Cover
Cover - shares | 3 Months Ended | |
Jun. 30, 2020 | Jul. 22, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | PetroGas Co | |
Entity Central Index Key | 0001609258 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | true | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Jun. 30, 2020 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 | |
Entity Ex Transition Period | false | |
Entity Common Stock Shares Outstanding | 3,874,473 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes |
BALANCE SHEETS
BALANCE SHEETS - USD ($) | Jun. 30, 2020 | Mar. 31, 2020 |
ASSETS | ||
Current Assets | $ 0 | $ 0 |
TOTAL ASSETS | 0 | 0 |
Current Liabilities | ||
Bank indebtedness | 322 | 322 |
Accounts payable and accrued liabilities | 15,986 | 18,024 |
Accrued interest | 83,327 | 71,504 |
Advances from related party | 28,541 | 28,541 |
Convertible promissory notes, net of discount of $856 and $9,424, respectively | 207,778 | 189,210 |
Promissory note | 6,962 | 6,962 |
Total Current Liabilities | 342,916 | 314,563 |
Long-term liabilities | ||
Asset retirement obligations | 83,580 | 83,580 |
Promissory note - related party | 42,683 | 42,683 |
Total long-term liabilities | 126,263 | 126,263 |
TOTAL LIABILITIES | 469,179 | 440,826 |
SHAREHOLDERS' DEFICIT | ||
Common stock: 300,000,000 authorized; $0.001 par value 3,874,473 shares issued and outstanding | 3,874 | 3,874 |
Additional paid in capital | 1,456,454 | 1,446,454 |
Accumulated deficit | (1,929,507) | (1,891,154) |
TOTAL SHAREHOLDERS' DEFICIT | (469,179) | (440,826) |
TOTAL LIABILITIES & SHAREHOLDERS' DEFICIT | $ 0 | $ 0 |
BALANCE SHEETS (Parenthetical)
BALANCE SHEETS (Parenthetical) - USD ($) | Jun. 30, 2020 | Mar. 31, 2020 |
Current Liabilities | ||
Convertible promissory notes, net of discount | $ 856 | $ 9,424 |
SHAREHOLDERS' DEFICIT | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 3,874,473 | 3,874,473 |
Common stock, shares outstanding | 3,874,473 | 3,874,473 |
STATEMENTS OF OPERATIONS (Unaud
STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
STATEMENTS OF OPERATIONS (Unaudited) | ||
ROYALTY REVENUE | $ 0 | $ 166 |
OPERATING EXPENSES | ||
Stock based compensation | 0 | 90,000 |
Professional fees | 7,838 | 0 |
General and administrative expense | 125 | 2,063 |
Total operating expenses | 7,963 | 92,063 |
Loss from Operations | (7,963) | (91,897) |
OTHER EXPENSE | ||
Interest expense | 30,390 | 24,014 |
Total other expense | 30,390 | 24,014 |
NET LOSS | $ (38,353) | $ (115,911) |
NET LOSS PER SHARE, BASIC AND DILUTED | $ (0.01) | $ (0.03) |
WEIGHTED AVERAGE SHARES OUTSTANDING, BASIC AND DILUTED | 3,874,473 | 3,587,660 |
STATEMENTS OF SHAREHOLDERS' DEF
STATEMENTS OF SHAREHOLDERS' DEFICIT (Unaudited) - USD ($) | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit |
Balance, shares at Mar. 31, 2019 | 300,993 | |||
Balance, amount at Mar. 31, 2019 | $ (344,027) | $ 301 | $ 1,326,435 | $ (1,670,763) |
Rounding off of reverse stock split, shares | 3,480 | |||
Rounding off of reverse stock split, amount | 0 | $ 3 | (3) | 0 |
Common stock issued for compensation, shares | 3,000,000 | |||
Common stock issued for compensation, amount | 90,000 | $ 3,000 | 87,000 | 0 |
Conversion of convertible notes into common stock, shares | 570,000 | |||
Conversion of convertible notes into common stock, amount | 5,700 | $ 570 | 5,130 | 0 |
Convertible notes debt discount | 7,243 | 0 | 7,243 | 0 |
Net loss | (115,911) | $ 0 | 0 | (115,911) |
Balance, shares at Jun. 30, 2019 | 3,874,473 | |||
Balance, amount at Jun. 30, 2019 | (356,995) | $ 3,874 | 1,425,805 | (1,786,674) |
Balance, shares at Mar. 31, 2020 | 3,874,473 | |||
Balance, amount at Mar. 31, 2020 | (440,826) | $ 3,874 | 1,446,454 | (1,891,154) |
Convertible notes debt discount | 10,000 | 0 | 10,000 | 0 |
Net loss | (38,353) | $ 0 | 0 | (38,353) |
Balance, shares at Jun. 30, 2020 | 3,874,473 | |||
Balance, amount at Jun. 30, 2020 | $ (469,179) | $ 3,874 | $ 1,456,454 | $ (1,929,507) |
STATEMENT OF CASH FLOWS (Unaudi
STATEMENT OF CASH FLOWS (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net Loss | $ (38,353) | $ (115,911) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Impairment of oil and gas leases | 0 | 0 |
Amortization of debt discount | 18,568 | 15,811 |
Stock based compensation | 0 | 90,000 |
Changes in operating assets and liabilities: | ||
Bank indebtedness | 0 | 310 |
Accounts payable and accrued liabilities | (2,038) | (6,042) |
Accrued interest | 11,823 | 8,202 |
Net cash used in Operating Activities | (10,000) | (7,630) |
CASH FLOWS FROM INVESTING ACTIVITIES | 0 | 0 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Issuance of convertible promissory notes | 10,000 | 7,243 |
Net cash provided by Financing Activities | 10,000 | 7,243 |
Net changes in cash and cash equivalents | 0 | (387) |
Cash and cash equivalents, beginning of period | 0 | 387 |
Cash and cash equivalents, end of period | 0 | 0 |
Supplemental cash flow information | ||
Cash paid for interest | 0 | 0 |
Cash paid for taxes | 0 | 0 |
Non-cash transactions: | ||
Conversion of convertible notes into common shares | 0 | 5,700 |
Reclassification from accounts payable to promissory note payable | $ 0 | $ 6,692 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PERSENTATION | 3 Months Ended |
Jun. 30, 2020 | |
DESCRIPTION OF BUSINESS AND BASIS OF PERSENTATION | |
NOTE 1 - DESCRIPTION OF BUSINESS AND BASIS OF PERSENTATION | Organization and nature of business PetroGas Company (Formerly America Resources Exploration Inc. (the “Company”)), was incorporated in the State of Nevada on January 24, 2014. The Company was incorporated under the name Alazzio Entertainment Corp. and changed its name to America Resources Exploration Inc. on April 17, 2015. Subsequently, on January 20, 2016, the Company changed its name to PetroGas Company. On June 12, 2015, the Company completed an acquisition of working interests in certain oil & gas properties. All share amounts in these financial statements have been adjusted to reflect this stock split. |
GOING CONCERN
GOING CONCERN | 3 Months Ended |
Jun. 30, 2020 | |
GOING CONCERN | |
NOTE 2 - GOING CONCERN | The Company had no significant revenues from the inception through June 30, 2020. As of June 30, 2020, the Company has an accumulated deficit of $1,929,507. We will need additional working capital to service debt and for ongoing operations, which raises substantial doubt about its ability to continue as a going concern. Management of the Company has developed a strategy to meet operational shortfalls which may include equity funding, short term or long term financing or debt financing, to enable the Company to reach profitable operations. The accompanying financial statements do not include any adjustments that might be necessary should we be unable to continue as a going concern. If we fail to generate positive cash flow or obtain additional financing, when required, we may have to modify, delay, or abandon some or all of our business and expansion plans. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Jun. 30, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions for Form 10-Q and Article 210 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature. Operating results for the three months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2021. For further information, refer to the financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2020 as filed with the Securities and Exchange Commission on May 26, 2020. Reclassifications Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported net (loss). Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the 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. Actual results could differ from those estimates. These estimates are reviewed periodically, and, as adjustments become necessary, they are reported in earnings in the period in which they become known. The estimates on depreciation were based on the estimated useful lives of the Company’s assets. Any estimates during the period have had an immaterial effect on earnings. Cash and Cash Equivalents Cash and cash equivalents consist of commercial accounts and interest-bearing bank deposits and are carried at cost, which approximates current value. Items are considered to be cash equivalents if the original maturity is three months or less. Oil and Gas Properties – Full Cost Method The Company follows the full cost accounting method to account for oil and natural gas properties, whereby 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. Revenue Recognition Oil and gas sales result from undivided interests held by the Company in oil and gas properties and royalty revenues. 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. Charges for gathering and transportation are included in production expenses. Revenue from royalties is recognized as they are earned, when collection is reasonably assured. Royalty revenue is recorded in the same period as the sales that generate the royalty payment. Asset Retirement Obligations The Company records 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. Inherent in the fair value calculation of an ARO are numerous assumptions and judgments including the ultimate settlement amounts, inflation factors, credit adjusted discount rates, timing of settlement, and changes in the legal, regulatory, environmental and political environments. To the extent future revisions to these assumptions impact the fair value of the existing ARO liability, a corresponding adjustment is made to the oil and gas property balance. Settlements greater than or less than amounts accrued as ARO are recorded as a gain or loss upon settlement. Fair Value of Financial Instruments The Company measures its financial assets and liabilities in accordance with the requirements of ASC 820, Fair Value Measurements and Disclosures. ASC 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. Level 2 - Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. Level 3 - Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information, The carrying value of all assets and liabilities approximated their fair values as June 30, 2020 and March 31, 2020, respectively. Stock-Based Compensation The Company follows the guidance included in ASC 718 Compensation-Stock Compensation (“ASC 718”) using the modified prospective transition method. The Company recognizes compensation expense in the financial statements for share-based awards based on the grant date fair value of those awards. For the three months ended June 30, 2020 and 2019, the Company incurred stock based compensation of $0 and $90,000, respectively. Earnings or Loss Per Share In accordance with ASC Topic 280 – “Earnings Per Share”, the basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For the three months ended June 30, 2020 and 2019, net loss per shares as the result of the computation was anti-dilutive: June 30, June 30, 2020 2019 (Shares) (Shares) Convertible notes payable 20,863,368 17,798,575 Recent Accounting Pronouncements The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. The Company regularly reviews and analyses the recent accounting pronouncements. |
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 3 Months Ended |
Jun. 30, 2020 | |
ASSET RETIREMENT OBLIGATIONS | |
NOTE 4 - ASSET RETIREMENT OBLIGATIONS | The Company has asset retirement obligations for any wells that are permanently removed from service. The primary obligations involve the removal and disposal of surface equipment, plugging and abandoning the wells and site restoration. For the purpose of determining the fair value of ARO incurred during the fiscal year ended March 31, 2016, the Company used the following assumptions. Inflation Rate 3 % Estimated asset life 20 years Credit adjusted risk free interest rate 18 % As at March 31, 2016, the Company determined to fully impair its shut in wells given a lack of production over a period in excess of two years, and the uncertainty in returning the wells to production in the future. As a result, the Company has recorded a long term liability equal to the full value of the ARO. As at June 30, 2020 and March 31, 2020, a total of $83,580 is recorded as asset retirement obligations, respectively. |
PROMISSORY NOTE RELATED PARTY
PROMISSORY NOTE RELATED PARTY | 3 Months Ended |
Jun. 30, 2020 | |
PROMISSORY NOTE RELATED PARTY | |
NOTE 5 - PROMISSORY NOTE - RELATED PARTY | On December 31, 2016, the Company entered into a promissory note with a majority shareholder, Rise Fast Limited, for an amount of $240,683. The promissory note bears interest at a rate of 2% per annum, and is payable on December 31, 2019. On July 10, 2017, the Company, along with the holder of the promissory note to assigned $174,000 of the promissory note to four individuals not related to the Company. Refer to Note 7 for further details. On October 6, 2017, the Company issued 24,000,000 common shares to the holder of the promissory note for the assignment of the notes of $24,000. On December 31, 2019, the maturity dates of the notes were extended for three years to December 31, 2022 and the interest rate was amended to 15% per annum. As of June 30, 2020 and March 31, 2020, the promissory note payable was $42,683 and $42,683 and accrued interest payable was $5,175 and $4,962, respectively. |
PROMISSORY NOTE
PROMISSORY NOTE | 3 Months Ended |
Jun. 30, 2020 | |
PROMISSORY NOTE | |
Note 6 - PROMISSORY NOTE | On May 31, 2019, the Company issued a promissory note to a legal firm at principal amount of $6,963 for the payable amount to a vendor. The note has a three month term and bears interest at 2% per annum compounded monthly. The note is now at default. As of June 30, 2020 and March 31, 2020, the promissory note payable was $6,963 and $6,963 and accrued interest payable was $1,060 and $641, respectively. |
CONVERTIBLE PROMISSORY NOTES
CONVERTIBLE PROMISSORY NOTES | 3 Months Ended |
Jun. 30, 2020 | |
CONVERTIBLE PROMISSORY NOTES | |
NOTE 7 - CONVERTIBLE PROMISSORY NOTES | On July 10, 2017, a total of $174,000 was assigned from a promissory note to four individuals not related to the Company. Each of the convertible promissory notes has a principal value of $43,500, maturity date of July 10, 2019, bears interest at 4% per annum, and are convertible at a rate of $0.03 per share. On October 6, 2017, the four convertible promissory notes were amended to an interest rate of 0.5% per annum, the maturity date was amended to July 10, 2020, and the conversion price was amended to $0.01 per share. On October 11, 2017, four individual holders that have $174,000 of convertible promissory notes, converted a total of $58,000, or $14,500 each, for a total of 5,800,000, or 1,450,000 common shares each. A debt discount on the notes was recognized of $174,000. During the year ended March 31, 2020 and 2019, a total of $34,272 and $34,272 of the debt discount has been amortized and recorded in interest expense, respectively. As of March 31, 2020 and 2019, the unamortized amount of the debt discounts is $9,424 and $43,696, respectively. On December 31, 2017, the Company entered into a convertible promissory note for $9,230 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 55% per annum, and is convertible at $0.01 per share. The debt discount of $9,230 was expensed upon issuance of the note. On March 12, 2019, the note holder sold to three unaffiliated parties an interest in the note equal to the principal amount of $1,900 each. On May 1 2019, total principal amount of $5,700 of the three $1,900 convertible notes was converted to 570,000 shares of common stock. On March 31, 2018, the Company entered into a convertible promissory note for $20,773 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 55% per annum, and is convertible at $0.01 per share. The debt discount of $20,773 was expensed upon issuance of the note. On June 30, 2018, the Company entered into a convertible promissory note for $10,667 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 55% per annum, and is convertible at $0.01 per share. The debt discount of $10,667 was expensed upon issuance of the note. On September 30, 2018, the Company entered into a convertible promissory note for $7,167 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 55% per annum, and is convertible at $0.01 per share. The debt discount of $7,167 was expensed upon issuance of the note. On December 31, 2018, the Company entered into a convertible promissory note for $2,411 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 55% per annum, and is convertible at $0.01 per share. The debt discount of $2,411 was expensed upon issuance of the note. On March 31, 2019, the Company entered into a convertible promissory note for $10,194 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 55% per annum, and is convertible at $0.01 per share. The debt discount of $10,194 was expensed upon issuance of the note. On June 30, 2019, the Company entered into a convertible promissory note for $7,243 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 55% per annum, and is convertible at $0.01 per share. The debt discount of $7,243 was expensed upon issuance of the note. On September 30, 2019, the Company entered into a convertible promissory note for $9,483 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 55% per annum, and is convertible at $0.01 per share. The debt discount of $9,483 was expensed upon issuance of the note. On December 31, 2019, the Company entered into a convertible promissory note for $5,454 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 55% per annum, and is convertible at $0.01 per share. The debt discount of $5,454 was expensed upon issuance of the note. On March 31, 2020, the Company entered into a convertible promissory note for $5,712 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 35% per annum, and is convertible at $0.01 per share. The debt discount of $5,712 was expensed upon issuance of the note. On June 30, 2020, the Company entered into a convertible promissory note for $10,000 with an individual not related to the Company. The convertible promissory note is due on demand, bears interest at 35% per annum, and is convertible at $0.01 per share. The debt discount of $10,000 was expensed upon issuance of the note. As of June 30, 2020 and March 31, 2020, the convertible note payable was $207,778 and $189,210 and accrued interest payable was $75,952 and $64,761, respectively. |
COMMON STOCK
COMMON STOCK | 3 Months Ended |
Jun. 30, 2020 | |
COMMON STOCK | |
NOTE 8 - COMMON STOCK | The Company has 300,000,000 authorized common shares at $0.001 par value. Year Ended March 31, 2020 On April 4, 2019, the Company issued 3,000,000 shares of common stock to the President of the Company as compensation for management services valued at $0.03 per share. On May 1, 2019, principal amount of $5,700 of the convertible notes was converted to 570,000 shares of common stock. As at June 30, 2020 and March 31, 2020, the Company had a total of 3,874,473 common shares issued and outstanding. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Jun. 30, 2020 | |
RELATED PARTY TRANSACTIONS | |
NOTE 9 - RELATED PARTY TRANSACTIONS | During the year ended March 31, 2018, the Company received advances totaling $24,156 from its majority shareholder, Rise Fast Limited, in order to fund ongoing operations in the normal course. As at June 30, 2020 and March 31, 2020, the Company had advances from related party of $28,541 and $28,541 and accrued interest of $5,175 and $4,962, respectively. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Jun. 30, 2020 | |
SUBSEQUENT EVENTS | |
NOTE 10 - SUBSEQUENT EVENTS | Management has evaluated subsequent events through the date these financial statements were available to be issued. Based on our evaluation, no material events have occurred that require disclosure. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Jun. 30, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions for Form 10-Q and Article 210 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature. Operating results for the three months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2021. For further information, refer to the financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2020 as filed with the Securities and Exchange Commission on May 26, 2020. |
Reclassifications | Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported net (loss). |
Use of Estimates | The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the 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. Actual results could differ from those estimates. These estimates are reviewed periodically, and, as adjustments become necessary, they are reported in earnings in the period in which they become known. The estimates on depreciation were based on the estimated useful lives of the Company’s assets. Any estimates during the period have had an immaterial effect on earnings. |
Cash and Cash Equivalents | Cash and cash equivalents consist of commercial accounts and interest-bearing bank deposits and are carried at cost, which approximates current value. Items are considered to be cash equivalents if the original maturity is three months or less. |
Oil and Gas Properties - Full Cost Method | The Company follows the full cost accounting method to account for oil and natural gas properties, whereby 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. |
Revenue Recognition | Oil and gas sales result from undivided interests held by the Company in oil and gas properties and royalty revenues. 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. Charges for gathering and transportation are included in production expenses. Revenue from royalties is recognized as they are earned, when collection is reasonably assured. Royalty revenue is recorded in the same period as the sales that generate the royalty payment. |
Asset Retirement Obligations | The Company records 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. Inherent in the fair value calculation of an ARO are numerous assumptions and judgments including the ultimate settlement amounts, inflation factors, credit adjusted discount rates, timing of settlement, and changes in the legal, regulatory, environmental and political environments. To the extent future revisions to these assumptions impact the fair value of the existing ARO liability, a corresponding adjustment is made to the oil and gas property balance. Settlements greater than or less than amounts accrued as ARO are recorded as a gain or loss upon settlement. |
Fair Value of Financial Instruments | The Company measures its financial assets and liabilities in accordance with the requirements of ASC 820, Fair Value Measurements and Disclosures. ASC 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. Level 2 - Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. Level 3 - Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information, The carrying value of all assets and liabilities approximated their fair values as June 30, 2020 and March 31, 2020, respectively. |
Stock-Based Compensation | The Company follows the guidance included in ASC 718 Compensation-Stock Compensation (“ASC 718”) using the modified prospective transition method. The Company recognizes compensation expense in the financial statements for share-based awards based on the grant date fair value of those awards. For the three months ended June 30, 2020 and 2019, the Company incurred stock based compensation of $0 and $90,000, respectively. |
Earnings or Loss Per Share | In accordance with ASC Topic 280 – “Earnings Per Share”, the basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For the three months ended June 30, 2020 and 2019, net loss per shares as the result of the computation was anti-dilutive: June 30, June 30, 2020 2019 (Shares) (Shares) Convertible notes payable 20,863,368 17,798,575 |
Recent Accounting Pronouncements | The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. The Company regularly reviews and analyses the recent accounting pronouncements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Jun. 30, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of anti-dilutive | June 30, June 30, 2020 2019 (Shares) (Shares) Convertible notes payable 20,863,368 17,798,575 |
ASSET RETIREMENT OBLIGATIONS (T
ASSET RETIREMENT OBLIGATIONS (Tables) | 3 Months Ended |
Jun. 30, 2020 | |
ASSET RETIREMENT OBLIGATIONS | |
Schedule of assumptions of determining the fair value of ARO | Inflation Rate 3 % Estimated asset life 20 years Credit adjusted risk free interest rate 18 % |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | Jun. 30, 2020 | Mar. 31, 2020 |
GOING CONCERN | ||
Accumulated deficit | $ (1,929,507) | $ (1,891,154) |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - shares | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Convertible notes payable, shares | 20,863,638 | 17,798,575 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Description of oil and gas properties under full cost method | 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. | |
Stock based compensation | $ 0 | $ 90,000 |
ASSET RETIREMENT OBLIGATIONS (D
ASSET RETIREMENT OBLIGATIONS (Details) | 3 Months Ended |
Jun. 30, 2020 | |
ASSET RETIREMENT OBLIGATIONS | |
Inflation Rate | 3.00% |
Estimated asset life | 20 years |
Credit adjusted risk free interest rate | 18.00% |
ASSET RETIREMENT OBLIGATIONS _2
ASSET RETIREMENT OBLIGATIONS (Details Narrative) - USD ($) | Jun. 30, 2020 | Mar. 31, 2020 |
ASSET RETIREMENT OBLIGATIONS | ||
Asset retirement obligations | $ 83,580 | $ 83,580 |
PROMISSORY NOTE - RELATED PARTY
PROMISSORY NOTE - RELATED PARTY (Details Narrative) | 1 Months Ended | |||||
Dec. 31, 2019shares | Oct. 06, 2017USD ($)integershares | Jul. 10, 2017USD ($)integer | Dec. 31, 2016USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | |
Debt amount | $ 6,962 | $ 6,962 | ||||
Promissory note - related party | 42,683 | 42,683 | ||||
Accrued interest | 83,327 | 71,504 | ||||
Promissory Note [Member] | ||||||
Debt amount | $ 174,000 | $ 0 | ||||
Maturity dates extended description | The maturity dates of the notes were extended for three years to December 31, 2022 and the interest rate was amended to 15% per annum. | |||||
Number of common stock shares issued to promissory note holder | shares | 24,000,000 | |||||
Promissory note - related party | 42,683 | 42,683 | ||||
Accrued interest | 5,175 | 4,962 | ||||
Number of individuals | integer | 4 | |||||
Common stock shares issued for assignment of notes, amount | $ 24,000 | |||||
Majority Shareholder [Member] | ||||||
Debt amount | $ 0 | $ 240,683 | 0 | |||
Debt maturity date | Dec. 31, 2019 | |||||
Interest rate | 2.00% | |||||
Accrued interest | $ 5,175 | $ 4,962 |
PROMISSORY NOTE (Details Narrat
PROMISSORY NOTE (Details Narrative) - Promissory Note [Member] - USD ($) | Jun. 30, 2020 | Mar. 31, 2020 | May 31, 2019 |
Principal Amount | $ 0 | $ 0 | $ 6,963 |
Interest Rate | 2.00% | ||
Promissory note payable | 6,963 | 6,963 | $ 0 |
Accured Interest Payable | $ 1,060 | $ 641 | $ 0 |
CONVERTIBLE PROMISSORY NOTES (D
CONVERTIBLE PROMISSORY NOTES (Details Narrative) | 1 Months Ended | 12 Months Ended | ||||||||||||||
May 01, 2019 | Oct. 11, 2017USD ($)integershares | Oct. 06, 2017integer$ / shares | Jul. 10, 2017USD ($)integer$ / shares | Mar. 31, 2020USD ($)$ / shares | Mar. 31, 2019USD ($)$ / shares | Jun. 30, 2020USD ($)$ / shares | Dec. 31, 2019USD ($)$ / shares | Sep. 30, 2019USD ($)$ / shares | Jun. 30, 2019USD ($)$ / shares | Mar. 12, 2019USD ($) | Dec. 31, 2018USD ($)$ / shares | Sep. 30, 2018USD ($)$ / shares | Jun. 30, 2018USD ($)$ / shares | Mar. 31, 2018USD ($)$ / shares | Dec. 31, 2017USD ($)$ / shares | |
Convertible note payable | $ 189,210 | $ 207,778 | ||||||||||||||
Accrued interest payable | 64,761 | 75,952 | ||||||||||||||
Convertible Promissory Notes [Member] | ||||||||||||||||
Interest rate | 55.00% | |||||||||||||||
Conversion price | $ / shares | $ 0.01 | |||||||||||||||
Debt discount | $ 9,230 | |||||||||||||||
Debt amount | $ 9,230 | |||||||||||||||
Number of individuals | integer | 4 | |||||||||||||||
Convertible Promissory Notes [Member] | Three Unaffiliated Parties [Member] | ||||||||||||||||
Debt principal amount | $ 1,900 | |||||||||||||||
Debt conversion description | Total principal amount of $5,700 of the three $1,900 convertible notes was converted to 570,000 shares of common stock. | |||||||||||||||
Convertible Promissory Notes [Member] | An Individuals [Member] | ||||||||||||||||
Debt amount | $ 5,712 | $ 10,194 | $ 10,000 | $ 5,454 | $ 9,483 | $ 7,243 | $ 2,411 | $ 7,167 | $ 10,667 | $ 20,773 | ||||||
Interest rate | 35.00% | 55.00% | 35.00% | 55.00% | 55.00% | 55.00% | 55.00% | 55.00% | 55.00% | 55.00% | ||||||
Conversion price | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||||
Debt discount | $ 5,712 | $ 10,194 | $ 10,000 | $ 5,454 | $ 9,483 | $ 7,243 | $ 2,411 | $ 7,167 | $ 10,667 | $ 20,773 | ||||||
Convertible Promissory Notes [Member] | Four Individuals [Member] | ||||||||||||||||
Interest rate | 0.50% | 4.00% | ||||||||||||||
Conversion price | $ / shares | $ 0.01 | $ 0.03 | ||||||||||||||
Debt discount | $ 174,000 | 9,424 | 43,696 | 0 | ||||||||||||
Debt amount | $ 174,000 | $ 174,000 | ||||||||||||||
Number of individuals | integer | 4 | 4 | ||||||||||||||
Debt maturity date | Jul. 10, 2020 | Jul. 10, 2019 | ||||||||||||||
Debt discount amortized | 34,272 | 34,272 | ||||||||||||||
Amount of convertible promissory notes, converted | $ 58,000 | |||||||||||||||
Debt conversion converted instrument, shares issued | shares | 5,800,000 | |||||||||||||||
Convertible Promissory Notes [Member] | Each Individual [Member] | ||||||||||||||||
Debt amount | $ 43,500 | |||||||||||||||
Amount of convertible promissory notes, converted | $ 14,500 | |||||||||||||||
Debt conversion converted instrument, shares issued | shares | 1,450,000 | |||||||||||||||
Convertible Notes Payable [Member] | ||||||||||||||||
Accrued interest payable | 64,761 | 27,297 | 0 | 0 | ||||||||||||
Debt amount | $ 189,210 | $ 132,746 | $ 0 | $ 0 |
COMMON STOCK (Details Narrative
COMMON STOCK (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Jun. 30, 2020 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 3,874,473 | 3,874,473 |
Common stock, shares outstanding | 3,874,473 | 3,874,473 |
On April 4, 2019 [Member] | ||
Value of compensation per share | $ 0.03 | |
Stock issued during period, shares | 3,000,000 | |
On May 1, 2019 [Member] | ||
Common stock, shares converted | 570,000 | |
Convertible notes principal amount | $ 5,700 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 12 Months Ended | ||
Mar. 31, 2018 | Jun. 30, 2020 | Mar. 31, 2020 | |
Advances from related party | $ 28,541 | $ 28,541 | |
Accrued interest | 83,327 | 71,504 | |
Majority Shareholder [Member] | |||
Advances from related party | 28,541 | 28,541 | |
Accrued interest | $ 5,175 | $ 4,962 | |
Advances received | $ 24,156 |