Diversified Resources 10-Q 12 Oct 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	9 Months Ended
	Jul. 31, 2016	Apr. 30, 2016
Document and Entity Information:
Entity Registrant Name	Diversified Resources Inc.
Document Type	10-Q
Document Period End Date	Jul. 31, 2016
Trading Symbol	divr
Amendment Flag	false
Entity Central Index Key	1,509,692
Current Fiscal Year End Date	--10-31
Entity Common Stock, Shares Outstanding		44,883,462
Entity Public Float		$ 0
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3

CONSOLIDATED BALANCE SHEETS (Un

CONSOLIDATED BALANCE SHEETS (Unaudited for July 31, 2016) - USD ($)	Jul. 31, 2016		Oct. 31, 2015
CURRENT ASSETS
Cash	$ 232,998		$ 21,706
Accounts receivable, trade	1,711,083		67,189
Accounts receivable, other			313,989
Accrued revenue	675,491
Prepaid Insurance	98,477
Total current assets	2,718,049		402,884
LONG-LIVED ASSETS
Property and Equipment	9,995,022	[1]	1,846,111	[2]
Bonds and deposits	169,301		167,867
Land and other equipment	194,540
Oil and gas properties - proved developed (successful efforts method)	1,215,294	[3]	1,282,876	[4]
Oil and gas properties - proved undeveloped (successful efforts method)	1,241,724		1,241,724
Oil and gas properties - unproved (successful efforts method)	2,932,730		2,932,730
Goodwill	3,984,695
Total assets	22,451,355		7,874,192
CURRENT LIABILITIES
Accounts payable	1,286,279		387,028
Accounts payable, related party	211,029		147,736
Current portion of notes payable	1,360,922		319,632
Note payable - related party	107,070		107,070
Accrued interest, related party	20,683		15,287
Current portion of capital lease obligation	89,004
Estimated income tax liability	741,300
Line of credit	347,126
Accrued expenses	534,927		405,669
Total current liabilities	4,698,340		1,382,422
LONG TERM LIABILITIES
Long term debt, notes payable	7,636,797		3,498,108
Accrued liability	750,000
Capital lease obligation	159,724
Asset retirement obligation	347,309		321,101
COMMITMENTS AND CONTINGENT LIABILITIES
STOCKHOLDERS' EQUITY
Preferred stock			301
Common stock	44,884		23,216
Additional paid in capital	19,675,373		9,741,759
Accumulated deficit	(10,861,072)		(7,092,714)
Total stockholders' equity	8,859,185		2,672,562
Total liabilities and stockholders' equity	$ 22,451,355		$ 7,874,192
[1]	Net of accumulated depreciation and amortization of $1,218,729.
[2]	Net of accumulated depreciation and amortization of $322,281.
[3]	Net of accumulated depletion and impairment of $2,690,921.
[4]	Net of accumulated depletion and impairment of $2,623,339.

Statement of Financial Position

Statement of Financial Position - Parenthetical - $ / shares	Jul. 31, 2016	Oct. 31, 2015
Statement of Financial Position
Preferred Stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	50,000,000	50,000,000
Preferred Stock, Shares Issued	0	301,000
Preferred Stock, Shares Outstanding	0	301,000
Common Stock, Par Value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	450,000,000	450,000,000
Common Stock, Shares Issued	44,893,062	23,215,926
Common Stock, Shares Outstanding	44,893,062	23,215,926

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Jul. 31, 2016	Jul. 31, 2015	Jul. 31, 2016	Jul. 31, 2015
Operating revenues
Oil and gas sales	$ 61,459	$ 161,052	$ 177,505	$ 518,865
Oilfield and construction services	2,064,316		5,835,506
Revenue - other	14,016		73,713
Total operating revenue	2,139,791	161,052	6,086,724	518,865
Cost of services
Subcontractor expenses	261,053		1,072,417
Field payroll	1,181,584		3,076,582
Fuel expenses	155,488		362,954
Equipment rental	66,120		185,146
Material	113,340		362,380
Total cost of services	1,777,585		5,059,479
Gross margin	362,206	161,052	1,027,245	518,865
Operating expenses
Exploration costs, including dry holes				16,513
Lease operating expenses	20,702	218,130	247,229	557,400
General and administrative	897,147	363,790	2,182,432	1,325,187
Legal expense			750,000
Insurance expense	57,233		396,367	23,747
Depreciation expense	386,558	41,768	940,282	125,304
Depletion expense	12,593	25,263	35,436	86,389
Production tax and royalty expense	19,596	49,643	41,162	194,567
Accretion expense	8,736	7,870	26,208	22,832
Total operating expenses	1,402,565	706,464	4,619,116	2,351,939
(Loss) from operations	(1,040,359)	(545,412)	(3,591,871)	(1,833,074)
Other income (expense)
Interest expense	(72,623)	(41,555)	(176,487)	(80,792)
Other income (expense), net	(72,623)	(41,555)	(176,487)	(80,792)
Net (loss)	$ (1,112,982)	$ (586,967)	$ (3,768,358)	$ (1,913,866)
Net (loss) per common share basic and diluted	$ (0.03)	$ (0.03)	$ (0.09)	$ (0.08)
Weighted average shares outstanding basic and diluted	40,859,329	22,851,919	43,685,821	22,940,864

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)		9 Months Ended
		Jul. 31, 2016	Jul. 31, 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities		$ 309,162	$ (1,683,121)
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for oil and gas properties			(32,002)
Cash paid for purchase of property and equipment		(121,753)	(21,273)
Net cash used in investing activities		(121,753)	(53,275)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock		60,000	663,720
Proceeds from notes payable		200,000	1,000,000
Payments on notes payable		(284,856)	(56,517)
Payments on capital lease		(19,946)
Proceeds from line of credit		68,685
Net cash provided by financing activities		23,883	1,607,203
INCREASE IN CASH		211,292	(129,193)
BEGINNING BALANCE		21,706	209,054
ENDING BALANCE		232,998	79,861
Cash paid for interest		$ 33,023	$ 29,620
Non cash investing and financing activities:
Preferred stock converted into common shares	[1]	602	0
Common stock issued	[1]	10,016,355	0
Notes payable issued	[1]	2,000,000	0
[1]	Acquisition of Diversified Energy Services, Inc.

Note 1 - Basis of Presentation

Note 1 - Basis of Presentation	9 Months Ended
	Jul. 31, 2016
Notes
Note 1 - Basis of Presentation	NOTE 1 – BASIS OF PRESENTATION The interim consolidated financial statements of Diversified Resources, Inc. ("we", "us", "our", "Diversified", or the "Company") are unaudited and contain all adjustments (consisting primarily of normal recurring accruals) necessary for a fair presentation of the results for the interim periods presented. Results for interim periods are not necessarily indicative of results to be expected for a full year or for previously reported periods due in part, but not limited to, interest rates, drilling risks, geological risks, the timing of acquisitions, and our ability to obtain additional capital. These interim financial statements should be read in conjunction with the audited financial statements and notes thereto included in Diversified's Annual Report on Form 10-K for the year ended October 31, 2015 as filed with the Securities and Exchange Commission ("SEC") on February 16, 2016. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the SEC for Quarterly Reports on Form 10-Q and in accordance with US GAAP. Certain information relating to our organization and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted in this Quarterly Report on Form 10-Q in accordance with GAAP and financial statement requirements promulgated by the U.S. Securities and Exchange Commission ("SEC"). The notes to the consolidated financial statements (unaudited) should be read in conjunction with the notes to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended October 31, 2015. The results of operations presented in this quarterly report are not necessarily indicative of the results of operations that may be expected for any future periods. In the opinion of management, all adjustments which are of a normal recurring nature considered necessary for a fair presentation have been made in the accompanying unaudited financial statements.

Note 2 - Organization and Going

Note 2 - Organization and Going Concern	9 Months Ended
	Jul. 31, 2016
Notes
Note 2 - Organization and Going Concern	NOTE 2 – ORGANIZATION AND GOING CONCERN Diversified Resources Inc. ("the Company") was incorporated in the State of Nevada on March 19, 2009 to pursue mineral extraction in the United States. Effective November 21, 2013 we acquired 100% of the outstanding shares of Natural Resource Group, Inc. in exchange for 14,558,150 shares of our common stock. In connection with this acquisition, the then President of the Company sold 2,680,033 shares of the Company's common stock to the Company for nominal consideration. The shares purchased from the President were returned to the status of authorized but unissued shares. Additionally, the former principals of the Company assumed all of the debts of the Company at the date of the exchange. On October 14, 2014 the Company acquired approximately 98% of the outstanding shares of BIYA Operators, Inc. ("BIYA") an independent oil and gas company. BIYA has oil and gas leases in the Horseshoe Gallop field in San Juan County, New Mexico covering approximately 10,100 acres and 48 producing wells. The majority of the leased acreage and producing wells are on Mountain Ute tribal land and are leased under an operating agreement with the tribe, which commenced on April 15, 2008. On February 1, 2016 we acquired 100% of the outstanding shares of Diversified Energy Services, Inc. ("DESI"), a holding company comprised of three oilfield services companies. As shown in the accompanying financial statements, the Company has incurred significant operating losses since inception, has an accumulated deficit of $11,323,446 and has negative working capital of $1,980,292 at July 31, 2016. As of July 31, 2016, the Company has limited financial resources. These factors raise substantial doubt about the Company's ability to continue as a going concern. The Company's ability to achieve and maintain profitability and positive cash flow is dependent upon its ability to locate profitable mineral properties, generate revenue from planned business operations, and control exploration costs. Management plans to fund its future operations through joint ventures, cash flow from commercial production and oilfield and construction services. However, there is no assurance that the Company will be able to obtain additional financing from investors or private lenders, or that additional commercial production can be attained. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

Note 3 - Summary of Significant

Note 3 - Summary of Significant Accounting Policies	9 Months Ended
	Jul. 31, 2016
Notes
Note 3 - Summary of Significant Accounting Policies	NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The accompanying consolidated unaudited financial statements include the accounts of Diversified Resources, Inc. and its wholly owned subsidiaries, Natural Resource Group, Inc., BIYA Operators, Inc. and Diversified Energy Services, Inc. Any inter-company accounts and transactions have been eliminated. Nature of Operations Our subsidiaries NRG and BIYA have oil and gas producing properties in Colorado and New Mexico, respectively. DESI offers a full range of services to the Rocky Mountain energy and construction industries and is dedicated to becoming the "one call, last call" solution to a full range of oil field service needs. DESI offers Crane Service, Well Site Construction, Materials Handling and Disposal, Trucking Services, Equipment Operation, and Rigging to the energy industry in the Denver Julesburg Basin, the Rockies and San Juan basin in New Mexico. These services are primarily provided using DESI's fleet of equipment. Cash and cash equivalents The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents. The Company holds only cash as of July 31, 2016. Use of estimates The preparation of 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates of oil and gas reserve quantities provide the basis for the calculation of depletion, depreciation, and amortization, and impairment, each of which represents a significant component of the financial statements. Actual results could differ from those estimates. Revenue Recognition We recognize oil and gas revenue from interests in producing wells as the oil and gas is sold. Revenue from the purchase, transportation, and sale of natural gas is recognized upon completion of the sale and when transported volumes are delivered. We recognize revenue related to gas balancing agreements based on the sales method. Our net imbalance position at July 31, 2016 and October 31, 2015 was immaterial. We recognize revenue when services are performed, collection of the relevant receivables is probable, persuasive evidence of an arrangement exists and the price is fixed or determinable. DESI prices services by the hour, day, or project depending on the type of service performed. Accounts Receivable and Allowance for Doubtful Accounts Our credit terms for our billings is net 30 days. Accounts receivables are determined to be past due if payments are not made in accordance with the terms and an allowance is recorded for accounts when there are indicators that the receivables may not be recovered. Customary collection efforts are initiated and receivables are written off when we determine they are not collectible and abandon these collection efforts. We evaluate the past due accounts to setup an allowance for doubtful accounts on a regular basis for adequacy based upon our periodic review of the collectability of the receivables in light of historical experience, adverse situations that may affect our customers' ability to pay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision as more information becomes available. Accounting for Oil and Gas Activities Successful Efforts Method Depreciation, depletion and amortization Impairments Proved Property Impairment Unproved Property Impairment Exploration Costs , Asset Retirement Obligations The following table reconciles the asset retirement obligation for nine months ended July 31, 2016 and year ended October 31, 2015: 2016 2015 Asset retirement obligation as of beginning of period $ 321,101 $ 290,312 Liabilities added - - Liabilities settled - - Revision of estimated obligation - - Accretion expense on discounted obligation 26,208 30,789 Asset retirement obligation as of end of period $ 347,309 $ 321,101 Property and Equipment Property and equipment are stated at cost, expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of the assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation and amortization are removed from the related accounts and any gain or loss is reflected in operations. All property and equipment are depreciated or amortized (to the extent of estimated salvage values) on the straight-line method and the estimated useful lives of the assets are as follows: Heavy Equipment 3-15 years Furniture and fixture 3-5 years Vehicles 3-7 years The components of a well servicing rig generally require replacement or refurbishment during the well servicing rig's life and are depreciated over their estimated useful lives, which ranges from 3 to 15 years. The costs of the original components of a purchased or acquired well servicing rig are not maintained separately from the base rig. Income Taxes We account for income taxes in accordance with Accounting Standards Codification ("ASC") Topic 740, Income Taxes. Under this standard, deferred tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities using the enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance when we cannot make the determination that it is more likely than not that some portion or all of the related tax asset will be realized. Interest and penalties on tax deficiencies recognized in accordance with accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19. We follow ASC 740-10-05 Accounting for Uncertainty in Income Taxes which prescribes a threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken on a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Contingent Liabilities The Company records contingent liabilities when the amounts were incurred and determined to be probable. Otherwise the Company will disclose the matter(s) and provide a range or best estimate of the contingency in the notes to the financial statements. Loss Per Share The Company computes net loss per share in accordance with ASC Topic 260, "Earnings per Share," Under the provisions of the standard, basic and diluted net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. During periods when losses occur, common stock equivalents, if any, are not considered in the computation as their effect would be anti-dilutive. Concentration of Credit Risk Financial instruments that potentially subject the Companies to concentrations of credit risk consist primarily of cash equivalents and accounts receivable. The Companies places its cash equivalents with a high credit quality financial institution. The Company periodically maintains cash balances at a commercial bank in excess of the Federal Deposit Insurance Corporation insurance limit of $250,000. Major Customers As of July 31, 2016, three customers each comprised more than 10% of the Company's accounts receivable balance; at approximately 18%, 14% and 11%, respectively. Revenues from these customers represented 16%, 11% and 2% of total revenues, respectively, for the three months ended July 31, 2016. No other customer exceeded 10% of total revenues for the three months ended July 31, 2016. Recent Accounting Pronouncements In August 2015, the FASB issued Update No. 2015-14 - Revenue from Contracts with Customers to defer the effective date of the new revenue recognition standard by one year. The new revenue recognition standard is now effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted but only for annual periods, and interim periods within those annual periods, beginning after December 15, 2016. The Company is reviewing its contracts and is assessing the impact of Update 2015-14, but does not currently believe this guidance will have a material effect on the Company's financial statements or disclosures. In February 2016, the FASB issued ASU 2016-02 "Leases (Topic 842)", which requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. We are currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements. The Company does not believe that any other recently issued or proposed accounting pronouncements will have a material impact on its financial position, results of operations or cash flows. Segment Disclosure FASB Codification Topic 280, Segment Reporting, establishes standards for reporting financial and descriptive information about an enterprise's reportable segments. The Company has two reportable segments: Exploration and Production (E&P) and the Services division. The segments are determined based on several factors, including the nature of product and service. Refer to Note 1 for a description of the various services performed by the Company. Prior to the February 1, 2016, the Company only had one reporting segment. An operating segment's performance is evaluated based on its pre-tax operating contribution, or segment income. Segment income is defined as oil and gas sales and service revenue less cost of sales and services, and segment selling, general and administrative expenses. Three months ended Selected Financial Data; July 31, 2016 Sales Oil and Gas $ 61,459 Oilfield Services 2,078,332 Total Sales $ 2,139,791 Segment income (loss) and reconciliation before tax Oil and Gas $ (47,833 ) Oilfield Services (95,379 ) Total segment income (loss) $ (143,212 ) Reconciling items General and administrative $ 897,147 Interest 72,623 Net loss $ (1,112,982 ) Total assets Oil and Gas $ 7,552,002 Oilfield Services 14,899,353 $ 22,451,355

Note 4 - Property and Equipment

Note 4 - Property and Equipment	9 Months Ended
	Jul. 31, 2016
Notes
Note 4 - Property and Equipment	NOTE 4 – PROPERTY AND EQUIPMENT Property and equipment consisted of the following: July 31, 2016 October 31, 2015 Heavy equipment $ 8,241,413 $ - Pickup trucks 784,157 - Other property and equipment 2,188,181 2,168,392 11,213,751 2,168,392 Less accumulated depreciation and amortization (1,218,729 ) (322,281 ) Property and Equipment, net $ 9,995,022 $ 1,846,111

Note 5 - Participation Agreemen

Note 5 - Participation Agreement	9 Months Ended
	Jul. 31, 2016
Notes
Note 5 - Participation Agreement	NOTE 5 – PARTICIPATION AGREEMENT In connection with the convertible promissory note described in Note 7, the Company entered into a participation agreement with a nonaffiliated company whereby the nonaffiliated company would advance up to $350,000 to conduct additional development of the underlying leases at the Garcia Field and drill and complete three additional wells on the acreage. During 2012, $250,000 was advanced to the Company. In consideration for extending this credit arrangement, the lender was assigned a 1% overriding royalty interest in the 4,600 acre field, a 20% modified net profits interest in the existing four producing wells in the Garcia Field and a 20% modified net profits interest in three additional wells to be drilled on the acreage. The Company valued the net profits interest and the overriding royalty interest at $136,599 using 10% present value over the estimated life of the wells. The amount was recorded as a debt discount and was amortized using the effective interest rate method over the life of the promissory note (3 years). The modified net profits interest is based on the gross proceeds from the sale of oil, gas and other minerals in the four producing wells in the Garcia Field and three additional wells to be drilled. The 20% is applied to 100% of the Company's net revenue interest in the wells which cannot be less than 80% and is reduced by any of the following expenditures: any overriding royalties or other burden on production in excess of the 80% net revenue interest; production, severance and similar taxes assessed by any taxing authority based on volume or value of the production; direct costs incurred in producing oil or natural gas, or the operation of the wells excluding administrative, supervisory or other indirect costs; costs reasonably incurred to process the production for market; costs reasonably incurred in transportation, delivery, storage or marketing the production.

Note 6 - Notes Payable - Relate

Note 6 - Notes Payable - Related Party	9 Months Ended
	Jul. 31, 2016
Notes
Note 6 - Notes Payable - Related Party	NOTE 6 – NOTES PAYABLE – RELATED PARTY In December 2010, the Company entered into a purchase and sale agreement to acquire certain oil and gas assets located in Adams, Broomfield, Huerfano, Las Animas, Morgan and Weld counties, Colorado. The Company issued 2,500,000 shares of its $0.0001 par value common stock and a promissory note for $360,000 bearing interest at 10% with an original maturity date of March 1, 2011. The shares were valued at $1 per share based on sales of the Company's common stock to third-parties. The promissory note is collateralized by the property and equipment transferred and was subsequently subrogated to a convertible promissory note on January 12, 2012 and matures on December 11, 2016. The balance on the note is $107,070 at July 31, 2016 with interest accrued in the amount of $23,324. In February 2016 the Company entered into a purchase and sales agreement to acquired DESI. As part of the purchase price, the Company issued an unsecured note for $2,000,000, to one of the owners of DESI, bearing interest at 2% with a maturity date of February 2018.

Note 7 - Long Term Debt and Not

Note 7 - Long Term Debt and Notes Payables	9 Months Ended
	Jul. 31, 2016
Notes
Note 7 - Long Term Debt and Notes Payables	NOTE 7 – LONG TERM DEBT AND NOTES PAYABLES Convertible Promissory Note On October 14, 2014 the Company acquired approximately 98% of the outstanding shares of BIYA Operators, Inc. ("BIYA") an independent oil and gas company. The Company issued a promissory note in the principal amount of approximately $1,860,000 (subject to adjustment for unknown liabilities). The note will be effective when certain leases covering Indian tribal lands have been issued. The note will bear interest at 5% a year and will be payable in October 2016. In May 2012 BIYA entered into a settlement agreement with a previous partner for $1.2 million. The amount is non-interest bearing and has a minimum monthly payment of $10,000, plus one third of BIYA's net profits, as defined in the agreement. On April 1, 2015, the agreement was amended, where the balance due will bear interest at 6% a year and has a fixed monthly payment of $5,500 until paid in full. The balance due was $486,161 at July 31, 2016. Secured Notes AR Facility Installment Loan The Company entered into various installment loans in 2014 and 2015 bearing interest ranging from 0% to 4.5%. The loans are payable in monthly installments ranging from $715 and $4,000 over 36 to 60 months. The loans are collateralized by heavy equipment, trucks and vehicles. On August 15, 2015, the Company entered into installment loans bearing interest of 4.5%. The loans are payable in monthly installments of $38,000 over 48 months and are collateralized by heavy equipment and trucks. The following summarizes the notes payable at: July 31, 2016 October 31, 2015 Convertible promissory note $ 248,895 $ 248,895 BIYA note 1,860,000 1,860,000 BIYA settlement 486,161 489,154 Convertible promissory notes 1,450,000 1,250,000 Discount on convertible promissory notes (90,000 ) (126,000 ) DESI note 2,000,000 - Installment loan 3,042,663 95,691 8,997,719 3,817,740 Less current portion 1,360,922 (319,632 ) $ 7,632,209 $ 3,498,108

Note 8 - Capital Lease Obligati

Note 8 - Capital Lease Obligations	9 Months Ended
	Jul. 31, 2016
Notes
Note 8 - Capital Lease Obligations	NOTE 8 – CAPITAL LEASE OBLIGATIONS The Companies leases various assets under capital leases expiring through 2019 as follows: July 31 2016 Heavy equipment $ 478,637 Less accumulated depreciation 153,681 Net $ 324,956 Amortization expense on assets under capital leases was $28,501 for the three months ended July 31, 2016. Aggregate future minimum rentals under capital leases are as follows: July 31, 2016 $ 69,058 2017 84,226 2018 82,980 2019 19,705 Total 255,969 Less interest 7,241 Present value of minimum lease payments 248,728 Less current portion of capital lease obligations 89,004 Capital lease obligations, net of current portion $ 159,724

Note 9 - Income Taxes

Note 9 - Income Taxes	9 Months Ended
	Jul. 31, 2016
Notes
Note 9 - Income Taxes	NOTE 9 – INCOME TAXES No provision was made for federal income tax for the three and nine months ended July 31, 2016 and 2015, since the Company had net operating losses.

Note 10 - Stockholders' Equity

Note 10 - Stockholders' Equity	9 Months Ended
	Jul. 31, 2016
Notes
Note 10 - Stockholders' Equity	NOTE 10 – STOCKHOLDERS' EQUITY The Company is authorized to issue 450,000,000 common shares of par value at $0.001 and 50,000,000 preferred shares of par value at $0.001. As of July 31, 2016, 44,893,062 shares of common stock were issued and outstanding. In March 2016 the Company converted 301,000 outstanding preferred shares for common shares at a conversion rate of two common shares for each preferred share. During the nine months ended July 31, 2016, the Company sold 120,000 shares of its common stock to a group of private investors for cash of $60,000.

Note 11 - Related Party Transac

Note 11 - Related Party Transactions	9 Months Ended
	Jul. 31, 2016
Notes
Note 11 - Related Party Transactions	NOTE 11 – RELATED PARTY TRANSACTIONS Natural Resource Group, Inc. has a lease for office space in Littleton, Colorado, with Spotswood Properties, LLC, a Colorado limited liability company ("Spotswood"), and an affiliate of the president, effective January 1, 2009, for a three-year term. Commencing July 1, 2010 the Company entered into a new lease for office space for a 3 year period ending July 1, 2013. The lease provides for the payment of $2,667 per month plus utilities and other incidentals. The president of the Company owns 50% of Spotswood. The Company is of the opinion that the terms of the lease are no less favorable than could be obtained from an unaffiliated party. Spotswood was paid $2,667 and $16,000 for the three and nine months ended July 31, 2016, respectively and $10,667 and $18,667 in three and nine months ended July 31, 2015, respectively. The Company is currently leasing the office space on a month to month basis under the same terms and conditions as the lease that expired July 31, 2013. The Company had accrued rent payable of $5,334 to Sportswood at July, 31 2016. The Company paid a director and shareholder $15,700 and $84,749 during the three and nine months ended July 31, 2016, respectively and $48,000 and $152,000 in the three and nine months ended July 31, 2015, respectively for financial public relations consulting. The Company paid the President's brother $26,850 and $71,358 during the three and nine months ended July 31, 2016, respectively and $18,160 and $57,720 in the three and nine months ended July 31, 2015, respectively for landman consulting services. The Company paid $0 and $8,210 during three and nine months ended July 31, 2016, respectively and $30,885 and $52,902 during three and nine months ended July 31, 2015, respectively to companies owned by the President of BIYA Operators Inc., the Company's wholly owned subsidiary and by his sons for field services. Capital Lease In January 1, 2015 the Company entered into capital lease agreement with one of its employee and shareholder with monthly lease payments of approximately $7,500 and maturity dates expiring through June 2019. Loan Guaranty In 2015, one of the DESI's subsidiaries financed some of the heavy equipment and trucks as described in Note 4. Under the terms of the agreement the loan was guaranteed by then owners and current employees and shareholders of the Company.

Note 12 - Commitments and Conti

Note 12 - Commitments and Contingencies	9 Months Ended
	Jul. 31, 2016
Notes
Note 12 - Commitments and Contingencies	NOTE 12 – COMMITMENTS AND CONTINGENCIES Legal — In March 2016 Gilbert Bernal and two companies he controls (collectively, the "Plaintiffs") filed a lawsuit against us in the District Court of Weld County, Colorado. In their lawsuit, Plaintiffs claim that: 1. Bernal had an ownership interest in Ultra Energy Solutions and Vinco Logistics, two of the three entities that combined to form Diversified Energy Services. 2. Bernal never consented to the transfer of his interest in Ultra Energy Solutions and Vinco Logistics to Diversified Energy Services. 3. Diversified Energy Services has possession of equipment owned by the Plaintiffs and has ignored Plaintiffs demand to return the equipment to the Plaintiffs. Diversified Energy Services has refused to repay approximately $1.3 million loaned to Ultra Energy Solutions and Vinco Logistics by the Plaintiffs. In addition to the foregoing, Plaintiffs also allege breach of contract, unjust enrichment, and civil conspiracy. Also named as Defendants in the lawsuit were Ultra Energy Solutions, Vinco Logistics, Diversified Energy Solutions, and Eric Whitehead. Mr. Whitehead is a former owner of Ultra Energy Solutions and is one of our directors. In their complaint Plaintiffs request damages to be determined at trial, the return of their equipment, and the repayment of their loans. We have filed an answer denying Plaintiffs' claims. Subsequent to the filing of the lawsuit, we have been in settlement discussions with the Plaintiffs. Based upon our estimate of potential liability, we believe we may be able to settle this matter by issuing the plaintiffs shares of our common stock and have a potential liability of between $500,000 and $1,000,000 payable over a 3 to 5 years period. We have accrued a liability and booked expense of $750,000 related to the cash portion of the potential liability. Environmental — Concentration – The Company is subject to various federal, state and local environmental laws and regulations that establish standards and requirements for the protection of the environment. The Company cannot predict the future impact of such standards and requirements, which are subject to change and can have retroactive effectiveness. The Company continues to monitor the status of these laws and regulations. Management believes that the likelihood of any of these items resulting in a material adverse impact to the Company's financial position, liquidity, capital resources or future results of operations is remote. Currently, the Company has not been fined, cited or notified of any environmental violations that would have a material adverse effect upon its financial position, liquidity or capital resources. However, management does recognize that by the very nature of its business, material costs could be incurred in the near term to bring the Company into total compliance. The amount of such future expenditures is not determinable due to several factors, including the unknown magnitude of possible contamination, the unknown timing and extent of the corrective actions which may be required, the determination of the Company's liability in proportion to other responsible parties and the extent to which such expenditures are recoverable from insurance or indemnification.

Note 13 - Acquisition

Note 13 - Acquisition	9 Months Ended
	Jul. 31, 2016
Notes
Note 13 - Acquisition	NOTE 13 – ACQUISITION On February 1, 2016 we acquired 100% of the outstanding shares of DESI, a holding company comprised of three oilfield services companies, for 20,032,710 restricted shares of our common stock having a value of approximately $10,016,356, a promissory note in the principal amount of approximately $2,000,000 and the assumption of DESI's liabilities in the approximate amount of $4,162,900 (subject to adjustment for unknown liabilities). As a result, we recorded goodwill of $3,984,695. The note bears interest at 2% a year and is payable in February 2018. DESI provides a wide range of services, including Crane and Rigging, Trucking Various Materials, Custom Fabrication, Well Site Construction; including Land cleaning/leveling/grading, Excavation and backfill, Access roads, Pad construction, Tank battery installation teardown, and replacement etc, Well Site Supervision, Pipeline Construction, Pressure Testing, Fencing, Environmental Remediation and Equipment Rental. DESI's operations are concentrated in northern Colorado and Wyoming. The consolidated pro forma results of operations as if the acquisition had occurred at the beginning of the last fiscal year and the beginning of this fiscal year are as follows: The consolidated unaudited pro forma operating revenue and net loss for the twelve months ended October 31, 2015 is $22.6 million and ($2.5) million, respectively, resulting in loss per share of $0.06. The consolidated unaudited pro forma operating revenue and net loss for the three months ended January 31, 2016 is $4.7 million and ($1.4) million, respectively, resulting in loss per share of $0.04. The Company has included the results of DESI's operations in its consolidated financial statements beginning on February 1, 2016. Fair values of the assets acquired and liabilities assumed in the acquisition of DESI are summarized below: Current assets, including cash and cash equivalents of $503,389 $ 3,906,845 Property, plant and equipment 8,270,765 Bonds and other assets 16,000 Total assets acquired 12,196,610 Current liabilities (1,487,535 ) Long-term liabilities (2,674,414 ) Net assets acquired 8,031,661 Goodwill 3,984,695 Net consideration $ 12,016,356 The amounts shown above are considered preliminary and are subject to change once the Company receives certain information it believes is necessary to finalize its determination of the fair value of assets acquired and liabilities assumed under the acquisition method. Thus these amounts are subject to refinement, and additional adjustments to record fair value of all assets acquired and liabilities assumed may be required.

Note 14 - Stock Compensation

Note 14 - Stock Compensation	9 Months Ended
	Jul. 31, 2016
Notes
Note 14 - Stock Compensation	NOTE 14 – STOCK COMPENSATION During the three and nine months ended July 31, 2016 the Company recorded stock based compensation of $0 and $365,130, respectively, for shares granted and issued, no such compensation was recorded in the three and nine months ended July 31, 2015. The expense was recorded based on the fair market value of the common stock ($0.40 per share) on the issuance date.

Note 15 - Subsequent Events

Note 15 - Subsequent Events	9 Months Ended
	Jul. 31, 2016
Notes
Note 15 - Subsequent Events	NOTE 15 – SUBSEQUENT EVENTS In August 2016, the Company terminated its capital lease agreement with one of its shareholder that had monthly lease payments of approximately $7,500. On September 20, 2016 the Company sent a "Notice of Deduction from Principal" to the previous owners of BIYA and holders of a promissory note in the principal amount of approximately $1,860,000 (subject to adjustment for unknown liabilities), related to the purchase of BIYA. In accordance with the Article 1.6 of the promissory note, the Company has the right to deduct from the principal of the note any liabilities of BIYA in existence as of October 1, 2014, purchase date, which were not disclosed to the Company. The Company has notified the note holders of the following liabilities to be deducted from the note. Deductions related to incurred and estimated environmental clean up, related to spills that had incurred prior to October 1, 2014. Deductions related to lost production due to the spills. Deductions related to undisclosed royalties and other liabilities.

Note 3 - Summary of Significa21

Note 3 - Summary of Significant Accounting Policies: Principles of Consolidation (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Principles of Consolidation	Principles of Consolidation The accompanying consolidated unaudited financial statements include the accounts of Diversified Resources, Inc. and its wholly owned subsidiaries, Natural Resource Group, Inc., BIYA Operators, Inc. and Diversified Energy Services, Inc. Any inter-company accounts and transactions have been eliminated.

Note 3 - Summary of Significa22

Note 3 - Summary of Significant Accounting Policies: Nature of Operations (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Nature of Operations	Nature of Operations Our subsidiaries NRG and BIYA have oil and gas producing properties in Colorado and New Mexico, respectively. DESI offers a full range of services to the Rocky Mountain energy and construction industries and is dedicated to becoming the "one call, last call" solution to a full range of oil field service needs. DESI offers Crane Service, Well Site Construction, Materials Handling and Disposal, Trucking Services, Equipment Operation, and Rigging to the energy industry in the Denver Julesburg Basin, the Rockies and San Juan basin in New Mexico. These services are primarily provided using DESI's fleet of equipment.

Note 3 - Summary of Significa23

Note 3 - Summary of Significant Accounting Policies: Cash and Cash Equivalents (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Cash and Cash Equivalents	Cash and cash equivalents The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents. The Company holds only cash as of July 31, 2016.

Note 3 - Summary of Significa24

Note 3 - Summary of Significant Accounting Policies: Use of Estimates (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Use of Estimates	Use of estimates The preparation of 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates of oil and gas reserve quantities provide the basis for the calculation of depletion, depreciation, and amortization, and impairment, each of which represents a significant component of the financial statements. Actual results could differ from those estimates.

Note 3 - Summary of Significa25

Note 3 - Summary of Significant Accounting Policies: Revenue Recognition (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Revenue Recognition	Revenue Recognition We recognize oil and gas revenue from interests in producing wells as the oil and gas is sold. Revenue from the purchase, transportation, and sale of natural gas is recognized upon completion of the sale and when transported volumes are delivered. We recognize revenue related to gas balancing agreements based on the sales method. Our net imbalance position at July 31, 2016 and October 31, 2015 was immaterial. We recognize revenue when services are performed, collection of the relevant receivables is probable, persuasive evidence of an arrangement exists and the price is fixed or determinable. DESI prices services by the hour, day, or project depending on the type of service performed.

Note 3 - Summary of Significa26

Note 3 - Summary of Significant Accounting Policies: Accounts Receivable and Allowance For Doubtful Accounts (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Accounts Receivable and Allowance For Doubtful Accounts	Accounts Receivable and Allowance for Doubtful Accounts Our credit terms for our billings is net 30 days. Accounts receivables are determined to be past due if payments are not made in accordance with the terms and an allowance is recorded for accounts when there are indicators that the receivables may not be recovered. Customary collection efforts are initiated and receivables are written off when we determine they are not collectible and abandon these collection efforts. We evaluate the past due accounts to setup an allowance for doubtful accounts on a regular basis for adequacy based upon our periodic review of the collectability of the receivables in light of historical experience, adverse situations that may affect our customers' ability to pay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision as more information becomes available.

Note 3 - Summary of Significa27

Note 3 - Summary of Significant Accounting Policies: Accounting For Oil and Gas Activities (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Accounting For Oil and Gas Activities	Accounting for Oil and Gas Activities Successful Efforts Method Depreciation, depletion and amortization Impairments Proved Property Impairment Unproved Property Impairment Exploration Costs , Asset Retirement Obligations The following table reconciles the asset retirement obligation for nine months ended July 31, 2016 and year ended October 31, 2015: 2016 2015 Asset retirement obligation as of beginning of period $ 321,101 $ 290,312 Liabilities added - - Liabilities settled - - Revision of estimated obligation - - Accretion expense on discounted obligation 26,208 30,789 Asset retirement obligation as of end of period $ 347,309 $ 321,101

Note 3 - Summary of Significa28

Note 3 - Summary of Significant Accounting Policies: Property and Equipment (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Property and Equipment	Property and Equipment Property and equipment are stated at cost, expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of the assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation and amortization are removed from the related accounts and any gain or loss is reflected in operations. All property and equipment are depreciated or amortized (to the extent of estimated salvage values) on the straight-line method and the estimated useful lives of the assets are as follows: Heavy Equipment 3-15 years Furniture and fixture 3-5 years Vehicles 3-7 years The components of a well servicing rig generally require replacement or refurbishment during the well servicing rig's life and are depreciated over their estimated useful lives, which ranges from 3 to 15 years. The costs of the original components of a purchased or acquired well servicing rig are not maintained separately from the base rig.

Note 3 - Summary of Significa29

Note 3 - Summary of Significant Accounting Policies: Income Taxes (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Income Taxes	Income Taxes We account for income taxes in accordance with Accounting Standards Codification ("ASC") Topic 740, Income Taxes. Under this standard, deferred tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities using the enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance when we cannot make the determination that it is more likely than not that some portion or all of the related tax asset will be realized. Interest and penalties on tax deficiencies recognized in accordance with accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19. We follow ASC 740-10-05 Accounting for Uncertainty in Income Taxes which prescribes a threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken on a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement.

Note 3 - Summary of Significa30

Note 3 - Summary of Significant Accounting Policies: Contingent Liabilities (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Contingent Liabilities	Contingent Liabilities The Company records contingent liabilities when the amounts were incurred and determined to be probable. Otherwise the Company will disclose the matter(s) and provide a range or best estimate of the contingency in the notes to the financial statements.

Note 3 - Summary of Significa31

Note 3 - Summary of Significant Accounting Policies: Loss Per Share (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Loss Per Share	Loss Per Share The Company computes net loss per share in accordance with ASC Topic 260, "Earnings per Share," Under the provisions of the standard, basic and diluted net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. During periods when losses occur, common stock equivalents, if any, are not considered in the computation as their effect would be anti-dilutive.

Note 3 - Summary of Significa32

Note 3 - Summary of Significant Accounting Policies: Concentration of Credit Risk (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Concentration of Credit Risk	Concentration of Credit Risk Financial instruments that potentially subject the Companies to concentrations of credit risk consist primarily of cash equivalents and accounts receivable. The Companies places its cash equivalents with a high credit quality financial institution. The Company periodically maintains cash balances at a commercial bank in excess of the Federal Deposit Insurance Corporation insurance limit of $250,000.

Note 3 - Summary of Significa33

Note 3 - Summary of Significant Accounting Policies: Major Customers (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Major Customers	Major Customers As of July 31, 2016, three customers each comprised more than 10% of the Company's accounts receivable balance; at approximately 18%, 14% and 11%, respectively. Revenues from these customers represented 16%, 11% and 2% of total revenues, respectively, for the three months ended July 31, 2016. No other customer exceeded 10% of total revenues for the three months ended July 31, 2016.

Note 3 - Summary of Significa34

Note 3 - Summary of Significant Accounting Policies: Recent Accounting Pronouncements (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Recent Accounting Pronouncements	Recent Accounting Pronouncements In August 2015, the FASB issued Update No. 2015-14 - Revenue from Contracts with Customers to defer the effective date of the new revenue recognition standard by one year. The new revenue recognition standard is now effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted but only for annual periods, and interim periods within those annual periods, beginning after December 15, 2016. The Company is reviewing its contracts and is assessing the impact of Update 2015-14, but does not currently believe this guidance will have a material effect on the Company's financial statements or disclosures. In February 2016, the FASB issued ASU 2016-02 "Leases (Topic 842)", which requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. We are currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements. The Company does not believe that any other recently issued or proposed accounting pronouncements will have a material impact on its financial position, results of operations or cash flows.

Note 3 - Summary of Significa35

Note 3 - Summary of Significant Accounting Policies: Segment Disclosure (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Segment Disclosure	Segment Disclosure FASB Codification Topic 280, Segment Reporting, establishes standards for reporting financial and descriptive information about an enterprise's reportable segments. The Company has two reportable segments: Exploration and Production (E&P) and the Services division. The segments are determined based on several factors, including the nature of product and service. Refer to Note 1 for a description of the various services performed by the Company. Prior to the February 1, 2016, the Company only had one reporting segment. An operating segment's performance is evaluated based on its pre-tax operating contribution, or segment income. Segment income is defined as oil and gas sales and service revenue less cost of sales and services, and segment selling, general and administrative expenses. Three months ended Selected Financial Data; July 31, 2016 Sales Oil and Gas $ 61,459 Oilfield Services 2,078,332 Total Sales $ 2,139,791 Segment income (loss) and reconciliation before tax Oil and Gas $ (47,833 ) Oilfield Services (95,379 ) Total segment income (loss) $ (143,212 ) Reconciling items General and administrative $ 897,147 Interest 72,623 Net loss $ (1,112,982 ) Total assets Oil and Gas $ 7,552,002 Oilfield Services 14,899,353 $ 22,451,355

Note 12 - Commitments and Con36

Note 12 - Commitments and Contingencies: Legal Matters and Contingencies (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Legal Matters and Contingencies	Legal — In March 2016 Gilbert Bernal and two companies he controls (collectively, the "Plaintiffs") filed a lawsuit against us in the District Court of Weld County, Colorado. In their lawsuit, Plaintiffs claim that: 1. Bernal had an ownership interest in Ultra Energy Solutions and Vinco Logistics, two of the three entities that combined to form Diversified Energy Services. 2. Bernal never consented to the transfer of his interest in Ultra Energy Solutions and Vinco Logistics to Diversified Energy Services. 3. Diversified Energy Services has possession of equipment owned by the Plaintiffs and has ignored Plaintiffs demand to return the equipment to the Plaintiffs. Diversified Energy Services has refused to repay approximately $1.3 million loaned to Ultra Energy Solutions and Vinco Logistics by the Plaintiffs. In addition to the foregoing, Plaintiffs also allege breach of contract, unjust enrichment, and civil conspiracy. Also named as Defendants in the lawsuit were Ultra Energy Solutions, Vinco Logistics, Diversified Energy Solutions, and Eric Whitehead. Mr. Whitehead is a former owner of Ultra Energy Solutions and is one of our directors. In their complaint Plaintiffs request damages to be determined at trial, the return of their equipment, and the repayment of their loans. We have filed an answer denying Plaintiffs' claims. Subsequent to the filing of the lawsuit, we have been in settlement discussions with the Plaintiffs. Based upon our estimate of potential liability, we believe we may be able to settle this matter by issuing the plaintiffs shares of our common stock and have a potential liability of between $500,000 and $1,000,000 payable over a 3 to 5 years period. We have accrued a liability and booked expense of $750,000 related to the cash portion of the potential liability.

Note 12 - Commitments and Con37

Note 12 - Commitments and Contingencies: Commitments Contingencies and Guarantees (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Commitments Contingencies and Guarantees	Environmental —

Note 12 - Commitments and Con38

Note 12 - Commitments and Contingencies: Commitments Disclosure (Policies)	9 Months Ended
	Jul. 31, 2016
Policies
Commitments Disclosure	Concentration – The Company is subject to various federal, state and local environmental laws and regulations that establish standards and requirements for the protection of the environment. The Company cannot predict the future impact of such standards and requirements, which are subject to change and can have retroactive effectiveness. The Company continues to monitor the status of these laws and regulations. Management believes that the likelihood of any of these items resulting in a material adverse impact to the Company's financial position, liquidity, capital resources or future results of operations is remote. Currently, the Company has not been fined, cited or notified of any environmental violations that would have a material adverse effect upon its financial position, liquidity or capital resources. However, management does recognize that by the very nature of its business, material costs could be incurred in the near term to bring the Company into total compliance. The amount of such future expenditures is not determinable due to several factors, including the unknown magnitude of possible contamination, the unknown timing and extent of the corrective actions which may be required, the determination of the Company's liability in proportion to other responsible parties and the extent to which such expenditures are recoverable from insurance or indemnification.

Note 3 - Summary of Significa39

Note 3 - Summary of Significant Accounting Policies: Accounting For Oil and Gas Activities: Schedule of Asset Retirement Obligations (Tables)	9 Months Ended
	Jul. 31, 2016
Tables/Schedules
Schedule of Asset Retirement Obligations	2016 2015 Asset retirement obligation as of beginning of period $ 321,101 $ 290,312 Liabilities added - - Liabilities settled - - Revision of estimated obligation - - Accretion expense on discounted obligation 26,208 30,789 Asset retirement obligation as of end of period $ 347,309 $ 321,101

Note 3 - Summary of Significa40

Note 3 - Summary of Significant Accounting Policies: Segment Disclosure: Schedule of Segment Reporting Information, by Segment (Tables)	9 Months Ended
	Jul. 31, 2016
Tables/Schedules
Schedule of Segment Reporting Information, by Segment	Three months ended Selected Financial Data; July 31, 2016 Sales Oil and Gas $ 61,459 Oilfield Services 2,078,332 Total Sales $ 2,139,791 Segment income (loss) and reconciliation before tax Oil and Gas $ (47,833 ) Oilfield Services (95,379 ) Total segment income (loss) $ (143,212 ) Reconciling items General and administrative $ 897,147 Interest 72,623 Net loss $ (1,112,982 ) Total assets Oil and Gas $ 7,552,002 Oilfield Services 14,899,353 $ 22,451,355

Note 4 - Property and Equipme41

Note 4 - Property and Equipment: Property, Plant and Equipment (Tables)	9 Months Ended
	Jul. 31, 2016
Tables/Schedules
Property, Plant and Equipment	July 31, 2016 October 31, 2015 Heavy equipment $ 8,241,413 $ - Pickup trucks 784,157 - Other property and equipment 2,188,181 2,168,392 11,213,751 2,168,392 Less accumulated depreciation and amortization (1,218,729 ) (322,281 ) Property and Equipment, net $ 9,995,022 $ 1,846,111

Note 7 - Long Term Debt and N42

Note 7 - Long Term Debt and Notes Payables: Schedule of Debt (Tables)	9 Months Ended
	Jul. 31, 2016
Tables/Schedules
Schedule of Debt	July 31, 2016 October 31, 2015 Convertible promissory note $ 248,895 $ 248,895 BIYA note 1,860,000 1,860,000 BIYA settlement 486,161 489,154 Convertible promissory notes 1,450,000 1,250,000 Discount on convertible promissory notes (90,000 ) (126,000 ) DESI note 2,000,000 - Installment loan 3,042,663 95,691 8,997,719 3,817,740 Less current portion 1,360,922 (319,632 ) $ 7,632,209 $ 3,498,108

Note 8 - Capital Lease Obliga43

Note 8 - Capital Lease Obligations: Schedule of Rent Expense (Tables)	9 Months Ended
	Jul. 31, 2016
Tables/Schedules
Schedule of Rent Expense	July 31 2016 Heavy equipment $ 478,637 Less accumulated depreciation 153,681 Net $ 324,956

Note 8 - Capital Lease Obliga44

Note 8 - Capital Lease Obligations: Schedule of Future Minimum Lease Payments for Capital Leases (Tables)	9 Months Ended
	Jul. 31, 2016
Tables/Schedules
Schedule of Future Minimum Lease Payments for Capital Leases	July 31, 2016 $ 69,058 2017 84,226 2018 82,980 2019 19,705 Total 255,969 Less interest 7,241 Present value of minimum lease payments 248,728 Less current portion of capital lease obligations 89,004 Capital lease obligations, net of current portion $ 159,724

Note 13 - Acquisition_ Schedule

Note 13 - Acquisition: Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Tables)	9 Months Ended
	Jul. 31, 2016
Tables/Schedules
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed	Current assets, including cash and cash equivalents of $503,389 $ 3,906,845 Property, plant and equipment 8,270,765 Bonds and other assets 16,000 Total assets acquired 12,196,610 Current liabilities (1,487,535 ) Long-term liabilities (2,674,414 ) Net assets acquired 8,031,661 Goodwill 3,984,695 Net consideration $ 12,016,356

Note 2 - Organization and Goi46

Note 2 - Organization and Going Concern (Details)	Jul. 31, 2016USD ($)
Details
Development Stage Enterprise, Deficit Accumulated During Development Stage	$ 11,323,446
Capital	$ 1,980,292

Note 4 - Property and Equipme47

Note 4 - Property and Equipment: Property, Plant and Equipment (Details) - USD ($)	Jul. 31, 2016		Oct. 31, 2015
Details
Property and Equipment	$ 9,995,022	[1]	$ 1,846,111	[2]
[1]	Net of accumulated depreciation and amortization of $1,218,729.
[2]	Net of accumulated depreciation and amortization of $322,281.

Note 6 - Notes Payable - Rela48

Note 6 - Notes Payable - Related Party (Details) - USD ($)	Jul. 31, 2016	Oct. 31, 2015
Details
Note payable - related party	$ 107,070	$ 107,070

Note 7 - Long Term Debt and N49

Note 7 - Long Term Debt and Notes Payables (Details)	Jul. 31, 2016USD ($)
Details
Senior Notes, Current	$ 486,161

Note 10 - Stockholders' Equity

Note 10 - Stockholders' Equity (Details) - $ / shares	Jul. 31, 2016	Oct. 31, 2015
Details
Common Stock, Shares Authorized	450,000,000	450,000,000
Common Stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	50,000,000	50,000,000
Common Stock, Shares Outstanding	44,893,062	23,215,926
Preferred Stock, Shares Outstanding	0	301,000

Note 11 - Related Party Trans51

Note 11 - Related Party Transactions (Details) - USD ($)	3 Months Ended		9 Months Ended
	Jul. 31, 2016	Jul. 31, 2015	Jul. 31, 2016	Jul. 31, 2015
Details
Operating Leases, Rent Expense, Net	$ 2,667	$ 10,667	$ 16,000	$ 18,667
Marketing and Advertising Expense	15,700	48,000	84,749	152,000
Professional and Contract Services Expense	26,850	18,160	71,358	57,720
Related Party Costs	$ 0	$ 30,885	$ 8,210	$ 52,902

Note 14 - Stock Compensation (D

Note 14 - Stock Compensation (Details) - USD ($)	3 Months Ended	9 Months Ended
	Jul. 31, 2016	Jul. 31, 2016
Details
Share-based Compensation	$ 0	$ 365,130