Graphene & Solar Technologies Limited (GSTX) 10-K 5 Jan 15 2014 FY Annual report Financial data

Document_and_Entity_Informatio

Document and Entity Information (USD $)	12 Months Ended
	Sep. 30, 2014	Dec. 15, 2014	Mar. 31, 2014
Document And Entity Information
Entity Registrant Name	Vanguard Energy Corp
Entity Central Index Key	1497649
Document Type	10-K
Document Period End Date	30-Sep-14
Amendment Flag	FALSE
Current Fiscal Year End Date	-21
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 Public Float			$996,000
Entity Common Stock, Shares Outstanding		975,623
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2014

CONSOLIDATED_BALANCE_SHEETS

CONSOLIDATED BALANCE SHEETS (USD $)	Sep. 30, 2014	Sep. 30, 2013
Statement of Financial Position [Abstract]
Cash and cash equivalents	$39,251	$1,334,285
Accounts receivable	0	371,765
Other assets	12,500	16,055
Total current assets	51,751	1,722,105
Property and equipment - Oil and gas, on the basis of full cost accounting
Proved properties	0	12,994,766
Unproved properties and properties under development, not being amortized	0	61,470
Furniture and equipment	0	26,946
Less: accumulated depreciation, depletion and amortization	0	-6,594,081
Total property and equipment	0	6,489,101
Debt issuance costs	83,654	538,700
Other assets	0	10,808
Total assets	135,405	8,760,714
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Accounts payable	578	113,314
Accrued interest payable	702,901	309,544
Other liabilities	8,600	12,650
Current portion of notes payable, net of discount of $71,750 and $0	2,923,040	0
Total current liabilities	3,635,119	435,508
Notes payable, net of discount of $0 and $441,132	0	7,813,368
Participation liability	0	465,551
Asset retirement obligations	0	177,685
Total liabilities	3,635,119	8,892,112
Commitments and contingencies
Stockholders' deficit
Preferred stock, $0.00001 par value; 5,000,000 shares authorized, none issued or outstanding	0	0
Common stock, $0.00001 par value; 100,000,000 and 50,000,000 shares authorized at September 20, 2014 and 2013 respectively, 115,243 and 12,741,512 shares issued and outstanding at September 30, 2014 and 2013, respectively	127	127
Additional paid-in capital	5,522,204	5,522,204
Accumulated deficit	-9,022,045	-5,653,729
Total stockholders' deficit	-3,499,714	-131,398
Total liabilities and stockholders' deficit	$135,405	$8,760,714

CONSOLIDATED_BALANCE_SHEETS_Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Sep. 30, 2014	Sep. 30, 2013
Statement of Financial Position [Abstract]
Discount on Note Payable Current portion	$71,754	$0
Discount on Note Payable	$0	$441,132
Stockholders' equity
Preferred stock, par value	$0.00	$0.00
Preferred stock, authorized shares	5,000,000	5,000,000
Preferred stock, issued shares	0	0
Preferred stock, outstanding shares	0	0
Common stock, par value	$0.00	$0.00
Common stock, authorized shares	100,000,000	100,000,000
Common stock, issued shares	115,243	115,243
Common stock, outstanding shares	115,243	115,243

CONSOLIDATED_STATEMENTS_OF_OPE

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Revenues
Oil and gas sales	$1,676,231	$4,644,356
Costs and expenses
Lease operating expense	544,045	714,669
Production taxes	77,253	214,127
Depreciation, depletion and amortization	984,200	1,850,814
Impairment of oil and gas properties	861,579	3,634,312
Asset retirement obligation accretion	29,088	23,186
General and administrative	904,414	1,373,122
Total costs and expenses	3,400,579	7,810,230
Loss from operations	-1,724,348	-3,165,874
Other income (expense)
Other income	2,645	7,386
Interest income	233	1,340
Gain on settlement of participation liability	171,772	0
Interest expense	-1,458,898	-1,864,379
Change in fair value of warrant and conversion feature liabilities	0	652,765
Change in estimate of participation liability	0	969,731
Other equipment write-off	20,819	0
Loss on debt extinguishment	-380,539	0
Total other expense	-1,643,968	-233,157
Loss before income taxes	-3,368,316	-3,399,031
Provision for income taxes	0	0
Net loss	($3,368,316)	($3,399,031)
Loss per share - Basic and diluted	($26.68)	($26.74)
Weighted average number of common shares	125,130	127,114

CONSOLIDATED_STATEMENTS_OF_CAS

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Cash flows from operating activities:
Net loss	($3,368,316)	($3,399,031)
Adjustments to reconcile net loss to net cash from operating activities:
Depreciation, depletion and amortization	941,294	1,850,814
Impairment of Oil and Gas Properties	861,579	3,634,312
Amortization of debt issuance costs	274,740	318,712
Gain on settlement of participation liability	-171,772	0
Loss on debt extinguishment	380,539	0
Asset retirement obligation accretion	29,088	81,275
Amortization of debt discount	169,145	272,200
Accretion of participation liability	-63,160	-138,323
Other equipment write-off	20,819	0
Change in estimate of participation liability	0	-969,731
Change in fair value of warrant and conversion feature liabilities	0	-652,765
Change in operating assets and liabilities:
Accounts receivable	343,194	243,866
Other assets	14,363	-5,161
Accounts payable	-112,736	-284,967
Accrued interest payable	393,357	0
Other liabilities	-4,050	-22,518
Net cash from operating activities	-291,916	928,683
Cash flows from investing activities
Capital expenditures on oil and gas properties	-1,012,793	-2,357,368
Proceeds from sale of oil and gas properties	5,500,000	0
Purchase of furniture and equipment	0	-2,452
Net cash from investing activities	4,487,207	-2,359,820
Cash flows from financing activities
Proceeds from issuance (repayment) of notes payable	-5,259,706	-325,000
Settlement of participation liability	-230,619	0
Net cash from financing activities	-5,490,325	-325,000
Net change in cash and cash equivalents	-1,295,034	-1,756,137
Cash and cash equivalents Beginning of period	1,334,285	3,090,422
Cash and cash equivalents End of period	$39,251	$1,334,285

CONSOLIDATED_STATEMENTS_OF_CHA

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT (USD $)	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total
Beginning Balance, Amount at Sep. 30, 2012	$127	$5,522,204	($2,254,698)	$3,267,633
Beginning Balance, Shares at Sep. 30, 2012	127,114
Net loss			-3,399,031	-3,399,031
Ending Balance, Amount at Sep. 30, 2013	127	5,522,204	-5,653,729	-131,398
Beginning Balance, Shares at Sep. 30, 2013	127,114
Return of common stock	-11,871
Net loss			-3,368,316	-3,368,316
Ending Balance, Amount at Sep. 30, 2014	$127	$5,522,204	($9,022,045)	($3,499,714)
Ending Balance, Shares at Sep. 30, 2014	115,243

1_ORGANIZATION

1. ORGANIZATION	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
1. ORGANIZATION	Vanguard Energy Corporation (the "Company") was organized under the laws of the State of Colorado on June 21, 2010. The Company commenced operations on July 19, 2010 and has been engaged in the acquisition, development and operation of onshore oil and gas properties in Texas.
	Going Concern –These financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses since its inception and will require capital for future operating activities to take place. The Company's ability to raise funding through the future issuances of debt or common stock is unknown. The obtainment of additional financing, the successful development of a plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern.
	Future issuances of the Company's equity or debt securities will be required in order for the Company to finance operations and continue as a going concern. The financial statements do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

2_SUMMARY_OF_SIGNIFICANT_ACCOU

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Principles of Consolidation and Basis of Presentation— The consolidated financial statements include the accounts of Vanguard Energy Corporation and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
	The Company's fiscal year-end is September 30. The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and pursuant to the accounting and disclosure rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). A summary of the significant accounting policies applied in the preparation of the accompanying financial statements follows
	Reclassifications – Certain amounts previously presented for prior periods have been reclassified to conform to the current presentation. The reclassifications had no effect on net loss, working capital or equity previously reported.
	Recently Issued Accounting Pronouncements – Various accounting standards updates have been recently issued, most of which represented technical corrections to the accounting literature or were applicable to specific industries. No new accounting pronouncements have been issued that are likely to have a material impact to the Company’s consolidated financial statements.
	Cash and Cash Equivalents—The Company considers all highly liquid instruments purchased with a maturity date of three months or less to be cash equivalents.
	Oil and Gas Properties— As of September 30, 2014 the Company does not have any oil and gas properties as further explained in Note 3. Prior to the disposal of its oil and gas properties, the Company followed the full cost accounting method to account for oil and natural gas properties.  Under the full cost accounting method, costs incurred in the acquisition, exploration and development of oil and gas reserves are capitalized. Such costs include lease acquisition, geological and geophysical activities, rentals on nonproducing leases, drilling, completing and equipping of oil and gas wells and administrative costs directly attributable to those activities and asset retirement costs. Disposition of oil and gas properties are accounted for as a reduction of capitalized costs, with no gain or loss recognized unless such adjustment would significantly alter the relationship between capital costs and proved reserves of oil and gas, in which case the gain or loss is recognized to  operations.
	The capitalized costs of oil and gas properties, excluding unevaluated and unproved properties, are amortized as depreciation, depletion and amortization expense using the units-of-production method based on estimated proved recoverable oil and gas reserves.
	The costs associated with unevaluated and unproved properties, initially excluded from the amortization base, relate to unproved leasehold acreage, wells and production facilities in progress and wells pending determination of the existence of proved reserves, together with capitalized interest costs for these projects. Unproved leasehold costs are transferred to the amortization base with the costs of drilling the related well once a determination of the existence of proved reserves has been made or upon impairment of a lease. Costs associated with wells in progress and completed wells that have yet to be evaluated are transferred to the amortization base once a determination is made whether or not proved reserves can be assigned to the property. Costs of dry wells are transferred to the amortization base immediately upon determination that the well is unsuccessful.
	All items classified as unproved property are assessed on a quarterly basis for possible impairment or reduction in value. Properties are assessed on an individual basis or as a group if properties are individually insignificant. The assessment includes consideration of various factors, including, but not limited to, the following: intent to drill; remaining lease term; geological and geophysical evaluations; drilling results and activity; assignment of proved reserves; and economic viability of development if proved reserves are assigned. During any period in which these factors indicate an impairment, the cumulative drilling costs incurred to date for such property and all or a portion of the associated leasehold costs are transferred to the full cost pool and become subject to amortization.
	Under full cost accounting rules for each cost center, capitalized costs of evaluated oil and gas properties, including asset retirement costs, less accumulated amortization and related deferred income taxes, may not exceed an amount (the "cost ceiling") equal to the sum of (a) the present value of future net cash flows from estimated production of proved oil and gas reserves, based on current prices and operating conditions, discounted at ten percent (10%), plus (b) the cost of properties not being amortized, plus (c) the lower of cost or estimated fair value of any unproved properties included in the costs being amortized, less (d) any income tax effects related to differences between the book and tax basis of the properties involved. If capitalized costs exceed this limit, the excess is charged to operations.  For purposes of the ceiling test calculation, current prices are defined as the unweighted arithmetic average of the first day of the month price for each month within the 12 month period prior to the end of the reporting period.  Prices are adjusted for basis or location differentials.  Unless sales contracts specify otherwise, prices are held constant for the productive life of each well.  Similarly, current costs are assumed to remain constant over the entire calculation period.
	During the fourth quarter of fiscal year 2013 and based on the October 1, 2013 Reserve Report, the cost ceiling analysis established that the Company’s proved properties required the recording of an impairment reduction. The Company recorded an impairment expense of $3,634,312 as a result of reductions in estimated proved reserves.  Revised calculations of proved reserves were based on detailed analysis of producing formations drive systems and declines in production from certain wells at a greater rate than previously experienced. The interpretation of 3D seismic during the fiscal fourth quarter of 2013 provided additional input and helped delineate the field more precisely, resulting in limiting the estimates of remaining recoverable oil. The production declines resulted in greater DD&A expense of $919,313 during the fourth quarter.  These adjustments were offset somewhat by a reduction in the Participation Liability of $969,731 resulting from lower estimated net cash flows from certain wells in which outside parties had a 20% net profits interest.
	As discussed in Note 3, the Company recognized impairment charges of $861,579 during fiscal year 2014 for the amount by which the carrying value of its oil and gas properties exceeded the estimated net proceeds from their sale.
	Revenue Recognition—Oil and gas sales result from undivided interests held by the Company in oil and gas properties. Sales of oil and gas produced from oil and gas operations are recognized when the product is delivered to the purchaser and title transfers to the purchaser. The Company had no natural gas sales imbalance positions at September 30, 2014 or 2013. Charges for gathering and transportation are included in production expenses.
	Asset Retirement Obligations—The Company recorded a liability for asset retirement obligations ("ARO") associated with its oil and gas wells when those assets are placed in service. The corresponding cost is capitalized as an asset and included in the carrying amount of oil and gas properties and is depleted over the useful life of the properties. Subsequently, the ARO liability is accreted to its then-present value.  Since the Company sold all its oil and gas assets in the 3rd quarter of 2014, no additional ARO was recorded.  As of September 30, 2014 the Company did not have an ARO liability.
	Capitalized Interest—Interest is capitalized as part of the historical cost of developing and constructing assets for significant projects. Significant oil and gas investments in unproved properties, significant exploration and development projects for which depreciation, depletion and amortization expense is not currently recognized, and exploration or development activities that are in progress qualify for interest capitalization. Interest is capitalized until the asset is ready for service. Capitalized interest is determined by multiplying the Company's weighted-average borrowing cost on debt by the average amount of qualifying costs incurred. Once an asset subject to interest capitalization is completed and placed in service, the associated capitalized interest is expensed through depletion or impairment, along with other capitalized costs related to that asset.
	Debt Issuance Costs—Costs incurred in connection with the issuance of long-term debt are capitalized and amortized over the term of the related debt.
	Participation Liability—In prior periods the Company recognized a participation liability related to a net profits interest granted to persons who purchased the Company’s 2010 Convertible Promissory Notes.  The net profits interest was held by Vanguard Net Profits, LLC and covered some of the Company’s oil and gas properties.  On June 17, 2014, the Company settled the net profits interests for $230,619.  The Company recognized a gain on the settlement of the participation liability of $171,772 during the quarter ended June 30, 2014 as a result.
	The Company incurred expense associated with the net profits interest during the nine-month period ended June 30, 2014 of fiscal year 2014.  This amount is reported as interest expense in the consolidated statement of operations.  The Company also made a final payment of $84,577 under this arrangement during year ended September 30, 2014.
	Conversion Feature Liability and Warrant Liabilities—The conversion feature liability and warrant liabilities are recorded at fair value based upon valuation models utilizing relevant factors such as expected life, estimated volatility, risk-free interest and expected dividend rate. Changes in the fair value of these liabilities are reported in the statements of operations.
	Stock-Based Compensation—The Company accounts for employee stock-based compensation using the fair value method. The fair value attributable to stock options is calculated based on the Black-Scholes option pricing model and is amortized to expense over the service period which is equivalent to the time required to vest the stock options.
	Income Taxes—Income taxes are provided based on the liability method for financial reporting purposes. Under this method deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred income tax assets to the amount expected to be realized.
	Uncertain tax positions are recognized in the financial statements only if that position is more likely than not of being sustained upon examination by taxing authorities, based on the technical merits of the position. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense.
	The Company is required to file federal income tax returns in the United States and in various state and local jurisdictions. The Company's tax returns filed since inception are subject to examination by taxing authorities in the jurisdictions in which it operates in accordance with the normal statutes of limitations in the applicable jurisdiction.
	Earnings (Loss) Per Share—Basic earnings (loss) per share have been calculated based upon the weighted-average number of common shares outstanding. The weighted-average number of common shares outstanding used in the computations of earnings (loss) per share was 125,425 for 2014 and 127,415 for 2013. The calculation of diluted weighted-average shares outstanding for 2014 and 2013 excludes 162,142 shares and 176,110 shares, respectively, issuable pursuant to outstanding warrants, stock options and debt conversion features because their effect is anti-dilutive.
	Concentration of Credit Risk—The Company is subject to credit risk resulting from the concentration of its oil and natural gas receivables with significant purchasers. One purchaser accounted for all of the Company's oil and gas sales revenues for 2014 and 2013. The Company does not require collateral. While the Company believes its recorded receivable will be collected, in the event of default the Company would follow normal collection procedures. The Company does not believe the loss of this purchaser would materially impact its operating results as oil and gas are fungible products with well-established markets and numerous purchasers.
	At times, the Company would maintain deposits in federally insured financial institutions in excess of federally insured limits. Management would monitor the credit ratings and concentration of risk with these financial institutions on a continuing basis to safeguard cash deposits.
	Fair Value Measurements—The carrying value of cash and cash equivalents, accounts receivable, and accounts payable, as reflected in the balance sheets, approximate fair value because of the short-term maturity of these instruments. The estimated fair value of long-term debt was determined by discounting future cash flows using rates currently available to the Company for debt with similar terms and remaining maturities. The Company calculated that the estimated fair value of the long term debt is not significantly different than the carrying value of the debt. The participation liability associated with outstanding long-term debt was determined by utilizing a present value factor of 10 applied to proved developed reserves associated with the wells drilled with the proceeds of the notes.
	Fair value is defined as the price that would be received to sell an asset or price paid to transfer a liability in an orderly transaction between market participants at the measurement date. Inputs used in determining fair value are classified for disclosure purposes according to a hierarchy that prioritizes those inputs based upon the degree to which they are observable. The three levels of the fair-value-measurement hierarchy are as follows:
	●	Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
	●	Level 2—Inputs that reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the asset or the liability; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.
	●	Level 3—Unobservable inputs reflecting the Company's own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.
	In determining fair value, the Company utilizes observable market data when available, or models that incorporate observable market data. In addition to market information, the Company incorporates transaction-specific details that, in management's judgment, market participants would take into account in measuring fair value. The Company utilizes the most observable inputs available for the valuation technique employed. If a fair value measurement reflects inputs at multiple levels within the hierarchy, the fair-value measurement of both financial and nonfinancial assets and liabilities are characterized based upon the lowest level of input that is significant to the fair value measurement.

3_SALE_OF_OIL_AND_GAS_PROPERTI

3. SALE OF OIL AND GAS PROPERTIES/ PAYMENT OF CONVERTIBLE NOTES	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
3. OIL AND GAS PROPERTIES	During 2012, the Company sold $8,254,500 of Convertible Promissory Notes.  On March 31, 2014 the Company failed to make the scheduled interest payments on the notes.  As a result, the note holders were entitled to declare the notes in default, in which case the principal amount of the notes plus all accrued and unpaid interest would be immediately due and payable.
	The Company’s inability to make the interest payment to the note holders was the result of the expenditure of considerable capital to work over some of the Company’s wells.  The costs of the work far exceeded the Company’s expectations and yet the work was required in order to get the wells back into production.  This depleted the Company’s cash position far below its expectations.  Further, although the initial work on those wells was successful in boosting production momentarily, further complications resulted in lower production than anticipated, which was not adequate to replenish the cash expended and enable the Company to make required interest payments.
	With a view to paying its note holders, the Company, on June 17, 2014 sold its oil and gas properties to Vast Exploration, Inc. for $5,500,000, after obtaining approvals from the holders of a majority of the Company’s outstanding shares of common stock and approvals of a majority of note holders.  An impairment charge of $880,213 was recognized during the quarter ended March 31, 2014 for the amount by which the carrying value of the Company’s oil and gas properties exceeded the estimated net proceeds from the planned sale.  The Company adjusted the impairment charge by $(18,634) during the quarter ended June 30, 2014 based on final closing of the transaction. The total impairment as of September 30, 2014 is $861,579.
	The Company used the proceeds from the sale as follows:
	Pay holders of the convertible notes	$	5,259,706
	Purchase the net profits interest held by Vanguard Net Profits, LLC		230,619
	Pay legal and closing costs		9,675
		$	5,500,000
	A loss on early extinguishment of debt totaling $380,539 was recognized during the quarter ended June 30, 2014 for the write-off of a portion of the debt issuance costs and debt issuance discount associated with the debt repayment.  After the payment of the $5,259,706, convertible notes totaling $2,994,794 remain to be paid together with accrued interest of $702,902.  As of September 30, 2014 the unamortized discount on the convertible notes totaled $71,754. Interest expense for the amortization of debt issuance cost and discount on the notes for the period ending September 30, 2014 was $445,078.  The effective interest rate of the convertible notes was 28.3% for the fiscal years ending September 30, 2014 and 2013.
	In consideration for accepting less than the full amount due on the notes, and releasing their lien on the Company’s oil and gas properties, holders of notes in the approximated principal of amount of $2,404,197 as a group, have agreed to received 860,381 shares in the Company’s stock in payment of the remaining balances on their notes, plus accrued interest. The Company subsequently issued the additional shares as payment for the notes and accrued interest in November 2014.

4_ASSET_RETIREMENT_OBLIGATIONS

4. ASSET RETIREMENT OBLIGATIONS	12 Months Ended
	Sep. 30, 2014
Accounting Policies [Abstract]
4. ASSET RETIREMENT OBLIGATIONS	The Company had asset retirement obligations for any wells that were permanently removed from service.   Since the Company sold all its oil and gas assets in the 3rd quarter of 2014, the Company no longer has any ARO liability.  For the purpose of determining the fair value of ARO during the fiscal years presented, the Company used the following assumptions:
		September 30,
		2014
	Inflation rate		4	%
	Estimated asset life	9.5 years
	Credit adjusted risk free interest rate		18	%
	The following table shows:
	Asset retirement obligations at September 30, 2012	$	96,410
	Additional retirement obligations incurred		(28,291	)
	Change in estimate		111,598
	Accretion expense		23,186
	Settlements		(25,218	)
	Asset retirement obligations at September 30, 2013	$	177,685
	Accretion expense		(158,513	)
	Settlements		(19,172	)
	Asset retirement obligations at September 30, 2014	$	-

5_INCOME_TAXES

5. INCOME TAXES	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
5. INCOME TAXES	The provision for income taxes consists of the following:
		Fiscal Year			Fiscal Year
		Ended			Ended
		September 30,			September 30,
		2014			2013
	Current	$	-		$	-
	Deferred		-			-
	Total	$	-		$	-
	The provision for income taxes differs from the amount computed by applying the federal statutory income tax rate (34%) on operations as follows:
		Fiscal Year			Fiscal Year
		Ended			Ended
		September 30,			September 30,
		2014			2013
	Income tax expense computed at statutory rates	$	-1,129,553		$	(1,137,194	)
	Non-deductible items		-898,411			(220,623	)
	Change in valuation allowance		2,027,964			1,357,817
	Total	$	-		$	-
	The components of the net deferred tax asset were as follows:
		September 30,			September 30,
		2014			2013
	Deferred tax assets
	Net operating loss carryforwards	$	5,165,180		$	3,665,319
	Stock-based compensation		222,936			222,936
	Deferred tax liability - oil & gas properties		(794,263	)		(1,380,769	)
	Participation liability		(332,041	)		(273,638	)
	Subtotal		4,261,812			2,233,848
	Valuation allowance		(4,261,812	)		(2,233,848	)
	Net deferred tax asset	$	-		$	-
	A valuation allowance has been established to offset reported deferred tax assets. The Company's accumulated net operating losses were approximately $15,000,000 at September 30, 2014 and begin to expire if not utilized in the year 2033.

6_STOCKHOLDERS_EQUITY

6. STOCKHOLDERS EQUITY	12 Months Ended
	Sep. 30, 2014
Stockholders' deficit
6. STOCKHOLDERS EQUITY	On August 19, 2014, upon receiving approval from the Financial Industry Regulatory Authority, a 100-for-1 reverse split of the Company’s common stock became effective. Common share amounts and per share amounts in these financial statements have been retroactively adjusted to reflect the reverse split.
	Preferred Stock—5,000,000 shares authorized none issued or outstanding.
	Common Stock—The Company is authorized to issue an aggregate of 100,000,000 shares of common stock with $0.00001 par value.
	In July and November 2014, 11,871 and 2,450 shares previously issued to the Company’s founders were returned the Company, respectively.
	Warrants—The following table summarizes certain information regarding outstanding warrants as of September 30, 2013 and 2012:  As of September 30, 2014 these warrants were no longer trading in the OTC market.  The last quote on August 16, 2014 was $-0-.
				Exercise		Shares Issuable Upon Exercise of Warrants (1)
	Series	Issuance Date	Expiration Date	Price		2014		2013
	Series A	1-Dec-10	31-Oct-14	$	400		1,700		1,700
	Series B	1-Dec-10	31-Oct-14	$	120		3,400		3,400
	Series B	1-Dec-10	31-Oct-14	$	400		1,700		1,700
	Series C	28-Feb-11	28-Feb-16	$	200		15,000		15,000
	Series D	28-Feb-11	28-Feb-16	$	120		1,500		1,500
	Class A	2-Dec-11	29-Nov-16	$	150		48,000		48,000
	Series E	29-Jun-12	15-Jun-17	$	155		2,963		2,963
	Series E	6-Jul-12	15-Jun-17	$	150		725		725
	Series E	31-Jul-12	15-Jun-17	$	150		572		572
	Series E	5-Sep-12	15-Jun-17	$	150		1,114		1,114
	(1) Shares and prices are adjusted for the 100-1 reverse stock including retrospective adjustment.

7_STOCKBASED_COMPENSATION

7. STOCK-BASED COMPENSATION	12 Months Ended
	Sep. 30, 2014
Stockholders' deficit
7. STOCK-BASED COMPENSATION	On January 10, 2011, the Board of Directors approved a Non-Qualified Stock Option Plan (the "Plan") which authorizes the issuance of up to 1,500,000 shares of Company common stock to persons that exercise options granted pursuant to the Plan. The Company's employees, directors, officers, consultants and advisors are eligible to be granted options pursuant to the Plan, provided however that bona fide services must be rendered by such consultants or advisors, and such services must not be in connection with the offer or sale of securities in a capital-raising transaction.
	Options for the purchase of 850,000 shares of the Company's common stock were issued to members of executive management and the Board of Directors on January 10, 2011. The stock options had an exercise price of $1.00 per share and were fully vested on the date of grant. The Company recognized stock-based compensation expense of $243,731 during 2011 related to the issuance of these options.  The Company’s officers and consultants surrendered these options in July 2014.

8_COMMITMENTS_AND_CONTINGENCIE

8. COMMITMENTS AND CONTINGENCIES	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
8. COMMITMENTS AND CONTINGENCIES	Management Agreements – In June 2010, the Company entered into an agreement with an entity controlled by its Chief Executive Officer ("CEO") to provide for his personal part-time management consulting services for $7,500 per month, on a month-to-month basis. Also in June 2010, the Company entered into a consulting services agreement with its Chairman of the Board to provide for his personal part-time management consulting services for $3,000 per month, on a month-to-month basis. Beginning in January 2011, the monthly payments were increased to $12,500 for the CEO and $10,000 for the Chairman. In May 2011, these consulting arrangements were replaced with employment agreements for each executive.  In May 2013 the consulting arrangement were set at $10,000 for the CEO and $-0- for the Chairman.  The Chairman resigned following the May 2013 modification.
	Office Lease – The Company leases office space under an operating lease. Rent expense for 2014 and 2013 totaled $48,841 and $72,474, respectively.   As of July 1, 2014 the Company is no longer leasing office space. The Company has a month-to-month virtual office lease in Houston. The lease for the satellite office in Los Angeles was allowed to expire.

9_FAIR_VALUE_OF_FINANCIAL_INST

9. FAIR VALUE OF FINANCIAL INSTRUMENTS	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
9. FAIR VALUE OF FINANCIAL INSTRUMENTS	The following table summarizes the financial liabilities measured at fair value on a recurring basis as of September 30, 2014 and 2013:
					September 30,		September 30,
		Level			2014		2013
	Participation liability		3		$	-	$	465,551
	The following tables present a reconciliation of those liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3):
		Participation Liability
	Balance at September 30, 2013	$	465,551
	Purchases, issuances and settlements		(230,619	)
	(Gains) losses included in earnings		(234,932	)
	Balance at September 30, 2014	$	-

10_SUPPLEMENTAL_CASH_FLOW_INFO

10. SUPPLEMENTAL CASH FLOW INFORMATION	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
10. SUPPLEMENTAL CASH FLOW INFORMATION		Fiscal Year		Fiscal Year
		Ended		Ended
		30-Sep-14		30-Sep-13
	Interest paid	$	312,111	$	1,435,660
	Interest capitalized (non-cash)		-		63,040
	Noncash investing and financing activities:
	Asset retirement obligations incurred		29,088		-
	Capital expenditures included in accounts payable		-		16,591

11_SUPPLEMENTAL_INFORMATION_RE

11. SUPPLEMENTAL INFORMATION RELATING TO OIL AND GAS PRODUCING ACTIVITIES (UNAUDITED)	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
11. SUPPLEMENTAL INFORMATION RELATING TO OIL AND GAS PRODUCING ACTIVITIES (UNAUDITED)	Results of operations.  Results of operations for producing activities consist of all activities for the exploration, production and sale of oil and gas.  Net revenues from production include only the revenues from the production and sale of oil and natural gas. Production costs are those incurred to operate and maintain wells and related equipment and facilities used in oil and gas operations. Income tax expense is calculated by applying the current statutory tax rates to the revenues after deducting costs, which include depreciation, depletion and amortization allowances, after giving effect to permanent differences. The results of operations exclude general office overhead and interest expense attributable to oil and gas activities.
		Fiscal Year Ended			Fiscal Year Ended
		September 30,			September 30,
		2014			2013
	Net revenues from production
	Third-party sales	$	1,676,231		$	4,644,356
	Production costs
	Lease operating expense		544,045			714,669
	Production taxes		77,253			214,127
	Asset retirement obligation accretion		29,088			23,186
			650,386			951,982
	Impairment of O&G Properties		861,579			3,634,312
	Depreciation, depletion and amortization		984,200			1,846,583
			(819,934	)		-1,788,521
	Income tax expense		-			-
	Results of operations from producing activities	$	(819,934	)	$	-1,788,521
	Costs Incurred in Oil and Gas Property Acquisition, Exploration and Development. Amounts reported as costs incurred include both capitalized costs and costs charged to expense during the year for oil and gas property acquisition, exploration and development activities. Costs incurred also include new asset retirement obligations established in the current year, as well as increases or decreases to the asset retirement obligations resulting from changes to cost estimates during the year. Exploration costs presented below include the costs of drilling and equipping successful exploration wells, as well as dry hole costs, leasehold impairments, geological and geophysical expenses, and the costs of retaining undeveloped leaseholds. Development costs include the costs of drilling and equipping development wells, and construction of related production facilities.
		Fiscal Year Ended			Fiscal Year Ended
		September 30,			September 30,
		2014			2013
	Property acquisitions
	Unproved	$	-		$	19,206
	Proved		-			-
	Exploration		-			373,731
	Development					1,947,841
	Total Costs Incurred	$	-		$	2,340,778
	Capitalized costs. Capitalized costs include the cost of properties, equipment and facilities for oil and natural-gas producing activities. Capitalized costs for proved properties include costs for oil and natural-gas leaseholds where proved reserves have been identified, development wells, and related equipment and facilities, including development wells in progress.
		September 30,			September 30,
		2014			2013
	Capitalized costs
	Unproved properties	$	-		$	61,470
	Proved properties		-			12,994,766
			-			13,056,236
	Less: Accumulated DD&A		-			6,587,955
	Net capitalized costs	$	-		$	6,468,281
	Oil and Gas Reserve Information.    Pressler Consultants, Inc., an independent engineering firm, prepared the estimates of the proved reserves, future production, and income attributable to the leasehold interests as of September 30, 2013. The estimated proved net recoverable reserves presented below include only those quantities that were expected to be commercially recoverable at prices and costs in effect at the balance sheet dates under the then existing regulatory practices and with conventional equipment and operating methods. Proved Developed Reserves represent only those reserves estimated to be recovered through existing wells. Proved Undeveloped Reserves include those reserves that may be recovered from new wells on undrilled acreage or from existing wells on which a relatively major expenditure for recompletion or secondary recovery operations is required. All of the Company's Proved Reserves were located onshore in the continental United States of America. A reserve report for the September 30, 2014 was not prepared.
	Discounted future cash flow estimates like those shown below are not intended to represent estimates of the fair value of oil and gas properties. Estimates of fair value should also consider unproved reserves, anticipated future oil and gas prices, interest rates, changes in development and production costs and risks associated with future production. Because of these and other considerations, any estimate of fair value is subjective and imprecise.
	The following table sets forth estimates of the proved oil and gas reserves (net of royalty interests) for the Company and changes therein, for the periods indicated.
	Estimated Quantities of Proved Reserves
		Oil
		(Bbls)
	30-Sep-12		725,864
	Revisions of prior estimates		(555,738	)
	Purchases of reserves in place		-
	Production		(45,758	)
	30-Sep-13		124,368
		September 30,			September 30,
		2014			2013
	Estimated Quantities of Proved Developed Reserves		-			124,368
	Estimated Quantities of Proved Undeveloped Reserves		-			-
	The proved developed reserves estimate of 124,368 net barrels as of September 30, 2013 is a material reduction from that estimated as of last fiscal year end.  Net production of 45,758 barrels accounted for a portion of the reduction, but the balance was due to calculations of reservoir potential that was influenced by further detailed analysis of the producing formations drive systems and the declines in production from certain wells at a greater rate than previously experienced.  The interpretation of 3D seismic during the fourth quarter of fiscal year 2013 provided additional input and helped delineate the field more precisely, resulting in  lowering the estimates of remaining recoverable oil.
	A Reserve Report was not prepared for period ending September 30, 2014 as the Company did not own any oil and gas properties at that date.
	Standardized Measure of Discounted Future Net Cash Flows.    The Standardized Measure related to proved oil and gas reserves is summarized below. Future cash inflows were computed by applying a twelve month average of the first day of the month prices adjusted for differentials to estimated future production, less estimated future expenditures (based on year end costs) to be incurred in developing and producing the proved reserves, less estimated future income tax expense. Future income tax expenses are calculated by applying appropriate year-end tax rates to future pretax net cash flows, less the tax basis of properties involved. Future net cash flows are discounted at a rate of 10% annually to derive the standardized measure of discounted future net cash flows. This calculation procedure does not necessarily result in an estimate of the fair market value or the present value of the Company.
		September 30,			September 30,			30-Sep
		2014			2013			2012
	Future cash inflows	$	-		$	12,943,629		$	74,669,619
	Future production costs		-			(3,557,348	)		(9,364,444	)
	Future development costs		-			(804,500	)		6,175,000	)
	Future income taxes		-			-			(13,639,715	)
	Future net cash flows		-			8,581,781			45,490,460
	Discount of future net cash flows at 10% per annum		-			(2,104,010	)		(8,509,198	)
	Standardized measure of discounted future net cash flows	$	-		$	6,477,771		$	36,981,262
	The following table sets forth the changes in standardized measure of discounted future net cash flows relating to proved oil and gas reserves for the periods indicated.
	Changes in Standardized Measure
	Fiscal Year Ended			Fiscal Year Ended			Fiscal Year Ended
	September 30,			September 30,			September 30,
	2014			2013			2012
Sales of oil and gas produced, net of production costs	$	-		$	(3,692,374	)	$	(2,532,636	)
Purchases of minerals in place		-			-			-
Net change due to revisions in quantity estimates		-			-28,337,652			17,466,030
Net changes in prices and production costs		-			-11,151,435			3,134,171
Accretion of discount before income taxes		-			3,698,126			2,269,050
Changes in timing and other		-			8,979,844			-6,045,848
Net change	$	-		$	-30,503,491		$	14,290,767

2_SUMMARY_OF_SIGNIFICANT_ACCOU1

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Principles of Consolidation and Basis of Presentation	The consolidated financial statements include the accounts of Vanguard Energy Corporation and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
	The Company's fiscal year-end is September 30. The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and pursuant to the accounting and disclosure rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). A summary of the significant accounting policies applied in the preparation of the accompanying financial statements follows
Reclassifications	Certain amounts previously presented for prior periods have been reclassified to conform to the current presentation. The reclassifications had no effect on net loss, working capital or equity previously reported.
Recently Issued Accounting Pronouncements	Various accounting standards updates have been recently issued, most of which represented technical corrections to the accounting literature or were applicable to specific industries. No new accounting pronouncements have been issued that are likely to have a material impact to the Company’s consolidated financial statements.
Cash and Cash Equivalents	The Company considers all highly liquid instruments purchased with a maturity date of three months or less to be cash equivalents.
Oil and Gas Properties	As of September 30, 2014 the Company does not have any oil and gas properties as further explained in Note 3. Prior to the disposal of its oil and gas properties, the Company followed the full cost accounting method to account for oil and natural gas properties.  Under the full cost accounting method, costs incurred in the acquisition, exploration and development of oil and gas reserves are capitalized. Such costs include lease acquisition, geological and geophysical activities, rentals on nonproducing leases, drilling, completing and equipping of oil and gas wells and administrative costs directly attributable to those activities and asset retirement costs. Disposition of oil and gas properties are accounted for as a reduction of capitalized costs, with no gain or loss recognized unless such adjustment would significantly alter the relationship between capital costs and proved reserves of oil and gas, in which case the gain or loss is recognized to  operations.
	The capitalized costs of oil and gas properties, excluding unevaluated and unproved properties, are amortized as depreciation, depletion and amortization expense using the units-of-production method based on estimated proved recoverable oil and gas reserves.
	The costs associated with unevaluated and unproved properties, initially excluded from the amortization base, relate to unproved leasehold acreage, wells and production facilities in progress and wells pending determination of the existence of proved reserves, together with capitalized interest costs for these projects. Unproved leasehold costs are transferred to the amortization base with the costs of drilling the related well once a determination of the existence of proved reserves has been made or upon impairment of a lease. Costs associated with wells in progress and completed wells that have yet to be evaluated are transferred to the amortization base once a determination is made whether or not proved reserves can be assigned to the property. Costs of dry wells are transferred to the amortization base immediately upon determination that the well is unsuccessful.
	All items classified as unproved property are assessed on a quarterly basis for possible impairment or reduction in value. Properties are assessed on an individual basis or as a group if properties are individually insignificant. The assessment includes consideration of various factors, including, but not limited to, the following: intent to drill; remaining lease term; geological and geophysical evaluations; drilling results and activity; assignment of proved reserves; and economic viability of development if proved reserves are assigned. During any period in which these factors indicate an impairment, the cumulative drilling costs incurred to date for such property and all or a portion of the associated leasehold costs are transferred to the full cost pool and become subject to amortization.
	Under full cost accounting rules for each cost center, capitalized costs of evaluated oil and gas properties, including asset retirement costs, less accumulated amortization and related deferred income taxes, may not exceed an amount (the "cost ceiling") equal to the sum of (a) the present value of future net cash flows from estimated production of proved oil and gas reserves, based on current prices and operating conditions, discounted at ten percent (10%), plus (b) the cost of properties not being amortized, plus (c) the lower of cost or estimated fair value of any unproved properties included in the costs being amortized, less (d) any income tax effects related to differences between the book and tax basis of the properties involved. If capitalized costs exceed this limit, the excess is charged to operations.  For purposes of the ceiling test calculation, current prices are defined as the unweighted arithmetic average of the first day of the month price for each month within the 12 month period prior to the end of the reporting period.  Prices are adjusted for basis or location differentials.  Unless sales contracts specify otherwise, prices are held constant for the productive life of each well.  Similarly, current costs are assumed to remain constant over the entire calculation period.
	During the fourth quarter of fiscal year 2013 and based on the October 1, 2013 Reserve Report, the cost ceiling analysis established that the Company’s proved properties required the recording of an impairment reduction. The Company recorded an impairment expense of $3,634,312 as a result of reductions in estimated proved reserves.  Revised calculations of proved reserves were based on detailed analysis of producing formations drive systems and declines in production from certain wells at a greater rate than previously experienced. The interpretation of 3D seismic during the fiscal fourth quarter of 2013 provided additional input and helped delineate the field more precisely, resulting in limiting the estimates of remaining recoverable oil. The production declines resulted in greater DD&A expense of $919,313 during the fourth quarter.  These adjustments were offset somewhat by a reduction in the Participation Liability of $969,731 resulting from lower estimated net cash flows from certain wells in which outside parties had a 20% net profits interest.
	As discussed in Note 3, the Company recognized impairment charges of $861,579 during fiscal year 2014 for the amount by which the carrying value of its oil and gas properties exceeded the net proceeds from their sale.
Revenue Recognition	Oil and gas sales result from undivided interests held by the Company in oil and gas properties. Sales of oil and gas produced from oil and gas operations are recognized when the product is delivered to the purchaser and title transfers to the purchaser. The Company had no natural gas sales imbalance positions at September 30, 2014 or 2013. Charges for gathering and transportation are included in production expenses.
Asset Retirement Obligations	The Company recorded a liability for asset retirement obligations ("ARO") associated with its oil and gas wells when those assets are placed in service. The corresponding cost is capitalized as an asset and included in the carrying amount of oil and gas properties and is depleted over the useful life of the properties. Subsequently, the ARO liability is accreted to its then-present value.  Since the Company sold all its oil and gas assets in the 3rd quarter of 2014, no additional ARO was recorded.  As of September 30, 2014 the Company did not have an ARO liability.
Capitalized Interest	Interest is capitalized as part of the historical cost of developing and constructing assets for significant projects. Significant oil and gas investments in unproved properties, significant exploration and development projects for which depreciation, depletion and amortization expense is not currently recognized, and exploration or development activities that are in progress qualify for interest capitalization. Interest is capitalized until the asset is ready for service. Capitalized interest is determined by multiplying the Company's weighted-average borrowing cost on debt by the average amount of qualifying costs incurred. Once an asset subject to interest capitalization is completed and placed in service, the associated capitalized interest is expensed through depletion or impairment, along with other capitalized costs related to that asset.
Debt Issuance Costs	Costs incurred in connection with the issuance of long-term debt are capitalized and amortized over the term of the related debt.
Participation Liability	In prior periods the Company recognized a participation liability related to a net profits interest granted to persons who purchased the Company’s 2010 Convertible Promissory Notes.  The net profits interest was held by Vanguard Net Profits, LLC and covered some of the Company’s oil and gas properties.  On June 17, 2014, the Company settled the net profits interests for $230,619.  The Company recognized a gain on the settlement of the participation liability of $171,772 during the quarter ended June 30, 2014 as a result.
	The Company incurred expense associated with the net profits interest during the nine-month period ended June 30, 2014 of fiscal year 2014.  This amount is reported as interest expense in the consolidated statement of operations.  The Company also made a final payment of $84,577 under this arrangement during year ended September 30, 2014.
Conversion Feature Liability and Warrant Liabilities	The conversion feature liability and warrant liabilities are recorded at fair value based upon valuation models utilizing relevant factors such as expected life, estimated volatility, risk-free interest and expected dividend rate. Changes in the fair value of these liabilities are reported in the statements of operations.
Stock-Based Compensation	The Company accounts for employee stock-based compensation using the fair value method. The fair value attributable to stock options is calculated based on the Black-Scholes option pricing model and is amortized to expense over the service period which is equivalent to the time required to vest the stock options.
Income Taxes	Income taxes are provided based on the liability method for financial reporting purposes. Under this method deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred income tax assets to the amount expected to be realized.
	Uncertain tax positions are recognized in the financial statements only if that position is more likely than not of being sustained upon examination by taxing authorities, based on the technical merits of the position. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense.
	The Company is required to file federal income tax returns in the United States and in various state and local jurisdictions. The Company's tax returns filed since inception are subject to examination by taxing authorities in the jurisdictions in which it operates in accordance with the normal statutes of limitations in the applicable jurisdiction.
Earnings (Loss) Per Share	Basic earnings (loss) per share have been calculated based upon the weighted-average number of common shares outstanding. The weighted-average number of common shares outstanding used in the computations of earnings (loss) per share was 125,425 for 2014 and 127,415for 2013. The calculation of diluted weighted-average shares outstanding for 2014 and 2013 excludes 162,142 shares and 176,110 shares, respectively, issuable pursuant to outstanding warrants, stock options and debt conversion features because their effect is anti-dilutive.
Concentration of Credit Risk	The Company is subject to credit risk resulting from the concentration of its oil and natural gas receivables with significant purchasers. One purchaser accounted for all of the Company's oil and gas sales revenues for 2014 and 2013. The Company does not require collateral. While the Company believes its recorded receivable will be collected, in the event of default the Company would follow normal collection procedures. The Company does not believe the loss of this purchaser would materially impact its operating results as oil and gas are fungible products with well-established markets and numerous purchasers.
	At times, the Company would maintain deposits in federally insured financial institutions in excess of federally insured limits. Management would monitor the credit ratings and concentration of risk with these financial institutions on a continuing basis to safeguard cash deposits.
Fair Value Measurements	The carrying value of cash and cash equivalents, accounts receivable, and accounts payable, as reflected in the balance sheets, approximate fair value because of the short-term maturity of these instruments. The estimated fair value of long-term debt was determined by discounting future cash flows using rates currently available to the Company for debt with similar terms and remaining maturities. The Company calculated that the estimated fair value of the long term debt is not significantly different than the carrying value of the debt. The participation liability associated with outstanding long-term debt was determined by utilizing a present value factor of 10 applied to proved developed reserves associated with the wells drilled with the proceeds of the notes.
	Fair value is defined as the price that would be received to sell an asset or price paid to transfer a liability in an orderly transaction between market participants at the measurement date. Inputs used in determining fair value are classified for disclosure purposes according to a hierarchy that prioritizes those inputs based upon the degree to which they are observable. The three levels of the fair-value-measurement hierarchy are as follows:
	●	Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
	●	Level 2—Inputs that reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the asset or the liability; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.
	●	Level 3—Unobservable inputs reflecting the Company's own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.
	In determining fair value, the Company utilizes observable market data when available, or models that incorporate observable market data. In addition to market information, the Company incorporates transaction-specific details that, in management's judgment, market participants would take into account in measuring fair value. The Company utilizes the most observable inputs available for the valuation technique employed. If a fair value measurement reflects inputs at multiple levels within the hierarchy, the fair-value measurement of both financial and nonfinancial assets and liabilities are characterized based upon the lowest level of input that is significant to the fair value measurement.

3_SALE_OF_OIL_AND_GAS_PROPERTI1

3. SALE OF OIL AND GAS PROPERTIES PAYMENT OF CONVERTIBLE NOTES (Tables)	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Sale of oil and gas properties/payment of convertible notes	Pay holders of the convertible notes	$	5,259,706
	Purchase the net profits interest held by Vanguard Net Profits, LLC		230,619
	Pay legal and closing costs		9,675
		$	5,500,000

4_ASSET_RETIREMENT_OBLIGATIONS1

4. ASSET RETIREMENT OBLIGATIONS (Tables)	12 Months Ended
	Sep. 30, 2014
Accounting Policies [Abstract]
Assumptions for fair value of ARO		September 30,
		2014
	Inflation rate		4	%
	Estimated asset life	9.5 years
	Credit adjusted risk free interest rate		18	%
SCHEDULE OF ASSET RETIREMENT OBLIGATIONS	Asset retirement obligations at September 30, 2012	$	96,410
	Additional retirement obligations incurred		(28,291	)
	Change in estimate		111,598
	Accretion expense		23,186
	Settlements		(25,218	)
	Asset retirement obligations at September 30, 2013	$	177,685
	Accretion expense		(158,513	)
	Settlements		(19,172	)
	Asset retirement obligations at September 30, 2014	$	-

5_INCOME_TAXES_Tables

5. INCOME TAXES (Tables)	12 Months Ended
	Sep. 30, 2014
Income Taxes Tables
Schedule for the provision for income taxes		Fiscal Year			Fiscal Year
		Ended			Ended
		September 30,			September 30,
		2014			2013
	Current	$	-		$	-
	Deferred		-			-
	Total	$	-		$	-
Schedule of income tax reconciliation		Fiscal Year			Fiscal Year
		Ended			Ended
		September 30,			September 30,
		2014			2013
	Income tax expense computed at statutory rates	$	-1,129,553		$	(1,137,194	)
	Non-deductible items		-898,411			(220,623	)
	Change in valuation allowance		2,027,964			1,357,817
	Total	$	-		$	-
Schedule of components of the net deferred tax asset		September 30,			September 30,
		2014			2013
	Deferred tax assets
	Net operating loss carryforwards	$	5,165,180		$	3,665,319
	Stock-based compensation		222,936			222,936
	Deferred tax liability - oil & gas properties		(794,263	)		(1,380,769	)
	Participation liability		(332,041	)		(273,638	)
	Subtotal		4,261,812			2,233,848
	Valuation allowance		(4,261,812	)		(2,233,848	)
	Net deferred tax asset	$	-		$	-

6_STOCKHOLDERS_EQUITY_Tables

6. STOCKHOLDERS EQUITY (Tables)	12 Months Ended
	Sep. 30, 2014
Stockholders' deficit
Schedule of Warrants				Exercise		Shares Issuable Upon Exercise of Warrants (1)
	Series	Issuance Date	Expiration Date	Price		2014		2013
	Series A	1-Dec-10	31-Oct-14	$	400		1,700		1,700
	Series B	1-Dec-10	31-Oct-14	$	120		3,400		3,400
	Series B	1-Dec-10	31-Oct-14	$	400		1,700		1,700
	Series C	28-Feb-11	28-Feb-16	$	200		15,000		15,000
	Series D	28-Feb-11	28-Feb-16	$	120		1,500		1,500
	Class A	2-Dec-11	29-Nov-16	$	150		48,000		48,000
	Series E	29-Jun-12	15-Jun-17	$	155		2,963		2,963
	Series E	6-Jul-12	15-Jun-17	$	150		725		725
	Series E	31-Jul-12	15-Jun-17	$	150		572		572
	Series E	5-Sep-12	15-Jun-17	$	150		1,114		1,114

9_FAIR_VALUE_OF_FINANCIAL_INST1

9. FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Financial Liabilities					September 30,		September 30,
		Level			2014		2013
	Participation liability		3		$	-	$	465,551
Liabilities Using Signigicant Unobservable Inputs		Participation Liability
	Balance at September 30, 2013	$	465,551
	Purchases, issuances and settlements		(230,619	)
	(Gains) losses included in earnings		(234,932	)
	Balance at September 30, 2014	$	-

10_SUPPLEMENTAL_CASH_FLOW_INFO1

10. SUPPLEMENTAL CASH FLOW INFORMATION (Tables)	12 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Supplemental Cash Flow Information		Fiscal Year		Fiscal Year
		Ended		Ended
		30-Sep-14		30-Sep-13
	Interest paid	$	312,111	$	1,435,660
	Interest capitalized (non-cash)		-		63,040
	Noncash investing and financing activities:
	Asset retirement obligations incurred		29,088		-
	Capital expenditures included in accounts payable		-		16,591

11_SUPPLEMENTAL_INFORMATION_RE1

11. SUPPLEMENTAL INFORMATION RELATING TO OIL AND GAS PRODUCING ACTIVITIES (UNAUDITED) (Tables)	12 Months Ended
	Sep. 30, 2014
Supplemental Information Relating To Oil And Gas Producing Activities Tables
Schedule of operations		Fiscal Year Ended			Fiscal Year Ended
		September 30,			September 30,
		2014			2013
	Net revenues from production
	Third-party sales	$	1,676,231		$	4,644,356
	Production costs
	Lease operating expense		544,045			714,669
	Production taxes		77,253			214,127
	Asset retirement obligation accretion		29,088			23,186
			650,386			951,982
	Impairment of O&G Properties		861,579			3,634,312
	Depreciation, depletion and amortization		984,200			1,846,583
			(819,934	)		-1,788,521
	Income tax expense		-			-
	Results of operations from producing activities	$	(819,934	)	$	-1,788,521
Schedule of development costs		Fiscal Year Ended			Fiscal Year Ended
		September 30,			September 30,
		2014			2013
	Property acquisitions
	Unproved	$	-		$	19,206
	Proved		-			-
	Exploration		-			373,731
	Development					1,947,841
	Total Costs Incurred	$	-		$	2,340,778
Schedule of capitalized costs		September 30,			September 30,
		2014			2013
	Capitalized costs
	Unproved properties	$	-		$	61,470
	Proved properties		-			12,994,766
			-			13,056,236
	Less: Accumulated DD&A		-			6,587,955
	Net capitalized costs	$	-		$	6,468,281
Schedule of proved oil and gas reserves		Oil
		(Bbls)
	30-Sep-12		725,864
	Revisions of prior estimates		(555,738	)
	Purchases of reserves in place		-
	Production		(45,758	)
	30-Sep-13		124,368
		September 30,			September 30,
		2014			2013
	Estimated Quantities of Proved Developed Reserves		-			124,368
	Estimated Quantities of Proved Undeveloped Reserves		-			-
Schedule of standardized measure of discounted future net cash flows		September 30,			September 30,			30-Sep
		2014			2013			2012
	Future cash inflows	$	-		$	12,943,629		$	74,669,619
	Future production costs		-			(3,557,348	)		(9,364,444	)
	Future development costs		-			(804,500	)		6,175,000	)
	Future income taxes		-			-			(13,639,715	)
	Future net cash flows		-			8,581,781			45,490,460
	Discount of future net cash flows at 10% per annum		-			(2,104,010	)		(8,509,198	)
	Standardized measure of discounted future net cash flows	$	-		$	6,477,771		$	36,981,262
	The following table sets forth the changes in standardized measure of discounted future net cash flows relating to proved oil and gas reserves for the periods indicated.
	Changes in Standardized Measure
		Fiscal Year Ended			Fiscal Year Ended			Fiscal Year Ended
		September 30,			September 30,			September 30,
		2014			2013			2012
	Sales of oil and gas produced, net of production costs	$	-		$	(3,692,374	)	$	(2,532,636	)
	Purchases of minerals in place		-			-			-
	Net change due to revisions in quantity estimates		-			-28,337,652			17,466,030
	Net changes in prices and production costs		-			-11,151,435			3,134,171
	Accretion of discount before income taxes		-			3,698,126			2,269,050
	Changes in timing and other		-			8,979,844			-6,045,848
	Net change	$	-		$	-30,503,491		$	14,290,767

2_SUMMARY_OF_SIGNIFICANT_ACCOU2

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Summary Of Significant Accounting Policies Details Narrative
Anti-dilutive shares	167,610	176,110

3_SALE_OF_OIL_AND_GAS_PROPERTI2

3. SALE OF OIL AND GAS PROPERTIES/PAYMENT OF CONVERTIBLE NOTES (details) (USD $)	12 Months Ended
	Sep. 30, 2014
Proceeds from sale used to:
Pay holders of the convertible notes	$5,259,706
Purchase the net profits interest held by Vanguard Net Profits, LLC	230,619
Pay legal and closing costs	9,675
Total	$5,500,000

4_ASSET_RETIREMENT_OBLIGATIONS2

4. ASSET RETIREMENT OBLIGATIONS (Details)	12 Months Ended
	Sep. 30, 2014
Asset Retirement Obligations Details
Inflation rate	4.00%
Estimated asset life	9.5 years
Credit adjusted risk free interest rate	18.00%

4_ASSET_RETIREMENT_OBLIGATIONS3

4. ASSET RETIREMENT OBLIGATIONS (Details 1) (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Asset Retirement Obligations Details 1
Asset retirement obligations at beginning of year	$177,685	$96,410
Obligations assumed in acquisition	29,088	0
Additional retirement obligations incurred		-28,291
Changes in estimate		111,598
Accretion expense	29,088	23,186
Settlements	-19,172	-25,218
Asset retirement obligations at ending of year	$0	$177,685

5_INCOME_TAXES_Details

5. INCOME TAXES (Details) (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Income Taxes Details
Current	$0	$0
Deferred	0	0
Total	$0	$0

5_INCOME_TAXES_Details_1

5. INCOME TAXES (Details 1) (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Income Taxes Details 1
Income tax expense computed at statutory rates	($1,129,553)	($1,137,194)
Non-deductible items	-898,410	-220,623
Change in valuation allowance	2,027,963	1,357,817
Total	$0	$0

5_INCOME_TAXES_Details_2

5. INCOME TAXES (Details 2) (USD $)	Sep. 30, 2014	Sep. 30, 2013
Deferred tax assets
Net operating loss carryforwards	$5,165,180	$3,665,319
Stock-based compensation	222,936	222,936
Deferred tax liability - oil & gas properties	-794,263	-1,380,769
Participation liability	-332,041	-273,638
Subtotal	4,261,812	2,233,848
Valuation allowance	-4,261,812	-2,233,848
Net deferred tax asset	$0	$0

6_STOCKHOLDERS_EQUITY_Details

6. STOCKHOLDERS EQUITY (Details) (USD $)	12 Months Ended
	Sep. 30, 2014
Series A
Issuance Date	1-Dec-10
Expiration Date	31-Oct-14
Exercise Price	$400
Warrants Outstanding-2014	17,000
Warrants Outstanding-2013	17,000
Series B1
Issuance Date	1-Dec-10
Expiration Date	31-Oct-14
Exercise Price	$120
Warrants Outstanding-2014	3,400
Warrants Outstanding-2013	3,400
Series B2
Issuance Date	1-Dec-10
Expiration Date	31-Oct-14
Exercise Price	$400
Warrants Outstanding-2014	1,700
Warrants Outstanding-2013	1,700
Series C
Issuance Date	28-Feb-11
Expiration Date	28-Feb-16
Exercise Price	$200
Warrants Outstanding-2014	15,000
Warrants Outstanding-2013	15,000
Series D
Issuance Date	28-Feb-11
Expiration Date	28-Feb-16
Exercise Price	$120
Warrants Outstanding-2014	1,500
Warrants Outstanding-2013	1,500
Class A
Issuance Date	2-Dec-11
Expiration Date	29-Nov-16
Exercise Price	$150
Warrants Outstanding-2014	48,000
Warrants Outstanding-2013	48,000
Series E1
Issuance Date	29-Jun-12
Expiration Date	15-Jun-17
Exercise Price	$155
Warrants Outstanding-2014	2,963
Warrants Outstanding-2013	2,963
Series E2
Issuance Date	6-Jul-12
Expiration Date	15-Jun-17
Exercise Price	$150
Warrants Outstanding-2014	725
Warrants Outstanding-2013	725
Series E3
Issuance Date	31-Jul-12
Expiration Date	15-Jun-17
Exercise Price	$150
Warrants Outstanding-2014	572
Warrants Outstanding-2013	572
Series E4
Issuance Date	5-Sep-12
Expiration Date	15-Jun-17
Exercise Price	$150
Warrants Outstanding-2014	1,114
Warrants Outstanding-2013	1,114

9_FAIR_VALUE_OF_FINANCIAL_INST2

9. FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (USD $)	Sep. 30, 2014	Sep. 30, 2013
Notes to Financial Statements
Participation liability (Level 3)	$0	$465,551

9_FAIR_VALUE_OF_FINANCIAL_INST3

9. FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 1) (Participation Liability, USD $)	12 Months Ended
	Sep. 30, 2014
Participation Liability
Balance at September 30,2013	$465,551
Purchases, issuances and settlements	-230,619
(Gains) losses included in earnings	-234,932
Balance at September 30, 2014	$0

10_SUPPLEMENTAL_CASH_FLOW_INFO2

10. SUPPLEMENTAL CASH FLOW INFORMATION (Details) (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Supplemental cash flow information:
Interest capitalized (non-cash)	$0	$63,040
Noncash investing and financing activities:
Asset retirement obligations incurred	29,088	0
Capital expenditures included in accounts payable	$0	$16,591

11_SUPPLEMENTAL_INFORMATION_RE2

11. SUPPLEMENTAL INFORMATION RELATING TO OIL AND GAS PRODUCING ACTIVITIES - Results of operations (UNAUDITED) (Details) (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Supplemental Information Relating To Oil And Gas Producing Activities - Results Of Operations Details
Third-party sales	$1,676,231	$4,644,356
Production costs
Lease operating expense	544,045	714,669
Production taxes	77,253	214,127
Asset retirement obligation accretion	29,088	23,186
Subtotal production costs	650,386	951,982
Impairment of O&G Properties	861,579	3,634,312
Depreciation, depletion and amortization	984,200	1,846,583
Total production costs	-819,934	-1,788,521
Income tax expense	0	0
Results of operations from producing activities	($819,934)	($1,788,521)

11_SUPPLEMENTAL_INFORMATION_RE3

11. SUPPLEMENTAL INFORMATION RELATING TO OIL AND GAS PRODUCING ACTIVITIES - Costs Incurred (UNAUDITED) (Details 1) (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Property acquisitions
Unproved	$0	$19,206
Proved	0	0
Exploration	0	373,731
Development	0	1,947,841
Total Costs Incurred	$0	$2,340,778

11_SUPPLEMENTAL_INFORMATION_RE4

11. SUPPLEMENTAL INFORMATION RELATING TO OIL AND GAS PRODUCING ACTIVITIES - Capitalized costs (UNAUDITED) (Details 2) (USD $)	Sep. 30, 2014	Sep. 30, 2013
Capitalized costs
Unproved properties	$0	$61,470
Proved properties	0	12,994,766
Gross	0	13,056,236
Less: Accumulated DD&A	0	6,587,955
Net capitalized costs	$0	$6,468,281

11_INFORMATION_RELATING_TO_OIL

11. INFORMATION RELATING TO OIL AND GAS PRODUCING ACTIVITIES - Estimated Quantities of Proved Reserves (UNAUDITED) (Details 4)	12 Months Ended
	Sep. 30, 2013	Sep. 30, 2014
	bbl	bbl
Information Relating To Oil And Gas Producing Activities - Estimated Quantities Of Proved Reserves Details 4
Oil Estimated Quantities of Proved Reserves, beginning balance	725,864	0
Revisions of prior estimates	-555,738
Purchases of reserves in place	0
Production	-45,758
Oil Estimated Quantities of Proved Reserves, ending balance	124,368	0
Estimated Quantities of Proved Developed Reserves	124,368	0
Estimated Quantities of Proved Undeveloped Reserves	0	0

11_SUPPLEMENTAL_INFORMATION_RE5

11. SUPPLEMENTAL INFORMATION RELATING TO OIL AND GAS PRODUCING ACTIVITIES - Net Cash Flows (UNAUDITED) (Details 5) (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Supplemental Information Relating To Oil And Gas Producing Activities - Net Cash Flows Details 5
Future cash inflows	$0	$12,943,629	$74,669,619
Future production costs	0	-3,557,348	-9,364,444
Future development costs	0	-804,500	6,175,000
Future income taxes		0	-13,639,715
Future net cash flows	0	8,581,781	45,490,460
Discount of future net cash flows at 10% per annum	0	-2,104,010	-8,509,198
Standardized measure of discounted future net cash flows	$0	$6,477,771	$36,981,262

11_SUPPLEMENTAL_INFORMATION_RE6

11. SUPPLEMENTAL INFORMATION RELATING TO OIL AND GAS PRODUCING ACTIVITIES - Standardized Measure (UNAUDITED) (Details 6) (USD $)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Supplemental Information Relating To Oil And Gas Producing Activities - Standardized Measure Details 6
Sales of oil and gas produced, net of production costs	$0	($3,692,374)	($2,532,636)
Purchases of minerals in place	0	0	0
Net change due to revisions in quantity estimates	0	-28,337,652	17,466,030
Net changes in prices and production costs	0	-11,151,435	3,134,171
Accretion of discount before income taxes	0	3,698,126	2,269,050
Changes in timing and other	0	8,979,844	-6,045,848
Net change	$0	($30,503,491)	$14,290,767