Energy Resources 12 10-Q 14 May 18 2018 Q1 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2018	Apr. 30, 2018
Document and Entity Information [Abstract]
Entity Registrant Name	ENERGY RESOURCES 12, L.P.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		3,961,995
Amendment Flag	false
Entity Central Index Key	1,696,088
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	Mar. 31, 2018
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q1

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Assets
Cash and cash equivalents	$ 1,664,816	$ 46,859,728
Accounts receivable
Oil, natural gas and natural gas liquids revenue receivable	2,995,766	0
Acquisition post-closing receivable	1,928,196	0
Deposit for potential acquisition	0	8,750,000
Deferred acquisition costs	0	4,884,208
Total Current Assets	6,588,778	60,493,936
Oil and natural gas properties, successful efforts method, net of accumulated depreciation, depletion and amortization of $693,498 and $0, respectively	90,377,230	0
Total Assets	96,966,008	60,493,936
Liabilities
Term loan	25,000,000	0
Due to related parties	5,187,122	5,283,623
Accounts payable and accrued expenses	1,317,843	164,786
Total Current Liabilities	31,504,965	5,448,409
Asset retirement obligations	134,375	0
Total Liabilities	31,639,340	5,448,409
Partners’ Equity
Limited partners’ interest (3,735,115 and 3,191,231 common units issued and outstanding, respectively)	65,326,883	55,045,742
General partner’s interest	(215)	(215)
Total Partners’ Equity	65,326,668	55,045,527
Total Liabilities and Partners’ Equity	$ 96,966,008	$ 60,493,936

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parentheticals) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Oil and natural gas properties, successful efforts method, accumulated depreciation, depletion and amortization (in Dollars)	$ 693,498	$ 0
Limited partners' interest, common units issued	3,735,115	3,191,231
Limited partners' interest, common units outstanding	3,735,115	3,191,231

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Revenue
Oil, natural gas and natural gas liquids revenues	$ 3,497,079	$ 0
Operating costs and expenses
Production expenses	632,903	0
Production taxes	321,278	0
General and administrative expenses	400,289	6,260
Depreciation, depletion, amortization and accretion	694,718	0
Total operating costs and expenses	2,049,188	6,260
Operating income	1,447,891	(6,260)
Interest expense, net	(159,566)	(275)
Net income (loss)	$ 1,288,325	$ (6,535)
Basic and diluted net income (loss) per common unit (in Dollars per share)	$ 0.38	$ 0
Weighted average common units outstanding - basic and diluted (in Shares)	3,427,374	0

Consolidated Statement of Cash

Consolidated Statement of Cash Flows - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash flow from operating activities:
Net income (loss)	$ 1,288,325	$ (6,535)
Adjustments to reconcile net income to cash from operating activities:
Depreciation, depletion, amortization and accretion	694,718	0
Changes in operating assets and liabilities:
Oil, natural gas and natural gas liquids revenue receivable	(2,995,766)	0
Due to related parties	(371,501)	0
Accounts payable and accrued expenses	767,653	4,730
Net cash flow used in operating activities	(616,571)	(1,805)
Cash flow from investing activities:
Cash paid for acquisition of oil and natural gas properties	(83,584,125)	0
Net cash flow used in investing activities	(83,584,125)	0
Cash flow from financing activities:
Cash paid for offering costs	0	(99,029)
Net proceeds from line of credit	0	106,000
Net proceeds from term loan	25,000,000	0
Proceeds from advance from member of general partner	7,000,000	0
Payments on advance from member of general partner	(2,000,000)	0
Net proceeds related to issuance of units	10,197,000	0
Distributions paid to limited partners	(1,191,216)	0
Net cash flow provided by financing activities	39,005,784	6,971
Increase (decrease) in cash and cash equivalents	(45,194,912)	5,166
Cash and cash equivalents, beginning of period	46,859,728	1,000
Cash and cash equivalents, end of period	1,664,816	6,166
Interest paid	146,762	275
Supplemental non-cash information:
Accounts receivable from seller in acquisition, net of assumed payables	2,000,000	0
Accrued deferred offering costs	$ 0	$ 143,240

Partnership Organization

Partnership Organization	3 Months Ended
	Mar. 31, 2018
Disclosure Text Block [Abstract]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	Note 1. Partnership Organization Energy Resources 12, L.P. (together with its wholly-owned subsidiary, the “Partnership”) was formed as a Delaware limited partnership. The initial capitalization of the Partnership of $1,000 occurred on December 30, 2016. The Partnership is offering common units of limited partner interest (the “common units”) on a best-efforts basis with the intention of raising up to $350,000,001 of capital, consisting of 17,631,579 common units. The Partnership’s offering was declared effective by the Securities and Exchange Commission (“SEC”) on May 17, 2017. As of July 25, 2017, the Partnership completed the sale of the minimum offering of 1,315,790 common units. The subscribers to the common units were admitted as Limited Partners of the Partnership at the initial closing of the offering and the Partnership has been admitting additional Limited Partners monthly since that time. The Partnership’s primary investment objectives are to (i) acquire producing and non-producing oil and gas properties with development potential to be operated by third-party operators, and to enhance the value of the properties through drilling and other development activities, (ii) make distributions to the holders of the common units, (iii) engage in a liquidity transaction after five to seven years, in which all properties are sold and the sales proceeds are distributed to the partners, merge with another entity, or list the common units on a national securities exchange, and (iv) permit holders of common units to invest in oil and gas properties in a tax efficient basis. The proceeds from the sale of the common units primarily will be used to acquire producing and non-producing oil and natural gas properties onshore in the United States, and to develop those properties. As of March 31, 2018, the Partnership owned an approximate 3.0% non-operated working interest in 228 currently producing wells and 9 wells in various stages of the drilling and completion process, predominantly in McKenzie, Dunn, McLean and Mountrail counties of North Dakota (collectively, the “Bakken Assets”). The Bakken Assets, which are a part of the Bakken shale formation in the Greater Williston Basin, are operated by 14 third-party operators on behalf of the Partnership and other working interest owners. The general partner of the Partnership is Energy Resources 12 GP, LLC (the “General Partner”). The General Partner manages and controls the business affairs of the Partnership. David Lerner Associates, Inc. (the “Managing Dealer”), is acting as the dealer manager for the offering of the common units. The Partnership’s fiscal year ends on December 31.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Significant Accounting Policies [Text Block]	Note 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with the instructions for Article 10 of SEC Regulation S-X. Accordingly, they do not include all of the information required by generally accepted accounting principles (“GAAP”) in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These unaudited financial statements should be read in conjunction with the Partnership’s audited December 31, 2017 financial statements included in its 2017 Annual Report on Form 10-K. Operating results for the three months ended March 31, 2018 are not necessarily indicative of the results that may be expected for the twelve-month period ending December 31, 2018. Cash and Cash Equivalents Cash and cash equivalents consist of highly liquid investments with original maturities of three months or less. The fair market value of cash and cash equivalents approximates their carrying value. Cash balances may at times exceed federal depository insurance limits. Offering Costs The Partnership is raising capital through an on-going best-efforts offering of units by the Managing Dealer, which receives a selling commission and a marketing expense allowance based on proceeds of the units sold. Additionally, the Partnership has incurred other offering costs including legal, accounting and reporting services. These offering costs are recorded by the Partnership as a reduction of partners’ equity. As of March 31, 2018, the Partnership had completed the sale of 3.7 million common units for gross proceeds of approximately $72.1 million and proceeds net of offering costs of approximately $67.2 million. Use of Estimates The preparation of financial statements in conformity with United States GAAP requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The Partnership does not operate its oil and natural gas properties and receives actual oil, natural gas and natural gas liquids (“NGL”) sales volumes and prices (in the normal course of business) more than a month later than the information is available to the operators of the wells. The Partnership closed on its first property acquisition on February 1, 2018 and is currently completing the requisite division and transfer orders to obtain title for each well with each operator. As a result, the operational data received from the operators during the post-close process is preliminary. Therefore, the Partnership has used the most current available production data gathered from its operators and the Oil and Gas Division of the North Dakota Industrial Commission, and oil, natural gas and NGL national index prices are used to estimate the accrual of revenue on these wells. The oil, natural gas and NGL sales revenue accrual can be impacted by many variables including rapid production decline rates, production curtailments by operators, the shut-in of wells with mechanical problems and rapidly changing market prices for oil, natural gas and NGLs. These variables could lead to an over or under accrual of oil, natural gas and NGL sales at the end of any particular quarter. However, the Partnership adjusts the estimated accruals of revenue to actual production in the period actual production is determined or the settlement proceeds are received. Reclassifications Certain prior period amounts in the consolidated financial statements have been reclassified to conform to the current period presentation with no effect on previously reported net income, partners’ equity or cash flows. Net Income Per Common Unit Basic net income per common unit is computed as net income divided by the weighted average number of common units outstanding during the period. Diluted net income per common unit is calculated after giving effect to all potential common units that were dilutive and outstanding for the period. There were no common units with a dilutive effect for the three months ended March 31, 2018. As a result, basic and diluted outstanding common units were the same. The Incentive Distribution Rights (as discussed in Note 6) are not included in net income per common unit until such time that it is probable Payout (as discussed in Note 6) would occur. Revenue Recognition Since it did not acquire any assets until 2018, the Partnership did not record any revenue in 2017. The Partnership is bound by a joint operating agreement with the operator of each of its producing wells. Under the joint operating agreement, the Partnership’s proportionate share of production is marketed at the discretion of the operators. Virtually all of the Partnership’s contracts’ pricing provisions are tied to a market index, with certain adjustments based on, among other factors, whether a well delivers to a gathering or transmission line, quality of oil, natural gas and natural gas liquids and prevailing supply and demand conditions, so that prices fluctuate to remain competitive with other available suppliers. The Partnership typically satisfies its performance obligations upon transfer of control of its products and records the related revenue in the month production is delivered to the purchaser. Settlement receipts for sales of oil, natural gas and natural gas liquids may not be received for more than a month after the date production is delivered to the purchaser, and as a result, the Partnership is required to estimate the amount of production delivered to the purchaser and the price that will be received for the sale of the product. The Partnership records the differences between estimates and the actual amounts received for product sales in the month that settlement proceeds are received from the operator. The following table disaggregates the Partnership’s revenue streams that are summarized as “Oil, natural gas and natural gas liquids revenues” on the consolidated statements of operations for the three months ended March 31, 2018. Three Months Ended Oil revenues $ 3,189,410 Natural gas revenues 83,153 Natural gas liquids revenues 224,516 $ 3,497,079 Recently Adopted Accounting Standards In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (Topic 606)

Oil and Gas Investments

Oil and Gas Investments	3 Months Ended
	Mar. 31, 2018
Oil and Gas Property [Abstract]
Oil and Gas Properties [Text Block]	Note 3. Oil and Gas Investments On February 1, 2018, the Partnership completed its purchase of an approximate average 3.1% non-operated working interest in approximately 204 producing wells and 30 wells in various stages of the drilling and completion process, predominantly in McKenzie, Dunn, McLean and Mountrail counties of North Dakota (collectively, the “Bakken Assets”) for $87.5 million, subject to customary post-closing adjustments. In addition to using proceeds from its best-efforts offering, the Partnership partially funded the acquisition using proceeds from an unsecured term loan of $25.0 million (discussed below in Note 5. Debt) and an advance from a member of the General Partner of $7.0 million. The Partnership is a non-operator of the Bakken Assets. The Bakken Assets are operated by 14 third-party operators on behalf of the Partnership and other working interest owners. During the first quarter of 2018, the Partnership adjusted the purchase price to reflect the Partnership’s estimate of the customary settlement of operating revenues and expenses received or paid by the seller on the Partnership’s behalf between the acquisition effective date of September 1, 2017 and the closing date of February 1, 2018. The estimate, which is preliminary and was derived from operator revenue and expense statements received from the seller, reduced the purchase price of the Bakken Assets by approximately $2.0 million. In accordance with the terms of the purchase agreement, the Partnership and the seller will agree to the final settlement of operating revenues and expenses between the effective and closing dates of the acquisition after all operator information has been received, and the Partnership will adjust its estimate at that time. The Partnership engaged Regional Energy Investors, LP (“REI”) to perform advisory and consulting services, including supporting the Partnership through closing and post-closing of the purchase agreement of the Bakken Assets. In the first quarter of 2018, the Partnership paid REI a total of approximately $5.3 million for its advisory and consulting services. REI is also entitled to a fee of 5% of the gross sales price in the event the Partnership disposes any or all of the Bakken Assets, if surplus funds are available after Payout to the holders of the Partnership’s common units, as defined in Note 6 below. Of the $5.3 million paid to REI, approximately $4.7 million of these services related to the acquisition of the Bakken Assets have been capitalized as part of the acquisition costs described below. REI is owned by entities that are controlled by Anthony F. Keating, III, Co-Chief Operating Officer of Energy 11 GP, LLC, and Michael J. Mallick, Co-Chief Operating Officer of Energy 11 GP, LLC. Glade M. Knight and David S. McKenney are the Chief Executive Officer and Chief Financial Officer, respectively, of Energy 11 GP, LLC as well as the Chief Executive Officer and Chief Financial Officer, respectively, of the General Partner. See Note 7. Related Parties below for additional information. The Partnership accounted for this acquisition as a purchase of a group of similar assets, and therefore capitalized transaction costs associated with this acquisition. These acquisition-related costs included, but were not limited to, fees for advisory and consulting (discussed above), due diligence, legal, accounting, engineering and environmental review services. The Partnership has capitalized approximately $5.0 million in transaction costs in conjunction with the acquisition. The Partnership also recorded an asset retirement obligation liability of approximately $0.1 million in conjunction with this acquisition. See Note 4. Asset Retirement Obligation below. As of March 31, 2018, the Partnership owned an approximate 3.0% non-operated working interest in 228 currently producing wells and 9 wells in various stages of the drilling and completion process in the Bakken Assets. In total, the Partnership estimated capital drilling costs were approximately $0.4 million for the period from February 1, 2018 to March 31, 2018 and the Partnership’s capital expenditures for the drilling and completion of the 9 wells in future periods are estimated to be approximately $1.1 million. The following unaudited pro forma financial information for the three months ended March 31, 2018 and 2017 have been prepared as if the acquisition of the Bakken Assets had occurred on January 1, 2017. The unaudited pro forma financial information was derived from the historical statements of operations of the Partnership and the historical financial statements of the sellers of the Bakken Assets. The unaudited pro forma financial information does not purport to be indicative of the results of operations that would have occurred had the acquisition of the Bakken Assets and related financings occurred on the basis assumed above, nor is such information indicative of the Partnership’s expected future results of operations. Three Months Ended Three Months Ended Revenues $ 5,175,920 $ 2,838,863 Net income $ 2,165,580 $ 881,579

Asset Retirement Obligations

Asset Retirement Obligations	3 Months Ended
	Mar. 31, 2018
Asset Retirement Obligation Disclosure [Abstract]
Asset Retirement Obligation Disclosure [Text Block]	Note 4. Asset Retirement Obligations The Partnership records an asset retirement obligation (“ARO”) and capitalizes the asset retirement costs in oil and natural gas properties in the period in which the asset retirement obligation is incurred based upon the fair value of an obligation to perform site reclamation, dismantle facilities or plug and abandon wells. After recording these amounts, the ARO is accreted to its future estimated value using an assumed cost of funds and the additional capitalized costs are depreciated on a unit-of-production basis. Inherent in the present value calculation 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 of these assumptions impact the present value of the existing asset retirement obligation, a corresponding adjustment is made to the oil and natural gas property balance. The changes in the aggregate ARO are as follows: 2018 Balance as of January 1, 2018 $ - Liabilities incurred on February 1, 2018 (acquisition) 133,155 Accretion 1,220 Balance as of March 31, 2018 $ 134,375

Debt

Debt	3 Months Ended
	Mar. 31, 2018
Debt Disclosure [Abstract]
Debt Disclosure [Text Block]	Note 5. Debt On January 16, 2018, the Partnership entered into a loan agreement with Bank of America, N.A., as the lender, for an unsecured term loan (“Term Loan”) of $25.0 million. The Partnership used the $25.0 million proceeds from the Term Loan to partially fund the purchase of the Bakken Assets, as described in Note 3. Oil and Gas Investments above. The Term Loan bears interest at a variable rate based on the London Inter-Bank Offered Rate (LIBOR) plus a margin of 2.00%. Interest is payable monthly. The maturity date is January 15, 2019. The Term Loan contains mandatory prepayment requirements, customary affirmative and negative covenants and events of default. Under the terms of the loan agreement, the Partnership may make voluntary prepayments, in whole or in part, at any time with no penalty. The Partnership plans to repay the Term Loan with future proceeds from the Partnership’s ongoing public offering. Glade M. Knight, the General Partner’s Chief Executive Officer, and David S. McKenney, the General Partner’s Chief Financial Officer, have guaranteed repayment of the Term Loan and have not and will not receive any consideration in exchange for providing this guarantee. As of March 31, 2018, the outstanding balance on the Term Loan was $25.0 million. The outstanding balance at March 31, 2018

Capital Contribution and Partne

Capital Contribution and Partners' Equity	3 Months Ended
	Mar. 31, 2018
Partners' Capital Notes [Abstract]
Partners' Capital Notes Disclosure [Text Block]	Note 6. Capital Contribution and Partners’ Equity At inception, the General Partner and organizational limited partner made initial capital contributions totaling $1,000 to the Partnership. Upon closing of the minimum offering, the organizational limited partner withdrew its initial capital contribution of $990, the General Partner received Incentive Distribution Rights (defined below), and has been and will be reimbursed for its documented third party out-of-pocket expenses incurred in organizing the Partnership and offering the common units. As of July 25, 2017, the Partnership completed its minimum offering of 1,315,790 common units at $19.00 per common unit. As of March 31, 2018, the Partnership had completed the sale of 3.7 million common units for gross proceeds of approximately $72.1 million and proceeds net of offering costs of approximately $67.2 million. In October 2017, the Partnership completed the sale of all common units at $19.00 (2,631,579 common units). In accordance with the prospectus, all subsequent common units are being sold at $20.00 per common unit. The Partnership intends to continue to raise capital through its best-efforts offering of common units by the Managing Dealer at $20.00. Under the agreement with the Managing Dealer, the Managing Dealer receives a total of 6% in selling commissions and a marketing expense allowance based on gross proceeds of the common units sold. The Managing Dealer also has Dealer Manager Incentive Fees (defined below) where the Managing Dealer could receive distributions up to an additional 4% of gross proceeds of the common units sold in the Partnership’s best-efforts offering as outlined in the prospectus based on the performance of the Partnership. Based on the common units sold through March 31, 2018, the Dealer Manager Incentive Fees are approximately $2.9 million, subject to Payout (defined below). Prior to “Payout,” which is defined below, all of the distributions made by the Partnership, if any, will be paid to the holders of common units. Accordingly, the Partnership will not make any distributions with respect to the Incentive Distribution Rights and will not pay the Dealer Manager Incentive Fees to the Managing Dealer, until Payout occurs. The Agreement of Limited Partnership of the Partnership (the “Partnership Agreement”) provides that “Payout”, which is defined below, occurs on the day when the aggregate amount distributed with respect to each of the common units equals $20.00 plus the Payout Accrual. The Partnership Agreement defines “Payout Accrual” as 7% per annum simple interest accrued monthly until paid on the Net Investment Amount outstanding from time to time. The Partnership Agreement defines Net Investment Amount initially as $20.00 per common unit, regardless of the amount paid for the common unit. If at any time the Partnership distributes to holders of common units more than the Payout Accrual, the amount the Partnership distributes in excess of the Payout Accrual will reduce the Net Investment Amount. All distributions made by the Partnership after Payout, which may include all or a portion of the proceeds of the sale of all or substantially all of the Partnership’s assets, will be made as follows: · First, (i) to the Record Holders of the Incentive Distribution Rights, 30%; (ii) to the Managing Dealer, the “Dealer Manager Incentive Fees”, 30%, until such time as the Managing Dealer receives 4% of the gross proceeds of the common units sold; and (iii) to the Record Holders of outstanding common units, 40%, pro rata based on their percentage interest. · Thereafter, (i) to the Record Holders of the Incentive Distribution Rights, 60%; and (ii) to the Record Holders of outstanding common units, 40%, pro rata based on their percentage interest. All items of income, gain, loss and deduction will be allocated to each Partner’s capital account in a manner generally consistent with the distribution procedures outlined above. For the three months ended March 31, 2018, the Partnership paid distributions of $0.349041 per common unit, or $1.2 million.

Related Parties

Related Parties	3 Months Ended
	Mar. 31, 2018
Related Party Transactions [Abstract]
Related Party Transactions Disclosure [Text Block]	Note 7. Related Parties The Partnership has, and is expected to continue to engage in, significant transactions with related parties. These transactions cannot be construed to be at arm’s length and the results of the Partnership’s operations may be different than if conducted with non-related parties. The General Partner’s Board of Directors oversees and reviews the Partnership’s related party relationships and is required to approve any significant modifications to any existing related party transactions, as well as any new significant related party transactions. The Partnership will reimburse the General Partner for any costs incurred by the General Partner for certain expenses, which include costs for organizing the Partnership and costs incurred in the offering of the common units. The Partnership has also agreed to pay the General Partner an advisory fee to manage the day-to-day affairs of the Partnership, including serving as an investment advisor and consultant in connection with the acquisition, development, operation and disposition of oil and gas properties and other assets of the Partnership. In accordance with the limited partner agreement, subsequent to the Partnership’s first asset purchase which occurred on February 1, 2018, the Partnership is required to pay quarterly an annual fee of 0.5% of the total gross equity proceeds raised by the Partnership in its best-efforts offering. Based upon the total gross equity proceeds as of March 31, 2018, the management fee for the period from February 1, 2018 to March 31, 2018 due to the General Partner is approximately $59,000, which has been accrued on the consolidated balance sheets in Due to related parties at March 31, 2018 and included in General and administrative expenses on the consolidated statements of operations. The Partnership also will reimburse the General Partner for certain general and administrative costs. For the three months ended March 31, 2018, approximately $81,000 of general and administrative costs were incurred by a member of the General Partner and will be reimbursed by the Partnership. At March 31, 2018, the approximately $81,000 that was due to a member of the General Partner is included in Due to related parties in the consolidated balance sheets. In January 2018, the Partnership received an advance of $7.0 million from a member of the General Partner to partially fund the purchase of the Bakken Assets. The advance does not bear interest and the member of the General Partner did not receive any compensation for the advance. As of March 31, 2018, the balance due to the member of the General Partner for the advance is $5.0 million, which is included in Due to related parties on the consolidated balance sheets. The Partnership plans to repay the remaining balance due with future proceeds from the Partnership’s ongoing public offering. The Chief Executive Officer and Chief Financial Officer of the Partnership’s General Partner are also the Chief Executive Officer and Chief Financial Officer of Energy 11 GP, LLC, the general partner of Energy 11, L.P. (“Energy 11”), a limited partnership that also invests in producing and non-producing oil and gas properties on-shore in the United States. On January 31, 2018, the Partnership entered into a cost sharing agreement with Energy 11 that will give the Partnership access to Energy 11’s personnel and administrative resources, including accounting, asset management and other day-to-day management support. The shared day-to-day costs will be split evenly between the two partnerships and any direct third-party costs will be paid by the party receiving the services. The shared costs will be based on actual costs incurred with no mark-up or profit to the Partnership. The agreement may be terminated at any time by either party upon 60 days written notice. As noted above, the cost sharing agreement reduces the costs to the Partnership for accounting and asset management services provided through a member of the General Partner. In addition to certain accounting and asset management resources, the Partnership and Energy 11 share the rent expense for leased office space (leased from an affiliate of a member of the general partner of Energy 11) in Oklahoma City, Oklahoma along with the compensation due to the President of the Energy 11’s general partner. For the three months ended March 31, 2018, approximately $47,000 of expenses subject to the cost sharing agreement were incurred by the Partnership and will be reimbursed to Energy 11. At March 31, 2018, the approximately $47,000 due from the Partnership to Energy 11 is included in Due to related parties in the consolidated balance sheets.

Subsequent Event

Subsequent Event	3 Months Ended
	Mar. 31, 2018
Subsequent Events [Abstract]
Subsequent Events [Text Block]	Note 8. Subsequent Events In April 2018, the Partnership closed on the issuance of approximately 0.2 million common units through its ongoing best-efforts offering, representing gross proceeds to the Partnership of approximately $4.5 million and proceeds net of selling and marketing costs of approximately $4.3 million. In April 2018, the Partnership declared and paid $0.4 million, or $0.107397 per outstanding common unit, in distributions to its holders of common units. In April 2018, the Partnership repaid $3.5 million to a member of the General Partner for the advance made in January 2018, as discussed in Note 7. Related Parties above.

Accounting Policies, by Policy

Accounting Policies, by Policy (Policies)	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Basis of Accounting, Policy [Policy Text Block]	Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with the instructions for Article 10 of SEC Regulation S-X. Accordingly, they do not include all of the information required by generally accepted accounting principles (“GAAP”) in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These unaudited financial statements should be read in conjunction with the Partnership’s audited December 31, 2017 financial statements included in its 2017 Annual Report on Form 10-K. Operating results for the three months ended March 31, 2018 are not necessarily indicative of the results that may be expected for the twelve-month period ending December 31, 2018.
Cash and Cash Equivalents, Policy [Policy Text Block]	Cash and Cash Equivalents Cash and cash equivalents consist of highly liquid investments with original maturities of three months or less. The fair market value of cash and cash equivalents approximates their carrying value. Cash balances may at times exceed federal depository insurance limits.
Offering Costs, Policy [Policy Text Block]	Offering Costs The Partnership is raising capital through an on-going best-efforts offering of units by the Managing Dealer, which receives a selling commission and a marketing expense allowance based on proceeds of the units sold. Additionally, the Partnership has incurred other offering costs including legal, accounting and reporting services. These offering costs are recorded by the Partnership as a reduction of partners’ equity. As of March 31, 2018, the Partnership had completed the sale of 3.7 million common units for gross proceeds of approximately $72.1 million and proceeds net of offering costs of approximately $67.2 million.
Use of Estimates, Policy [Policy Text Block]	Use of Estimates The preparation of financial statements in conformity with United States GAAP requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The Partnership does not operate its oil and natural gas properties and receives actual oil, natural gas and natural gas liquids (“NGL”) sales volumes and prices (in the normal course of business) more than a month later than the information is available to the operators of the wells. The Partnership closed on its first property acquisition on February 1, 2018 and is currently completing the requisite division and transfer orders to obtain title for each well with each operator. As a result, the operational data received from the operators during the post-close process is preliminary. Therefore, the Partnership has used the most current available production data gathered from its operators and the Oil and Gas Division of the North Dakota Industrial Commission, and oil, natural gas and NGL national index prices are used to estimate the accrual of revenue on these wells. The oil, natural gas and NGL sales revenue accrual can be impacted by many variables including rapid production decline rates, production curtailments by operators, the shut-in of wells with mechanical problems and rapidly changing market prices for oil, natural gas and NGLs. These variables could lead to an over or under accrual of oil, natural gas and NGL sales at the end of any particular quarter. However, the Partnership adjusts the estimated accruals of revenue to actual production in the period actual production is determined or the settlement proceeds are received.
Reclassification, Policy [Policy Text Block]	Reclassifications Certain prior period amounts in the consolidated financial statements have been reclassified to conform to the current period presentation with no effect on previously reported net income, partners’ equity or cash flows.
Earnings Per Share, Policy [Policy Text Block]	Net Income Per Common Unit Basic net income per common unit is computed as net income divided by the weighted average number of common units outstanding during the period. Diluted net income per common unit is calculated after giving effect to all potential common units that were dilutive and outstanding for the period. There were no common units with a dilutive effect for the three months ended March 31, 2018. As a result, basic and diluted outstanding common units were the same. The Incentive Distribution Rights (as discussed in Note 6) are not included in net income per common unit until such time that it is probable Payout (as discussed in Note 6) would occur.
Revenue Recognition, Policy [Policy Text Block]	Revenue Recognition Since it did not acquire any assets until 2018, the Partnership did not record any revenue in 2017. The Partnership is bound by a joint operating agreement with the operator of each of its producing wells. Under the joint operating agreement, the Partnership’s proportionate share of production is marketed at the discretion of the operators. Virtually all of the Partnership’s contracts’ pricing provisions are tied to a market index, with certain adjustments based on, among other factors, whether a well delivers to a gathering or transmission line, quality of oil, natural gas and natural gas liquids and prevailing supply and demand conditions, so that prices fluctuate to remain competitive with other available suppliers. The Partnership typically satisfies its performance obligations upon transfer of control of its products and records the related revenue in the month production is delivered to the purchaser. Settlement receipts for sales of oil, natural gas and natural gas liquids may not be received for more than a month after the date production is delivered to the purchaser, and as a result, the Partnership is required to estimate the amount of production delivered to the purchaser and the price that will be received for the sale of the product. The Partnership records the differences between estimates and the actual amounts received for product sales in the month that settlement proceeds are received from the operator. The following table disaggregates the Partnership’s revenue streams that are summarized as “Oil, natural gas and natural gas liquids revenues” on the consolidated statements of operations for the three months ended March 31, 2018. Three Months Ended Oil revenues $ 3,189,410 Natural gas revenues 83,153 Natural gas liquids revenues 224,516 $ 3,497,079
New Accounting Pronouncements, Policy [Policy Text Block]	Recently Adopted Accounting Standards In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (Topic 606)

Summary of Significant Accoun15

Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Disaggregation of Revenue [Table Text Block]	The following table disaggregates the Partnership’s revenue streams that are summarized as “Oil, natural gas and natural gas liquids revenues” on the consolidated statements of operations for the three months ended March 31, 2018. Three Months Ended Oil revenues $ 3,189,410 Natural gas revenues 83,153 Natural gas liquids revenues 224,516 $ 3,497,079

Oil and Gas Investments (Tables

Oil and Gas Investments (Tables)	3 Months Ended
	Mar. 31, 2018
Oil and Gas Property [Abstract]
Business Acquisition, Pro Forma Information [Table Text Block]	The following unaudited pro forma financial information for the three months ended March 31, 2018 and 2017 have been prepared as if the acquisition of the Bakken Assets had occurred on January 1, 2017. The unaudited pro forma financial information was derived from the historical statements of operations of the Partnership and the historical financial statements of the sellers of the Bakken Assets. The unaudited pro forma financial information does not purport to be indicative of the results of operations that would have occurred had the acquisition of the Bakken Assets and related financings occurred on the basis assumed above, nor is such information indicative of the Partnership’s expected future results of operations. Three Months Ended Three Months Ended Revenues $ 5,175,920 $ 2,838,863 Net income $ 2,165,580 $ 881,579

Asset Retirement Obligations (T

Asset Retirement Obligations (Tables)	3 Months Ended
	Mar. 31, 2018
Asset Retirement Obligation Disclosure [Abstract]
Schedule of Asset Retirement Obligations [Table Text Block]	The changes in the aggregate ARO are as follows: 2018 Balance as of January 1, 2018 $ - Liabilities incurred on February 1, 2018 (acquisition) 133,155 Accretion 1,220 Balance as of March 31, 2018 $ 134,375

Partnership Organization (Detai

Partnership Organization (Details)	Feb. 01, 2018	Dec. 30, 2016USD ($)shares	Mar. 31, 2018	Jul. 25, 2017shares
Partnership Organization (Details) [Line Items]
Limited Liability Company or Limited Partnership, Business, Formation State		Delaware
Partners' Capital Account, Contributions (in Dollars) | $		$ 1,000
Total Amount of Unit Offering (in Dollars) | $		$ 350,000,001
Total Amount of Units Offered (in Shares) | shares		17,631,579
Minimum Unit Offering, Shares (in Shares) | shares				1,315,790
Subsidiary of Limited Liability Company or Limited Partnership, Business Purpose		(i) acquire producing and non-producing oil and gas properties with development potential to be operated by third-party operators, and to enhance the value of the properties through drilling and other development activities, (ii) make distributions to the holders of the common units, (iii) engage in a liquidity transaction after five to seven years, in which all properties are sold and the sales proceeds are distributed to the partners, merge with another entity, or list the common units on a national securities exchange, and (iv) permit holders of common units to invest in oil and gas properties in a tax efficient basis. The proceeds from the sale of the common units primarily will be used to acquire producing and non-producing oil and natural gas properties onshore in the United States, and to develop those properties.
Bakken Assets [Member]
Partnership Organization (Details) [Line Items]
Gas and Oil Area Developed, Net	3.10%		3.00%
Productive Oil Wells, Number of Wells, Net	204		228
Wells in Process of Drilling			9
Number of Operators	14		14

Summary of Significant Accoun19

Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions	1 Months Ended	15 Months Ended
	Oct. 31, 2017	Mar. 31, 2018
Accounting Policies [Abstract]
Partners' Capital Account, Units, Sale of Units (in Shares)	2,631,579	3,700,000
Proceeds from Issuance of Common Limited Partners Units		$ 72.1
Proceeds, Net of Offering Costs, from Issuance of Common Limited Partners Units		$ 67.2

Summary of Significant Accoun20

Summary of Significant Accounting Policies (Details) - Disaggregation of Revenue - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Disaggregation of Revenue [Line Items]
	$ 3,497,079	$ 0
Oil [Member]
Disaggregation of Revenue [Line Items]
Oil revenues	3,189,410
Natural Gas [Member]
Disaggregation of Revenue [Line Items]
Natural gas revenues	83,153
Natural Gas Liquids [Member]
Disaggregation of Revenue [Line Items]
Natural gas liquids revenues	$ 224,516

Oil and Gas Investments (Detail

Oil and Gas Investments (Details)	Feb. 01, 2018USD ($)	Mar. 31, 2018USD ($)	Mar. 31, 2018USD ($)	Mar. 31, 2017USD ($)
Oil and Gas Investments (Details) [Line Items]
Proceeds from Issuance of Unsecured Debt			$ 25,000,000	$ 0
Proceeds from Related Party Debt			7,000,000	0
Non-cash Transaction Increase in Accounts Receivable Settlement of Pre-close Activity			2,000,000	$ 0
Asset Retirement Obligation, Liabilities Incurred			$ 133,155
Bakken Assets [Member]
Oil and Gas Investments (Details) [Line Items]
Gas and Oil Area Developed, Net	3.10%		3.00%
Productive Oil Wells, Number of Wells, Net	204	228	228
Gas and Oil Area Undeveloped, Net	30		9
Business Combination, Consideration Transferred	$ 87,500,000
Proceeds from Issuance of Unsecured Debt	25,000,000
Proceeds from Related Party Debt	$ 7,000,000
Number of Operators	14		14
Non-cash Transaction Increase in Accounts Receivable Settlement of Pre-close Activity	$ 2,000,000
Acquisition Costs, Period Cost			$ 5,000,000
Asset Retirement Obligation, Liabilities Incurred			100,000
Costs Incurred, Development Costs		$ 400,000
Capital Expenditures Drilling and Completion of Wells			1,100,000
Bakken Assets [Member] | Affiliated Entity [Member]
Oil and Gas Investments (Details) [Line Items]
Advisory and Consulting Services Related Party			$ 5,300,000
Asset Disposal Fee, Related Party, Percentage			5.00%
Acquisition Costs, Period Cost			$ 4,700,000

Oil and Gas Investments (Deta22

Oil and Gas Investments (Details) - Business Acquisition, Pro Forma Information - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Business Acquisition, Pro Forma Information [Abstract]
Revenues	$ 5,175,920	$ 2,838,863
Net income	$ 2,165,580	$ 881,579

Asset Retirement Obligations (D

Asset Retirement Obligations (Details) - Schedule of Asset Retirement Obligations	3 Months Ended
	Mar. 31, 2018USD ($)
Schedule of Asset Retirement Obligations [Abstract]
Balance	$ 0
Liabilities incurred	133,155
Accretion	1,220
Balance	$ 134,375

Debt (Details)

Debt (Details) - USD ($)	Jan. 16, 2018	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Debt (Details) [Line Items]
Proceeds from Issuance of Unsecured Debt		$ 25,000,000	$ 0
Unsecured Debt, Current		$ 25,000,000		$ 0
Notes Payable to Banks [Member]
Debt (Details) [Line Items]
Debt Instrument, Face Amount	$ 25,000,000
Proceeds from Issuance of Unsecured Debt	$ 25,000,000
Debt Instrument, Maturity Date	Jan. 15, 2019
Debt Instrument, Payment Terms	The Term Loan contains mandatory prepayment requirements, customary affirmative and negative covenants and events of default. Under the terms of the loan agreement, the Partnership may make voluntary prepayments, in whole or in part, at any time with no penalty.
Guarantor Obligations, Origin and Purpose	Glade M. Knight, the General Partner’s Chief Executive Officer, and David S. McKenney, the General Partner’s Chief Financial Officer, have guaranteed repayment of the Term Loan and have not and will not receive any consideration in exchange for providing this guarantee.
Unsecured Debt, Current	$ 25,000,000
Notes Payable to Banks [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	2.00%

Capital Contribution and Part25

Capital Contribution and Partners' Equity (Details) - USD ($)	Dec. 30, 2016	Oct. 31, 2017	Mar. 31, 2018	Mar. 31, 2017	Jul. 25, 2017	Dec. 31, 2017	Mar. 31, 2018
Partners' Capital Notes [Abstract]
Partners' Capital Account, Contributions	$ 1,000
Partners' Capital Account, Return of Contribution Upon Minimum Offering						$ 990
Minimum Unit Offering, Shares (in Shares)					1,315,790
Partners Capital Account, Units Sold, Price Per Unit (in Dollars per share)		$ 19			$ 19
Partners' Capital Account, Units, Sale of Units (in Shares)		2,631,579					3,700,000
Proceeds from Issuance of Common Limited Partners Units							$ 72,100,000
Proceeds, Net of Offering Costs, from Issuance of Common Limited Partners Units							$ 67,200,000
Partners' Capital Account, Description of Units Sold			The Partnership intends to continue to raise capital through its best-efforts offering of common units by the Managing Dealer at $20.00. Under the agreement with the Managing Dealer, the Managing Dealer receives a total of 6% in selling commissions and a marketing expense allowance based on gross proceeds of the common units sold. The Managing Dealer also has Dealer Manager Incentive Fees (defined below) where the Managing Dealer could receive distributions up to an additional 4% of gross proceeds of the common units sold in the Partnership’s best-efforts offering as outlined in the prospectus based on the performance of the Partnership.
Managing Dealer, Selling Commissions, Percentage			6.00%
Managing Dealer, Maximum Contingent Incentive Fee on Gross Proceeds, Percentage			4.00%
Managing Dealer, Maximum Contingent Incentive Fee on Gross Proceeds			$ 2,900,000
Key Provisions of Operating or Partnership Agreement, Description			The Agreement of Limited Partnership of the Partnership (the “Partnership Agreement”) provides that “Payout”, which is defined below, occurs on the day when the aggregate amount distributed with respect to each of the common units equals $20.00 plus the Payout Accrual. The Partnership Agreement defines “Payout Accrual” as 7% per annum simple interest accrued monthly until paid on the Net Investment Amount outstanding from time to time. The Partnership Agreement defines Net Investment Amount initially as $20.00 per common unit, regardless of the amount paid for the common unit. If at any time the Partnership distributes to holders of common units more than the Payout Accrual, the amount the Partnership distributes in excess of the Payout Accrual will reduce the Net Investment Amount.All distributions made by the Partnership after Payout, which may include all or a portion of the proceeds of the sale of all or substantially all of the Partnership’s assets, will be made as follows:·First, (i) to the Record Holders of the Incentive Distribution Rights, 30%; (ii) to the Managing Dealer, the “Dealer Manager Incentive Fees”, 30%, until such time as the Managing Dealer receives 4% of the gross proceeds of the common units sold; and (iii) to the Record Holders of outstanding common units, 40%, pro rata based on their percentage interest.·Thereafter, (i) to the Record Holders of the Incentive Distribution Rights, 60%; and (ii) to the Record Holders of outstanding common units, 40%, pro rata based on their percentage interest.All items of income, gain, loss and deduction will be allocated to each Partner’s capital account in a manner generally consistent with the distribution procedures outlined above.
Distribution Made to Limited Partner, Distributions Paid, Per Unit (in Dollars per share)			$ 0.349041
Distribution Made to Limited Partner, Cash Distributions Paid			$ 1,191,216	$ 0

Related Parties (Details)

Related Parties (Details) - USD ($)	1 Months Ended	2 Months Ended	3 Months Ended
	Jan. 31, 2018	Mar. 31, 2018	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Related Parties (Details) [Line Items]
Related Party Transaction, Description of Transaction			subsequent to the Partnership’s first asset purchase which occurred on February 1, 2018, the Partnership is required to pay quarterly an annual fee of 0.5% of the total gross equity proceeds raised by the Partnership in its best-efforts offering.
Due to Related Parties, Current		$ 5,187,122	$ 5,187,122		$ 5,283,623
Proceeds from Related Party Debt			7,000,000	$ 0
General Partner [Member]
Related Parties (Details) [Line Items]
Due to Related Parties, Current	$ 5,000,000	81,000	81,000
Related Party Transaction, Selling, General and Administrative Expenses from Transactions with Related Party			81,000
Proceeds from Related Party Debt	$ 7,000,000
Energy 11 [Member]
Related Parties (Details) [Line Items]
Due to Related Parties, Current		47,000	47,000
Related Party Transaction, Selling, General and Administrative Expenses from Transactions with Related Party			47,000
Management Fee [Member] | General Partner [Member]
Related Parties (Details) [Line Items]
Due to Related Parties, Current		59,000	$ 59,000
Related Party Transaction, Selling, General and Administrative Expenses from Transactions with Related Party		$ 59,000

Subsequent Event (Details)

Subsequent Event (Details) - USD ($)	1 Months Ended		3 Months Ended		15 Months Ended
	Apr. 30, 2018	Oct. 31, 2017	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2018
Subsequent Event (Details) [Line Items]
Partners' Capital Account, Units, Sale of Units (in Shares)		2,631,579			3,700,000
Proceeds from Issuance of Common Limited Partners Units					$ 72,100,000
Distribution Made to Limited Partner, Cash Distributions Paid			$ 1,191,216	$ 0
Distribution Made to Limited Partner, Distributions Paid, Per Unit (in Dollars per share)			$ 0.349041
Repayments from Related Party Debt			$ 2,000,000	$ 0
Subsequent Event [Member]
Subsequent Event (Details) [Line Items]
Distribution Made to Limited Partner, Cash Distributions Paid	$ 400,000
Distribution Made to Limited Partner, Distributions Paid, Per Unit (in Dollars per share)	$ 0.107397
Subsequent Event [Member] | General Partner [Member]
Subsequent Event (Details) [Line Items]
Repayments from Related Party Debt	$ 3,500,000
Subsequent Event [Member] | Best-Efforts Offering [Member]
Subsequent Event (Details) [Line Items]
Partners' Capital Account, Units, Sale of Units (in Shares)	200,000
Proceeds from Issuance of Common Limited Partners Units	$ 4,500,000
Proceeds, Net of Selling Commissions and Marketing Expenses, from Issuance of Common Limited Partners Units	$ 4,300,000