Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jun. 30, 2016 | Aug. 08, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | MEXCO ENERGY CORP | |
Entity Central Index Key | 66,418 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 2,037,266 | |
Trading Symbol | MXC | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,017 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Jun. 30, 2016 | Mar. 31, 2016 |
Current assets | ||
Cash and cash equivalents | $ 37,229 | $ 34,013 |
Accounts receivable: | ||
Oil and gas sales | 485,262 | 248,145 |
Trade | 21,566 | 29,880 |
Prepaid costs and expenses | 20,084 | 43,284 |
Total current assets | 564,141 | 355,322 |
Property and equipment, at cost | ||
Oil and gas properties, using the full cost method | 40,343,746 | 40,365,197 |
Other | 107,484 | 107,484 |
Accumulated depreciation, depletion and amortization | (24,703,566) | (24,395,184) |
Property and equipment, net | 15,747,664 | 16,077,497 |
Other noncurrent assets | 34,268 | 34,441 |
Total assets | 16,346,073 | 16,467,260 |
Current liabilities | ||
Accounts payable and accrued expenses | 547,206 | 332,172 |
Long-term debt | 5,520,000 | 5,580,000 |
Asset retirement obligations | 1,209,711 | 1,211,077 |
Total liabilities | 7,276,917 | 7,123,249 |
Commitments and contingencies | ||
Stockholders’ equity | ||
Preferred stock - $1.00 par value; 10,000,000 shares authorized; none outstanding | ||
Common stock - $0.50 par value; 40,000,000 shares authorized; 2,104,266 shares issued and 2,037,266 shares outstanding as of June 30, 2016 and March 31, 2016 | 1,052,133 | 1,052,133 |
Additional paid-in capital | 7,210,585 | 7,191,984 |
Retained earnings | 1,152,439 | 1,445,895 |
Treasury stock, at cost (67,000 shares) | (346,001) | (346,001) |
Total stockholders’ equity | 9,069,156 | 9,344,011 |
Total liabilities and stockholders’ equity | $ 16,346,073 | $ 16,467,260 |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2016 | Mar. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock par value | $ 1 | $ 1 |
Preferred stock shares authorized | 10,000,000 | 10,000,000 |
Preferred stock shares issued | ||
Preferred stock shares outstanding | ||
Common stock par value | $ 0.50 | $ 0.50 |
Common stock shares authorized | 40,000,000 | 40,000,000 |
Common stock shares issued | 2,104,266 | 2,104,266 |
Common stock shares outstanding | 2,037,266 | 2,037,266 |
Treasury stock, shares | 67,000 | 67,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Operating revenues: | ||
Oil and gas | $ 536,403 | $ 692,582 |
Other | 133,780 | 10,027 |
Total operating revenues | 670,183 | 702,609 |
Operating expenses: | ||
Production | 260,944 | 297,578 |
Accretion of asset retirement obligations | 8,796 | 8,784 |
Depreciation, depletion and amortization | 308,382 | 417,982 |
General and administrative | 344,246 | 413,746 |
Total operating expenses | 922,368 | 1,138,090 |
Operating loss | (252,185) | (435,481) |
Other income (expense): | ||
Interest income | 163 | 33 |
Interest expense | (41,434) | (40,865) |
Net other expense | (41,271) | (40,832) |
Loss before provision for income taxes | (293,456) | (476,313) |
Income tax benefit: | ||
Current | ||
Deferred | (151,947) | |
Total | (151,947) | |
Net loss | $ (293,456) | $ (324,366) |
Loss per common share: | ||
Basic and diluted | $ (0.14) | $ (0.16) |
Weighted average common shares outstanding: | ||
Basic and diluted | 2,037,266 | 2,037,266 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - 3 months ended Jun. 30, 2016 - USD ($) | Common Stock Par Value [Member] | Treasury Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Total |
Balance at Mar. 31, 2016 | $ 1,052,133 | $ (346,001) | $ 7,191,984 | $ 1,445,895 | $ 9,344,011 |
Balance, shares at Mar. 31, 2016 | 2,104,266 | (67,000) | |||
Net loss | (293,456) | (293,456) | |||
Stock based compensation | $ 18,601 | $ 18,601 | |||
Common stock shares issued, shares | |||||
Common stock shares, held in treasury, Acquisitions, shares | |||||
Balance at Jun. 30, 2016 | $ 1,052,133 | $ (346,001) | $ 7,210,585 | $ 1,152,439 | $ 9,069,156 |
Balance, shares at Jun. 30, 2016 | 2,104,266 | (67,000) | |||
Common stock shares outstanding at Jun. 30, 2016 | 2,037,266 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (293,456) | $ (324,366) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Deferred income tax benefit | (151,947) | |
Stock-based compensation | 18,601 | 41,249 |
Depreciation, depletion and amortization | 308,382 | 417,982 |
Accretion of asset retirement obligations | 8,796 | 8,784 |
Settlement of asset retirement obligations | (88,168) | (795) |
Changes in assets and liabilities, net of business combination: | ||
Increase in accounts receivable | (228,803) | (22,054) |
Decrease in prepaid expenses | 23,200 | 8,195 |
Increase in accounts payable and accrued expenses | 227,205 | 302,550 |
Net cash (used in) provided by operating activities | (24,243) | 279,598 |
Cash flows from investing activities: | ||
Additions to oil and gas properties | (48,561) | (419,325) |
Drilling refund | 75,808 | |
Proceeds from sale of oil and gas properties and equipment | 60,212 | 188 |
Net cash provided by (used in) investing activities | 87,459 | (419,137) |
Cash flows from financing activities: | ||
Reduction of long-term debt | (60,000) | |
Proceeds from long-term debt | 200,000 | |
Net cash (used in) provided by financing activities | (60,000) | 200,000 |
Net increase in cash and cash equivalents | 3,216 | 60,461 |
Cash and cash equivalents at beginning of period | 34,013 | 96,084 |
Cash and cash equivalents at end of period | 37,229 | 156,545 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 42,151 | 40,523 |
Income taxes paid | ||
Non-cash investing and financing activities: | ||
Asset retirement obligations | $ 78,006 | $ 3,050 |
Nature of Operations
Nature of Operations | 3 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | 1. Nature of Operations Mexco Energy Corporation (a Colorado corporation) and its wholly owned subsidiaries, Forman Energy Corporation (a New York corporation), Southwest Texas Disposal Corporation (a Texas corporation) and TBO Oil & Gas, LLC (a Texas limited liability company) (collectively, the Company) are engaged in the exploration, development and production of natural gas, crude oil, condensate and natural gas liquids (NGLs). Most of the Companys oil and gas interests are centered in the Permian Basin of West Texas; however, the Company owns producing properties and undeveloped acreage in thirteen states. Although most of the Companys oil and gas interests are operated by others, the Company operates several properties in which it owns an interest. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 3 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | 2. Basis of Presentation and Significant Accounting Policies Principles of Consolidation Estimates and Assumptions Interim Financial Statements. Reclassifications. Recent Accounting Pronouncements. In February 2016, the FASB issued ASU 2016-02, Topic 842 Leases, which requires companies to recognize a right of use asset and related liability on the balance sheet for the rights and obligations arising from leases with durations greater than 12 months. The standard is effective for fiscal years beginning after December 15, 2018, and interim periods thereafter. Early adoption is permitted. We are currently evaluating the effect the new guidance will have on our consolidated financial statements. In January 2016, the FASB issued authoritative guidance that amends existing requirements on the classification and measurement of financial instruments. The standard principally affects accounting for equity investments and financial liabilities where the fair value option has been elected. The guidance is effective for fiscal periods after December 15, 2017, and interim periods thereafter. Early adoption of certain provisions is permitted. We are currently evaluating the effect the new guidance will have on our financial statements. In November 2015, the FASB issued ASU No. 2015-17, Topic 740 Income Taxes: Balance Sheet Classification of Deferred Taxes which requires all deferred income tax liabilities and assets to be presented as noncurrent in a classified balance sheet. Currently, entities are required to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified balance sheet. The new standard will become effective for Mexco beginning on April 1, 2017, with the option to early adopt, and can be applied either prospectively or retrospectively. The adoption of this guidance will have no impact on our results of operations or cash flows. The reclassification of amounts from current to noncurrent could affect the presentation of our balance sheet. In February 2015, the FASB issued ASU No. 2015-02, Topic 810: Consolidation which amends the current consolidation guidance. ASU No. 2015-02 was effective for Mexco as of April 1, 2016. There was no significant impact on our consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, Subtopic 205-40: Disclosure of Uncertainties about an Entitys Ability to Continue as a Going Concern which provides guidance on determining when and how reporting entities must disclose going-concern uncertainties in their financial statements. ASU No. 2014-15 is effective for Mexco for the fiscal year ending March 31, 2017 and interim periods thereafter and early adoption is permitted. Management does not expect the adoption of this ASU to have a material impact on our consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Topic 606: Revenue from Contracts with Customers. This ASU provides guidance concerning the recognition and measurement of revenue from contracts with customers. The effective date for ASU 2014-09 was delayed through the issuance of ASU 2015-14, Revenue from Contracts with Customers Deferral of the Effective Date, to annual and interim periods beginning in 2018 and is required to be adopted using either the retrospective or cumulative effect transition method, with early adoption permitted in 2017. Management is evaluating the effect, if any, this pronouncement will have on our consolidated financial statements. |
Asset Retirement Obligations
Asset Retirement Obligations | 3 Months Ended |
Jun. 30, 2016 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Asset Retirement Obligations | 3. Asset Retirement Obligations The Companys asset retirement obligations (ARO) relate to the plugging of wells, the removal of facilities and equipment, and site restoration on oil and gas properties. The fair value of a liability for an ARO is recorded in the period in which it is incurred, discounted to its present value using the credit adjusted risk-free interest rate, and a corresponding amount capitalized by increasing the carrying amount of the related long-lived asset. The liability is accreted each period, and the capitalized cost is depreciated over the useful life of the related asset. The ARO is included on the consolidated balance sheets with the current portion being included in the accounts payable and other accrued expenses. The following table provides a rollforward of the AROs for the first three months of fiscal 2017: Carrying amount of asset retirement obligations as of April 1, 2016 $ 1,221,077 Liabilities incurred 78,006 Liabilities settled (88,168 ) Accretion expense 8,796 Carrying amount of asset retirement obligations as of June 30, 2016 1,219,711 Less: Current portion 10,000 Non-Current asset retirement obligation $ 1,209,711 |
Stock-based Compensation
Stock-based Compensation | 3 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based Compensation | 4. Stock-based Compensation The Company recognized compensation expense of $18,601 and $41,249 in general and administrative expense in the Consolidated Statements of Operations for the three months ended June 30, 2016 and 2015, respectively. The total cost related to non-vested awards not yet recognized at June 30, 2016 totals approximately $60,052 which is expected to be recognized over a weighted average of 1.87 years. The following table is a summary of activity of stock options for the three months ended June 30, 2016: Number of Shares Weighted Average Exercise Price Per Share Weighted Aggregate Average Remaining Contract Life in Years Intrinsic Value Outstanding at April 1, 2016 153,600 $ 6.52 7.36 $ - Granted - - Exercised - - Forfeited or Expired - - Outstanding at June 30, 2016 153,600 $ 6.52 6.11 $ - Vested at June 30, 2016 114,850 $ 6.44 5.54 $ - Exercisable at June 30, 2016 114,850 $ 6.44 5.54 $ - Outstanding options at June 30, 2015 expire between August 2020 and August 2024 and have exercise prices ranging from $5.98 to $7.00. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 5. Fair Value of Financial Instruments Fair value as defined by authoritative literature is the price that would be received to sell an asset or paid to transfer a liability (exit price) in an orderly transaction between market participants at the measurement date. Fair value measurements are classified and disclosed in one of the following categories: Level 1 Quoted prices in active markets for identical assets and liabilities. Level 2 Quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Level 3 Significant inputs to the valuation model are unobservable. Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The carrying amount reported in the accompanying consolidated balance sheets for cash and cash equivalents, accounts receivable and accounts payable approximates fair value because of the immediate or short-term maturity of these financial instruments. The fair value amount reported in the accompanying consolidated balance sheets for long term debt approximates fair value because the actual interest rates do not significantly differ from current rates offered for instruments with similar characteristics and is deemed to use Level 2 inputs. See the Companys Note 6 on Credit Facility for further discussion. |
Credit Facility
Credit Facility | 3 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
Credit Facility | 6. Credit Facility The Company has a loan agreement with Bank of America, N.A. (the Agreement), which provided for a credit facility of $5,570,000 with no monthly commitment reductions and a borrowing base to be evaluated on July 30 and January 1 of each year or at any additional time in the Banks discretion as of June 30, 2016. The borrowing base will be reset to the extent the Company sells or otherwise disposes of any of its oil and gas properties. The Company is required to pay 100% of such net proceeds to the lender resulting in a permanent reduction of the borrowing base. Amounts borrowed under the Agreement are collateralized by the common stock of the Companys wholly owned subsidiaries and substantially all of the Companys oil and gas properties. The Agreement was renewed ten times with the tenth amendment effective as of March 31, 2016 with a maturity date of November 30, 2020. The revised borrowing base as of June 20, 2016 was set at $5,570,000. Under such renewal agreement, interest on the facility accrues at an annual rate equal to the British Bankers Association London Interbank Offered Rate (BBA LIBOR) daily floating rate, plus 3.0 percentage points, which was 3.4533% on June 30, 2016. Interest on the outstanding amount under the credit agreement is payable monthly. There was no availability of this line of credit at June 30, 2016. No principal payments are anticipated to be required through November 30, 2020. The Agreement contains customary covenants for credit facilities of this type including limitations on change in control, disposition of assets, mergers and reorganizations. The Company is also obligated to meet certain financial covenants under the Agreement and requires minimum earnings before interest, taxes, depreciation and amortization (EBITDA) of $100,000 for the two fiscal quarters ending September 30, 2016, $300,000 for the three fiscal quarters ending December 31, 2016, $500,000 for the four fiscal quarters ending March 31, 2017 and $650,000 for each trailing fiscal quarter period thereafter and minimum interest coverage ratios (EBITDA/Interest Expense) of 1.25 to 1 for the fiscal quarter ending June 30, 2016 and 2.00 to 1.00 for each quarter thereafter. The Company is in compliance with all covenants as of June 30, 2016. In addition, this Agreement prohibits the Company from paying cash dividends on its common stock. The Agreement does grant the Company permission to enter into hedge agreements however, it is under no obligation to do so. The Agreement allows for up to $500,000 of the facility to be used for outstanding letters of credits. As of June 30, 2016, one letter of credit for $50,000, in lieu of plugging bond with the Texas Railroad Commission (TRRC) covering the properties the Company operates is outstanding under the facility. This letter of credit renews annually. The company will pay a fee in an amount equal to 1 percent (1.0%) per annum of the outstanding undrawn amount of each standby letter of credit, payable monthly in arrears, on the basis of the face amount outstanding on the day the fee is calculated. The balance outstanding on the line of credit as of June 30, 2016 was $5,520,000. The following table is a summary of activity on the Bank of America, N.A. line of credit for the three months ended June 30, 2016: Principal Balance at April 1, 2016: $ 5,580,000 Borrowings - Repayments (60,000 ) Balance at June 30, 2015: $ 5,520,000 |
Income Taxes
Income Taxes | 3 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 7. Income Taxes A valuation allowance for deferred tax assets, including net operating losses, is recognized when it is more likely than not that some or all of the benefit from the deferred tax asset will not be realized. To assess that likelihood, we use estimates and judgment regarding our future taxable income, and we consider the tax consequences in the jurisdiction where such taxable income is generated, to determine whether a valuation allowance is required. Such evidence can include our current financial position, our results of operations, both actual and forecasted, the reversal of deferred tax liabilities, and tax planning strategies as well as the current and forecasted business economics of our industry. Based on the material write-downs of the carrying value of our oil and natural gas properties during fiscal 2016, we project being in a net deferred tax asset position at March 31, 2017. Our deferred tax asset is $954,657 as of June 30, 2016 with a valuation amount of $954,657. We believe it is more likely than not that these deferred tax assets will not be realized. Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the use of deferred tax assets. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as future expected growth. The income tax provision consists of the following for the three months ended June 30, 2016 and 2015: 2016 2015 Current income tax expense $ - $ - Deferred income tax benefit - (151,947 ) Total income tax provision $ - $ (151,947 ) Effective tax rate - 32 % |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 8. Related Party Transactions Related party transactions for the Company relate to shared office expenditures in addition to administrative and operating expenses paid on behalf of the principal stockholder. The total billed to and reimbursed by the stockholder for the quarters ended June 30, 2016 and 2015 were $5,803 and $25,621, respectively. |
Loss Per Common Share
Loss Per Common Share | 3 Months Ended |
Jun. 30, 2016 | |
Loss per common share: | |
Loss Per Common Share | 9. Loss Per Common Share The Companys basic net loss per share has been computed based on the weighted average number of common shares outstanding during the period. Diluted net loss per share assumes the exercise of all stock options having exercise prices less than the average market price of the common stock during the period using the treasury stock method and is computed by dividing net loss by the weighted average number of common shares and dilutive potential common shares (stock options) outstanding during the period. In periods where losses are reported, the weighted average number of common shares outstanding excludes potential common shares, because their inclusion would be anti-dilutive. The following is a reconciliation of the number of shares used in the calculation of basic and diluted net loss per share for the three month periods ended June 30, 2016 and 2015. 2016 2015 Net loss $ (293,456 ) $ (324,366 ) Shares outstanding: Weighted average common shares outstanding basic 2,037,266 2,037,266 Effect of the assumed exercise of dilutive stock options - - Weighted average common shares outstanding dilutive 2,037,266 2,037,266 Loss per common share: Basic and diluted $ (0.14 ) $ (0.16 ) Due to a net loss for the three months ended June 30, 2016 and 2015, the weighted average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | 10. Subsequent Events On July 15, 2016, Pioneer Natural Resources Company exercised its option to extend for an additional two years on Mexco leasehold interest in 60 net acres (200 gross acres) in Upton County, Texas. Pioneer paid Mexco $1,500 per acre for a total of $90,000. Mexco retained a 1% overriding royalty interest in this acreage. Pioneer has drilled 7 wells on other portions of acreage in which Mexco holds an interest. |
Basis of Presentation and Sig17
Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation |
Estimates and Assumptions | Estimates and Assumptions |
Interim Financial Statements | Interim Financial Statements. |
Reclassifications | Reclassifications. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements. In February 2016, the FASB issued ASU 2016-02, Topic 842 Leases, which requires companies to recognize a right of use asset and related liability on the balance sheet for the rights and obligations arising from leases with durations greater than 12 months. The standard is effective for fiscal years beginning after December 15, 2018, and interim periods thereafter. Early adoption is permitted. We are currently evaluating the effect the new guidance will have on our consolidated financial statements. In January 2016, the FASB issued authoritative guidance that amends existing requirements on the classification and measurement of financial instruments. The standard principally affects accounting for equity investments and financial liabilities where the fair value option has been elected. The guidance is effective for fiscal periods after December 15, 2017, and interim periods thereafter. Early adoption of certain provisions is permitted. We are currently evaluating the effect the new guidance will have on our financial statements. In November 2015, the FASB issued ASU No. 2015-17, Topic 740 Income Taxes: Balance Sheet Classification of Deferred Taxes which requires all deferred income tax liabilities and assets to be presented as noncurrent in a classified balance sheet. Currently, entities are required to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified balance sheet. The new standard will become effective for Mexco beginning on April 1, 2017, with the option to early adopt, and can be applied either prospectively or retrospectively. The adoption of this guidance will have no impact on our results of operations or cash flows. The reclassification of amounts from current to noncurrent could affect the presentation of our balance sheet. In February 2015, the FASB issued ASU No. 2015-02, Topic 810: Consolidation which amends the current consolidation guidance. ASU No. 2015-02 was effective for Mexco as of April 1, 2016. There was no significant impact on our consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, Subtopic 205-40: Disclosure of Uncertainties about an Entitys Ability to Continue as a Going Concern which provides guidance on determining when and how reporting entities must disclose going-concern uncertainties in their financial statements. ASU No. 2014-15 is effective for Mexco for the fiscal year ending March 31, 2017 and interim periods thereafter and early adoption is permitted. Management does not expect the adoption of this ASU to have a material impact on our consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Topic 606: Revenue from Contracts with Customers. This ASU provides guidance concerning the recognition and measurement of revenue from contracts with customers. The effective date for ASU 2014-09 was delayed through the issuance of ASU 2015-14, Revenue from Contracts with Customers Deferral of the Effective Date, to annual and interim periods beginning in 2018 and is required to be adopted using either the retrospective or cumulative effect transition method, with early adoption permitted in 2017. Management is evaluating the effect, if any, this pronouncement will have on our consolidated financial statements. |
Asset Retirement Obligations (T
Asset Retirement Obligations (Tables) | 3 Months Ended |
Jun. 30, 2016 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Schedule of Rollforward of Asset Retirement Obligations | The following table provides a rollforward of the AROs for the first three months of fiscal 2017: Carrying amount of asset retirement obligations as of April 1, 2016 $ 1,221,077 Liabilities incurred 78,006 Liabilities settled (88,168 ) Accretion expense 8,796 Carrying amount of asset retirement obligations as of June 30, 2016 1,219,711 Less: Current portion 10,000 Non-Current asset retirement obligation $ 1,209,711 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 3 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock Options Activity | The following table is a summary of activity of stock options for the three months ended June 30, 2016: Number of Shares Weighted Average Exercise Price Per Share Weighted Aggregate Average Remaining Contract Life in Years Intrinsic Value Outstanding at April 1, 2016 153,600 $ 6.52 7.36 $ - Granted - - Exercised - - Forfeited or Expired - - Outstanding at June 30, 2016 153,600 $ 6.52 6.11 $ - Vested at June 30, 2016 114,850 $ 6.44 5.54 $ - Exercisable at June 30, 2016 114,850 $ 6.44 5.54 $ - |
Credit Facility (Tables)
Credit Facility (Tables) | 3 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
Summary of Line of Credit Activity | The balance outstanding on the line of credit as of June 30, 2016 was $5,520,000. The following table is a summary of activity on the Bank of America, N.A. line of credit for the three months ended June 30, 2016: Principal Balance at April 1, 2016: $ 5,580,000 Borrowings - Repayments (60,000 ) Balance at June 30, 2015: $ 5,520,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Provision | The income tax provision consists of the following for the three months ended June 30, 2016 and 2015: 2016 2015 Current income tax expense $ - $ - Deferred income tax benefit - (151,947 ) Total income tax provision $ - $ (151,947 ) Effective tax rate - 32 % |
Loss Per Common Share (Tables)
Loss Per Common Share (Tables) | 3 Months Ended |
Jun. 30, 2016 | |
Loss per common share: | |
Schedule of Reconciliation of Basic Net Loss Per Share and Diluted Loss Per Share | The following is a reconciliation of the number of shares used in the calculation of basic and diluted net loss per share for the three month periods ended June 30, 2016 and 2015. 2016 2015 Net loss $ (293,456 ) $ (324,366 ) Shares outstanding: Weighted average common shares outstanding basic 2,037,266 2,037,266 Effect of the assumed exercise of dilutive stock options - - Weighted average common shares outstanding dilutive 2,037,266 2,037,266 Loss per common share: Basic and diluted $ (0.14 ) $ (0.16 ) |
Assets Retirement Obligations -
Assets Retirement Obligations - Schedule of Rollforward of Asset Retirement Obligations (Details) - USD ($) | 3 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Mar. 31, 2016 | |
Asset Retirement Obligation Disclosure [Abstract] | |||
Carrying amount of asset retirement obligations as of April 1, 2015 | $ 1,221,077 | ||
Liabilities incurred | 78,006 | ||
Liabilities settled | (88,168) | ||
Accretion expense | 8,796 | $ 8,784 | |
Carrying amount of asset retirement obligations as of June 30, 2016 | 1,219,711 | ||
Less: Current portion | 10,000 | ||
Non-Current asset retirement obligation | $ 1,209,711 | $ 1,211,077 |
Stock-based Compensation (Detai
Stock-based Compensation (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Recognized compensation expense | $ 18,601 | $ 41,249 |
Total cost related to non-vested awards | 60,052 | |
Non vested awards not yet recognized over weighted average | 1 year 10 months 13 days | |
Outstanding options expiration date description | Outstanding options at June 30, 2015 expire between August 2020 and August 2024 | |
Options exercise prices range per share, minimum | $ 5.98 | |
Options exercise prices range per share, maximum | $ 7 |
Stock-based Compensation - Sche
Stock-based Compensation - Schedule of Stock Options Activity (Details) | 3 Months Ended |
Jun. 30, 2016USD ($)$ / sharesshares | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Number of Shares Outstanding, Beginning Balance | shares | 153,600 |
Number of Shares Outstanding, Granted | shares | |
Number of Shares Outstanding, Exercised | shares | |
Number of Shares Outstanding, Forfeited or Expired | shares | |
Number of Shares Outstanding, Ending Balance | shares | 153,600 |
Number of Shares Outstanding, Vested | shares | 114,850 |
Number of Shares Outstanding, Exercisable | shares | 114,850 |
Weighted Average Exercise Price Per Share, Beginning Balance | $ / shares | $ 6.52 |
Weighted Average Exercise Price Per Share, Granted | $ / shares | |
Weighted Average Exercise Price Per Share, Exercised | $ / shares | |
Weighted Average Exercise Price Per Share, Forfeited or Expired | $ / shares | |
Weighted Average Exercise Price Per Share, Ending Balance | $ / shares | 6.52 |
Weighted Average Exercise Price Per Share, Vested | $ / shares | 6.44 |
Weighted Average Exercise Price Per Share, Exercisable | $ / shares | $ 6.44 |
Weighted Aggregate Average Remaining Contract Life in Years, Beginning Balance | 7 years 4 months 10 days |
Weighted Aggregate Average Remaining Contract Life in Years, Ending Balance | 6 years 1 month 10 days |
Weighted Aggregate Average Remaining Contract Life in Years, Vested | 5 years 6 months 15 days |
Weighted Aggregate Average Remaining Contract Life in Years, Exercisable | 5 years 6 months 15 days |
Intrinsic Value, Beginning Balance | $ | |
Intrinsic Value, Ending Balance | $ | |
Intrinsic Value, Vested | $ | |
Intrinsic Value, Exercisable | $ |
Credit Facility (Details Narrat
Credit Facility (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2016 | Mar. 31, 2016 | |
Debt instrument covenant description | For each trailing fiscal quarter period thereafter and minimum interest coverage ratios (EBITDA/Interest Expense) of 1.25 to 1 for the fiscal quarter ending June 30, 2016 and 2.00 to 1.00 for each quarter thereafter. The Company is in compliance with all covenants as of June 30, 2016. | |
Line of credit | $ 5,520,000 | $ 5,580,000 |
September 30, 2016 [Member] | ||
Amendment replaces the tangible net worth | 100,000 | |
December 31, 2016 [Member] | ||
Amendment replaces the tangible net worth | 300,000 | |
March 31, 2017 [Member] | ||
Amendment replaces the tangible net worth | 500,000 | |
Each Trailing Fiscal Quarter [Member] | ||
Amendment replaces the tangible net worth | $ 650,000 | |
Revolving Credit Agreement [Member] | ||
Line of credit unused commitment fee percentage | 1.00% | |
Maximum line of credit amount used for letter of credit | $ 500,000 | |
Letter of credit | 50,000 | |
Revolving Credit Agreement [Member] | Bank of America, N.A [Member] | ||
Credit facility face amount | 5,570,000 | |
Disposes of oil and gas properties | $ 5,570,000 | |
Percentage of amount require to pay lendar | 100.00% | |
Original and Renewed Agreements [Member] | ||
Line of credit maturity date | Nov. 30, 2020 | |
Accrued interest rate | 3.4533% | |
Line of credit commitment fee description | Under such renewal agreement, interest on the facility accrues at an annual rate equal to the British Bankers Association London Interbank Offered Rate (BBA LIBOR) daily floating rate, plus 3.0 percentage points, which was 3.4533% on June 30, 2016. Interest on the outstanding amount under the credit agreement is payable monthly. | |
Original and Renewed Agreements [Member] | BBA LIBOR [Member] | Maximum [Member] | ||
Accrues variable interest rate | 3.00% |
Credit Facility - Summary of Li
Credit Facility - Summary of Line of Credit Activity (Details) | 3 Months Ended |
Jun. 30, 2016USD ($) | |
Debt Disclosure [Abstract] | |
Balance at April 1, 2016: | $ 5,580,000 |
Borrowings | |
Repayments | (60,000) |
Balance at June 30, 2016: | $ 5,520,000 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | Jun. 30, 2016USD ($) |
Income Tax Disclosure [Abstract] | |
Deferred tax asset | $ 954,657 |
Valuation allovance | $ 954,657 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Tax Provision (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | ||
Current income tax expense | ||
Deferred income tax benefit | (151,947) | |
Total income tax provision | $ (151,947) | |
Effective tax rate | 0.00% | 32.00% |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Related Party Transactions [Abstract] | ||
Shared office expenditures in addition to administrative and operating expenses paid on behalf of the majority stockholder | $ 5,803 | $ 25,621 |
Loss Per Common Share - Schedul
Loss Per Common Share - Schedule of Reconciliation of Basic Net Loss Per Share and Diluted Loss Per Share (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Loss per common share: | ||
Net loss | $ (293,456) | $ (324,366) |
Weighted average common shares outstanding - basic | 2,037,266 | 2,037,266 |
Effect of the assumed exercise of dilutive stock options | ||
Weighted average common shares outstanding - dilutive | 2,037,266 | 2,037,266 |
Loss per common share: Basic and diluted | $ (0.14) | $ (0.16) |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - Pioneer Natural Resources Company [Member] | Jul. 15, 2016USD ($)aWells |
Extend term of options | 2 years |
leasehold area, net | a | 60 |
leasehold area, gross | a | 200 |
Leasehold payment per acre | $ | $ 1,500 |
Leasehold payment, gross | $ | $ 90,000 |
Overriding royalty interest, percentage | 1.00% |
Number of wells | Wells | 7 |