Cover
Cover | 3 Months Ended |
Dec. 31, 2022 | |
Cover [Abstract] | |
Document Type | S-1/A |
Amendment Flag | true |
Amendment Description | AMENDMENT NO. 3 |
Entity Registrant Name | PERMEX PETROLEUM CORPORATION |
Entity Central Index Key | 0001922639 |
Entity Primary SIC Number | 1381 |
Entity Tax Identification Number | 98-1384682 |
Entity Incorporation, State or Country Code | A1 |
Entity Address, Address Line One | 2911 Turtle Creek Blvd |
Entity Address, Address Line Two | Suite 925 |
Entity Address, City or Town | Dallas |
Entity Address, State or Province | TX |
Entity Address, Postal Zip Code | 75219 |
City Area Code | (469) |
Local Phone Number | 804-1306 |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | true |
Elected Not To Use the Extended Transition Period | false |
Condensed Interim Consolidated
Condensed Interim Consolidated Balance Sheets (Unaudited) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 |
Current assets | |||
Cash and cash equivalents | $ 1,693,664 | $ 3,300,495 | $ 25,806 |
Trade and other receivables, net | 185,466 | 137,214 | 12,984 |
Prepaid expenses and deposits | 204,958 | 317,277 | 46,151 |
Total current assets | 2,084,088 | 3,754,986 | 84,941 |
Non-current assets | |||
Reclamation deposits | 145,000 | 145,000 | 144,847 |
Property and equipment, net of accumulated depreciation and depletion | 9,874,776 | 8,426,776 | 6,638,975 |
Right of use asset, net | 212,486 | 240,796 | 72,539 |
Total assets | 12,316,350 | 12,567,558 | 6,941,302 |
Current liabilities | |||
Trade and other payables | 2,699,225 | 1,561,344 | 402,979 |
Amounts due to related party | 16,628 | ||
Convertible debenture | 38,291 | 78,500 | |
Lease liability – current portion | 91,665 | 104,224 | 51,963 |
Total current liabilities | 2,790,890 | 1,703,859 | 550,070 |
Non-current liabilities | |||
Asset retirement obligations | 244,406 | 236,412 | 552,594 |
Lease liability, less current portion | 126,799 | 140,682 | 26,986 |
Loan payable | 31,400 | ||
Warrant liability | 166 | 23,500 | |
Total liabilities | 3,162,261 | 2,104,453 | 1,161,050 |
Equity | |||
Common stock value | 14,337,739 | 14,337,739 | 8,976,747 |
Additional paid-in capital | 4,513,369 | 4,513,194 | 2,476,717 |
Accumulated other comprehensive loss | (127,413) | (127,413) | (127,413) |
Deficit | (9,569,606) | (8,260,415) | (5,545,799) |
Total equity | 9,154,089 | 10,463,105 | 5,780,252 |
Total liabilities and equity | $ 12,316,350 | $ 12,567,558 | $ 6,941,302 |
Condensed Interim Consolidate_2
Condensed Interim Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 12 Months Ended | |||||
Oct. 26, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |||
Statement of Financial Position [Abstract] | |||||||
Common Stock, No Par Value | $ 0 | $ 0 | $ 0 | ||||
Common stock shares authorized unlimited | Unlimited | Unlimited | Unlimited | ||||
Common stock, shares issued | 1,932,604 | [1] | 1,932,604 | [1] | 1,103,010 | ||
Common stock, shares outstanding | 1,932,604 | [1] | 1,932,604 | [1] | 1,103,010 | ||
Stockholders' Equity, Reverse Stock Split | 1 for 60 ratio | 60:1 reverse stock split | 60:1 reverse stock split | 60:1 reverse stock split | |||
[1]The number of shares has been restated to reflect the 60:1 reverse stock split |
Condensed Interim Consolidate_3
Condensed Interim Consolidated Statements of Loss (Unaudited) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |||
Revenues | ||||||
Oil and gas sales | $ 213,754 | $ 89,990 | $ 815,391 | $ 46,703 | ||
Royalty income | 8,188 | 16,459 | 63,068 | 37,922 | ||
Total revenues | 221,942 | 106,449 | 878,459 | 84,625 | ||
Operating expenses | ||||||
Production | 292,679 | 81,879 | 829,194 | 59,671 | ||
General and administrative | 1,215,106 | 809,606 | 2,796,395 | 496,381 | ||
Depletion and depreciation | 40,196 | 32,011 | 105,503 | 60,479 | ||
Accretion on asset retirement obligations | 7,994 | 8,253 | 55,030 | 19,907 | ||
Foreign exchange gain (loss) | 3,310 | 4,970 | (7,429) | 24,301 | ||
Forfeiture of reclamation deposit | 50,165 | |||||
Loss on disposal of property and equipment | 613,457 | |||||
Total operating expenses | (1,559,285) | (936,719) | (3,778,693) | (1,324,361) | ||
Loss from operations | (1,337,343) | (830,270) | (2,900,234) | (1,239,736) | ||
Other income (expense) | ||||||
Interest income | 5,895 | |||||
Other income | 6,000 | 24,000 | ||||
Forgiveness of loan | 7,800 | |||||
Finance expense | (1,182) | (23,468) | (30,586) | (13,506) | ||
Change in fair value of warrant liability | 23,334 | 102,550 | 178,509 | |||
Total other income (expense) | 28,152 | 79,082 | 185,618 | (13,506) | ||
Net loss and comprehensive loss | $ (1,309,191) | $ (751,188) | (2,714,616) | (1,253,242) | ||
Other comprehensive income | ||||||
Foreign currency translation adjustment | 142,889 | |||||
Comprehensive loss | $ (2,714,616) | $ (1,110,353) | ||||
Basic and diluted loss per common share | $ (0.68) | $ (0.66) | $ (1.76) | $ (1.84) | ||
Weighted average number of common shares outstanding | 1,932,604 | [1] | 1,130,344 | [1] | 1,543,021 | 678,958 |
[1]The number of shares has been restated to reflect the 60:1 reverse stock split |
Condensed Interim Consolidate_4
Condensed Interim Consolidated Statements of Loss (Unaudited) (Parenthetical) | 3 Months Ended | 12 Months Ended | ||
Oct. 26, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | |
Equity [Abstract] | ||||
Stockholders' equity, reverse stock split | 1 for 60 ratio | 60:1 reverse stock split | 60:1 reverse stock split | 60:1 reverse stock split |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Equity (Unaudited) - USD ($) | Total | Share Capital [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | |
Balance at Sep. 30, 2020 | $ 3,312,657 | $ 6,453,039 | $ 1,422,477 | $ (270,302) | $ (4,292,557) | |
Balance, shares at Sep. 30, 2020 | [1],[2] | 667,073 | ||||
Acquisition of property | 2,468,750 | $ 2,468,750 | ||||
Acquisition of property, shares | [1],[2] | 416,666 | ||||
Acquisition of property - warrants | 1,051,370 | 1,051,370 | ||||
Shares issued for services | 54,958 | $ 54,958 | ||||
Shares issued for services, shares | [1],[2] | 19,271 | ||||
Share-based payments | 2,870 | 2,870 | ||||
Net loss | (1,253,242) | (1,253,242) | ||||
Other comprehensive income | 142,889 | 142,889 | ||||
Balance at Sep. 30, 2021 | 5,780,252 | $ 8,976,747 | 2,476,717 | (127,413) | (5,545,799) | |
Balance, shares at Sep. 30, 2021 | [1],[2],[3] | 1,103,010 | ||||
Share-based payments | 607,325 | 607,325 | ||||
Net loss | (751,188) | (751,188) | ||||
Private placements | 369,751 | $ 369,751 | ||||
Private placements, shares | [3] | 44,117 | ||||
Share issuance costs | (14,307) | $ (38,850) | 24,543 | |||
Balance at Dec. 31, 2021 | 5,991,833 | $ 9,307,648 | 3,108,585 | (127,413) | (6,296,987) | |
Balance, shares at Dec. 31, 2021 | [3] | 1,147,127 | ||||
Balance at Sep. 30, 2021 | 5,780,252 | $ 8,976,747 | 2,476,717 | (127,413) | (5,545,799) | |
Balance, shares at Sep. 30, 2021 | [1],[2],[3] | 1,103,010 | ||||
Share-based payments | 546,335 | 546,335 | ||||
Net loss | (2,714,616) | (2,714,616) | ||||
Private placements | 7,910,331 | $ 7,303,161 | 607,170 | |||
Private placements, shares | [1],[2] | 829,594 | ||||
Share issuance costs | (1,059,197) | $ (1,942,169) | 882,972 | |||
Balance at Sep. 30, 2022 | 10,463,105 | $ 14,337,739 | 4,513,194 | (127,413) | (8,260,415) | |
Balance, shares at Sep. 30, 2022 | [1],[2],[3] | 1,932,604 | ||||
Share-based payments | 175 | 175 | ||||
Net loss | (1,309,191) | (1,309,191) | ||||
Balance at Dec. 31, 2022 | $ 9,154,089 | $ 14,337,739 | $ 4,513,369 | $ (127,413) | $ (9,569,606) | |
Balance, shares at Dec. 31, 2022 | [3] | 1,932,604 | ||||
[1] The number of shares has been restated to reflect the 60:1 share consolidation (Note 1). 60:1 reverse stock split 60:1 reverse stock split |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Equity (Unaudited) (Parenthetical) | 3 Months Ended | 12 Months Ended | ||
Oct. 26, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | |
Equity [Abstract] | ||||
Stockholders' equity, reverse stock split | 1 for 60 ratio | 60:1 reverse stock split | 60:1 reverse stock split | 60:1 reverse stock split |
Condensed Interim Consolidate_5
Condensed Interim Consolidated Statements of Cash Flows (Unaudited) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||||
Net loss | $ (1,309,191) | $ (751,188) | $ (2,714,616) | $ (1,253,242) |
Adjustments to reconcile net loss to net cash from operating activities: | ||||
Accretion on asset retirement obligations | 7,994 | 8,253 | 55,030 | 19,907 |
Depletion and depreciation | 40,196 | 32,011 | 105,503 | 60,479 |
Foreign exchange loss (gain) | 474 | (7,168) | 87,747 | |
Forfeiture of reclamation bond | 50,165 | |||
Forgiveness of loan payable | (7,800) | |||
Finance expense | 11,073 | 18,031 | 13,506 | |
Change in fair value of warrant liability | (23,334) | (102,550) | (178,509) | |
Loss on disposal of property and equipment | 613,457 | |||
Extinguishment of trade and other payables | (4,368) | (9,682) | ||
Share-based payments | 175 | 607,325 | 546,335 | 2,870 |
Shares issued for services | 54,958 | |||
Changes in operating assets and liabilities: | ||||
Trade and other receivables | (48,252) | (118,432) | (124,230) | 34,092 |
Prepaid expenses and deposits | 112,319 | (2,994) | (271,126) | (29,977) |
Trade and other payables | 514,733 | (13,583) | 584,216 | (234,475) |
Amounts due to related parties | (24,536) | (162,598) | ||
Right of use asset and lease liability | 1,868 | 318 | (785) | 3,010 |
Net cash used in operating activities | (703,492) | (329,293) | (2,024,023) | (749,783) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||||
Capital expenditures on property and equipment | (865,048) | (8,777) | (1,685,999) | (265,717) |
Proceeds from sale of oil and gas interests | 1,123,244 | |||
Net cash provided by (used in) investing activities | (865,048) | (8,777) | (1,685,999) | 857,527 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||||
Proceeds from issuance of private placement units | 571,760 | |||
Proceeds from issuance of share capital | 8,112,340 | |||
Share issuance costs | (22,978) | (1,067,868) | ||
Convertible debenture repayment | (38,291) | (34,709) | (79,000) | |
Loan from related party | (1,452) | (8,455) | ||
Loan from related party | 3,095 | |||
Loan repayment | (23,600) | |||
Net cash provided by (used in) financing activities | (38,291) | 551,877 | 6,984,711 | (87,455) |
Change in cash and cash equivalents during the period | (1,606,831) | 213,807 | 3,274,689 | 20,289 |
Cash and cash equivalents, beginning of the period | 3,300,495 | 25,806 | 25,806 | 5,517 |
Cash and cash equivalents, end of the period | 1,693,664 | 239,613 | 3,300,495 | 25,806 |
Supplemental disclosures of non-cash investing and financing activities: | ||||
Common stock issued in connection with property acquisition agreement | 2,468,750 | |||
Share purchase warrants issued in connection with private placements and property acquisition | 1,692,151 | 1,051,370 | ||
Share purchase warrants issued in connection with private placements | 226,552 | |||
Trade and other payables related to property and equipment | 1,270,400 | 109,888 | 647,252 | 68,735 |
Adjustments to asset retirement obligations | (371,212) | 376,647 | ||
Supplemental cash flow disclosures: | ||||
Interest paid | $ 1,182 | $ 24,536 | $ 13,090 |
BACKGROUND
BACKGROUND | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
BACKGROUND | 1. BACKGROUND Permex Petroleum Corporation (the “Company”) was incorporated on April 24, 2017 th On October 26, 2022, the Company’s board of directors approved a reverse stock split of the Company’s issued and outstanding common stock at a 1 for 60 ratio | 1. BACKGROUND Permex Petroleum Corporation (the “Company”) was incorporated on April 24, 2017 under the laws of British Columbia, Canada and maintains its head office at Suite 925, 2911 Turtle Creek Blvd, Dallas, Texas, 75219. Its registered office is located at 10 th On October 26, 2022, the Company’s board of directors approved a reverse stock split of the Company’s issued and outstanding common stock at a 1 for 60 ratio |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Accounting Policies [Abstract] | ||
SIGNIFICANT ACCOUNTING POLICIES | 2. SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) and applicable rules and regulations of the United States Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the condensed consolidated financial statements include all adjustments necessary, which are of a normal and recurring nature, for the fair presentation of the Company’s financial position and of the results of operations and cash flows for the periods presented. These interim results are not necessarily indicative of the results to be expected for the fiscal year ending September 30, 2023 or for any other interim period or for any other future fiscal year. These condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and footnotes for the fiscal year ended September 30, 2022. Principles of Consolidation The accompanying consolidated financial statements include the assets, liabilities, revenue and expenses of the Company’s wholly-owned subsidiary, Permex Petroleum US Corporation PERMEX PETROLEUM CORPORATION NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED DECEMBER 31, 2022 (UNAUDITED) 2. Significant Accounting Policies Going concern of operations These consolidated financial statements have been prepared on a going concern basis which assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The Company has incurred losses since inception in the amount of $ 9,569,606 Management plans to fund operations of the Company with its current working capital and through increasing production from its oil and gas leases. The Company also expects to raise additional funds through equity financings. There are no written agreements in place for such funding or issuance of securities and there can be no assurance that such will be available in the future. Management believes that this plan provides an opportunity for the Company to continue as a going concern. In view of these matters, continuation as a going concern is dependent upon continued operations of the Company, which in turn is dependent upon the Company’s ability to meet its financial requirements, raise additional capital, and the success of its future operations. The financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should the Company not continue as a going concern. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period. Management evaluates these estimates and judgments on an ongoing basis and bases its estimates on experience, current and expected future conditions, third-party evaluations and various other assumptions that management believes are reasonable under the circumstances. Significant estimates have been used by management in conjunction with the following: (i) amounts subject to allowances and returns; (ii) the fair value of assets when determining the existence of impairment factors and the amount of impairment, if any; (iii) the costs of site restoration when determining decommissioning liabilities; (iv) income taxes receivable or payable; (v) the useful lives of assets for the purposes of depreciation; (vi) petroleum and natural gas reserves; and (vii) share-based payments. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. These estimates are based on information available as of the date of the financial statements; therefore, actual results could differ from those estimates. New accounting standards There are not currently any new or pending accounting standards that are expected to have a significant impact on the Company’s consolidated financial statements. PERMEX PETROLEUM CORPORATION NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED DECEMBER 31, 2022 (UNAUDITED) | 2. SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The Company’s consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) Principles of Consolidation These consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Permex Petroleum US Corporation. All intercompany balances and transactions have been eliminated. Going concern of operations These consolidated financial statements have been prepared on a going concern basis which assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The Company has incurred losses since inception in the amount of $ 8,260,415 and has not yet achieved profitable operations. The Company has been relying on equity financing and loans from related parties to fund its operation in the past. While the Company has been successful in securing financing to date, there can be no assurances that it will be able to do so in the future. The aforementioned factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management plans to fund operations of the Company with its current working capital and through increasing productions from its oil and gas leases. The Company also expects to raise additional funds through equity financings. There are no written agreements in place for such funding or issuance of securities and there can be no assurance that such will be available in the future. Management believes that this plan provides an opportunity for the Company to continue as a going concern. In view of these matters, continuation as a going concern is dependent upon continued operations of the Company, which in turn is dependent upon the Company’s ability to, meets its financial requirements, raise additional capital, and the success of its future operations. The financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should the Company not continue as a going concern. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. Significant Accounting Policies Use of Estimates The preparation of financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period. Management evaluates these estimates and judgments on an ongoing basis and bases its estimates on experience, current and expected future conditions, third-party evaluations and various other assumptions that management believes are reasonable under the circumstances. Significant estimates have been used by management in conjunction with the following: (i) petroleum and natural gas reserves; (ii) the fair value of assets when determining the existence of impairment factors and the amount of impairment, if any; (iii) the costs of site restoration when determining asset retirement obligations; (iv) income taxes receivable or payable; (v) the useful lives of assets for the purposes of depreciation; (vi) general credit risk associated with receivables and other assets; and (vii) share-based payments. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. These estimates are based on information available as of the date of the financial statements; therefore, actual results could differ from those estimates. Cash and cash equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash and cash equivalents. Cash and cash equivalents are recorded at cost, which approximates fair value. Trade and other receivables Trade and other receivables are stated at net realizable value. The majority of customers are not extended credit and the majority of the receivables has payment terms of 30 days or less. On a periodic basis, management evaluates its accounts receivable and determines whether to provide an allowance or if any accounts should be written off based on a past history of write-offs, collections, and current credit conditions. A receivable is considered past due if the Company has not received payments based on agreed-upon terms. Given the nature and balances of the Company’s receivables the Company has no material loss allowance as at September 30, 2022 and September 30, 2021. Property and equipment The Company follows the successful efforts method of accounting for its oil and gas properties. All costs for development wells along with related acquisition costs, the costs of drilling development wells, and related asset retirement obligation (ARO) assets are capitalized. Exploration costs, such as exploratory geological and geophysical costs, and costs associated with non-productive exploratory wells, delay rentals and exploration overhead are expensed. Costs of drilling exploratory wells are capitalized pending determination of whether the wells found proved reserves. Costs of wells that are assigned proved reserves remain capitalized. Costs also are capitalized for exploratory wells that have found crude oil and natural gas reserves even if the reserves cannot be classified as proved when the drilling is completed, provided the exploratory well has found a sufficient quantity of reserves to justify its completion as a producing well and the Company is making sufficient progress assessing the reserves and the economic and operating viability of the project. The Company groups its oil and gas properties with a common geological structure or stratigraphic condition (“common operating field”) for purposes of computing depletion expenses, assessing proved property impairments and accounting for asset dispositions. Capitalized costs of proved oil and gas properties are depleted by individual field using a unit-of-production method based on proved and probable developed reserves. Proved reserves are estimated using reserve engineer reports and represent the estimated quantities of crude oil, natural gas and natural gas liquids, which geological, geophysical and engineering data demonstrate with a specified degree of certainty to be recoverable in future years from known reservoirs and which are considered commercially producible. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. Significant Accounting Policies Property and equipment Proved oil and natural gas properties are assessed for possible impairment by comparing their carrying values with their associated undiscounted, future net cash flows. Events that can trigger assessments for possible impairments include write-downs of proved reserves based on field performance, significant decreases in the market value of an asset (including changes to the commodity price forecast or carbon costs), significant change in the extent or manner of use of or a physical change in an asset, and a more-likely-than-not expectation that a long-lived asset or asset group will be sold or otherwise disposed of significantly sooner than the end of its previously estimated useful life. Impaired assets are written down to their estimated fair values, generally their discounted, future net cash flows. For proved oil and natural gas properties, the Company performs impairment reviews on a field basis, annually or as appropriate. Other corporate property and equipment consist primarily of leasehold improvements, vehicle, and office furniture and equipment and are stated at cost less accumulated depreciation. The capitalized costs are generally depreciated on a straight line basis over their estimated useful lives ranging from three to five years . For property dispositions, measurement is at fair value, unless the transaction lacks commercial substance or fair value cannot be reliably measured. Where the exchange is measured at fair value, a gain or loss is recognized in net income. Any deferred consideration recorded on property dispositions are recognized as revenue in the statement of loss and comprehensive loss over the reserve life. Gains or losses are recorded for sales or dispositions of oil and gas properties which constitute an entire common operating field or which result in a significant alteration of the common operating field’s depletion rate. These gains and losses are classified as asset dispositions in the accompanying consolidated statements of loss and comprehensive loss. Partial common operating field sales or dispositions deemed not to significantly alter the depletion rates are generally accounted for as adjustments to capitalized costs with no gain or loss recognized. Impairment of long-lived assets The Company assesses long-lived assets for impairment in accordance with the provisions of the Financial Account Standards Board Accounting Standards Codification (“ASC”) regarding long-lived assets. It requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through the estimated undiscounted cash flows expected to result from the use and eventual disposition of the assets. Whenever any such impairment exists, an impairment loss will be recognized for the amount by which the carrying value exceeds the fair value. As of September 30, 2022 and September 30, 2021, no impairment charge has been recorded. Asset retirement obligations The Company recognizes asset retirement obligations (“ARO”) associated with tangible assets such as well sites when there is a legal obligation associated with the retirement of such assets and the amount can be reasonably estimated. The ARO are measured at the present value of management’s best estimate of the future remediation expenditures at the reporting date. The initial measurement of an ARO is recorded as a liability at its fair value, with an offsetting asset retirement cost recorded as an increase to the associated property and equipment on the consolidated balance sheet. When the assumption used to estimate a recorded ARO change, a revision is recorded to both the ARO and the asset retirement cost. The ARO is accreted to its then present value each period, and the asset retirement cost is depreciated using a systematic and rational method similar to that used for the associated property and equipment. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. SIGNIFICANT ACCOUNTING POLICIES Fair value measurement Fair value accounting is applied for all assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). Fair value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company follows the established framework for measuring fair value and expands disclosures about fair value measurements. The Company categorizes its assets and liabilities measured at fair value into a three-level hierarchy based on the priority of the inputs to the valuation technique used to determine fair value. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used in the determination of the fair value measurement fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement. Assets and liabilities valued at fair value are categorized based on the inputs to the valuation techniques as follows: Level 1 Level 2 Level 3 ’ The carrying values of cash and cash equivalents, trade receivable, other current receivables, due from/to related parties, trade payable, other current payables, accrued expenses, convertible debenture and lease liability included in the accompanying consolidated balance sheets approximated fair value at September 30, 2022 and September 30, 2021. The financial statements as of and for the years ended September 30, 2022 and September 30, 2021, do not include any recurring or nonrecurring fair value measurements relating to assets or liabilities. Subsequent to initial recognition, the Company may re-measure the carrying value of assets and liabilities measured on a nonrecurring basis to fair value. Adjustments to fair value usually result when certain assets are impaired. Such assets are written down from their carrying amounts to their fair value. Professional standards allow entities the irrevocable option to elect to measure certain financial instruments and other items at fair value for the initial and subsequent measurement on an instrument-by-instrument basis. The Company has not elected to measure any existing financial instruments at fair value. However, it may elect to measure newly acquired financial instruments at fair value in the future. Earnings (loss) per share Basic earnings (loss) per share (“EPS”) is calculated by dividing net income (loss) attributable to common shareholders by the weighted average number of common shares outstanding in the period. The diluted EPS reflects all dilutive potential common share equivalents, in the weighted average number of common shares outstanding during the period, if dilutive. All of the outstanding convertible securities, stock options and warrants were anti-dilutive for the years ended September 30, 2022 and 2021. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. SIGNIFICANT ACCOUNTING POLICIES Leases At inception of a contract, the Company assesses whether a contract is, or contains a lease based on whether the contract conveys the right to control the use of an identified asset for a period in exchange for consideration. The Company recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured based on the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date. The lease obligation is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate. Variable lease payments that do not depend on an index or rate are not included in the measurement of the lease liability. The lease liability is subsequently measured at amortized cost using the effective interest rate method. Share capital The Company records proceeds from the issuance of its common shares as equity. Incremental costs directly attributable to the issue of new common shares are shown in equity as a deduction, net of tax, from the proceeds. Common shares issued for consideration other than cash are valued based on their market value at the date that the shares are issued. Share purchase warrants The fair value of warrants issued with private placement units is determined using the Black-Scholes option pricing model. Proceeds from the issuance of private placement units are allocated between the private placement warrants and common shares on a relative fair value basis. Share purchase warrants with exercise prices denominated in a currency other than its functional currency are classified as a liability. Proceeds from the issuance of private placement units are first allocated to the warrant liability based on their fair value and the residual is allocated to common shares issued while for equity warrants, proceeds are allocated on a relative fair value basis. The changes in fair value of the warrant liability are recorded in the statement of loss and comprehensive loss. Warrants issued for oil and gas interests and warrants issued as finder’s fees are share-based payments and are measured at fair value on the date of the grant as determined using the Black-Scholes option pricing model. Share-based payments The Company issues stock options and other share-based compensation to directors, employees and others service providers. Equity awards including stock options and share purchase warrants are measured at grant date at the fair value of the instruments issued and amortized over the vesting periods using a graded vesting approach. The number of options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount ultimately recognized as an expense is based on the number of options that eventually vest. The Company has elected to account for forfeitures as they occur rather than estimate expected forfeitures. The fair value of the equity awards is determined using the Black-Scholes option pricing model. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average historic volatility), weighted average expected life of the instruments (based on historical experience), expected dividends, and the risk-free interest rate (based on government bonds). PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. SIGNIFICANT ACCOUNTING POLICIES Revenue In accordance with ASC 606, Revenue from Contracts with Customers, The Company records revenue in the month production is delivered to the purchaser. However, production statements for oil and gas sales may not be received until the following month end after the products are purchased, and as a result, the Company is required to estimate the amount of revenue to be received. The Company records the differences between its estimates and the actual amounts received for revenue in the month that payment is received from the customer. Identified differences between the Company’s revenue estimates and actual revenue received are $ 1,395 and $ nil for years ended September 30, 2022 and September 30, 2021, respectively. The Company believes that the pricing provisions of its oil, natural gas and natural gas liquids contracts are customary in the industry. To the extent actual volumes and prices of oil and natural gas sales are unavailable for a given reporting period because of timing or information not received from third parties, the revenue related to sales volumes and prices for those good sold are estimated and recorded. The Company does not have any contract assets or liabilities, or capitalized contract costs. Foreign Currency These consolidated financial statements are presented in United States dollars (“U.S. dollar”). The functional currency of the Company and the subsidiary of the Company is the U.S. dollar. The Company changed its functional currency from Canadian dollars (“CAD”) to the U.S. dollars as at October 1, 2021. The change in functional currency from Canadian dollars to U.S. dollars is accounted for prospectively from October 1, 2021. Management determined that the Company’s functional currency had changed based on the assessment related to significant changes of the Company’s economic facts and circumstances. These significant changes included the fact that the Company’s equity financings and the primary economic environment are now in the U.S. as well as the expectation of the majority of the Company’s expenses will be denominated in U.S. dollars. Moreover, the Company’s place of business and management are now located in the United States. Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates of the transactions. At the end of each reporting period, monetary assets and liabilities that are denominated in foreign currencies are translated at the rates prevailing at that date. Non-monetary assets and liabilities are translated using the historical rate on the date of the transaction. Non-monetary assets and liabilities that are stated at fair value are translated using the historical rate on the date that the fair value was determined. All gains and losses on translation of these foreign currency transactions are charged to profit or loss. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. SIGNIFICANT ACCOUNTING POLICIES Income taxes Current taxes receivable or payable are estimated on taxable income or loss for the current year at the statutory tax rates enacted or substantively enacted at the reporting date. Deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax assets and liabilities are measured at the tax rates that have been enacted or substantially enacted at the end of the reporting period and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. Deferred income tax assets also result from unused loss carry forwards, resource related pools and other deductions. At the end of each reporting year the Company reassesses unrecognized deferred tax assets. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred income tax assets and deferred income tax liabilities are offset if a legally enforceable right exists to offset current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority. New accounting standards There are not currently any new or pending accounting standards that have a significant impact on the Company’s consolidated financial statements. |
REVENUE
REVENUE | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
REVENUE | 3. REVENUE Revenue from contracts with customers is presented in “Oil and gas sales” on the Consolidated Statements of Loss. As of December 31, 2022 and September 30, 2022, receivable from contracts with customers, included in trade and other receivables, were $ 78,802 56,639 The following table present our revenue from contracts with customers disaggregated by product type and geographic areas. SCHEDULE OF REVENUE DISAGGREGATED BY PRODUCT TYPE AND GEOGRAPHIC AREAS 1 2 3 Three months ended December 31, 2022 Texas New Mexico Total Crude oil $ 173,961 $ 39,512 $ 213,473 Natural gas 281 - 281 Revenue from contracts with customers $ 174,242 $ 39,512 $ 213,754 Three months ended December 31, 2021 Texas New Mexico Total Crude oil $ 70,161 $ - $ 70,161 Natural gas 19,829 - 19,829 Revenue from contracts with customers $ 89,990 $ - $ 89,990 | 3. REVENUE Revenue from contracts with customers is presented in “Oil and gas sales” on the Consolidated Statement of Loss and Comprehensive Loss. As of September 30, 2022 and September 30, 2021, receivable from contracts with customers, included in trade and other receivables, were $ 56,639 and $ nil , respectively. The following table present our revenue from contracts with customers disaggregated by product type and geographic areas. SCHEDULE OF REVENUE DISAGGREGATED BY PRODUCT TYPE AND GEOGRAPHIC AREAS 1 2 3 Year ended September 30, 2022 Texas New Mexico Total Crude oil $ 621,275 $ 140,236 $ 761,511 Natural gas 53,880 - 53,880 Revenue from contracts with customers $ 675,155 $ 140,236 $ 815,391 1 2 3 Year ended September 30, 2021 Texas New Mexico Total Crude oil $ 44,425 $ - $ 44,425 Natural gas 2,278 - 2,278 Revenue from contracts with customers $ 46,703 $ - $ 46,703 |
CONCENTRATION OF CREDIT RISK
CONCENTRATION OF CREDIT RISK | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Risks and Uncertainties [Abstract] | ||
CONCENTRATION OF CREDIT RISK | 4. CONCENTRATION OF CREDIT RISK The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of its cash equivalents and trade receivables. The Company’s cash balances sometimes exceed the United States’ Federal Deposit Insurance Corporation insurance limits. The Company mitigates this risk by placing its cash and cash equivalents with high credit quality financial institutions and attempts to limit the amount of credit exposure with any one institution. To date, the Company has not recognized any losses caused by uninsured balances. The majority of the Company’s receivable balance is concentrated in trade receivables, with a balance of $ 140,497 91,928 78,451 56 44,969 PERMEX PETROLEUM CORPORATION NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED DECEMBER 31, 2022 (UNAUDITED) | 4. CONCENTRATION OF CREDIT RISK The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of its cash equivalents and trade receivables. The Company’s cash balances sometimes exceed the United States’ Federal Deposit Insurance Corporation insurance limits. The Company mitigates this risk by placing its cash and cash equivalents with high credit quality financial institutions and attempts to limit the amount of credit exposure with any one institution. To date, the Company has not recognized any losses caused by uninsured balances. The majority of the Company’s receivable balance is concentrated in trade receivables, with a balance of $ 91,928 as of September 30, 2022. Three customers represented $ 79,942 ( 87 %) of the trade receivable balance. The Company routinely assesses the financial strength of its customers. The non-trade receivable balance consists of GST recoverable of $ 39,770 and interest receivable of $ 5,516 . GST recoverable is due from the Canadian Government. Interest receivable is due from a financial institution with high credit rating. It is in management’s opinion that the Company is not exposed to significant credit risk. To date, the Company has not recognized any credit losses on its receivables. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 |
ACQUISITION AND DISPOSITION
ACQUISITION AND DISPOSITION | 12 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITION AND DISPOSITION | 5. ACQUISITION AND DISPOSITION Acquisition During the year ended September 30, 2021, the Company and its wholly owned subsidiary, Permex Petroleum US Corporation, acquired a 100 % Working Interest and a 81.75 % Net Revenue Interest in the Breedlove “B” Clearfork leases located in Martin County, Texas. The Company issued 416,666 common shares and 208,333 share purchase warrants as consideration for this acquisition. The Company valued the 416,666 common shares issued at a fair value of $ 2,468,750 . The share purchase warrants were valued at $ 1,051,370 using the Black-Scholes option pricing model (assuming a risk-free interest rate of 1.51 %, an expected life of 10 -years, annualized volatility of 96.56 % and a dividend rate of 0 %). The warrants have an exercise price $ 8.76 per share (CAD$ 12.00 ) and are exercisable until September 30, 2031. Disposition During the year ended September 30, 2021, the Company sold its interests in the Peavy leases together with reclamation obligations for $ 10,000 and recognized a loss of $ 604,687 from the sale. The Company also recognized a loss of $ 8,770 from the disposal of equipment. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | ||
PROPERTY AND EQUIPMENT | 5. PROPERTY AND EQUIPMENT Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT December 31, 2022 September 30, 2022 Oil and natural gas properties, at cost $ 9,903,713 $ 8,029,234 Construction in progress - 460,306 Less: accumulated depletion (212,853 ) (184,658 ) Oil and natural gas properties, net 9,690,860 8,304,882 Other property and equipment, at cost 201,565 127,542 Less: accumulated depreciation (17,649 ) (5,648 ) Other property and equipment, net 183,916 121,894 Property and equipment, net $ 9,874,776 $ 8,426,776 Depletion and depreciation expense was $ 40,196 32,011 | 6. PROPERTY AND EQUIPMENT Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT September 30, September 30, 2021 Oil and natural gas properties, at cost $ 8,029,234 $ 6,723,778 Construction in progress 460,306 - Less: accumulated depletion (184,658 ) (84,803 ) Oil and natural gas properties, net 8,304,882 6,638,975 Other property and equipment, at cost 127,542 - Less: accumulated depreciation (5,648 ) - Other property and equipment, net 121,894 - Property and equipment, net $ 8,426,776 $ 6,638,975 Depletion and depreciation expense was $ 105,503 and $ 60,479 for the years ended September 30, 2022 and September 30, 2021, respectively. |
LEASES
LEASES | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Leases | ||
LEASES | 6. LEASES All of the Company’s right-of-use assets are operating leases related to its office premises. Details of the Company’s right-of-use assets and lease liabilities are as follows: SCHEDULE OF RIGHT OF USE OPERATING LEASES December 31, 2022 September 30, 2022 Right-of-use assets $ 212,486 $ 240,796 Lease liabilities Balance, beginning of the year $ 244,906 $ 78,949 Addition - 220,368 Liability accretion 7,088 9,042 Lease payments (33,530 ) (63,453 ) Balance, end of the year $ 218,464 $ 244,906 Current lease liabilities $ 91,665 $ 104,224 Long-term lease liabilities $ 126,799 $ 140,682 The following table presents the Company’s total lease cost. SCHEDULE OF LEASE COST Three months ended Three months ended Operating lease cost $ 35,398 $ 13,961 Variable lease expense 7,175 7,557 Sublease income (10,004 ) (4,868 ) Rent subsidy - (1,674 ) Net lease cost $ 32,569 $ 14,976 As of December 31, 2022, maturities of the Company’s operating lease liabilities are as follows: SCHEDULE OF FUTURE LEASE PAYMENTS Year 2023 $ 77,294 2024 82,190 2025 84,664 2026 14,180 Total lease payments 258,328 Less: imputed interest (39,864 ) Total lease liabilities $ 218,464 PERMEX PETROLEUM CORPORATION NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED DECEMBER 31, 2022 (UNAUDITED) | 7. LEASES All of the Company’s right-of-use assets are operating leases related to its office premises. Details of the Company’s right-of-use assets and lease liabilities are as follows: SCHEDULE OF RIGHT OF USE OPERATING LEASES 2022 2021 Right-of-use assets $ 240,796 $ 72,539 Lease liabilities Balance, beginning of the year $ 78,949 $ 53,128 Addition 220,368 57,357 Interest expense 9,042 9,812 Liability accretion 7,088 9,042 Lease payments (63,453 ) (43,932 ) Foreign exchange movement - 2,584 Balance, end of the year $ 244,906 $ 78,949 Current lease liabilities $ 104,224 $ 51,963 Long-term lease liabilities $ 140,682 $ 26,986 The following table presents the Company’s total lease cost. SCHEDULE OF LEASE COST 2022 2021 Operating lease cost $ 35,398 $ 13,961 Amortization of right-of-use assets $ 52,111 $ 37,129 Interest on lease liabilities 9,042 9,812 Variable lease expense 36,216 16,564 Sublease income (36,633 ) (10,191 ) Rent subsidy (1,644 ) (9,169 ) Net lease cost $ 59,092 $ 44,145 As of September 30, 2022, maturities of the Company’s operating lease liabilities are as follows: SCHEDULE OF FUTURE LEASE PAYMENTS Year 2023 $ 110,593 2024 82,190 2025 84,664 2026 14,180 Total lease payments 291,627 Less: imputed interest (46,721 ) Total lease liabilities $ 244,906 PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 |
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Asset Retirement Obligation Disclosure [Abstract] | ||
ASSET RETIREMENT OBLIGATIONS | 7. ASSET RETIREMENT OBLIGATIONS Asset retirement obligations reflects the estimated present value of the amount of dismantlement, removal, site reclamation, and similar activities associated with the Company’s oil and gas properties. Changes to the asset retirement obligations are as follows: SCHEDULE OF ASSET RETIREMENT OBLIGATIONS December 31, 2022 September 30, 2022 Asset retirement obligations, beginning of the year $ 236,412 $ 552,594 Revisions of estimates - (371,212 ) Accretion expense 7,994 55,030 Asset retirement obligations, ending of the year $ 244,406 $ 236,412 During the year ended September 30, 2022, the Company had revision of estimates totaling $ 371,212 Reclamation deposits As of December 31, 2022, the Company held reclamation deposits of $ 145,000 145,000 PERMEX PETROLEUM CORPORATION NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED DECEMBER 31, 2022 (UNAUDITED) | 8. ASSET RETIREMENT OBLIGATIONS Asset retirement obligations reflects the estimated present value of the amount of dismantlement, removal, site reclamation, and similar activities associated with the Company’s oil and gas properties. Changes to the asset retirement obligations are as follows: SCHEDULE OF ASSET RETIREMENT OBLIGATIONS 2022 2021 Decommissioning obligations, beginning of the year $ 552,594 $ 271,402 Obligations recognized - 258,726 Obligations derecognized - (125,511 ) Revisions of estimates (371,212 ) 117,921 Accretion expense 55,030 19,907 Foreign exchange movement - 10,149 Decommissioning obligations, ending of the year $ 236,412 $ 552,594 During the year ended September 30, 2022, the Company had revision of estimates totaling $ 371,212 (2021 - increase of $ 117,921 ) primarily due to changes in future cost estimates and retirement dates for its oil and gas assets. Reclamation bonds As of September 30, 2022, the Company held reclamation bonds of $ 145,000 (September 30, 2021 - $ 144,847 ), which are expected to be released after all reclamation work has been completed with regard to its oil and natural gas interests. During the year ended September 30, 2021, the Company wrote off $ 50,165 of a reclamation deposit forfeited by the Texas State government due to a violation on a previously owned property. |
DEBT
DEBT | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Debt Disclosure [Abstract] | ||
DEBT | 8. DEBT Convertible debenture – Related party As of September 30, 2022, the Company had a debenture loan of $ 73,000 100,000 12 December 20, 2022 6.57 9.00 three years 8.76 12.00 During the year ended September 30, 2022, the Company repaid $ 34,709 47,546 38,291 52,454 During the three months ended December 31, 2022 and the year ended September 30, 2022, the Company recorded interest of $ 1,182 9,360 Loan payable In May 2020, the Company opened a Canada Emergency Business Account (“CEBA”) and received a loan of $ 28,640 40,000 60,000 23,600 30,000 7,800 10,000 | 9. DEBT Convertible debenture As of September 30, 2022, the Company had a debenture loan of $ 73,000 (CAD$ 100,000 ) (September 30, 2021 - $ 78,500 ) from the CEO of the Company outstanding. The debenture loan is secured by an interest in all of the Company’s right, title, and interest in all of its oil and gas assets, bears interest at a rate of 12 % per annum and has a maturity date of December 20, 2022 . The debenture is convertible at the holder’s option into units of the Company at $ 6.57 (CAD$ 9.00 ) per unit. Each unit will be comprised of one common share of the Company and one share purchase warrant; each warrant entitles the holder to acquire one additional common share for a period of three years at an exercise price of $ 8.76 (CAD$ 12.00 ). During the year ended September 30, 2022, the Company repaid $ 34,709 of the loan (CAD$ 47,546 ). Subsequent to September 30, 2022, the Company repaid the remaining principal loan amount of CAD$ 52,454 . During the years ended September 30, 2022 and September 30, 2021, the Company recorded interest of $ 9,360 and $ 13,506 , respectively. Loan payable In May 2020, the Company opened a Canada Emergency Business Account (“CEBA”) and received a loan of $ 28,640 (CAD$ 40,000 ) from the Canadian Government. The CEBA program was established to provide interest-free loans of up to CAD$ 60,000 to small businesses to help them cover operating costs during the COVID-19 pandemic. The loan was unsecured and non-interest bearing with a repayment deadline of December 31, 2023. During the year ended September 30, 2022, the Company repaid the loan balance of $ 23,600 (CAD$ 30,000 ) and recognized a gain of $ 7,800 (CAD$ 10,000 ) on the forgiven amount. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Related Party Transactions [Abstract] | ||
RELATED PARTY TRANSACTIONS | 9. RELATED PARTY TRANSACTIONS i) The convertible debenture loan from the CEO of the Company mentioned in Note 8 was paid off during the three months ended December 31, 2022. ii) The Company has an employment agreement with the CEO of the Company for an annual base salary of $ 250,000 The CEO is also eligible on an annual basis for a cash bonus of up to 100% of annual salary. The employment agreement may be terminated with a termination payment equal to three years of base salary and a bonus equal to 20% of the annual base salary iii) On May 1, 2022, the Company entered into an employment agreement with the CFO of the Company for an annual base salary of $ 50,000 The CFO is also eligible on an annual basis for a cash bonus of up to 100% of annual salary. The employment agreement may be terminated with a termination payment equal to two months of base salary. | 10. RELATED PARTY TRANSACTIONS i) In October 2019, the Company issued $ 76,000 (CAD$ 100,000 ) in convertible debenture to a director of the Company for cash. The debenture loan was secured by an interest in all of the Company’s right, title, and interest in all of its oil and gas assets, bore interest at a rate of 12 % per annum and had a maturity date of September 30, 2021 . During the year ended September 30, 2021, the Company repaid the principal loan amount of CAD$ 100,000 together with accrued interest of $ 13,090 . During the year ended September 30, 2021, the Company recorded interest of $ 4,026 . ii) In February 2020, the Company issued $ 76,000 (CAD$ 100,000 ) in convertible debenture to the CEO of the Company for cash. The debenture loan is secured by an interest in all of the Company’s right, title, and interest in all of its oil and gas assets, bears interest at a rate of 12 % per annum and has an original maturity date of February 20, 2022. During the year ended September 30, 2022, the Company extended the maturity date to December 20, 2022 and repaid $ 34,709 of the loan (CAD$ 47,546 ). During the years ended September 30, 2022 and September 30, 2021, the Company recorded interest of $ 9,360 and $ 9,480 , respectively. As at September 30, 2021, accrued interest of $ 15,176 was included in amounts due to related parties. iii) The Company has an employment agreement with the CEO of the Company for an annual base salary of $ 250,000 , with no specified term. The CEO is also eligible on an annual basis for a cash bonus of up to 100% of annual salary. The employment agreement may be terminated with a termination payment equal to three years of base salary and a bonus equal to 20% of the annual base salary . During the years ended September 30, 2022 and September 30, 2021, the Company incurred management fees of $ 220,834 and $ 149,806 , respectively, to the CEO of the Company. The Company considers this a related party transaction, as it relates to key management personnel and entities over which it has control or significant influence. iv) On May 1, 2022, the Company entered into an employment agreement with the CFO of the Company for an annual base salary of $ 50,000 , with no specified term. The CFO is also eligible on an annual basis for a cash bonus of up to 100% of annual salary. The employment agreement may be terminated with a termination payment equal to two months of base salary . During the years ended September 30, 2022, the Company incurred salaries of $ 20,835 to the CFO of the Company. The Company considers this a related party transaction, as it relates to key management personnel and entities over which it has control or significant influence. Included in amounts due to related parties are $ nil (2021 - $ 1,321 ) related to accrued management fee to a director of the Company and $ nil ( 2021 - $ 131 ) in advances from the CEO of the Company. Amounts due to related parties are unsecured, non-interest bearing, and have no specific terms of repayment. |
LOSS PER SHARE
LOSS PER SHARE | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||
LOSS PER SHARE | 10. LOSS PER SHARE The calculation of basic and diluted loss per share for the three month periods ended December 31, 2022 and 2021 was based on the net losses attributable to common shareholders. The following table sets forth the computation of basic and diluted loss per share: SCHEDULE OF BASIC AND DILUTED LOSS PER SHARE Three months ended December 31, 2022 Three months ended December 31, 2021 Net loss $ (1,309,191 ) $ (751,188 ) Weighted average common shares outstanding 1,932,604 1,130,344 Basic and diluted loss per share $ (0.68 ) $ (0.66 ) As of December 31, 2022, 84,583 (2021 - 92,917 ) stock options and 1,097,096 (2021 - 1,097,096 ) warrants were excluded from the diluted weighted average number of common shares calculation as their effect would have been anti-dilutive. PERMEX PETROLEUM CORPORATION NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED DECEMBER 31, 2022 (UNAUDITED) | 11. LOSS PER SHARE The calculation of basic and diluted loss per share for the years ended September 30, 2022 and 2021 was based on the net losses attributable to common shareholders. The following table sets forth the computation of basic and diluted loss per share: SCHEDULE OF BASIC AND DILUTED LOSS PER SHARE 2022 2021 Net loss $ (2,714,616 ) $ (1,253,242 ) Weighted average common shares outstanding 1,543,021 678,958 Basic and diluted loss per share $ (1.76 ) $ (1.84 ) As of September 30, 2022, $ 73,000 (CAD$ 100,000 ) of convertible debentures convertible into 11,111 common shares, 84,583 (2021 - 37,917 ) stock options and 1,097,096 (2021 - 208,333 ) warrants were excluded from the diluted weighted average number of common shares calculation as their effect would have been anti-dilutive. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 |
EQUITY
EQUITY | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Equity [Abstract] | ||
EQUITY | 11. EQUITY Common stock The Company has authorized an unlimited no 1,932,604 There were no share issuance transactions during the three months ended December 31, 2022. During the year ended September 30, 2022, the Company: a) Completed a non-brokered private placement of 44,117 12.96 16.20 571,760 714,700 25.80 32.40 202,009 34,733 2,680 24,543 0.98 2 153.02 0 800 8,671 b) Completed a brokered private placement of 785,477 9.60 7,540,580 5 12.60 607,170 754,058 78,548 131,560 858,429 2.45 5 134.66 0 159,271 Share-based payments Stock options The Company has a stock option plan (the “Plan”) in place under which it is authorized to grant options to executive officers and directors, employees and consultants. Pursuant to the Plan, the Company may issue aggregate stock options totaling up to 10 10 PERMEX PETROLEUM CORPORATION NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED DECEMBER 31, 2022 (UNAUDITED) 11. EQUITY Share-based payments Stock option transactions are summarized as follows: SCHEDULE OF STOCK OPTION TRANSACTIONS Number Weighted Average Balance, September 30, 2021 37,917 $ 19.51 Granted 55,000 10.51 Cancelled (8,334 ) 17.34 Balance, September 30, 2022 and December 31, 2022 84,583 $ 13.26 Exercisable at December 31, 2022 83,333 $ 13.61 The aggregate intrinsic value of options outstanding and exercisable as at December 31, 2022 was $ nil nil The options outstanding as of December 31, 2022 have exercise prices in the range of $ 2.22 22.20 7.46 During the three months ended December 31, 2022 and 2021, the Company recognized share-based payment expense of $ 175 607,325 SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN THE FAIR VALUE 2022 2021 Risk-free interest rate - 1.5 % Expected life of options - 10 Expected annualized volatility - 96.56 % Dividend rate - Nil Weighted average fair value of options granted - $ 10.17 As December 31, 2022, the following stock options were outstanding: SCHEDULE OF STOCK OPTIONS OUTSTANDING Number Exercise Price Issuance Date Expiry Date 27,917 $ 22.20 December 4, 2017 December 4, 2027 5,000 $ 13.32 November 1, 2018 November 1, 2028 5,000 $ 2.22 March 16, 2020 March 16, 2030 51,666 $ 10.66 October 6, 2021 October 6, 2031 84,583 PERMEX PETROLEUM CORPORATION NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED DECEMBER 31, 2022 (UNAUDITED) 11. EQUITY Warrants Warrant transactions are summarized as follows: SCHEDULE OF WARRANTS TRANSACTIONS Number Weighted Balance, September 30, 2021 208,333 $ 9.42 Granted 888,763 12.91 Balance, September 30, 2022 and December 31, 2022 1,097,096 $ 12.12 As December 31, 2022, the following warrants were outstanding: SCHEDULE OF WARRANTS OUTSTANDING Number Exercise Price Issuance Date Expiry Date 24,739 $ 23.98 November 4, 2021 November 4, 2023 864,024 $ 12.60 March 29, 2022 March 29, 2027 208,333 $ 8.88 September 30, 2021 September 30, 2031 1,097,096 22,059 202,009 0.98 2 153.02 0 178,509 23,334 102,550 The following weighted average assumptions were used for the Black-Scholes valuation of warrants as at December 31, 2022 and September 30, 2022: SCHEDULE OF VALUATION OF WARRANTS December 31, 2022 September 30, 2022 Risk-free interest rate 4.06 % 3.79 % Warrant measurement input 4.06 % 3.79 % Expected life of options 0.75 Year 1 Year Expected annualized volatility 110.97 % 135.59 % Dividend rate Nil Nil Weighted average fair value of options granted $ 0.01 $ 1.46 | 12. EQUITY Common stock The Company has authorized an unlimited number of common shares with no par value. At September 30, 2022 and September 30, 2021, the Company had 1,932,604 and 1,103,010 common shares issued and outstanding, respectively. During the year ended September 30, 2022, the Company: a) Completed a non-brokered private placement of 44,117 units at a price of $ 12.96 (CAD$ 16.20 ) per unit for gross proceeds of $ 571,760 (CAD$ 714,700 ). Each unit is comprised of one common share and one half of one share purchase warrant; each whole warrant entitles the holder to acquire one additional common share for a period of 24 months at an exercise price of $ 25.80 (CAD$ 32.40 ). $ 202,009 of the proceeds was allocated to the warrants and recorded as a warrant liability. The Company paid $ 34,733 and issued 2,680 agent’s warrants as a finders’ fee. The finder’s warrants have the same terms as the warrants issued under the private placement. The finder’s warrants were valued at $ 24,543 using the Black-Scholes option pricing model (assuming a risk-free interest rate of 0.98 %, an expected life of 2 years, annualized volatility of 153.02 % and a dividend rate of 0 %). The Company also incurred filing and other expenses of $ 800 in connection with the private placement. $ 8,671 of issuance costs related to the warrants was recorded in the statement of loss and comprehensive loss. b) Completed a brokered private placement of 785,477 units at a price of $ 9.60 per unit for gross proceeds of $ 7,540,580 . Each unit is comprised of one common share and one common share purchase warrant; each warrant entitles the holder to acquire one additional common share for a period of 5 years at an exercise price of $ 12.60 . $ 607,170 of the proceeds was allocated to the warrants. ThinkEquity LLC acted as sole placement agent for the private placement. In connection with the private placement, ThinkEquity received a cash commission of $ 754,058 , 78,548 broker warrants and expense reimbursement of $ 131,560 . The broker’s warrants have the same terms as the warrants issued under the private placement. The broker’s warrants were valued at $ 858,429 using the Black-Scholes option pricing model (assuming a risk-free interest rate of 2.45 %, an expected life of 5 years, annualized volatility of 134.66 % and a dividend rate of 0 %). The Company also incurred filing and other expenses of $ 159,271 in connection with the private placement. During the year ended September 30, 2021, the Company: a) Issued 19,271 common shares of the Company for a fair value of $ 54,958 pursuant to service agreements. b) Issued 416,666 common shares of the Company for a value of $ 2,468,750 pursuant to a property acquisition agreement. Share-based payments Stock options The Company has a stock option plan (the “Plan”) in place under which it is authorized to grant options to executive officers and directors, employees and consultants. Pursuant to the Plan, the Company may issue aggregate stock options totaling up to 10 % of the issued and outstanding common stock of the Company. Further, the Plan calls for the exercise price of each option to be equal to the market price of the Company’s stock as calculated on the date of grant. The options can be granted for a maximum term of 10 years and vest at the discretion of the Board of Directors at the time of grant. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 12. EQUITY Share-based payments Stock option transactions are summarized as follows: SCHEDULE OF STOCK OPTION TRANSACTIONS Number Weighted Balance, September 30, 2020 39,003 $ 18.75 Cancelled (1,086 ) 23.70 Balance, September 30, 2021 37,917 $ 19.51 Granted 55,000 10.51 Cancelled (8,334 ) 17.34 Balance, September 30, 2022 84,583 $ 13.26 Exercisable at September 30, 2022 83,333 $ 13.42 The aggregate intrinsic value of options outstanding and exercisable as at September 30, 2022 was $ nil (2021 - $ nil ). The options outstanding as of September 30, 2022 have exercise prices in the range of $ 2.19 to $ 21.90 and a weighted average remaining contractual life of 7.72 years. There were no options granted during the year ended September 30, 2021. During the years ended September 30, 2022 and 2021, the Company recognized share-based payment expense of $ 546,335 and $ 2,870 , respectively, for the portion of stock options that vested during the year. The following weighted average assumptions were used for the Black-Scholes valuation of stock options granted: SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN THE FAIR VALUE 2022 2021 Risk-free interest rate 1.50 % - Expected life of options 10 Years - Expected annualized volatility 96.56 % - Dividend rate Nil - Weighted average fair value of options granted $ 10.17 $ - PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 12. EQUITY Share-based payments As September 30, 2022, the following stock options were outstanding: SCHEDULE OF STOCK OPTIONS OUTSTANDING Number Exercise Price Expiry Date 27,917 $ 21.90 December 4, 2027 5,000 $ 13.14 November 1, 2028 5,000 $ 2.19 March 16, 2030 51,666 $ 10.51 October 6, 2031 84,583 Warrants Warrant transactions are summarized as follows: SCHEDULE OF WARRANTS TRANSACTIONS Number Weighted Balance, September 30, 2020 80,087 $ 12.77 Granted 208,333 9.48 Warrants expired (80,087 ) 13.46 Balance, September 30, 2021 208,333 $ 9.42 Granted 888,763 12.91 Balance, September 30, 2022 1,097,096 $ 12.12 As September 30, 2022, the following warrants were outstanding: SCHEDULE OF WARRANTS OUTSTANDING Number Exercise Price Expiry Date 24,739 $ 23.65 November 4, 2023 864,024 $ 12.60 March 29, 2027 208,333 $ 8.76 October 1, 2031 1,097,096 22,059 warrants issued with private placement units during fiscal 2022 have an exercise price denominated in CAD. These warrants were initially valued at $ 202,009 using the Black-Scholes option pricing model (assuming a risk-free interest rate of 0.98% , an expected life of 2 years, annualized volatility of 153.02% and a dividend rate of 0% ) and recorded as a warrant liability. These warrants were subsequently revaluated and a gain on fair value adjustment of $ 178,509 was recorded during the year ended September 30, 2022. The following weighted average assumptions were used for the Black-Scholes valuation of warrants as at September 30, 2022 and November 4, 2021: SCHEDULE OF VALUATION OF WARRANTS September 30,2022 November 4, 2021 Risk-free interest rate 3.79 % 0.98 % Expected life of options 1 Year 2 Years Expected annualized volatility 135.59 % 153.02 % Dividend rate Nil Nil Weighted average fair value of options granted $ 1.46 $ 11.45 PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 13. INCOME TAXES SCHEDULE OF RECONCILIATION OF INCOME TAX 2022 2021 Loss before income taxes $ (2,714,616 ) $ (1,253,242 ) Expected income tax recovery at statutory rates $ (407,000 ) $ (188,000 ) Provincial income tax (244,000 ) (137,000 ) Effect of income taxes from US operations (42,000 ) (7,000 ) Change in statutory, foreign tax, foreign exchange rates and other (32,000 ) (59,000 ) Permanent differences 103,000 1,000 Adjustment to prior years provision versus statutory tax returns (53,000 ) (11,000 ) Change in valuation allowance 675,000 401,000 Deferred income tax recovery $ - $ - Components of the Company’s pre-tax loss and income taxes are as follows: SCHEDULE OF PRE TAX LOSS AND INCOME TAXES 2022 2021 Loss for the year Canada $ (2,030,281 ) $ (1,144,350 ) US (684,335 ) (108,892 ) $ (2,714,616 ) $ (1,253,242 ) Expected income tax (recovery) Canada $ (549,000 ) $ (309,000 ) US (102,000 ) (29,000 ) $ (651,000 ) $ (338,000 ) Deferred income tax (recovery) Canada $ 548,000 $ 309,000 US 103,000 29,000 $ 651,000 $ 338,000 Deferred income tax recovery $ - $ - The significant components of the Company’s deferred tax assets and liabilities are as follows: SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES 2022 2021 Tax loss carryforwards $ 1,342,000 $ 780,000 Property and equipment (74,000 ) (9,000 ) Financing fees 216,000 38,000 Total gross deferred tax assets 1,484,000 809,000 Deferred tax assets valuation allowance (1,484,000 ) (809,000 ) Net deferred tax assets $ - $ - The significant components of the Company’s temporary differences include unamortized financing fees and tax loss carryforwards. The valuation allowance reduces the deferred tax assets to amounts that are, in management’s assessment, more likely than not to be realized. For the years ended September 30, 2022 and 2021, the Company had financing fees of $ 801,000 and $ 140,000 , respectively, with expiration dates between 2042 and 2047. The Company also had tax loss carryforwards of approximately $ 4,832,000 in Canada and the United States. For the years ended September 30, 2022 and 2021, the Canada tax losses totaled $ 4,028,000 and $ 2,707,000 , respectively, with expiration dates ranging from 2037 to 2042 and 2037 to 2041 , respectively. The United States tax losses for the years ended September 30, 2022 and 2021 totaled $ 804,000 and $ 213,000 , respectively, and had no expiration dates. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | 14. SEGMENT INFORMATION Operating segments The Company operates in a single reportable segment – the acquisition, development and production of oil and gas properties in the United States. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 |
SUPPLEMENTAL INFORMATION ON OIL
SUPPLEMENTAL INFORMATION ON OIL AND GAS OPERATIONS | 12 Months Ended |
Sep. 30, 2022 | |
Supplemental Information On Oil And Gas Operations | |
SUPPLEMENTAL INFORMATION ON OIL AND GAS OPERATIONS | 15. SUPPLEMENTAL INFORMATION ON OIL AND GAS OPERATIONS (UNAUDITED) Supplemental unaudited information regarding Permex’s oil and gas activities is presented in this note. All of Permex’s reserves are located within the U.S. Costs Incurred in Oil and Gas Producing Activities SCHEDULE OF COST INCURRED IN PRODUCING ACTIVITIES 12 Months Ended 12 Months Ended September 30, 2022 September 30, 2021 Acquisition of proved properties $ — $ 3,699,215 Acquisition of unproved properties — — Development costs 1,676,668 9,403 Exploration costs — — Total costs incurred $ 1,676,668 $ 3,708,618 Results of Operations from Oil and Gas Producing Activities 12 Months Ended 12 Months Ended September 30, 2022 September 30, 2021 Oil and gas revenues $ 815,391 $ 46,703 Production costs (829,194 ) (59,671 ) Exploration expenses — — Depletion, depreciation and amortization (99,855 ) (52,439 ) Impairment of oil and gas properties — — Result of oil and gas producing operations before income taxes (113,658 ) (65,407 ) Provision for income taxes — — Results of oil and gas producing activities $ (113,658 ) $ (65,407 ) PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 15. SUPPLEMENTAL INFORMATION ON OIL AND GAS OPERATIONS (UNAUDITED) Proved Reserves The Company’s proved oil and natural gas reserves have been estimated by the certified independent engineering firm, MKM Engineering. Proved reserves are the estimated quantities that geologic and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions. Proved developed reserves are the quantities expected to be recovered through existing wells with existing equipment and operating methods when the estimates were made. Due to the inherent uncertainties and the limited nature of reservoir data, such estimates are subject to change as additional information becomes available. The reserves actually recovered and the timing of production of these reserves may be substantially different from the original estimate. Revisions result primarily from new information obtained from development drilling and production history; acquisitions of oil and natural gas properties; and changes in economic factors. Our proved reserves are summarized in the table below: SCHEDULE OF PROVED RESERVES Oil (Barrels) Natural Gas (Mcf) BOE (Barrels) Proved developed and undeveloped reserves: September 30, 2020 3,706,360 740,180 3,829,723 Revisions (1) (88,263 ) 38,640 (81,823 ) Purchase of proved reserves (2) 5,408,560 2,859,590 5,885,158 Sale of reserves (3) (2,826,290 ) (618,650 ) (2,929,398 ) Production (947 ) (1,410 ) (1,182 ) September 30, 2021 6,199,420 3,018,350 6,702,478 Revisions 48,320 (5,613 ) 47,385 Purchase of proved reserves - - - Sale reserves - - - Production (10,670 ) (11,567 ) (12,598 ) September 30, 2022 6,237,070 3,001,170 6,737,265 Proved developed reserves: September 30, 2020 549,390 82,430 563,128 September 30, 2021 587,450 411,910 656,102 September 30, 2022 1,153,870 864,770 1,297,998 Proved undeveloped reserves: September 30, 2020 3,156,970 657,750 3,266,595 September 30, 2019 5,611,970 2,606,440 6,046,377 September 30, 2022 5,083,200 2,136,400 5,439,267 (1) Revisions in 2021 included 120,850 bbls in proved undeveloped reserves being reclassified as probable in the 2021 reserve report, net of other immaterial revisions in several properties. (2) During 2021, the Company purchased 1,246 net acres in Martin County, Texas. (3) During 2021, the Company sold ODC and Taylor properties. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 15. SUPPLEMENTAL INFORMATION ON OIL AND GAS OPERATIONS (UNAUDITED) Standardized Measure of Discounted Future Net Cash Flows Relating to Proved Oil and Gas Reserves The following information is based on the Company’s best estimate of the required data for the Standardized Measure of Discounted Future Net Cash Flows as of September 30, 2022 and September 30, 2021 in accordance with ASC 932, “Extractive Activities – Oil and Gas” which requires the use of a 10% discount rate. This information is not the fair market value, nor does it represent the expected present value of future cash flows of the Company’s proved oil and gas reserves. Future cash inflows for the years ended September 30, 2022 and September 30, 2021 were estimated as specified by the SEC through calculation of an average price based on the 12-month unweighted arithmetic average of the first-day-of-the-month price for the period from October through September during each respective fiscal year. The resulting net cash flow are reduced to present value by applying a 10% discount factor. SCHEDULE OF NET CASH FLOWS RELATING TO PROVED OIL AND GAS RESERVES September 30, 2022 September 30, 2021 12 Months Ended September 30, 2022 September 30, 2021 Future cash inflows $ 589,481,000 $ 355,958,000 Future production costs(1) (91,630,000 ) (69,683,000 ) Future development costs (71,700,000 ) (71,700,000 ) Future income tax expenses (113,873,000 ) (57,206,000 ) Future net cash flows 312,278,000 157,369,000 10% annual discount for estimated timing of cash flows (167,549,000 ) (84,100,000 ) Standardized measure of discounted future net cash flows at the end of the fiscal year $ 144,729,000 $ 73,269,000 (1) Production costs include crude oil and natural gas operations expense, production ad valorem taxes, transportation costs and G&A expense supporting the Company’s crude oil and natural gas operations. Average hydrocarbon prices are set forth in the table below. SCHEDULE OF AVERAGE HYDROCARBON PRICES Average Price Natural Crude Oil (Bbl) Gas (Mcf) Year ended September 30, 2020 (1) $ 40.30 $ 1.77 Year ended September 30, 2021 (1) $ 55.98 $ 2.95 Year ended September 30, 2022 (1) $ 91.72 $ 5.79 (1) Average prices were based on 12-month unweighted arithmetic average of the first-day-of-the-month prices for the period from October through September during each respective fiscal year. Future production and development costs, which include dismantlement and restoration expense, are computed by estimating the expenditures to be incurred in developing and producing the Company’s proved crude oil and natural gas reserves at the end of the year, based on year-end costs, and assuming continuation of existing economic conditions. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 15. SUPPLEMENTAL INFORMATION ON OIL AND GAS OPERATIONS (UNAUDITED) Sources of Changes in Discounted Future Net Cash Flows Principal changes in the aggregate standardized measure of discounted future net cash flows attributable to the Company’s proved crude oil and natural gas reserves, as required by ASC 932, at fiscal year-end are set forth in the table below. SCHEDULE OF CHANGES IN DISCOUNTED FUTURE NET CASH FLOWS September 30, 2022 September 30, 2021 12 Months Ended September 30, 2022 September 30, 2021 Standardized measure of discounted future net cash flows at the beginning of the year $ 73,269,000 $ 20,797,000 Extensions, discoveries and improved recovery, less related costs — — Sales of minerals in place — (62,682,000 ) Purchase of minerals in place — 125,927,000 Revisions of previous quantity estimates 1,674,000 (1,751,000 ) Net changes in prices and production costs 88,333,000 32,573,000 Accretion of discount 10,077,000 1,498,000 Sales of oil produced, net of production costs (49,000 ) 13,000 Changes in future development costs 911,000 (21,339,000 ) Changes in timing of future production (3,099,000 ) (2,580,000 ) Net changes in income taxes (26,387,000 ) (19,187,000 ) Standardized measure of discounted future net cash flows at the end of the year $ 144,729,000 $ 73,269,000 |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Accounting Policies [Abstract] | ||
Basis of presentation | Basis of presentation The unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) and applicable rules and regulations of the United States Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the condensed consolidated financial statements include all adjustments necessary, which are of a normal and recurring nature, for the fair presentation of the Company’s financial position and of the results of operations and cash flows for the periods presented. These interim results are not necessarily indicative of the results to be expected for the fiscal year ending September 30, 2023 or for any other interim period or for any other future fiscal year. These condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and footnotes for the fiscal year ended September 30, 2022. | Basis of presentation The Company’s consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the assets, liabilities, revenue and expenses of the Company’s wholly-owned subsidiary, Permex Petroleum US Corporation PERMEX PETROLEUM CORPORATION NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED DECEMBER 31, 2022 (UNAUDITED) 2. Significant Accounting Policies | Principles of Consolidation These consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Permex Petroleum US Corporation. All intercompany balances and transactions have been eliminated. |
Going concern of operations | Going concern of operations These consolidated financial statements have been prepared on a going concern basis which assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The Company has incurred losses since inception in the amount of $ 9,569,606 Management plans to fund operations of the Company with its current working capital and through increasing production from its oil and gas leases. The Company also expects to raise additional funds through equity financings. There are no written agreements in place for such funding or issuance of securities and there can be no assurance that such will be available in the future. Management believes that this plan provides an opportunity for the Company to continue as a going concern. In view of these matters, continuation as a going concern is dependent upon continued operations of the Company, which in turn is dependent upon the Company’s ability to meet its financial requirements, raise additional capital, and the success of its future operations. The financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should the Company not continue as a going concern. | Going concern of operations These consolidated financial statements have been prepared on a going concern basis which assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The Company has incurred losses since inception in the amount of $ 8,260,415 and has not yet achieved profitable operations. The Company has been relying on equity financing and loans from related parties to fund its operation in the past. While the Company has been successful in securing financing to date, there can be no assurances that it will be able to do so in the future. The aforementioned factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management plans to fund operations of the Company with its current working capital and through increasing productions from its oil and gas leases. The Company also expects to raise additional funds through equity financings. There are no written agreements in place for such funding or issuance of securities and there can be no assurance that such will be available in the future. Management believes that this plan provides an opportunity for the Company to continue as a going concern. In view of these matters, continuation as a going concern is dependent upon continued operations of the Company, which in turn is dependent upon the Company’s ability to, meets its financial requirements, raise additional capital, and the success of its future operations. The financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should the Company not continue as a going concern. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. Significant Accounting Policies |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period. Management evaluates these estimates and judgments on an ongoing basis and bases its estimates on experience, current and expected future conditions, third-party evaluations and various other assumptions that management believes are reasonable under the circumstances. Significant estimates have been used by management in conjunction with the following: (i) amounts subject to allowances and returns; (ii) the fair value of assets when determining the existence of impairment factors and the amount of impairment, if any; (iii) the costs of site restoration when determining decommissioning liabilities; (iv) income taxes receivable or payable; (v) the useful lives of assets for the purposes of depreciation; (vi) petroleum and natural gas reserves; and (vii) share-based payments. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. These estimates are based on information available as of the date of the financial statements; therefore, actual results could differ from those estimates. | Use of Estimates The preparation of financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period. Management evaluates these estimates and judgments on an ongoing basis and bases its estimates on experience, current and expected future conditions, third-party evaluations and various other assumptions that management believes are reasonable under the circumstances. Significant estimates have been used by management in conjunction with the following: (i) petroleum and natural gas reserves; (ii) the fair value of assets when determining the existence of impairment factors and the amount of impairment, if any; (iii) the costs of site restoration when determining asset retirement obligations; (iv) income taxes receivable or payable; (v) the useful lives of assets for the purposes of depreciation; (vi) general credit risk associated with receivables and other assets; and (vii) share-based payments. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and makes adjustments when facts and circumstances dictate. These estimates are based on information available as of the date of the financial statements; therefore, actual results could differ from those estimates. |
Cash and cash equivalents | Cash and cash equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash and cash equivalents. Cash and cash equivalents are recorded at cost, which approximates fair value. | |
Trade and other receivables | Trade and other receivables Trade and other receivables are stated at net realizable value. The majority of customers are not extended credit and the majority of the receivables has payment terms of 30 days or less. On a periodic basis, management evaluates its accounts receivable and determines whether to provide an allowance or if any accounts should be written off based on a past history of write-offs, collections, and current credit conditions. A receivable is considered past due if the Company has not received payments based on agreed-upon terms. Given the nature and balances of the Company’s receivables the Company has no material loss allowance as at September 30, 2022 and September 30, 2021. | |
Property and equipment | Property and equipment The Company follows the successful efforts method of accounting for its oil and gas properties. All costs for development wells along with related acquisition costs, the costs of drilling development wells, and related asset retirement obligation (ARO) assets are capitalized. Exploration costs, such as exploratory geological and geophysical costs, and costs associated with non-productive exploratory wells, delay rentals and exploration overhead are expensed. Costs of drilling exploratory wells are capitalized pending determination of whether the wells found proved reserves. Costs of wells that are assigned proved reserves remain capitalized. Costs also are capitalized for exploratory wells that have found crude oil and natural gas reserves even if the reserves cannot be classified as proved when the drilling is completed, provided the exploratory well has found a sufficient quantity of reserves to justify its completion as a producing well and the Company is making sufficient progress assessing the reserves and the economic and operating viability of the project. The Company groups its oil and gas properties with a common geological structure or stratigraphic condition (“common operating field”) for purposes of computing depletion expenses, assessing proved property impairments and accounting for asset dispositions. Capitalized costs of proved oil and gas properties are depleted by individual field using a unit-of-production method based on proved and probable developed reserves. Proved reserves are estimated using reserve engineer reports and represent the estimated quantities of crude oil, natural gas and natural gas liquids, which geological, geophysical and engineering data demonstrate with a specified degree of certainty to be recoverable in future years from known reservoirs and which are considered commercially producible. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. Significant Accounting Policies Property and equipment Proved oil and natural gas properties are assessed for possible impairment by comparing their carrying values with their associated undiscounted, future net cash flows. Events that can trigger assessments for possible impairments include write-downs of proved reserves based on field performance, significant decreases in the market value of an asset (including changes to the commodity price forecast or carbon costs), significant change in the extent or manner of use of or a physical change in an asset, and a more-likely-than-not expectation that a long-lived asset or asset group will be sold or otherwise disposed of significantly sooner than the end of its previously estimated useful life. Impaired assets are written down to their estimated fair values, generally their discounted, future net cash flows. For proved oil and natural gas properties, the Company performs impairment reviews on a field basis, annually or as appropriate. Other corporate property and equipment consist primarily of leasehold improvements, vehicle, and office furniture and equipment and are stated at cost less accumulated depreciation. The capitalized costs are generally depreciated on a straight line basis over their estimated useful lives ranging from three to five years . For property dispositions, measurement is at fair value, unless the transaction lacks commercial substance or fair value cannot be reliably measured. Where the exchange is measured at fair value, a gain or loss is recognized in net income. Any deferred consideration recorded on property dispositions are recognized as revenue in the statement of loss and comprehensive loss over the reserve life. Gains or losses are recorded for sales or dispositions of oil and gas properties which constitute an entire common operating field or which result in a significant alteration of the common operating field’s depletion rate. These gains and losses are classified as asset dispositions in the accompanying consolidated statements of loss and comprehensive loss. Partial common operating field sales or dispositions deemed not to significantly alter the depletion rates are generally accounted for as adjustments to capitalized costs with no gain or loss recognized. | |
Impairment of long-lived assets | Impairment of long-lived assets The Company assesses long-lived assets for impairment in accordance with the provisions of the Financial Account Standards Board Accounting Standards Codification (“ASC”) regarding long-lived assets. It requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through the estimated undiscounted cash flows expected to result from the use and eventual disposition of the assets. Whenever any such impairment exists, an impairment loss will be recognized for the amount by which the carrying value exceeds the fair value. As of September 30, 2022 and September 30, 2021, no impairment charge has been recorded. | |
Asset retirement obligations | Asset retirement obligations The Company recognizes asset retirement obligations (“ARO”) associated with tangible assets such as well sites when there is a legal obligation associated with the retirement of such assets and the amount can be reasonably estimated. The ARO are measured at the present value of management’s best estimate of the future remediation expenditures at the reporting date. The initial measurement of an ARO is recorded as a liability at its fair value, with an offsetting asset retirement cost recorded as an increase to the associated property and equipment on the consolidated balance sheet. When the assumption used to estimate a recorded ARO change, a revision is recorded to both the ARO and the asset retirement cost. The ARO is accreted to its then present value each period, and the asset retirement cost is depreciated using a systematic and rational method similar to that used for the associated property and equipment. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. SIGNIFICANT ACCOUNTING POLICIES | |
Fair value measurement | Fair value measurement Fair value accounting is applied for all assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). Fair value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company follows the established framework for measuring fair value and expands disclosures about fair value measurements. The Company categorizes its assets and liabilities measured at fair value into a three-level hierarchy based on the priority of the inputs to the valuation technique used to determine fair value. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used in the determination of the fair value measurement fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement. Assets and liabilities valued at fair value are categorized based on the inputs to the valuation techniques as follows: Level 1 Level 2 Level 3 ’ The carrying values of cash and cash equivalents, trade receivable, other current receivables, due from/to related parties, trade payable, other current payables, accrued expenses, convertible debenture and lease liability included in the accompanying consolidated balance sheets approximated fair value at September 30, 2022 and September 30, 2021. The financial statements as of and for the years ended September 30, 2022 and September 30, 2021, do not include any recurring or nonrecurring fair value measurements relating to assets or liabilities. Subsequent to initial recognition, the Company may re-measure the carrying value of assets and liabilities measured on a nonrecurring basis to fair value. Adjustments to fair value usually result when certain assets are impaired. Such assets are written down from their carrying amounts to their fair value. Professional standards allow entities the irrevocable option to elect to measure certain financial instruments and other items at fair value for the initial and subsequent measurement on an instrument-by-instrument basis. The Company has not elected to measure any existing financial instruments at fair value. However, it may elect to measure newly acquired financial instruments at fair value in the future. | |
Earnings (loss) per share | Earnings (loss) per share Basic earnings (loss) per share (“EPS”) is calculated by dividing net income (loss) attributable to common shareholders by the weighted average number of common shares outstanding in the period. The diluted EPS reflects all dilutive potential common share equivalents, in the weighted average number of common shares outstanding during the period, if dilutive. All of the outstanding convertible securities, stock options and warrants were anti-dilutive for the years ended September 30, 2022 and 2021. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. SIGNIFICANT ACCOUNTING POLICIES | |
Leases | Leases At inception of a contract, the Company assesses whether a contract is, or contains a lease based on whether the contract conveys the right to control the use of an identified asset for a period in exchange for consideration. The Company recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured based on the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date. The lease obligation is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate. Variable lease payments that do not depend on an index or rate are not included in the measurement of the lease liability. The lease liability is subsequently measured at amortized cost using the effective interest rate method. | |
Share capital | Share capital The Company records proceeds from the issuance of its common shares as equity. Incremental costs directly attributable to the issue of new common shares are shown in equity as a deduction, net of tax, from the proceeds. Common shares issued for consideration other than cash are valued based on their market value at the date that the shares are issued. | |
Share purchase warrants | Share purchase warrants The fair value of warrants issued with private placement units is determined using the Black-Scholes option pricing model. Proceeds from the issuance of private placement units are allocated between the private placement warrants and common shares on a relative fair value basis. Share purchase warrants with exercise prices denominated in a currency other than its functional currency are classified as a liability. Proceeds from the issuance of private placement units are first allocated to the warrant liability based on their fair value and the residual is allocated to common shares issued while for equity warrants, proceeds are allocated on a relative fair value basis. The changes in fair value of the warrant liability are recorded in the statement of loss and comprehensive loss. Warrants issued for oil and gas interests and warrants issued as finder’s fees are share-based payments and are measured at fair value on the date of the grant as determined using the Black-Scholes option pricing model. | |
Share-based payments | Share-based payments The Company issues stock options and other share-based compensation to directors, employees and others service providers. Equity awards including stock options and share purchase warrants are measured at grant date at the fair value of the instruments issued and amortized over the vesting periods using a graded vesting approach. The number of options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount ultimately recognized as an expense is based on the number of options that eventually vest. The Company has elected to account for forfeitures as they occur rather than estimate expected forfeitures. The fair value of the equity awards is determined using the Black-Scholes option pricing model. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average historic volatility), weighted average expected life of the instruments (based on historical experience), expected dividends, and the risk-free interest rate (based on government bonds). PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. SIGNIFICANT ACCOUNTING POLICIES | |
Revenue | Revenue In accordance with ASC 606, Revenue from Contracts with Customers, The Company records revenue in the month production is delivered to the purchaser. However, production statements for oil and gas sales may not be received until the following month end after the products are purchased, and as a result, the Company is required to estimate the amount of revenue to be received. The Company records the differences between its estimates and the actual amounts received for revenue in the month that payment is received from the customer. Identified differences between the Company’s revenue estimates and actual revenue received are $ 1,395 and $ nil for years ended September 30, 2022 and September 30, 2021, respectively. The Company believes that the pricing provisions of its oil, natural gas and natural gas liquids contracts are customary in the industry. To the extent actual volumes and prices of oil and natural gas sales are unavailable for a given reporting period because of timing or information not received from third parties, the revenue related to sales volumes and prices for those good sold are estimated and recorded. The Company does not have any contract assets or liabilities, or capitalized contract costs. | |
Foreign Currency | Foreign Currency These consolidated financial statements are presented in United States dollars (“U.S. dollar”). The functional currency of the Company and the subsidiary of the Company is the U.S. dollar. The Company changed its functional currency from Canadian dollars (“CAD”) to the U.S. dollars as at October 1, 2021. The change in functional currency from Canadian dollars to U.S. dollars is accounted for prospectively from October 1, 2021. Management determined that the Company’s functional currency had changed based on the assessment related to significant changes of the Company’s economic facts and circumstances. These significant changes included the fact that the Company’s equity financings and the primary economic environment are now in the U.S. as well as the expectation of the majority of the Company’s expenses will be denominated in U.S. dollars. Moreover, the Company’s place of business and management are now located in the United States. Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates of the transactions. At the end of each reporting period, monetary assets and liabilities that are denominated in foreign currencies are translated at the rates prevailing at that date. Non-monetary assets and liabilities are translated using the historical rate on the date of the transaction. Non-monetary assets and liabilities that are stated at fair value are translated using the historical rate on the date that the fair value was determined. All gains and losses on translation of these foreign currency transactions are charged to profit or loss. PERMEX PETROLEUM CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED SEPTEMBER 30, 2022 AND 2021 2. SIGNIFICANT ACCOUNTING POLICIES | |
Income taxes | Income taxes Current taxes receivable or payable are estimated on taxable income or loss for the current year at the statutory tax rates enacted or substantively enacted at the reporting date. Deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax assets and liabilities are measured at the tax rates that have been enacted or substantially enacted at the end of the reporting period and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. Deferred income tax assets also result from unused loss carry forwards, resource related pools and other deductions. At the end of each reporting year the Company reassesses unrecognized deferred tax assets. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred income tax assets and deferred income tax liabilities are offset if a legally enforceable right exists to offset current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority. | |
New accounting standards | New accounting standards There are not currently any new or pending accounting standards that are expected to have a significant impact on the Company’s consolidated financial statements. | New accounting standards There are not currently any new or pending accounting standards that have a significant impact on the Company’s consolidated financial statements. |
REVENUE (Tables)
REVENUE (Tables) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
SCHEDULE OF REVENUE DISAGGREGATED BY PRODUCT TYPE AND GEOGRAPHIC AREAS | The following table present our revenue from contracts with customers disaggregated by product type and geographic areas. SCHEDULE OF REVENUE DISAGGREGATED BY PRODUCT TYPE AND GEOGRAPHIC AREAS 1 2 3 Three months ended December 31, 2022 Texas New Mexico Total Crude oil $ 173,961 $ 39,512 $ 213,473 Natural gas 281 - 281 Revenue from contracts with customers $ 174,242 $ 39,512 $ 213,754 Three months ended December 31, 2021 Texas New Mexico Total Crude oil $ 70,161 $ - $ 70,161 Natural gas 19,829 - 19,829 Revenue from contracts with customers $ 89,990 $ - $ 89,990 | The following table present our revenue from contracts with customers disaggregated by product type and geographic areas. SCHEDULE OF REVENUE DISAGGREGATED BY PRODUCT TYPE AND GEOGRAPHIC AREAS 1 2 3 Year ended September 30, 2022 Texas New Mexico Total Crude oil $ 621,275 $ 140,236 $ 761,511 Natural gas 53,880 - 53,880 Revenue from contracts with customers $ 675,155 $ 140,236 $ 815,391 1 2 3 Year ended September 30, 2021 Texas New Mexico Total Crude oil $ 44,425 $ - $ 44,425 Natural gas 2,278 - 2,278 Revenue from contracts with customers $ 46,703 $ - $ 46,703 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | ||
SCHEDULE OF PROPERTY AND EQUIPMENT | Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT December 31, 2022 September 30, 2022 Oil and natural gas properties, at cost $ 9,903,713 $ 8,029,234 Construction in progress - 460,306 Less: accumulated depletion (212,853 ) (184,658 ) Oil and natural gas properties, net 9,690,860 8,304,882 Other property and equipment, at cost 201,565 127,542 Less: accumulated depreciation (17,649 ) (5,648 ) Other property and equipment, net 183,916 121,894 Property and equipment, net $ 9,874,776 $ 8,426,776 | Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT September 30, September 30, 2021 Oil and natural gas properties, at cost $ 8,029,234 $ 6,723,778 Construction in progress 460,306 - Less: accumulated depletion (184,658 ) (84,803 ) Oil and natural gas properties, net 8,304,882 6,638,975 Other property and equipment, at cost 127,542 - Less: accumulated depreciation (5,648 ) - Other property and equipment, net 121,894 - Property and equipment, net $ 8,426,776 $ 6,638,975 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Leases | ||
SCHEDULE OF RIGHT OF USE OPERATING LEASES | All of the Company’s right-of-use assets are operating leases related to its office premises. Details of the Company’s right-of-use assets and lease liabilities are as follows: SCHEDULE OF RIGHT OF USE OPERATING LEASES December 31, 2022 September 30, 2022 Right-of-use assets $ 212,486 $ 240,796 Lease liabilities Balance, beginning of the year $ 244,906 $ 78,949 Addition - 220,368 Liability accretion 7,088 9,042 Lease payments (33,530 ) (63,453 ) Balance, end of the year $ 218,464 $ 244,906 Current lease liabilities $ 91,665 $ 104,224 Long-term lease liabilities $ 126,799 $ 140,682 | SCHEDULE OF RIGHT OF USE OPERATING LEASES 2022 2021 Right-of-use assets $ 240,796 $ 72,539 Lease liabilities Balance, beginning of the year $ 78,949 $ 53,128 Addition 220,368 57,357 Interest expense 9,042 9,812 Liability accretion 7,088 9,042 Lease payments (63,453 ) (43,932 ) Foreign exchange movement - 2,584 Balance, end of the year $ 244,906 $ 78,949 Current lease liabilities $ 104,224 $ 51,963 Long-term lease liabilities $ 140,682 $ 26,986 |
SCHEDULE OF LEASE COST | The following table presents the Company’s total lease cost. SCHEDULE OF LEASE COST Three months ended Three months ended Operating lease cost $ 35,398 $ 13,961 Variable lease expense 7,175 7,557 Sublease income (10,004 ) (4,868 ) Rent subsidy - (1,674 ) Net lease cost $ 32,569 $ 14,976 | SCHEDULE OF LEASE COST 2022 2021 Operating lease cost $ 35,398 $ 13,961 Amortization of right-of-use assets $ 52,111 $ 37,129 Interest on lease liabilities 9,042 9,812 Variable lease expense 36,216 16,564 Sublease income (36,633 ) (10,191 ) Rent subsidy (1,644 ) (9,169 ) Net lease cost $ 59,092 $ 44,145 |
SCHEDULE OF FUTURE LEASE PAYMENTS | As of December 31, 2022, maturities of the Company’s operating lease liabilities are as follows: SCHEDULE OF FUTURE LEASE PAYMENTS Year 2023 $ 77,294 2024 82,190 2025 84,664 2026 14,180 Total lease payments 258,328 Less: imputed interest (39,864 ) Total lease liabilities $ 218,464 | SCHEDULE OF FUTURE LEASE PAYMENTS Year 2023 $ 110,593 2024 82,190 2025 84,664 2026 14,180 Total lease payments 291,627 Less: imputed interest (46,721 ) Total lease liabilities $ 244,906 |
ASSET RETIREMENT OBLIGATIONS (T
ASSET RETIREMENT OBLIGATIONS (Tables) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Asset Retirement Obligation Disclosure [Abstract] | ||
SCHEDULE OF ASSET RETIREMENT OBLIGATIONS | SCHEDULE OF ASSET RETIREMENT OBLIGATIONS December 31, 2022 September 30, 2022 Asset retirement obligations, beginning of the year $ 236,412 $ 552,594 Revisions of estimates - (371,212 ) Accretion expense 7,994 55,030 Asset retirement obligations, ending of the year $ 244,406 $ 236,412 | SCHEDULE OF ASSET RETIREMENT OBLIGATIONS 2022 2021 Decommissioning obligations, beginning of the year $ 552,594 $ 271,402 Obligations recognized - 258,726 Obligations derecognized - (125,511 ) Revisions of estimates (371,212 ) 117,921 Accretion expense 55,030 19,907 Foreign exchange movement - 10,149 Decommissioning obligations, ending of the year $ 236,412 $ 552,594 |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||
SCHEDULE OF BASIC AND DILUTED LOSS PER SHARE | The calculation of basic and diluted loss per share for the three month periods ended December 31, 2022 and 2021 was based on the net losses attributable to common shareholders. The following table sets forth the computation of basic and diluted loss per share: SCHEDULE OF BASIC AND DILUTED LOSS PER SHARE Three months ended December 31, 2022 Three months ended December 31, 2021 Net loss $ (1,309,191 ) $ (751,188 ) Weighted average common shares outstanding 1,932,604 1,130,344 Basic and diluted loss per share $ (0.68 ) $ (0.66 ) | SCHEDULE OF BASIC AND DILUTED LOSS PER SHARE 2022 2021 Net loss $ (2,714,616 ) $ (1,253,242 ) Weighted average common shares outstanding 1,543,021 678,958 Basic and diluted loss per share $ (1.76 ) $ (1.84 ) |
EQUITY (Tables)
EQUITY (Tables) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Equity [Abstract] | ||
SCHEDULE OF STOCK OPTION TRANSACTIONS | Stock option transactions are summarized as follows: SCHEDULE OF STOCK OPTION TRANSACTIONS Number Weighted Average Balance, September 30, 2021 37,917 $ 19.51 Granted 55,000 10.51 Cancelled (8,334 ) 17.34 Balance, September 30, 2022 and December 31, 2022 84,583 $ 13.26 Exercisable at December 31, 2022 83,333 $ 13.61 | Stock option transactions are summarized as follows: SCHEDULE OF STOCK OPTION TRANSACTIONS Number Weighted Balance, September 30, 2020 39,003 $ 18.75 Cancelled (1,086 ) 23.70 Balance, September 30, 2021 37,917 $ 19.51 Granted 55,000 10.51 Cancelled (8,334 ) 17.34 Balance, September 30, 2022 84,583 $ 13.26 Exercisable at September 30, 2022 83,333 $ 13.42 |
SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN THE FAIR VALUE | SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN THE FAIR VALUE 2022 2021 Risk-free interest rate - 1.5 % Expected life of options - 10 Expected annualized volatility - 96.56 % Dividend rate - Nil Weighted average fair value of options granted - $ 10.17 | SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN THE FAIR VALUE 2022 2021 Risk-free interest rate 1.50 % - Expected life of options 10 Years - Expected annualized volatility 96.56 % - Dividend rate Nil - Weighted average fair value of options granted $ 10.17 $ - |
SCHEDULE OF STOCK OPTIONS OUTSTANDING | As December 31, 2022, the following stock options were outstanding: SCHEDULE OF STOCK OPTIONS OUTSTANDING Number Exercise Price Issuance Date Expiry Date 27,917 $ 22.20 December 4, 2017 December 4, 2027 5,000 $ 13.32 November 1, 2018 November 1, 2028 5,000 $ 2.22 March 16, 2020 March 16, 2030 51,666 $ 10.66 October 6, 2021 October 6, 2031 84,583 | As September 30, 2022, the following stock options were outstanding: SCHEDULE OF STOCK OPTIONS OUTSTANDING Number Exercise Price Expiry Date 27,917 $ 21.90 December 4, 2027 5,000 $ 13.14 November 1, 2028 5,000 $ 2.19 March 16, 2030 51,666 $ 10.51 October 6, 2031 84,583 |
SCHEDULE OF WARRANTS TRANSACTIONS | Warrant transactions are summarized as follows: SCHEDULE OF WARRANTS TRANSACTIONS Number Weighted Balance, September 30, 2021 208,333 $ 9.42 Granted 888,763 12.91 Balance, September 30, 2022 and December 31, 2022 1,097,096 $ 12.12 | Warrant transactions are summarized as follows: SCHEDULE OF WARRANTS TRANSACTIONS Number Weighted Balance, September 30, 2020 80,087 $ 12.77 Granted 208,333 9.48 Warrants expired (80,087 ) 13.46 Balance, September 30, 2021 208,333 $ 9.42 Granted 888,763 12.91 Balance, September 30, 2022 1,097,096 $ 12.12 |
SCHEDULE OF WARRANTS OUTSTANDING | As December 31, 2022, the following warrants were outstanding: SCHEDULE OF WARRANTS OUTSTANDING Number Exercise Price Issuance Date Expiry Date 24,739 $ 23.98 November 4, 2021 November 4, 2023 864,024 $ 12.60 March 29, 2022 March 29, 2027 208,333 $ 8.88 September 30, 2021 September 30, 2031 1,097,096 | As September 30, 2022, the following warrants were outstanding: SCHEDULE OF WARRANTS OUTSTANDING Number Exercise Price Expiry Date 24,739 $ 23.65 November 4, 2023 864,024 $ 12.60 March 29, 2027 208,333 $ 8.76 October 1, 2031 1,097,096 |
SCHEDULE OF VALUATION OF WARRANTS | The following weighted average assumptions were used for the Black-Scholes valuation of warrants as at December 31, 2022 and September 30, 2022: SCHEDULE OF VALUATION OF WARRANTS December 31, 2022 September 30, 2022 Risk-free interest rate 4.06 % 3.79 % Warrant measurement input 4.06 % 3.79 % Expected life of options 0.75 Year 1 Year Expected annualized volatility 110.97 % 135.59 % Dividend rate Nil Nil Weighted average fair value of options granted $ 0.01 $ 1.46 | The following weighted average assumptions were used for the Black-Scholes valuation of warrants as at September 30, 2022 and November 4, 2021: SCHEDULE OF VALUATION OF WARRANTS September 30,2022 November 4, 2021 Risk-free interest rate 3.79 % 0.98 % Expected life of options 1 Year 2 Years Expected annualized volatility 135.59 % 153.02 % Dividend rate Nil Nil Weighted average fair value of options granted $ 1.46 $ 11.45 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
SCHEDULE OF RECONCILIATION OF INCOME TAX | SCHEDULE OF RECONCILIATION OF INCOME TAX 2022 2021 Loss before income taxes $ (2,714,616 ) $ (1,253,242 ) Expected income tax recovery at statutory rates $ (407,000 ) $ (188,000 ) Provincial income tax (244,000 ) (137,000 ) Effect of income taxes from US operations (42,000 ) (7,000 ) Change in statutory, foreign tax, foreign exchange rates and other (32,000 ) (59,000 ) Permanent differences 103,000 1,000 Adjustment to prior years provision versus statutory tax returns (53,000 ) (11,000 ) Change in valuation allowance 675,000 401,000 Deferred income tax recovery $ - $ - |
SCHEDULE OF PRE TAX LOSS AND INCOME TAXES | Components of the Company’s pre-tax loss and income taxes are as follows: SCHEDULE OF PRE TAX LOSS AND INCOME TAXES 2022 2021 Loss for the year Canada $ (2,030,281 ) $ (1,144,350 ) US (684,335 ) (108,892 ) $ (2,714,616 ) $ (1,253,242 ) Expected income tax (recovery) Canada $ (549,000 ) $ (309,000 ) US (102,000 ) (29,000 ) $ (651,000 ) $ (338,000 ) Deferred income tax (recovery) Canada $ 548,000 $ 309,000 US 103,000 29,000 $ 651,000 $ 338,000 Deferred income tax recovery $ - $ - |
SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES | The significant components of the Company’s deferred tax assets and liabilities are as follows: SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES 2022 2021 Tax loss carryforwards $ 1,342,000 $ 780,000 Property and equipment (74,000 ) (9,000 ) Financing fees 216,000 38,000 Total gross deferred tax assets 1,484,000 809,000 Deferred tax assets valuation allowance (1,484,000 ) (809,000 ) Net deferred tax assets $ - $ - |
SUPPLEMENTAL INFORMATION ON O_2
SUPPLEMENTAL INFORMATION ON OIL AND GAS OPERATIONS (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Supplemental Information On Oil And Gas Operations | |
SCHEDULE OF COST INCURRED IN PRODUCING ACTIVITIES | SCHEDULE OF COST INCURRED IN PRODUCING ACTIVITIES 12 Months Ended 12 Months Ended September 30, 2022 September 30, 2021 Acquisition of proved properties $ — $ 3,699,215 Acquisition of unproved properties — — Development costs 1,676,668 9,403 Exploration costs — — Total costs incurred $ 1,676,668 $ 3,708,618 Results of Operations from Oil and Gas Producing Activities 12 Months Ended 12 Months Ended September 30, 2022 September 30, 2021 Oil and gas revenues $ 815,391 $ 46,703 Production costs (829,194 ) (59,671 ) Exploration expenses — — Depletion, depreciation and amortization (99,855 ) (52,439 ) Impairment of oil and gas properties — — Result of oil and gas producing operations before income taxes (113,658 ) (65,407 ) Provision for income taxes — — Results of oil and gas producing activities $ (113,658 ) $ (65,407 ) |
SCHEDULE OF PROVED RESERVES | Our proved reserves are summarized in the table below: SCHEDULE OF PROVED RESERVES Oil (Barrels) Natural Gas (Mcf) BOE (Barrels) Proved developed and undeveloped reserves: September 30, 2020 3,706,360 740,180 3,829,723 Revisions (1) (88,263 ) 38,640 (81,823 ) Purchase of proved reserves (2) 5,408,560 2,859,590 5,885,158 Sale of reserves (3) (2,826,290 ) (618,650 ) (2,929,398 ) Production (947 ) (1,410 ) (1,182 ) September 30, 2021 6,199,420 3,018,350 6,702,478 Revisions 48,320 (5,613 ) 47,385 Purchase of proved reserves - - - Sale reserves - - - Production (10,670 ) (11,567 ) (12,598 ) September 30, 2022 6,237,070 3,001,170 6,737,265 Proved developed reserves: September 30, 2020 549,390 82,430 563,128 September 30, 2021 587,450 411,910 656,102 September 30, 2022 1,153,870 864,770 1,297,998 Proved undeveloped reserves: September 30, 2020 3,156,970 657,750 3,266,595 September 30, 2019 5,611,970 2,606,440 6,046,377 September 30, 2022 5,083,200 2,136,400 5,439,267 (1) Revisions in 2021 included 120,850 bbls in proved undeveloped reserves being reclassified as probable in the 2021 reserve report, net of other immaterial revisions in several properties. (2) During 2021, the Company purchased 1,246 net acres in Martin County, Texas. (3) During 2021, the Company sold ODC and Taylor properties. |
SCHEDULE OF NET CASH FLOWS RELATING TO PROVED OIL AND GAS RESERVES | SCHEDULE OF NET CASH FLOWS RELATING TO PROVED OIL AND GAS RESERVES September 30, 2022 September 30, 2021 12 Months Ended September 30, 2022 September 30, 2021 Future cash inflows $ 589,481,000 $ 355,958,000 Future production costs(1) (91,630,000 ) (69,683,000 ) Future development costs (71,700,000 ) (71,700,000 ) Future income tax expenses (113,873,000 ) (57,206,000 ) Future net cash flows 312,278,000 157,369,000 10% annual discount for estimated timing of cash flows (167,549,000 ) (84,100,000 ) Standardized measure of discounted future net cash flows at the end of the fiscal year $ 144,729,000 $ 73,269,000 (1) Production costs include crude oil and natural gas operations expense, production ad valorem taxes, transportation costs and G&A expense supporting the Company’s crude oil and natural gas operations. |
SCHEDULE OF AVERAGE HYDROCARBON PRICES | Average hydrocarbon prices are set forth in the table below. SCHEDULE OF AVERAGE HYDROCARBON PRICES Average Price Natural Crude Oil (Bbl) Gas (Mcf) Year ended September 30, 2020 (1) $ 40.30 $ 1.77 Year ended September 30, 2021 (1) $ 55.98 $ 2.95 Year ended September 30, 2022 (1) $ 91.72 $ 5.79 (1) Average prices were based on 12-month unweighted arithmetic average of the first-day-of-the-month prices for the period from October through September during each respective fiscal year. |
SCHEDULE OF CHANGES IN DISCOUNTED FUTURE NET CASH FLOWS | SCHEDULE OF CHANGES IN DISCOUNTED FUTURE NET CASH FLOWS September 30, 2022 September 30, 2021 12 Months Ended September 30, 2022 September 30, 2021 Standardized measure of discounted future net cash flows at the beginning of the year $ 73,269,000 $ 20,797,000 Extensions, discoveries and improved recovery, less related costs — — Sales of minerals in place — (62,682,000 ) Purchase of minerals in place — 125,927,000 Revisions of previous quantity estimates 1,674,000 (1,751,000 ) Net changes in prices and production costs 88,333,000 32,573,000 Accretion of discount 10,077,000 1,498,000 Sales of oil produced, net of production costs (49,000 ) 13,000 Changes in future development costs 911,000 (21,339,000 ) Changes in timing of future production (3,099,000 ) (2,580,000 ) Net changes in income taxes (26,387,000 ) (19,187,000 ) Standardized measure of discounted future net cash flows at the end of the year $ 144,729,000 $ 73,269,000 |
BACKGROUND (Details Narrative)
BACKGROUND (Details Narrative) | 3 Months Ended | 12 Months Ended | ||
Oct. 26, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | |
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||||
Date of incorporation | Apr. 24, 2017 | Apr. 24, 2017 | ||
Stockholders equity reverse stock split | 1 for 60 ratio | 60:1 reverse stock split | 60:1 reverse stock split | 60:1 reverse stock split |
Board of Directors Chairman [Member] | ||||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||||
Stockholders equity reverse stock split | 1 for 60 ratio |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | |||
Retained earnings accumulated deficit | $ 8,260,415 | $ 5,545,799 | $ 9,569,606 |
Impairment charge | 0 | 0 | |
Revenue | $ 1,395 | ||
Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 3 years | ||
Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 5 years |
SCHEDULE OF REVENUE DISAGGREGAT
SCHEDULE OF REVENUE DISAGGREGATED BY PRODUCT TYPE AND GEOGRAPHIC AREAS (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue from contracts with customers | $ 213,754 | $ 89,990 | $ 815,391 | $ 46,703 |
TEXAS | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contracts with customers | 174,242 | 89,990 | 675,155 | 46,703 |
NEW MEXICO | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contracts with customers | 39,512 | 140,236 | ||
Crude Oil [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contracts with customers | 213,473 | 70,161 | 761,511 | 44,425 |
Crude Oil [Member] | TEXAS | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contracts with customers | 173,961 | 70,161 | 621,275 | 44,425 |
Crude Oil [Member] | NEW MEXICO | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contracts with customers | 39,512 | 140,236 | ||
Natural Gas [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contracts with customers | 281 | 19,829 | 53,880 | 2,278 |
Natural Gas [Member] | TEXAS | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contracts with customers | 281 | 19,829 | 53,880 | 2,278 |
Natural Gas [Member] | NEW MEXICO | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contracts with customers |
REVENUE (Details Narrative)
REVENUE (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenue | $ 213,754 | $ 89,990 | $ 815,391 | $ 46,703 |
Accounts Receivable [Member] | ||||
Revenue | $ 78,802 | $ 56,639 |
CONCENTRATION OF CREDIT RISK (D
CONCENTRATION OF CREDIT RISK (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Concentration Risk [Line Items] | ||||
Revenue | $ 213,754 | $ 89,990 | $ 815,391 | $ 46,703 |
Non trade receivables current | 44,969 | 39,770 | ||
Interest receivable | $ 5,516 | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Three Customer [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 87% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer [Member] | ||||
Concentration Risk [Line Items] | ||||
Trade receivables | 140,497 | $ 91,928 | ||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Two Customer [Member] | ||||
Concentration Risk [Line Items] | ||||
Revenue | $ 78,451 | |||
Concentration risk percentage | 56% | |||
Accounts Receivable [Member] | Three Customer [Member] | ||||
Concentration Risk [Line Items] | ||||
Revenue | $ 79,942 |
ACQUISITION AND DISPOSITION (De
ACQUISITION AND DISPOSITION (Details Narrative) | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 | Sep. 30, 2022 USD ($) shares | Sep. 30, 2021 USD ($) $ / shares shares | Sep. 30, 2021 $ / shares | |||
Business Acquisition [Line Items] | |||||||
Number of common stock issued | shares | 1,932,604 | [1] | 1,932,604 | [1] | 1,103,010 | ||
Fair value of common stock | $ 14,337,739 | $ 14,337,739 | $ 8,976,747 | ||||
Risk-free interest rate | 1.50% | 1.50% | |||||
Expected life | 10 years | 10 years | |||||
Annualized volatility | 96.56% | 96.56% | |||||
Dividend rate | (0.00%) | 0% | |||||
Reclamation obligations | $ 10,000 | ||||||
Loss on sale of lease | 604,687 | ||||||
Disposal of equipment | $ 8,770 | ||||||
Permex Petroleum US Corporation [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Acquired percentage | 100% | ||||||
Net revenue interest rate | 81.75% | ||||||
Number of common stock issued | shares | 416,666 | ||||||
Number of shares purchase warrants | shares | 208,333 | ||||||
Fair value of common stock | $ 2,468,750 | ||||||
Risk-free interest rate | 1.51% | ||||||
Expected life | 10 years | ||||||
Annualized volatility | 96.56% | ||||||
Dividend rate | 0% | ||||||
Exercise price | (per share) | $ 8.76 | $ 12 | |||||
Permex Petroleum US Corporation [Member] | Valuation Technique, Option Pricing Model [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Share purchase warrants | $ 1,051,370 | ||||||
[1]The number of shares has been restated to reflect the 60:1 reverse stock split |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 |
Property, Plant and Equipment [Abstract] | |||
Oil and natural gas properties, at cost | $ 9,903,713 | $ 8,029,234 | $ 6,723,778 |
Construction in progress | 460,306 | ||
Less: accumulated depletion | (212,853) | (184,658) | (84,803) |
Oil and natural gas properties, net | 9,690,860 | 8,304,882 | 6,638,975 |
Other property and equipment, at cost | 201,565 | 127,542 | |
Less: accumulated depreciation | (17,649) | (5,648) | |
Other property and equipment, net | 183,916 | 121,894 | |
Property and equipment, net | $ 9,874,776 | $ 8,426,776 | $ 6,638,975 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | ||||
Depletion and depreciation | $ 40,196 | $ 32,011 | $ 105,503 | $ 60,479 |
SCHEDULE OF RIGHT OF USE OPERAT
SCHEDULE OF RIGHT OF USE OPERATING LEASES (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Right-of-use assets | $ 212,486 | $ 240,796 | $ 72,539 |
Beginning balance | 244,906 | ||
Ending balance | 218,464 | 244,906 | |
Current lease liabilities | 91,665 | 104,224 | 51,963 |
Long-term lease liabilities | 126,799 | 140,682 | 26,986 |
Office Premises [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Right-of-use assets | 212,486 | 240,796 | 72,539 |
Beginning balance | 244,906 | 78,949 | 53,128 |
Addition | 220,368 | 57,357 | |
Interest expense | 9,042 | 9,812 | |
Liability accretion | 7,088 | 9,042 | |
Lease payments | (33,530) | (63,453) | (43,932) |
Foreign exchange movement | 2,584 | ||
Ending balance | 218,464 | 244,906 | 78,949 |
Current lease liabilities | 91,665 | 104,224 | 51,963 |
Long-term lease liabilities | $ 126,799 | $ 140,682 | $ 26,986 |
SCHEDULE OF LEASE COST (Details
SCHEDULE OF LEASE COST (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Leases | ||||
Operating lease cost | $ 35,398 | $ 13,961 | $ 35,398 | $ 13,961 |
Amortization of right-of-use assets | 52,111 | 37,129 | ||
Interest on lease liabilities | 9,042 | 9,812 | ||
Variable lease expense | 7,175 | 7,557 | 36,216 | 16,564 |
Sublease income | (10,004) | (4,868) | (36,633) | (10,191) |
Rent subsidy | (1,674) | (1,644) | (9,169) | |
Net lease cost | $ 32,569 | $ 14,976 | $ 59,092 | $ 44,145 |
SCHEDULE OF FUTURE LEASE PAYMEN
SCHEDULE OF FUTURE LEASE PAYMENTS (Details) - USD ($) | Dec. 31, 2022 | Sep. 30, 2022 |
Leases | ||
2023 | $ 77,294 | $ 110,593 |
2024 | 82,190 | 82,190 |
2025 | 84,664 | 84,664 |
2026 | 14,180 | 14,180 |
Total lease payments | 258,328 | 291,627 |
Less: imputed interest | (39,864) | (46,721) |
Total lease liabilities | $ 218,464 | $ 244,906 |
SCHEDULE OF ASSET RETIREMENT OB
SCHEDULE OF ASSET RETIREMENT OBLIGATIONS (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Asset Retirement Obligation Disclosure [Abstract] | |||
Asset retirement obligations, beginning of the year | $ 236,412 | $ 552,594 | $ 271,402 |
Obligations recognized | 258,726 | ||
Obligations derecognized | (125,511) | ||
Revisions of estimates | (371,212) | 117,921 | |
Accretion expense | 7,994 | 55,030 | 19,907 |
Foreign exchange movement | 10,149 | ||
Asset retirement obligations, ending of the year | $ 244,406 | $ 236,412 | $ 552,594 |
ASSET RETIREMENT OBLIGATIONS (D
ASSET RETIREMENT OBLIGATIONS (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Asset Retirement Obligation Disclosure [Abstract] | |||
Asset retirement obligation, revision of estimate | $ (371,212) | $ 117,921 | |
Reclamation deposits | $ 145,000 | 145,000 | 144,847 |
Forfeiture of reclamation deposit | $ 50,165 |
DEBT (Details Narrative)
DEBT (Details Narrative) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||
May 31, 2020 USD ($) | May 31, 2020 CAD ($) | May 30, 2020 USD ($) | May 30, 2020 CAD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Sep. 30, 2022 USD ($) $ / shares | Sep. 30, 2022 CAD ($) | Sep. 30, 2021 USD ($) | Dec. 31, 2022 CAD ($) | Sep. 30, 2022 CAD ($) $ / shares | |
Short-Term Debt [Line Items] | |||||||||||
Repayments of loan | $ 38,291 | $ 34,709 | $ 47,546 | $ 79,000 | |||||||
Principal loan amount | 38,291 | 52,454 | $ 52,454 | ||||||||
Interest expenses | $ 1,182 | 9,360 | 13,506 | ||||||||
Repayments of short term debt | 23,600 | 30,000 | |||||||||
Forgiveness of loan payable | $ 7,800 | $ 10,000 | |||||||||
Loans Payable [Member] | |||||||||||
Short-Term Debt [Line Items] | |||||||||||
Loans payable to bank, current | $ 60,000 | ||||||||||
Loans Payable [Member] | CEBA [Member] | |||||||||||
Short-Term Debt [Line Items] | |||||||||||
Proceeds from loans | $ 28,640 | $ 40,000 | $ 28,640 | $ 40,000 | |||||||
Convertible Debt [Member] | |||||||||||
Short-Term Debt [Line Items] | |||||||||||
Interest rate | 12% | 12% | |||||||||
Maturity date | Dec. 20, 2022 | Dec. 20, 2022 | |||||||||
Debt conversion price | (per share) | $ 6.57 | $ 9 | |||||||||
Debt instrument term | 3 years | 3 years | |||||||||
Exercise price | (per share) | $ 8.76 | $ 12 | |||||||||
Repayments of loan | $ 34,709 | $ 47,546 | |||||||||
Debt instrument, maturity date, description | December 20, 2022 | December 20, 2022 | |||||||||
CEO [Member] | Convertible Debt [Member] | |||||||||||
Short-Term Debt [Line Items] | |||||||||||
Debenture loan | $ 73,000 | $ 78,500 | $ 100,000 | ||||||||
Chief Executive Officer [Member] | Convertible Debt [Member] | |||||||||||
Short-Term Debt [Line Items] | |||||||||||
Debenture loan | $ 73,000 | $ 100,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
May 01, 2022 USD ($) | May 31, 2022 | Feb. 29, 2020 USD ($) | Oct. 31, 2019 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2022 CAD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2021 CAD ($) | Feb. 29, 2020 CAD ($) | Oct. 31, 2019 CAD ($) | |
Short-Term Debt [Line Items] | ||||||||||||
Repayment of short term loan | $ 23,600 | $ 30,000 | ||||||||||
Repayment of debt | $ 38,291 | 34,709 | $ 47,546 | 79,000 | ||||||||
Employee Agreement [Member] | ||||||||||||
Short-Term Debt [Line Items] | ||||||||||||
Management fees | 220,834 | 149,806 | ||||||||||
Director [Member] | ||||||||||||
Short-Term Debt [Line Items] | ||||||||||||
Due from related parties | 1,321 | |||||||||||
Chief Executive Officer [Member] | ||||||||||||
Short-Term Debt [Line Items] | ||||||||||||
Due from affiliates | 131 | |||||||||||
Chief Executive Officer [Member] | Employee Agreement [Member] | ||||||||||||
Short-Term Debt [Line Items] | ||||||||||||
Annual base salary | $ 250,000 | $ 250,000 | ||||||||||
Description of officer annual bonus | The CEO is also eligible on an annual basis for a cash bonus of up to 100% of annual salary. The employment agreement may be terminated with a termination payment equal to three years of base salary and a bonus equal to 20% of the annual base salary | The CEO is also eligible on an annual basis for a cash bonus of up to 100% of annual salary. The employment agreement may be terminated with a termination payment equal to three years of base salary and a bonus equal to 20% of the annual base salary | The CEO is also eligible on an annual basis for a cash bonus of up to 100% of annual salary. The employment agreement may be terminated with a termination payment equal to three years of base salary and a bonus equal to 20% of the annual base salary | |||||||||
Chief Financial Officer [Member] | Employee Agreement [Member] | ||||||||||||
Short-Term Debt [Line Items] | ||||||||||||
Annual base salary | $ 50,000 | |||||||||||
Description of officer annual bonus | The CFO is also eligible on an annual basis for a cash bonus of up to 100% of annual salary. The employment agreement may be terminated with a termination payment equal to two months of base salary. | The CFO is also eligible on an annual basis for a cash bonus of up to 100% of annual salary. The employment agreement may be terminated with a termination payment equal to two months of base salary | ||||||||||
Salary | $ 20,835 | |||||||||||
Convertible Debentures [Member] | Director [Member] | ||||||||||||
Short-Term Debt [Line Items] | ||||||||||||
Convertible debt | $ 76,000 | $ 100,000 | ||||||||||
Debt interest rate | 12% | 12% | ||||||||||
Maturity date description | maturity date of September 30, 2021 | |||||||||||
Repayment of short term loan | $ 100,000 | |||||||||||
Accrued interest | 13,090 | 4,026 | ||||||||||
Convertible Debentures [Member] | Chief Executive Officer [Member] | ||||||||||||
Short-Term Debt [Line Items] | ||||||||||||
Convertible debt | $ 76,000 | $ 100,000 | ||||||||||
Debt interest rate | 12% | 12% | ||||||||||
Maturity date description | maturity date of February 20, 2022. | |||||||||||
Accrued interest | $ 9,360 | 9,480 | ||||||||||
Due from related parties | $ 15,176 |
SCHEDULE OF BASIC AND DILUTED L
SCHEDULE OF BASIC AND DILUTED LOSS PER SHARE (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |||
Earnings Per Share [Abstract] | ||||||
Net loss | $ (1,309,191) | $ (751,188) | $ (2,714,616) | $ (1,253,242) | ||
Weighted average common shares outstanding | 1,932,604 | [1] | 1,130,344 | [1] | 1,543,021 | 678,958 |
Basic and diluted loss per share | $ (0.68) | $ (0.66) | $ (1.76) | $ (1.84) | ||
[1]The number of shares has been restated to reflect the 60:1 reverse stock split |
LOSS PER SHARE (Details Narrati
LOSS PER SHARE (Details Narrative) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2022 shares | Dec. 31, 2021 shares | Sep. 30, 2022 USD ($) shares | Sep. 30, 2022 CAD ($) shares | Sep. 30, 2021 shares | |
Share-Based Payment Arrangement, Option [Member] | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Anti-dilutive shares | 84,583 | 92,917 | 84,583 | 84,583 | 37,917 |
Warrant [Member] | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Anti-dilutive shares | 1,097,096 | 1,097,096 | 1,097,096 | 1,097,096 | 208,333 |
Common Stock [Member] | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Conversion of debentures | $ | $ 11,111 | ||||
Convertible Debt [Member] | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Conversion of debentures | $ 73,000 | $ 100,000 |
SCHEDULE OF STOCK OPTION TRANSA
SCHEDULE OF STOCK OPTION TRANSACTIONS (Details) - $ / shares | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Equity [Abstract] | |||
Number of options, beginning balance | 84,583 | 37,917 | 39,003 |
Weighted average exercise price,beginning balance | $ 13.26 | $ 19.51 | $ 18.75 |
Cancelled | (8,334) | (8,334) | (1,086) |
Weighted average exercise price, cancelled | $ 17.34 | $ 17.34 | $ 23.70 |
Granted | 55,000 | 55,000 | 0 |
Weighted average exercise price, granted | $ 10.51 | $ 10.51 | |
Number of options, ending balance | 84,583 | 84,583 | 37,917 |
Weighted average exercise price, ending balance | $ 13.26 | $ 13.26 | $ 19.51 |
Exercisable | 83,333 | 83,333 | |
Weighted average exercise price, exercisable | $ 13.61 | $ 13.42 |
SCHEDULE OF WEIGHTED AVERAGE AS
SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN THE FAIR VALUE (Details) - $ / shares | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Equity [Abstract] | ||||
Risk-free interest rate | 1.50% | 1.50% | ||
Expected life of options | 10 years | 10 years | ||
Expected annualized volatility | 96.56% | 96.56% | ||
Dividend rate | (0.00%) | 0% | ||
Weighted average fair value of options granted | $ 10.17 | $ 10.17 |
SCHEDULE OF STOCK OPTIONS OUTST
SCHEDULE OF STOCK OPTIONS OUTSTANDING (Details) - $ / shares | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | |
Offsetting Assets [Line Items] | ||||
Number of options | 84,583 | 84,583 | 37,917 | 39,003 |
Exercise Price | $ 13.26 | $ 13.26 | $ 19.51 | $ 18.75 |
Stock Option One [Member] | ||||
Offsetting Assets [Line Items] | ||||
Number of options | 27,917 | 27,917 | ||
Exercise Price | $ 22.20 | $ 21.90 | ||
Expiry Date | Dec. 04, 2027 | Dec. 04, 2027 | ||
Issuance Date | Dec. 04, 2017 | |||
Stock Option Two [Member] | ||||
Offsetting Assets [Line Items] | ||||
Number of options | 5,000 | 5,000 | ||
Exercise Price | $ 13.32 | $ 13.14 | ||
Expiry Date | Nov. 01, 2028 | Nov. 01, 2028 | ||
Issuance Date | Nov. 01, 2018 | |||
Stock Option Three [Member] | ||||
Offsetting Assets [Line Items] | ||||
Number of options | 5,000 | 5,000 | ||
Exercise Price | $ 2.22 | $ 2.19 | ||
Expiry Date | Mar. 16, 2030 | Mar. 16, 2030 | ||
Issuance Date | Mar. 16, 2020 | |||
Stock Option Four [Member] | ||||
Offsetting Assets [Line Items] | ||||
Number of options | 51,666 | 51,666 | ||
Exercise Price | $ 10.66 | $ 10.51 | ||
Expiry Date | Oct. 06, 2031 | Oct. 06, 2031 | ||
Issuance Date | Oct. 06, 2021 |
SCHEDULE OF WARRANTS TRANSACTIO
SCHEDULE OF WARRANTS TRANSACTIONS (Details) - $ / shares | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Equity [Abstract] | |||
Number of warrants, beginning balance | 1,097,096 | 208,333 | 80,087 |
Weighted Average Exercise Price, beginning balance | $ 12.12 | $ 9.42 | $ 12.77 |
Granted | 888,763 | 888,763 | 208,333 |
Weighted average exercise price, granted | $ 12.91 | $ 12.91 | $ 9.48 |
Warrants expired | (80,087) | ||
Weighted average exercise price, warrants expired | $ 13.46 | ||
Number of warrants, ending balance | 1,097,096 | 1,097,096 | 208,333 |
Weighted Average Exercise Price, ending balance | $ 12.12 | $ 12.12 | $ 9.42 |
SCHEDULE OF WARRANTS OUTSTANDIN
SCHEDULE OF WARRANTS OUTSTANDING (Details) - $ / shares | 3 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Sep. 30, 2022 | |
Class of Warrant or Right [Line Items] | ||
Number of warrants | 1,097,096 | 1,097,096 |
Warrant One [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | 24,739 | 24,739 |
Exercise price | $ 23.98 | $ 23.65 |
Expiry Date | Nov. 04, 2023 | Nov. 04, 2023 |
Issuance Date | Nov. 04, 2021 | |
Warrant Two [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | 864,024 | 864,024 |
Exercise price | $ 12.60 | $ 12.60 |
Expiry Date | Mar. 29, 2027 | Mar. 29, 2027 |
Issuance Date | Mar. 29, 2022 | |
Warrant Three [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of warrants | 208,333 | 208,333 |
Exercise price | $ 8.88 | $ 8.76 |
Expiry Date | Sep. 30, 2031 | Oct. 01, 2031 |
Issuance Date | Sep. 30, 2021 |
SCHEDULE OF VALUATION OF WARRAN
SCHEDULE OF VALUATION OF WARRANTS (Details) | Dec. 31, 2022 $ / shares | Sep. 30, 2022 $ / shares | Nov. 04, 2021 $ / shares |
Measurement Input, Risk Free Interest Rate [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Dividend rate | 4.06 | 3.79 | 0.98 |
Measurement Input, Expected Term [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Expected life of options | 9 months | 1 year | 2 years |
Measurement Input, Price Volatility [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Dividend rate | 110.97 | 135.59 | 153.02 |
Measurement Input, Expected Dividend Rate [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Dividend rate | 0 | 0 | |
Measurement Input, Share Price [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Dividend rate | 0.01 | 1.46 | 11.45 |
EQUITY (Details Narrative)
EQUITY (Details Narrative) | 3 Months Ended | 12 Months Ended | 24 Months Ended | |||||||||||
Mar. 29, 2022 USD ($) $ / shares shares | Nov. 04, 2021 USD ($) $ / shares shares | Nov. 04, 2021 CAD ($) shares | Nov. 04, 2021 USD ($) $ / shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) | Sep. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2022 CAD ($) shares | Sep. 30, 2021 USD ($) $ / shares shares | Sep. 30, 2023 USD ($) | Sep. 30, 2022 $ / shares | Nov. 04, 2021 $ / shares | |||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||
Common stock, shares authorized | Unlimited | Unlimited | Unlimited | Unlimited | ||||||||||
Common stock, par value | $ / shares | $ 0 | $ 0 | $ 0 | |||||||||||
Common stock, shares outstanding | shares | 1,932,604 | [1] | 1,932,604 | [1] | 1,103,010 | |||||||||
Warrants issued | $ (14,307) | $ (1,059,197) | ||||||||||||
Risk free interest rate | 1.50% | 1.50% | 1.50% | |||||||||||
Expected life | 10 years | 10 years | 10 years | |||||||||||
Volatility rate | 96.56% | 96.56% | 96.56% | |||||||||||
Dividend rate | (0.00%) | 0% | 0% | |||||||||||
Issuance costs | $ 22,978 | $ 1,067,868 | ||||||||||||
Fair value of common stock value | 54,958 | |||||||||||||
Fair value of common stock issued for acquisitions | 2,468,750 | |||||||||||||
Percentage issued and outstanding for common stock | 10% | 10% | ||||||||||||
Vested term | 10 years | 10 years | 10 years | |||||||||||
Aggregate intrinsic value of options outstanding and exercisable | ||||||||||||||
Exercise price range, minimum | $ / shares | $ 2.22 | $ 2.19 | ||||||||||||
Exercise price range, maximum | $ / shares | $ 22.20 | $ 21.90 | ||||||||||||
Weighted average remaining contractual life | 7 years 5 months 15 days | 7 years 8 months 19 days | 7 years 8 months 19 days | |||||||||||
Option granted | shares | 55,000 | 55,000 | 55,000 | 0 | ||||||||||
Share-based payment expense | $ 175 | 607,325 | $ 546,335 | $ 2,870 | ||||||||||
Warrant liability | (23,334) | (102,550) | (178,509) | |||||||||||
Gain on fair value adjustment of warrants | $ 23,334 | $ 102,550 | $ 178,509 | $ 178,509 | ||||||||||
Common stock, shares issued | shares | 1,932,604 | [1] | 1,932,604 | [1] | 1,103,010 | |||||||||
Service Agreement [Member] | ||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||
Number of common stock shares | shares | 19,271 | |||||||||||||
Fair value of common stock value | $ 54,958 | |||||||||||||
Property Acquisition Agreement [Member] | ||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||
Number of common stock issued for acquisitions, shares | shares | 416,666 | |||||||||||||
Fair value of common stock issued for acquisitions | $ 2,468,750 | |||||||||||||
Think Equity LLC [Member] | ||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||
Other expenses | $ 131,560 | |||||||||||||
Cash commission | $ 754,058 | |||||||||||||
Broker warrants, shares | shares | 78,548 | |||||||||||||
Broker warrants | $ 858,429 | |||||||||||||
Warrant [Member] | ||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||
Risk free interest rate | 0.98% | 0.98% | ||||||||||||
Expected life | 2 years | 2 years | ||||||||||||
Volatility rate | 153.02% | 153.02% | ||||||||||||
Dividend rate | 0% | 0% | ||||||||||||
Non Brokered Private Placement [Member] | ||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||
Stock shares new issue | shares | 44,117 | 44,117 | 44,117 | 44,117 | ||||||||||
Sale of stock price per share | (per share) | $ 12.96 | $ 12.96 | $ 12.96 | $ 16.20 | $ 16.20 | |||||||||
Common stock, gross proceeds | $ 571,760 | $ 714,700 | $ 571,760 | $ 714,700 | ||||||||||
Exercise price | (per share) | $ 25.80 | $ 32.40 | ||||||||||||
Proceeds from allocated warrants | $ 202,009 | |||||||||||||
Warrants and rights outstanding | $ 34,733 | |||||||||||||
Risk free interest rate | 0.98% | 0.98% | ||||||||||||
Expected life | 2 years | 2 years | ||||||||||||
Volatility rate | 153.02% | 153.02% | ||||||||||||
Dividend rate | 0% | 0% | ||||||||||||
Other expenses | $ 800 | |||||||||||||
Issuance costs | $ 8,671 | |||||||||||||
Non Brokered Private Placement [Member] | Warrant [Member] | ||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||
Stock shares new issue | shares | 2,680 | 2,680 | ||||||||||||
Warrants issued | $ 24,543 | |||||||||||||
Brokered Private Placement [Member] | ||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||
Stock shares new issue | shares | 785,477 | 785,477 | 785,477 | |||||||||||
Sale of stock price per share | $ / shares | $ 9.60 | $ 9.60 | ||||||||||||
Common stock, gross proceeds | $ 7,540,580 | $ 7,540,580 | ||||||||||||
Exercise price | $ / shares | $ 12.60 | |||||||||||||
Proceeds from allocated warrants | $ 607,170 | |||||||||||||
Risk free interest rate | 2.45% | 2.45% | ||||||||||||
Expected life | 5 years | 5 years | ||||||||||||
Volatility rate | 134.66% | 134.66% | ||||||||||||
Dividend rate | 0% | 0% | ||||||||||||
Other expenses | $ 159,271 | |||||||||||||
Warrants term | 5 years | |||||||||||||
Private Placement [Member] | ||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||
Number of shares issued with private placement | shares | 22,059 | |||||||||||||
Warrant liability | $ 202,009 | $ 202,009 | ||||||||||||
[1]The number of shares has been restated to reflect the 60:1 reverse stock split |
SCHEDULE OF RECONCILIATION OF I
SCHEDULE OF RECONCILIATION OF INCOME TAX (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Loss before income taxes | $ (1,309,191) | $ (751,188) | $ (2,714,616) | $ (1,253,242) |
Expected income tax recovery at statutory rates | (407,000) | (188,000) | ||
Provincial income tax | (244,000) | (137,000) | ||
Effect of income taxes from US operations | (42,000) | (7,000) | ||
Change in statutory, foreign tax, foreign exchange rates and other | (32,000) | (59,000) | ||
Permanent differences | 103,000 | 1,000 | ||
Adjustment to prior years provision versus statutory tax returns | (53,000) | (11,000) | ||
Change in valuation allowance | 675,000 | 401,000 | ||
Deferred income tax recovery |
SCHEDULE OF PRE TAX LOSS AND IN
SCHEDULE OF PRE TAX LOSS AND INCOME TAXES (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Loss for the year | $ (1,309,191) | $ (751,188) | $ (2,714,616) | $ (1,253,242) |
Expected income tax (recovery) | (651,000) | (338,000) | ||
Deferred income tax (recovery) | 651,000 | 338,000 | ||
Deferred income tax recovery | ||||
CANADA | ||||
Loss for the year | (2,030,281) | (1,144,350) | ||
Expected income tax (recovery) | (549,000) | (309,000) | ||
Deferred income tax (recovery) | 548,000 | 309,000 | ||
UNITED STATES | ||||
Loss for the year | (684,335) | (108,892) | ||
Expected income tax (recovery) | (102,000) | (29,000) | ||
Deferred income tax (recovery) | $ 103,000 | $ 29,000 |
SCHEDULE OF DEFERRED TAX ASSETS
SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES (Details) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
Income Tax Disclosure [Abstract] | ||
Tax loss carryforwards | $ 1,342,000 | $ 780,000 |
Property and equipment | (74,000) | (9,000) |
Financing fees | 216,000 | 38,000 |
Total gross deferred tax assets | 1,484,000 | 809,000 |
Deferred tax assets valuation allowance | (1,484,000) | (809,000) |
Net deferred tax assets |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Deferred Tax Asset, Tax Deferred Expense, Reserve and Accrual, Financing Receivable, Allowance for Credit Loss | $ 801,000 | $ 140,000 |
Deferred tax assets non capital loss carryforwards | $ 1,342,000 | 780,000 |
Expiration date range description | with expiration dates ranging from 2037 to 2042 and 2037 to 2041 | |
CA and US [Member] | ||
Deferred tax assets non capital loss carryforwards | $ 4,832,000 | |
CANADA | ||
Deferred tax assets non capital loss carryforwards | 4,028,000 | 2,707,000 |
UNITED STATES | ||
Deferred tax assets non capital loss carryforwards | $ 804,000 | $ 213,000 |
SCHEDULE OF COST INCURRED IN PR
SCHEDULE OF COST INCURRED IN PRODUCING ACTIVITIES (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Supplemental Information On Oil And Gas Operations | ||
Acquisition of proved properties | $ 3,699,215 | |
Acquisition of unproved properties | ||
Development costs | 1,676,668 | 9,403 |
Exploration costs | ||
Total costs incurred | 1,676,668 | 3,708,618 |
Oil and gas revenues | 815,391 | 46,703 |
Production costs | (829,194) | (59,671) |
Exploration expenses | ||
Depletion, depreciation and amortization | (99,855) | (52,439) |
Impairment of oil and gas properties | ||
Result of oil and gas producing operations before income taxes | (113,658) | (65,407) |
Provision for income taxes | ||
Results of oil and gas producing activities | $ (113,658) | $ (65,407) |
SCHEDULE OF PROVED RESERVES (De
SCHEDULE OF PROVED RESERVES (Details) | 12 Months Ended | ||||||||||||||||||||||
Sep. 30, 2022 bbl | Sep. 30, 2022 Boe bbl | Sep. 30, 2022 bbl Mcf | Sep. 30, 2021 bbl | Sep. 30, 2021 Boe bbl | Sep. 30, 2021 bbl Mcf | Sep. 30, 2022 Boe | Sep. 30, 2022 Mcf | Sep. 30, 2021 Boe | Sep. 30, 2021 Mcf | Sep. 30, 2020 bbl | Sep. 30, 2020 Boe | Sep. 30, 2020 Mcf | Sep. 30, 2019 bbl | Sep. 30, 2019 Boe | Sep. 30, 2019 Mcf | ||||||||
Supplemental Information On Oil And Gas Operations | |||||||||||||||||||||||
Beginning balance | 6,199,420 | 3,018,350 | 3,706,360 | 740,180 | |||||||||||||||||||
Beginning balance, BOE (Barrels) | 6,702,478 | 3,829,723 | |||||||||||||||||||||
Revisions | 48,320 | [1] | (5,613) | [1] | (88,263) | [2] | 38,640 | [2] | |||||||||||||||
Revisions, BOE (Barrels) | 47,385 | [1] | (81,823) | [2] | |||||||||||||||||||
Purchase of proved reserves | 5,408,560 | [3] | 2,859,590 | [3] | |||||||||||||||||||
Purchase of proved reserves | [3] | 5,885,158 | |||||||||||||||||||||
Sale reserves | (2,826,290) | [1] | (618,650) | [1] | |||||||||||||||||||
Sale reserves, BOE (Barrels) | (2,929,398) | [1] | |||||||||||||||||||||
Production | (10,670) | (11,567) | (947) | (1,410) | |||||||||||||||||||
Production, BOE (Barrels) | (12,598) | (1,182) | |||||||||||||||||||||
Purchase of proved reserves, BOE (Barrels) | |||||||||||||||||||||||
Ending balance | 6,237,070 | 3,001,170 | 6,199,420 | 3,018,350 | |||||||||||||||||||
Ending balance, BOE (Barrels) | 6,737,265 | 6,702,478 | |||||||||||||||||||||
Proved developed reserves | 1,153,870 | 1,153,870 | 1,153,870 | 587,450 | 587,450 | 587,450 | 864,770 | 411,910 | 549,390 | 82,430 | |||||||||||||
Proved developed reserves, BOE (Barrels) | 1,297,998 | 656,102 | 563,128 | ||||||||||||||||||||
Proved undeveloped reserves | 5,083,200 | 5,083,200 | 5,083,200 | 2,136,400 | 3,156,970 | 657,750 | 5,611,970 | 2,606,440 | |||||||||||||||
Proved undeveloped reserves, BOE (Barrels) | 5,439,267 | 3,266,595 | 6,046,377 | ||||||||||||||||||||
[1] During 2021, the Company sold ODC and Taylor properties. Revisions in 2021 included 120,850 bbls in proved undeveloped reserves being reclassified as probable in the 2021 reserve report, net of other immaterial revisions in several properties. During 2021, the Company purchased 1,246 net acres in Martin County, Texas. |
SCHEDULE OF PROVED RESERVES (_2
SCHEDULE OF PROVED RESERVES (Details) (Paranthetiacal) | Sep. 30, 2022 Boe | Sep. 30, 2021 a Boe | Sep. 30, 2020 Boe | Sep. 30, 2019 Boe |
Reserve Quantities [Line Items] | ||||
Proved Undeveloped Reserves (Energy) | 5,439,267 | 3,266,595 | 6,046,377 | |
Area of Land | a | 1,246 | |||
Other Nonrenewable Natural Resources [Member] | ||||
Reserve Quantities [Line Items] | ||||
Proved Undeveloped Reserves (Energy) | 120,850 |
SCHEDULE OF NET CASH FLOWS RELA
SCHEDULE OF NET CASH FLOWS RELATING TO PROVED OIL AND GAS RESERVES (Details) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 |
Supplemental Information On Oil And Gas Operations | |||
Future cash inflows | $ 589,481,000 | $ 355,958,000 | |
Future production costs(1) | (91,630,000) | (69,683,000) | |
Future development costs | (71,700,000) | (71,700,000) | |
Future income tax expenses | (113,873,000) | (57,206,000) | |
Future net cash flows | 312,278,000 | 157,369,000 | |
10% annual discount for estimated timing of cash flows | (167,549,000) | (84,100,000) | |
Standardized measure of discounted future net cash flows at the end of the fiscal year | $ 144,729,000 | $ 73,269,000 | $ 20,797,000 |
SCHEDULE OF AVERAGE HYDROCARBON
SCHEDULE OF AVERAGE HYDROCARBON PRICES (Details) - $ / shares | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | |
Oil [Member] | ||||
Reserve Quantities [Line Items] | ||||
Average Price | [1] | $ 91.72 | $ 55.98 | $ 40.30 |
Natural Gas [Member] | ||||
Reserve Quantities [Line Items] | ||||
Average Price | [1] | $ 5.79 | $ 2.95 | $ 1.77 |
[1]Average prices were based on 12-month unweighted arithmetic average of the first-day-of-the-month prices for the period from October through September during each respective fiscal year. |
SCHEDULE OF CHANGES IN DISCOUNT
SCHEDULE OF CHANGES IN DISCOUNTED FUTURE NET CASH FLOWS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Supplemental Information On Oil And Gas Operations | ||
Standardized measure of discounted future net cash flows at the beginning of the year | $ 73,269,000 | $ 20,797,000 |
Extensions, discoveries and improved recovery, less related costs | ||
Sales of minerals in place | (62,682,000) | |
Purchase of minerals in place | 125,927,000 | |
Revisions of previous quantity estimates | 1,674,000 | (1,751,000) |
Net changes in prices and production costs | 88,333,000 | 32,573,000 |
Accretion of discount | 10,077,000 | 1,498,000 |
Sales of oil produced, net of production costs | (49,000) | 13,000 |
Changes in future development costs | 911,000 | (21,339,000) |
Changes in timing of future production | (3,099,000) | (2,580,000) |
Net changes in income taxes | (26,387,000) | (19,187,000) |
Standardized measure of discounted future net cash flows at the end of the year | $ 144,729,000 | $ 73,269,000 |