Energy Resources 12 10-Q 26 May 20 2020 Q1 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2020	May 26, 2020
Document Information Line Items
Entity Registrant Name	Energy Resources 12, L.P.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		11,031,579
Amendment Flag	false
Entity Central Index Key	0001696088
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Document Period End Date	Mar. 31, 2020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Shell Company	false
Entity Ex Transition Period	true
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	000-55916
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	81-4805237
Entity Address, Address Line One	120 W 3rd Street, Suite 220
Entity Address, City or Town	Fort Worth
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	76102
City Area Code	817
Local Phone Number	882-9192
Entity Interactive Data Current	Yes

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Assets
Cash and cash equivalents	$ 15,047,213	$ 14,834,452
Oil, natural gas and natural gas liquids revenue receivable	4,013,593	8,186,604
Derivative asset	1,036,771	0
Total Current Assets	20,097,577	23,021,056
Oil and natural gas properties, successful efforts method, net of accumulated depreciation, depletion and amortization of $26,448,543 and $21,955,397, respectively	195,246,409	197,498,771
Total Assets	215,343,986	220,519,827
Liabilities
Accounts payable and accrued expenses	5,541,449	8,835,537
Due to related parties	167,747	217,209
Derivative liability	0	207,327
Total Current Liabilities	5,709,196	9,260,073
Asset retirement obligations	581,989	570,795
Total Liabilities	6,291,185	9,830,868
Partners’ Equity
Limited partners' interest (11,031,579 common units issued and outstanding, respectively)	209,053,016	210,689,174
General partner's interest	(215)	(215)
Total Partners’ Equity	209,052,801	210,688,959
Total Liabilities and Partners’ Equity	$ 215,343,986	$ 220,519,827

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parentheticals) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Oil and natural gas properties, successful efforts method, accumulated depreciation, depletion and amortization (in Dollars)	$ 26,448,543	$ 21,955,397
Limited partners' interest, common units issued	11,031,579	11,031,579
Limited partners' interest, common units outstanding	11,031,579	11,031,579

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenues
Oil	$ 11,087,656	$ 10,711,687
Natural gas	499,114	391,539
Natural gas liquids	346,126	258,604
Total revenue	11,932,896	11,361,830
Operating costs and expenses
Production expenses	4,899,265	2,613,659
Production taxes	1,040,346	1,006,101
General and administrative expenses	805,508	780,183
Depreciation, depletion, amortization and accretion	4,498,722	2,761,473
Total operating costs and expenses	11,243,841	7,161,416
Operating income	689,055	4,200,414
Interest income (expense), net	19,172	(686,587)
Gain (loss) on derivatives	1,506,088	(1,871,884)
Total other expense, net	1,525,260	(2,558,471)
Net income	$ 2,214,315	$ 1,641,943
Basic and diluted net income per common unit (in Dollars per share)	$ 0.20	$ 0.20
Weighted average common units outstanding - basic and diluted (in Shares)	11,031,579	8,148,399

Consolidated Statements of Part

Consolidated Statements of Partners' Equity - USD ($)	Total	Limited Partner [Member]	General Partner [Member]
Balance at Dec. 31, 2018	$ 146,001,144	$ 146,001,359	$ (215)
Balance (in Shares) at Dec. 31, 2018		7,857,359
Net proceeds from issuance of common units	15,398,132	$ 15,398,132
Net proceeds from issuance of common units (in Shares)		820,004
Distributions declared and paid to common units	(2,833,574)	$ (2,833,574)
Net income	1,641,943	1,641,943
Balance at Mar. 31, 2019	160,207,645	$ 160,207,860	(215)
Balance (in Shares) at Mar. 31, 2019		8,677,363
Balance at Dec. 31, 2019	$ 210,688,959	$ 210,689,174	(215)
Balance (in Shares) at Dec. 31, 2019	11,031,579	11,031,579
Distributions declared and paid to common units	$ (3,850,473)	$ (3,850,473)
Net income	2,214,315	2,214,315
Balance at Mar. 31, 2020	$ 209,052,801	$ 209,053,016	$ (215)
Balance (in Shares) at Mar. 31, 2020	11,031,579	11,031,579

Consolidated Statements of Pa_2

Consolidated Statements of Partners' Equity (Parentheticals) - $ / shares	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
General Partner [Member]
Distributions declared and paid per unit	$ 0.349041	$ 0.349041

Consolidated Statement of Cash

Consolidated Statement of Cash Flows - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash flow from operating activities:
Net income	$ 2,214,315	$ 1,641,943
Adjustments to reconcile net income to cash from operating activities:
Depreciation, depletion, amortization and accretion	4,498,722	2,761,473
(Gain) loss on mark-to-market of derivatives	(1,244,098)	1,871,884
Other non-cash expenses, net	0	141,838
Changes in operating assets and liabilities:
Oil, natural gas and natural gas liquids revenue receivable	4,173,011	(1,517,486)
Due to related parties	(49,462)	161,172
Accounts payable and accrued expenses	(341,671)	375,083
Net cash flow provided by operating activities	9,250,817	5,435,907
Cash flow from investing activities:
Cash paid for acquisition of oil and natural gas properties	(110,073)	(1,254,763)
Additions to oil and natural gas properties	(5,077,510)	(10,348,632)
Net cash flow used in investing activities	(5,187,583)	(11,603,395)
Cash flow from financing activities:
Payments on revolving credit facility	0	(9,501,000)
Net proceeds related to issuance of common units	0	15,393,499
Distributions paid to limited partners	(3,850,473)	(2,833,574)
Net cash flow (used in) provided by financing activities	(3,850,473)	3,058,925
Increase (decrease) in cash and cash equivalents	212,761	(3,108,563)
Cash and cash equivalents, beginning of period	14,834,452	9,682,402
Cash and cash equivalents, end of period	15,047,213	6,573,839
Interest paid	0	398,096
Supplemental non-cash information:
Accrued capital expenditures related to additions to oil and natural gas properties	$ 2,997,080	$ 11,175,253

Partnership Organization

Partnership Organization	3 Months Ended
	Mar. 31, 2020
Accounting Policies [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”) is a Delaware limited partnership formed to acquire producing and non-producing oil and natural gas properties onshore in the United States and to develop those properties. The initial capitalization of the Partnership of $1,000 occurred on December 30, 2016. The Partnership completed its best-efforts offering in October 2019 with a total of approximately 11.0 million common units sold for gross proceeds of $218.0 million and proceeds net of offering costs of $204.3 million. As of March 31, 2020, the Partnership owned an approximate 5.7% non-operated working interest in 347 producing wells, predominantly in McKenzie, Dunn, McLean and Mountrail counties of North Dakota (collectively, the “Bakken Assets”). The Partnership also owns an estimated approximate 1.2% non-operated working interest in 21 wells in various stages of the drilling and completion process, and possible future development locations in 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. The Partnership’s fiscal year ends on December 31. COVID-19, Current Oil Demand, Pricing and Production The outbreak of a novel coronavirus (“COVID-19”) in China in December 2019 has spread worldwide, forcing governments around the world to take drastic measures to halt the outbreak. These measures include significant restrictions on travel, forced quarantines, stay-at-home requirements and the closure of businesses in many industries, creating extreme volatility in capital markets and the global economy. Because of COVID-19’s impact to the global economy, demand for oil, natural gas and other hydrocarbons substantially declined in March and April 2020, and demand for oil and natural gas is anticipated to be low for the remainder of 2020. In addition to the outbreak of COVID-19, Saudi Arabia and Russia, two of the largest worldwide producers of crude oil, engaged in a price war during March and April 2020, which ultimately led to excess crude oil and natural gas inventory, congested supply chain channels and shrinking storage capacity. These factors led to oil prices falling to 20-year lows in April 2020. With the anticipation that world-wide oil and natural gas prices will remain depressed during the remainder of 2020, the majority of the operators that operate the Bakken Assets on behalf of working interest owners like the Partnership have announced reductions to their 2020 capital budgets, and as a result, new investment in the Partnership’s undrilled acreage is expected to be limited until commodity prices and market supply and demand imbalances become more favorable. In addition, certain operators of the Bakken Assets have announced plans to curtail daily production, shut-in producing wells or seek other cost-cutting measures, starting in April 2020, due to the inability to produce, process and sell oil and natural gas at economical prices. Low commodity prices due to the supply and demand imbalances caused by COVID-19 have and are expected to continue to have a negative effect on the Partnership’s revenue and operating results. Significant uncertainty remains as to when commodity prices will return to normalized levels and how much of the Partnership’s oil, natural gas and other hydrocarbon production volumes will be impacted by cost-cutting measures enacted by the operators of the Bakken Assets.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2020
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, 2019 financial statements included in its 2019 Annual Report on Form 10-K. Operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the twelve-month period ending December 31, 2020. 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. 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. 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, 2020 and 2019. As a result, basic and diluted outstanding common units were the same. The Incentive Distribution Rights, as defined below, are not included in net income per common unit until such time that it is probable Payout (as discussed in Note 7) will occur.

Oil and Gas Investments

Oil and Gas Investments	3 Months Ended
	Mar. 31, 2020
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 first purchase (“Acquisition No. 1”) in the Bakken Assets for approximately $90.5 million, including all closing costs and assumed liabilities. On August 31, 2018, the Partnership completed its second purchase (“Acquisition No. 2”) of an additional non-operated working interest in the Bakken Assets for approximately $81.3 million, including all closing costs and assumed liabilities. As of March 31, 2020, the Partnership’s ownership of the Bakken Assets consisted of an approximate 5.7% non-operated working interest in 347 producing wells, and an estimated approximate 1.2% non-operated working interest in 21 wells in various stages of the drilling and completion process. From September 1, 2017, the effective date of Acquisition No. 1, to March 31, 2020, the Partnership has elected to participate in the drilling of 172 wells, of which 145 have been completed, 21 wells are in various stages of completion and six wells have not yet commenced drilling at March 31, 2020. The Partnership incurred approximately $2.2 million and $11.2 million, respectively, in capital drilling and completion costs for the three months ended March 31, 2020 and 2019. The Partnership anticipates approximately $1 to $2 million of capital expenditures will be incurred during the second and third quarters of 2020 to complete the 21 wells in various stages of completion at March 31, 2020. The Partnership’s estimated share of capital expenditures to complete the six wells that have not yet commenced drilling is approximately $3.6 million. However, estimated capital expenditures to complete these 27 wells could be significantly different from amounts actually invested. Evaluation for Potential Impairment of Oil and Natural Gas Investments The Partnership assesses its proved oil and natural gas properties for possible impairment whenever events or circumstances indicate that the recorded carrying value of its oil and gas properties may not be recoverable. The Partnership considered the declines in the current and forecasted operating cash flows resulting from COVID-19, commodity price decreases and the oversupply of oil in the United States during the first quarter of 2020 to be potential indicators of impairment and, as a result, performed a test of recoverability for the Bakken Assets. Estimated future net cash flows calculated in the recoverability test were based on existing reserves, forecasted production and cost information and management’s outlook of future commodity prices. The underlying commodity prices used in the determination of the Partnership’s estimated future net cash flows were based on forward strip prices as of April 1, 2020, adjusted by field or area for estimated location and quality differentials, as well as other trends and factors that management believed will impact realizable prices. Future operating costs estimates were based on actual historical costs of the Bakken Assets. A different set of assumptions could produce different results. The Partnership’s recoverability analyses did not identify any impairment losses as of March 31, 2020. If the macro-economic conditions that exist as of the date of this filing continue or worsen, it is likely that the Partnership’s oil and natural gas properties will be tested for impairment during the second quarter of 2020, which could result in non-cash asset impairments, and such impairments could be material to the Partnership’s consolidated financial statements.

Asset Retirement Obligations

Asset Retirement Obligations	3 Months Ended
	Mar. 31, 2020
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: 2020 2019 Balance at January 1 $ 570,795 $ 383,255 Well additions 5,618 19,648 Accretion 5,576 4,816 Revisions - - Balance at March 31 $ 581,989 $ 407,719

Fair Value of Financial Instrum

Fair Value of Financial Instruments	3 Months Ended
	Mar. 31, 2020
Fair Value Disclosures [Abstract]
Fair Value Disclosures [Text Block]	Note 5. Fair Value of Financial Instruments The Partnership follows authoritative guidance related to fair value measurement and disclosure, which establishes a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy categorizes assets and liabilities measured at fair value into one of three different levels depending on the observability of the inputs employed in the measurement using market participant assumptions at the measurement date. Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows: ● Level 1: Quoted prices in active markets for identical assets ● Level 2: Significant other observable inputs – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, either directly or indirectly, for substantially the full term of the financial instrument ● Level 3: Significant unobservable inputs The Partnership’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and the consideration of factors specific to the asset or liability. The Partnership’s policy is to recognize transfers in or out of a fair value hierarchy as of the end of the reporting period for which the event or change in circumstances caused the transfer. The Partnership has consistently applied the valuation techniques discussed above for all periods presented. During the three months ended March 31, 2020 and 2019, there were no transfers in or out of Level 1, Level 2, or Level 3 assets and liabilities measured on a recurring basis. As required, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The following table sets forth by level within the fair value hierarchy the Partnership’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2020 and December 31, 2019. Fair Value Measurements at March 31, 2020 Quoted Prices in Significant Other Observable Inputs Significant Unobservable Inputs Commodity derivatives - current assets $ - $ 1,036,771 $ - Total $ - $ 1,036,771 $ - Fair Value Measurements at December 31, 2019 Quoted Prices in Significant Other Observable Inputs Significant Unobservable Inputs Commodity derivatives - current liabilities $ - $ (207,327 ) $ - Total $ - $ (207,327 ) $ - The Level 2 instruments presented in the table above consist of the Partnership’s costless collar commodity derivative instruments. The fair value of the Partnership’s derivative financial instruments is determined based upon future prices, volatility and time to maturity, among other things. Counterparty statements are utilized to determine the value of the commodity derivative instruments and are reviewed and corroborated using various methodologies and significant observable inputs. The fair value of the commodity derivatives noted above are included in the Partnership’s consolidated balance sheets as Derivative asset at March 31, 2020 and Derivative liability at December 31, 2019. See additional detail in Note 6. Risk Management. Fair Value of Other Financial Instruments The carrying value of the Partnership’s cash and cash equivalents, oil, natural gas and natural gas liquids revenue receivable, accounts payable and accrued expenses reflect these items’ cost, which approximates fair value based on the timing of the anticipated cash flows, current market conditions and short-term maturity of these instruments.

Risk Management

Risk Management	3 Months Ended
	Mar. 31, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Instruments and Hedging Activities Disclosure [Text Block]	Note 6. Risk Management Participation in the oil and gas industry exposes the Partnership to risks associated with potentially volatile changes in energy commodity prices, and the Partnership’s future earnings are subject to these risks. Therefore, the Partnership periodically enters into derivative contracts to manage the commodity price risk on a portion of the Partnership’s anticipated future oil and gas production it will produce and sell and to reduce the effect of volatility in commodity price changes to provide a base level of cash flow from operations. The Partnership’s derivative instruments open at March 31, 2020 are costless collar contracts, which establish floor and ceiling prices on future anticipated oil production. While the use of costless collars limits the downside risk of adverse price movement, they may also limit future revenues from favorable price movement. The Partnership did not pay or receive a premium related to the costless collar agreements. The contracts are settled monthly. All derivative instruments are recorded on the Partnership’s balance sheet as assets or liabilities measured at fair value. As of March 31, 2020, the Partnership’s derivative instruments were in a gain position; therefore, an asset of approximately $1.0 million, which approximates its fair value, has been recognized as a Derivative asset on the Partnership’s consolidated balance sheet as of March 31, 2020. As of December 31, 2019, the Partnership’s derivative instruments were in a loss position; therefore, a liability of approximately $0.2 million, which approximates its fair value, was recognized as a Derivative liability on the Partnership’s consolidated balance sheet as of December 31, 2019. The fair values of the Derivative asset at March 31, 2020 and Derivative liability at December 31, 2019 were determined based on Level 2 inputs as defined under the fair value hierarchy. The Partnership determined the estimated fair value of derivative instruments using a market approach based on several factors, including quoted market prices in active markets and quotes from third parties, among other things. The Partnership also performs an internal valuation to ensure the reasonableness of third-party quotes. In consideration of counterparty credit risk, the Partnership considers that both counterparties to the derivative are of substantial credit quality and have the financial resources and willingness to meet its potential repayment obligations associated with the derivative transactions. See additional discussion above in Note 5. Fair Value of Financial Instruments. The Partnership did not designate its derivative instruments as hedges for accounting purposes and did not enter into such instruments for speculative trading purposes. As a result, when derivatives did not qualify or were not designated as a hedge, the changes in the fair value were recognized on the Partnership’s consolidated statements of operations as a gain or loss on derivative instruments. The following table presents settlements on matured derivative instruments and non-cash gains or losses on open derivative instruments for the three months ended March 31, 2020 and 2019. The settlement gain on matured derivatives for the three months ended March 31, 2020 reflects gains on derivative contracts which matured during the period, calculated as the difference between the contract price and the market settlement price. Non-cash gains or losses below represent the change in fair value of derivative instruments which were held at period-end. Three Months Ended Three Months Ended Settlement gain on matured derivatives $ 261,990 $ - Gain (loss) on mark-to-market of derivatives 1,244,098 (1,871,884 ) Gain (loss) on derivatives $ 1,506,088 $ (1,871,884 ) The following table reflects the open costless collar instruments as of March 31, 2020. Settlement Period Basis Product Volume Floor / Ceiling Prices ($) Fair Value of Asset at 04/01/20 - 06/30/20 NYMEX Oil (bbls) 52,000 45.00 / 61.20 $ 1,036,771 The Partnership’s outstanding derivative instruments are covered by International Swap Dealers Association Master Agreements (“ISDA”) entered into with the counterparties. The ISDA may provide that as a result of certain circumstances, such as cross-defaults, a counterparty may require all outstanding derivative instruments under an ISDA to be settled immediately. The use of derivative instruments involves the risk that the Partnership’s counterparties will be unable to meet the financial terms of such instruments. The Partnership has netting arrangements with its counterparties that provide for offsetting payables against receivables from separate derivative instruments, which allow these assets and liabilities to be netted on the Partnership’s consolidated balance sheet.

Capital Contribution and Partne

Capital Contribution and Partners' Equity	3 Months Ended
	Mar. 31, 2020
Partners' Capital Notes [Abstract]
Partners' Capital Notes Disclosure [Text Block]	Note 7. 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 reimbursed for its documented third party out-of-pocket expenses incurred in organizing the Partnership and offering the common units. The Partnership completed its best-efforts offering of common units as of the close of business on October 24, 2019. As of the conclusion of the offering, the Partnership had completed the sale of approximately 11.0 million common units for total gross proceeds of $218.0 million and proceeds net of offering costs of $204.3 million. Under the agreement with David Lerner Associates, Inc. (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 in the best-efforts offering, the Dealer Manager Incentive Fees are approximately $8.7 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, 2020 and 2019, the Partnership paid distributions of $0.349041 per common unit in both periods, or $3.9 million and $2.8 million, respectively.

Related Parties

Related Parties	3 Months Ended
	Mar. 31, 2020
Related Party Transactions [Abstract]
Related Party Transactions Disclosure [Text Block]	Note 8. 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. The management fee paid the General Partner for the three months ended March 31, 2020 and 2019 was approximately $273,000 and $214,000, respectively, and is 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, 2020 and 2019, approximately $92,000 and $95,000 of general and administrative costs were incurred by a member of the General Partner and have been or will be reimbursed by the Partnership. At March 31, 2020, approximately $92,000 was due to a member of the General Partner and is included in Due to related parties in the consolidated balance sheets. The Chief Executive Officer and Chief Financial Officer of the Partnership’s General Partner are also partners and 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 gives 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 are split evenly between the two partnerships and any direct third-party costs are paid by the party receiving the services. The shared costs are 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. 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 Energy 11’s general partner. For the three months ended March 31, 2020 and 2019, approximately $76,000 and $65,000, respectively, of expenses subject to the cost sharing agreement were incurred by the Partnership and have been or will be reimbursed to Energy 11. At March 31, 2020, approximately $76,000 was due from the Partnership to Energy 11 and is included in Due to related parties in the consolidated balance sheets.

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2020
Subsequent Events [Abstract]
Subsequent Events [Text Block]	Note 9. Subsequent Events In April 2020, the Partnership declared and paid $1.2 million, or $0.107397 per outstanding common unit, in distributions to its holders of common units.

Accounting Policies, by Policy

Accounting Policies, by Policy (Policies)	3 Months Ended
	Mar. 31, 2020
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, 2019 financial statements included in its 2019 Annual Report on Form 10-K. Operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the twelve-month period ending December 31, 2020.
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.
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.
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, 2020 and 2019. As a result, basic and diluted outstanding common units were the same. The Incentive Distribution Rights, as defined below, are not included in net income per common unit until such time that it is probable Payout (as discussed in Note 7) will occur.

Asset Retirement Obligations (T

Asset Retirement Obligations (Tables)	3 Months Ended
	Mar. 31, 2020
Asset Retirement Obligation Disclosure [Abstract]
Schedule of Asset Retirement Obligations [Table Text Block]	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: 2020 2019 Balance at January 1 $ 570,795 $ 383,255 Well additions 5,618 19,648 Accretion 5,576 4,816 Revisions - - Balance at March 31 $ 581,989 $ 407,719

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	3 Months Ended
	Mar. 31, 2020
Fair Value Disclosures [Abstract]
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]	As required, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The following table sets forth by level within the fair value hierarchy the Partnership’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2020 and December 31, 2019. Fair Value Measurements at March 31, 2020 Quoted Prices in Significant Other Observable Inputs Significant Unobservable Inputs Commodity derivatives - current assets $ - $ 1,036,771 $ - Total $ - $ 1,036,771 $ - Fair Value Measurements at December 31, 2019 Quoted Prices in Significant Other Observable Inputs Significant Unobservable Inputs Commodity derivatives - current liabilities $ - $ (207,327 ) $ - Total $ - $ (207,327 ) $ -

Risk Management (Tables)

Risk Management (Tables)	3 Months Ended
	Mar. 31, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Instruments, Gain (Loss) [Table Text Block]	The Partnership did not designate its derivative instruments as hedges for accounting purposes and did not enter into such instruments for speculative trading purposes. As a result, when derivatives did not qualify or were not designated as a hedge, the changes in the fair value were recognized on the Partnership’s consolidated statements of operations as a gain or loss on derivative instruments. The following table presents settlements on matured derivative instruments and non-cash gains or losses on open derivative instruments for the three months ended March 31, 2020 and 2019. The settlement gain on matured derivatives for the three months ended March 31, 2020 reflects gains on derivative contracts which matured during the period, calculated as the difference between the contract price and the market settlement price. Non-cash gains or losses below represent the change in fair value of derivative instruments which were held at period-end. Three Months Ended Three Months Ended Settlement gain on matured derivatives $ 261,990 $ - Gain (loss) on mark-to-market of derivatives 1,244,098 (1,871,884 ) Gain (loss) on derivatives $ 1,506,088 $ (1,871,884 )
Schedule of Derivative Instruments [Table Text Block]	The following table reflects the open costless collar instruments as of March 31, 2020. Settlement Period Basis Product Volume Floor / Ceiling Prices ($) Fair Value of Asset at 04/01/20 - 06/30/20 NYMEX Oil (bbls) 52,000 45.00 / 61.20 $ 1,036,771

Partnership Organization (Detai

Partnership Organization (Details) shares in Millions	Dec. 30, 2016USD ($)	Mar. 31, 2020	Mar. 31, 2019USD ($)	Oct. 24, 2019USD ($)shares
Partnership Organization (Details) [Line Items]
Limited Liability Company or Limited Partnership, Business, Formation State	Delaware
Partners' Capital Account, Contributions (in Dollars)	$ 1,000
Proceeds from Issuance of Common Limited Partners Units (in Dollars)			$ 15,398,132
Bakken Assets [Member]
Partnership Organization (Details) [Line Items]
Number of Operators		14
Best-Efforts Offering [Member]
Partnership Organization (Details) [Line Items]
Partners' Capital Account, Units, Sale of Units (in Shares) | shares				11
Proceeds from Issuance of Common Limited Partners Units (in Dollars)				$ 218,000,000
Proceeds, Net of Offering Costs, from Issuance of Common Limited Partners Units (in Dollars)				$ 204,300,000
Non-operated Completed Wells [Member] | Bakken Assets [Member]
Partnership Organization (Details) [Line Items]
Gas and Oil Area Developed, Net		5.70%
Oil, Productive Well, Number of Wells, Net		347
Non-operated Wells in the Process of Drilling [Member] | Bakken Assets [Member]
Partnership Organization (Details) [Line Items]
Gas and Oil Area Developed, Net		1.20%
Oil and Gas, Present Activity, Well in Process of Drilling		21

Oil and Gas Investments (Detail

Oil and Gas Investments (Details) - Bakken Assets [Member] $ in Millions	Aug. 31, 2018USD ($)	Feb. 01, 2018USD ($)	Mar. 31, 2020USD ($)	Mar. 31, 2019USD ($)	Mar. 31, 2020
Acquisition No. 1 [Member]
Oil and Gas Investments (Details) [Line Items]
Business Combination, Consideration Transferred (in Dollars)		$ 90.5
Wells Drilled					172
Oil and Gas, Development Well Drilled, Net Productive, Number					145
Oil and Gas, Present Activity, Well in Process of Drilling			21		21
Costs Incurred, Development Costs (in Dollars)			$ 2.2	$ 11.2
Number of Wells not yet Completed			27
Acquisition No. 2 [Member]
Oil and Gas Investments (Details) [Line Items]
Business Combination, Consideration Transferred (in Dollars)	$ 81.3
Minimum [Member] | Acquisition No. 1 [Member]
Oil and Gas Investments (Details) [Line Items]
Capital Expenditures Drilling and Completion of Wells (in Dollars)			$ 1
Maximum [Member] | Acquisition No. 1 [Member]
Oil and Gas Investments (Details) [Line Items]
Capital Expenditures Drilling and Completion of Wells (in Dollars)			$ 2
Non-operated Completed Wells [Member]
Oil and Gas Investments (Details) [Line Items]
Gas and Oil Area Developed, Net			5.70%
Oil, Productive Well, Number of Wells, Net			347		347
Non-operated Wells in the Process of Drilling [Member]
Oil and Gas Investments (Details) [Line Items]
Gas and Oil Area Developed, Net			1.20%
Oil, Productive Well, Number of Wells, Net			21		21
Wells, Drilling not yet Commenced [Member] | Acquisition No. 1 [Member]
Oil and Gas Investments (Details) [Line Items]
Number of Wells, Drilling not yet Commenced					6
Capital Expenditures Drilling and Completion of Wells (in Dollars)			$ 3.6

Asset Retirement Obligations (D

Asset Retirement Obligations (Details) - Schedule of Asset Retirement Obligations - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Schedule of Asset Retirement Obligations [Abstract]
Balance	$ 570,795	$ 383,255
Well additions	5,618	19,648
Accretion	5,576	4,816
Revisions	0	0
Balance	$ 581,989	$ 407,719

Fair Value of Financial Instr_3

Fair Value of Financial Instruments (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Fair Value, Inputs, Level 1 [Member]
Fair Value of Financial Instruments (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Commodity derivatives - current assets	$ 0
Total	0	$ 0
Commodity derivatives - current liabilities		0
Fair Value, Inputs, Level 2 [Member]
Fair Value of Financial Instruments (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Commodity derivatives - current assets	1,036,771
Total	1,036,771	(207,327)
Commodity derivatives - current liabilities		(207,327)
Fair Value, Inputs, Level 3 [Member]
Fair Value of Financial Instruments (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items]
Commodity derivatives - current assets	0
Total	$ 0	0
Commodity derivatives - current liabilities		$ 0

Risk Management (Details)

Risk Management (Details) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Asset, Current	$ 1,036,771	$ 0
Derivative Liability, Current	$ 0	$ 207,327

Risk Management (Details) - Der

Risk Management (Details) - Derivative Instruments, Gain (Loss) - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Derivative Instruments, Gain (Loss) [Abstract]
Settlement gain on matured derivatives	$ 261,990	$ 0
Gain (loss) on mark-to-market of derivatives	1,244,098	(1,871,884)
Gain (loss) on derivatives	$ 1,506,088	$ (1,871,884)

Risk Management (Details) - Sch

Risk Management (Details) - Schedule of Derivative Instruments - Price Risk Derivative [Member]	3 Months Ended
	Mar. 31, 2020USD ($)$ / iteml
Derivative [Line Items]
Basis	NYMEX
Oil (Barrels) (in Liters) | l	52,000
Floor Price	45
Fair Value of Asset (in Dollars) | $	$ 1,036,771
Ceiling Price	61.20

Capital Contribution and Part_2

Capital Contribution and Partners' Equity (Details) - USD ($) $ / shares in Units, shares in Millions	Dec. 30, 2016	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2017	Oct. 24, 2019
Capital Contribution and Partners' Equity (Details) [Line Items]
Partners' Capital Account, Contributions	$ 1,000
Partners' Capital Account, Return of Contribution Upon Minimum Offering				$ 990
Proceeds from Issuance of Common Limited Partners Units			$ 15,398,132
Partners' Capital Account, Description of Units Sold		Under the agreement with David Lerner Associates, Inc. (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		$ 8,700,000
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	$ 0.349041
Distribution Made to Limited Partner, Cash Distributions Paid		$ 3,850,473	$ 2,833,574
Best-Efforts Offering [Member]
Capital Contribution and Partners' Equity (Details) [Line Items]
Partners' Capital Account, Units, Sale of Units (in Shares)					11
Proceeds from Issuance of Common Limited Partners Units					$ 218,000,000
Proceeds, Net of Offering Costs, from Issuance of Common Limited Partners Units					$ 204,300,000

Related Parties (Details)

Related Parties (Details) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
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	$ 167,747		$ 217,209
General Partner [Member]
Related Parties (Details) [Line Items]
Due to Related Parties, Current	92,000
Related Party Transaction, Selling, General and Administrative Expenses from Transactions with Related Party	92,000	$ 95,000
Energy 11 [Member]
Related Parties (Details) [Line Items]
Due to Related Parties, Current	76,000
Related Party Transaction, Selling, General and Administrative Expenses from Transactions with Related Party	76,000	65,000
Management Fee [Member] | General Partner [Member]
Related Parties (Details) [Line Items]
Due to Related Parties, Current	$ 273,000	$ 214,000

Subsequent Events (Details)

Subsequent Events (Details) - Subsequent Event [Member] $ / shares in Units, $ in Millions	1 Months Ended
	Apr. 30, 2020USD ($)$ / shares
Subsequent Events (Details) [Line Items]
Distribution Made to Limited Partner, Cash Distributions Paid | $	$ 1.2
Distribution Made to Limited Partner, Distributions Paid, Per Unit | $ / shares	$ 0.107397