash flows are less than net book value. The fair values of proved properties are measured using valuation techniques consistent with the income approach, converting future cash flows to a single discounted amount. Significant inputs used to determine the fair values of proved properties include estimates of: (i) reserves; (ii) future operating and development costs; (iii) future commodity prices; and (iv) a market-based weighted average cost of capital rate. |
Use of estimates | Use of estimates The preparation of condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ significantly from those estimates. |
Fair value of financial instruments | Fair value of financial instruments The carrying value of the Company’s financial instruments, including cash, due to shareholders/related parties and accounts and other payables approximate their fair values due to the immediate or short-term maturity of these instruments. It is management’s opinion that the Company is not exposed to significant interest, price or credit risks arising from these financial instruments. |
Cash and Cash Equivalents | Cash and cash equivalents The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents. The Company had no cash equivalents as of September 30, 2016 and December 31, 2015. |
Earnings per share | Earnings per share The Company follows ASC Topic 260 to account for the earnings per share. Basic earnings per common share (“EPS”) calculations are determined by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per common share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding. During periods when common stock equivalents, if any, are anti-dilutive they are not considered in the computation. |
Recent pronouncements | Recent pronouncements The Company has evaluated the recent accounting pronouncements through September 30, 2016 and believes that none of them will have a material effect on the company’s condensed consolidated financial statements. |
OIL AND GAS PROPERTIES, BUILDIN
OIL AND GAS PROPERTIES, BUILDINGS AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Extractive Industries [Abstract] | |
The costs capitalized in oil and gas properties | Oil and natural gas properties, buildings and equipment consist of the following: September 30, 2016 (unaudited) December 31, 2015 (audited) Oil and Natural Gas: Proved properties $ 3,347,096 $ 1,734,223 Unproved properties 2,794,611 2,444,608 6,141,707 4,178,831 Less accumulated depreciation, depletion, and amortization (10,667 ) (5,524 ) $ 6,131,040 $ 4,173,307 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Notes to Financial Statements | |
Notes payable consists of the following at: | Notes payable consists of the following: September 30, 2016 (unaudited) December 31, 2015 (unaudited) Note payable to an entity for the financing of insurance premiums, unsecured; 7.75% interest, due April 2017 $ 37,644 $ 17,263 Two notes payable to investors, unsecured, 10% interest; due March 31, 2017 $ 500,000 500,000 Debt discount for 500,000 warrants issued relating to notes payable 5,938 7,771 Notes Payable - Total $ 543,582 $ 525,034 Notes Payable, Related Party Term loan with a related party investor executed July 30, 2015, unsecured, 10% interest; due July 30, 2016 $ — 3,500,000 Total – Notes Payable & Notes Payable, Related Party $ 543,582 $ 4,025,034 |
STOCK OPTION PLAN (Tables)
STOCK OPTION PLAN (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Notes to Financial Statements | |
Summary of the status of all of the Company's stock options | The following is a summary of the status of all of the Company’s stock options as of September 30, 2016 and changes during the period ended on that date: Number of Options Weighted-Average Exercise Price Weighted-Average Remaining Life (Years) Outstanding at January 1, 2016 9,500,000 $ 0.20 4.51 — $ — — Exercised — $ — — Cancelled — $ — — Outstanding at September 30, 2016 9,500,000 $ 0.20 4.51 Exercisable at September 30,2016 7,533,000 $ 0.20 4.22 |
WARRANTS (Tables)
WARRANTS (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Notes to Financial Statements | |
Summary of the status of all of the Company's stock warrants | The following is a summary of the status of all of the Company’s stock warrants as of September 30, 2016 and changes during the period ended on that date: Number of Warrants Weighted-Average Exercise Price Weighted-Average Remaining Life (Years) Outstanding at January 1, 2016 500,000 $ 0.20 0.50 Granted — $ 0.00 — Exercised — $ 0.00 — Cancelled — $ 0.00 — Total Outstanding at September 30, 2016 500,000 $ 0.20 0.50 Exercisable at September 30, 2016 500,000 $ 0.20 0.50 |
SUMMARY OF SIGNIFICANT ACCOUN21
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Accounting Policies [Abstract] | ||
Cash equivalents | $ 0 | $ 0 |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Notes to Financial Statements | ||
Accumulated deficit | $ (8,211,898) | $ (6,885,086) |
OIL AND GAS PROPERTIES, BUILD23
OIL AND GAS PROPERTIES, BUILDINGS AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Oil and Natural Gas: | ||
Proved properties | $ 3,347,096 | $ 1,734,223 |
Unproved properties | 2,794,611 | 2,444,608 |
Oil and Natural Gas Total | 6,141,707 | 4,178,831 |
Less accumulated depreciation, depletion, and amortization | (7,757) | (5,524) |
Oil and Natural Gas, Net | $ 6,131,040 | $ 4,173,307 |
DEPOSITS (Details Narrative)
DEPOSITS (Details Narrative) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Banking and Thrift [Abstract] | ||
Company Deposit | $ 9,900 | $ 9,900 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Notes Payable Details Narrative | ||
Note payable to an entity for the financing of insurance premiums, unsecured; 7.75% interest, due April 2017 | $ 37,644 | $ 17,263 |
Two notes payable to investors, unsecured, 10% interest; due March 31, 2017 | 500,000 | 500,000 |
Debt discount for 500,000 warrants issued relating to notes payable | 5,938 | 7,771 |
Notes payable | 543,582 | 525,034 |
Notes payable, related party, net | 0 | 3,500,000 |
Total - Notes Payable & Notes Payable, Related Party | $ 564,202 | $ 4,025,034 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Notes to Financial Statements | |
Interest expense on note payable | $ 91,300 |
STOCK OPTION PLAN (Details)
STOCK OPTION PLAN (Details) | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Number of Options | |
Outstanding at January 1, 2016 | shares | 9,500,000 |
Exercised | shares | 0 |
Cancelled | shares | 0 |
Outstanding at September 30, 2016 | shares | 9,500,000 |
Exercisable at September 30, 2016 | shares | 7,533,000 |
Weighted-Average Exercise Price | |
Outstanding at January 1, 2016 | $ / shares | $ 0.2 |
Exercised | $ / shares | 0 |
Cancelled | $ / shares | 0 |
Outstanding at September 30, 2016 | $ / shares | 0.2 |
Exercisable at September 30, 2016 | $ / shares | $ 0.2 |
Weighted-Average Remaining Life (Years) | |
Outstanding at January 1, 2016 | 4 years 6 months 4 days |
Outstanding at September 30, 2016 | 4 years 6 months 4 days |
Exercisable at September 30, 2016 | 4 years 2 months 19 days |
STOCK OPTION PLAN (Details Narr
STOCK OPTION PLAN (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | |
Notes to Financial Statements | |||
Stock based compensation | $ 152,198 | $ 0 | $ 264,692 |
Options vest per share | $ 0.15 | ||
Fair value of Options | $ 376,490 | $ 376,490 | |
Expected life | 7 years | ||
Risk free interest rate | 1.872% | ||
Dividend yield | 0.00% | ||
Expected volatility | 333.00% |
WARRANTS (Details)
WARRANTS (Details) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | Sep. 30, 2016$ / sharesshares | |
Number of Warrants | ||
Outstanding at January 1, 2016 | shares | 9,500,000 | |
Exercised | shares | 0 | |
Cancelled | shares | 0 | |
Outstanding at September 30, 2016 | shares | 9,500,000 | 9,500,000 |
Exercisable at September 30, 2016 | shares | 7,533,000 | 7,533,000 |
Weighted-Average Exercise Price | ||
Outstanding at January 1, 2016 | $ 0.2 | |
Granted | $ 0.15 | |
Exercised | 0 | |
Cancelled | 0 | |
Outstanding at September 30, 2016 | 0.2 | 0.2 |
Exercisable at September 30, 2016 | $ 0.2 | $ 0.2 |
Weighted-Average Remaining Life (Years) | ||
Outstanding at January 1, 2016 | 4 years 6 months 4 days | |
Outstanding at September 30, 2016 | 4 years 6 months 4 days | |
Exercisable at September 30, 2016 | 4 years 2 months 19 days | |
Warrant [Member] | ||
Number of Warrants | ||
Outstanding at January 1, 2016 | shares | 500,000 | |
Granted | shares | 0 | |
Exercised | shares | 0 | |
Cancelled | shares | 0 | |
Outstanding at September 30, 2016 | shares | 500,000 | 500,000 |
Exercisable at September 30, 2016 | shares | 500,000 | 500,000 |
Weighted-Average Exercise Price | ||
Outstanding at January 1, 2016 | $ 0.20 | |
Granted | 0 | |
Exercised | 0 | |
Cancelled | 0 | |
Outstanding at September 30, 2016 | $ 0.20 | 0.20 |
Exercisable at September 30, 2016 | $ 0.20 | $ 0.20 |
Weighted-Average Remaining Life (Years) | ||
Outstanding at January 1, 2016 | 6 months | |
Outstanding at September 30, 2016 | 6 months | |
Exercisable at September 30, 2016 | 6 months |