Blue Dolphin Energy (BDCO) 10-Q 16 Nov 20 2020 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2020	Nov. 16, 2020
Cover [Abstract]
Entity Registrant Name	BLUE DOLPHIN ENERGY CO
Entity Central Index Key	0000793306
Document Type	10-Q
Document Period End Date	Sep. 30, 2020
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Entity Interactive Data Current	Yes
Entity Incorporation State Country Code	DE
Entity File Number	0-15905
Entity Common Stock, Shares Outstanding		12,693,514
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2020

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
CURRENT ASSETS
Cash and cash equivalents	$ 275	$ 72
Restricted cash	49	49
Accounts receivable, net	203	446
Accounts receivable, related party	0	1,364
Prepaid expenses and other current assets	1,617	2,276
Deposits	124	158
Inventory	862	1,645
Refundable federal income tax	100	65
Total current assets	3,230	6,075
LONG-TERM ASSETS
Total property and equipment, net	63,139	63,893
Operating lease right-of-use assets, net	538	649
Restricted cash, noncurrent	514	547
Surety bonds	230	230
Deferred tax assets, net	0	50
Total long-term assets	64,421	65,369
Total assets	67,651	71,444
CURRENT LIABILITIES
Long-term debt less unamortized debt issue costs, current portion (in default)	33,644	33,836
Line of credit payable less unamortized debt issue costs (in default)	9,621	11,464
Long-term debt, related party, current portion (in default)	12,173	6,001
Interest payable (in default)	5,615	3,814
Interest payable, related party (in default)	2,654	2,174
Accounts payable	3,240	1,877
Accounts payable, related party	155	149
Current portion of lease liabilities	251	251
Asset retirement obligations, current portion	2,386	2,565
Accrued expenses and other current liabilities	4,119	3,333
Total current liabilities	73,858	65,464
LONG-TERM LIABILITIES
Long-term operating leases, net of current	421	564
Deferred revenue	1,635	1,930
Long-term debt, net of current portion	300	0
Total long-term liabilities	2,356	2,494
Total liabilities	76,214	67,958
Commitments and contingencies (Note 16)
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock ($0.01 par value, 20,000,000 shares authorized; 12,693,514 and 12,327,365 shares issued at September 30, 2020 and December 31, 2019, respectively)	127	123
Additional paid-in capital	38,457	38,275
Accumulated deficit	(47,147)	(34,912)
Total stockholders' equity (deficit)	(8,563)	3,486
Total liabilities and stockholders' equity (deficit)	$ 67,651	$ 71,444

Consolidated Balance Sheets (_2

Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Sep. 30, 2020	Dec. 31, 2019
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	20,000,000	20,000,000
Common stock, shares issued	12,693,514	12,327,365

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
REVENUE FROM OPERATIONS
Refinery operations	$ 41,929	$ 77,537	$ 120,185	$ 222,652
Tolling and terminaling	1,001	1,096	3,214	3,253
Total revenue from operations	42,930	78,633	123,399	225,905
COST OF GOODS SOLD
Crude oil, fuel use, and chemicals	41,789	74,163	118,292	213,714
Other conversion costs	2,611	2,066	7,872	6,587
Total cost of goods sold	44,400	76,229	126,164	220,301
Gross profit (deficit)	(1,470)	2,404	(2,765)	5,604
COST OF OPERATIONS
LEH operating fee	169	144	506	477
Other operating expenses	58	52	164	165
General and administrative expenses	684	655	1,859	1,904
Depletion, depreciation and amortization	690	632	1,992	1,855
Total cost of operations	1,601	1,483	4,521	4,401
Income (loss) from operations	(3,071)	921	(7,286)	1,203
OTHER INCOME (EXPENSE)
Easement, interest and other income	70	1	170	2
Interest and other expense	(1,652)	(1,883)	(5,104)	(4,718)
Gain on extinguishment of debt	0	9,128	0	9,128
Total other income (expense)	(1,582)	7,246	(4,934)	4,412
Income (loss) before income taxes	(4,653)	8,167	(12,220)	5,615
Income tax expense	0	0	(15)	0
Net income (loss)	$ (4,653)	$ 8,167	$ (12,235)	$ 5,615
Income (loss) per common share:
Basic	$ (0.37)	$ 0.74	$ (0.98)	$ 0.51
Diluted	$ (0.37)	$ 0.74	$ (0.98)	$ 0.51
Weighted average number of common shares outstanding:
Basic	12,693,514	10,975,514	12,534,493	10,975,514
Diluted	12,693,514	10,975,514	12,534,493	10,975,514

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
OPERATING ACTIVITIES
Net income (loss)	$ (12,235)	$ 5,615
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depletion, depreciation and amortization	1,992	1,855
Deferred income tax	15	0
Amortization of debt issue costs	316	409
Guaranty fees paid in kind	457	471
Related-party interest expense paid in kind	361	189
Deferred revenues and expenses	(295)	0
Gain on extinguishment of debt	0	(9,128)
Gain on issuance of shares	(80)	0
Changes in operating assets and liabilities
Accounts receivable	243	43
Accounts receivable, related party	1,364	(321)
Prepaid expenses and other current assets	659	522
Deposits and other assets	34	32
Inventory	783	(224)
Accrued arbitration award	0	(12,000)
Accounts payable, accrued expenses and other liabilities	4,184	1,689
Accounts payable, related party	6	513
Net cash used in operating activities	(2,196)	(10,335)
INVESTING ACTIVITIES
Capital expenditures	(1,085)	(1,458)
Net cash used in investing activities	(1,085)	(1,458)
FINANCING ACTIVITIES
Proceeds from debt	300	12,402
Payments on debt	(2,351)	(1,312)
Net activity on related-party debt	5,502	218
Net cash provided by financing activities	3,451	11,308
Net change in cash, cash equivalents, and restricted cash	170	(485)
Cash, cash equivalents and restricted cash at beginning of period	668	1,665
Cash, cash equivalents and restricted cash at end of period	838	1,180
Non-cash investing and financing activities:
Financing of capital expenditures via accounts payable and finance leases	0	86
Issuance of shares to extinguish debt	120	0
Conversion of related-party notes to common stock	148	0
Line of credit closing costs included in principal balance	0	398
Interest paid	1,980	2,261
Income taxes paid	$ 0	$ 0

1. Organization

1. Organization	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	Overview Blue Dolphin is an independent downstream energy company operating in the Gulf Coast region of the United States. Our subsidiaries operate a light sweet-crude, 15,000-bpd crude distillation tower with more than 1.2 million bbls of petroleum storage tank capacity in Nixon, Texas. Blue Dolphin was formed in 1986 as a Delaware corporation and is traded on the OTCQX under the ticker symbol “BDCO”. Blue Dolphin has 20.0 million shares of Common Stock and 2.5 million shares of Preferred Stock authorized. There are approximately 12.7 million shares of Common Stock and no shares of Preferred Stock issued and outstanding. Our assets are primarily organized in two segments: refinery operations (owned by LE) and tolling and terminaling services (owned by LRM and NPS). Subsidiaries that are reflected in corporate and other include BDPL (inactive pipeline and facilities assets), BDPC (inactive leasehold interests in oil and gas wells), and BDSC (administrative services). See “Note (4)” to our consolidated financial statements for more information about our business segments. Unless the context otherwise requires, references in this report to “we,” “us,” “our,” or “ours,” refer to Blue Dolphin, one or more of its consolidated subsidiaries or all of them taken as a whole. Affiliates Affiliates control approximately 82% of the voting power of our Common Stock. An Affiliate operates and manages all Blue Dolphin properties and has historically funded working capital requirements during periods of working capital deficits, and an Affiliate is a significant customer of our refined products. Blue Dolphin and certain of its subsidiaries are currently parties to a variety of agreements with Affiliates. See “Note (3)” to our consolidated financial statements for additional disclosures related to Affiliate agreements and arrangements and working capital deficits. Going Concern Management has determined that certain factors raise substantial doubt about our ability to continue as a going concern. These factors include the following: Defaults Under Secured Loan Agreements with Third Parties Veritex Loan Agreements In April 2020, LE and LRM were each granted a two-month deferment period on their respective Veritex loans commencing from April 22, 2020 to June 22, 2020. During the deferment period, LE and LRM were not obligated to make payments and interest continued to accrue at the stated rates of the loans. Upon expiration of the deferment period: (i) Veritex re-amortized the loan such that future payments on principal and interest were adjusted based on the remaining principal balances and loan terms, and (ii) all other terms of the loans reverted to the original terms, and previous defaults were reinstated. The deferment did not address LE’s requirement to replenish the payment reserve account. Principal and interest payments resumed on July 22, 2020. As of the filing date of this report, we are current on required monthly payments under our secured loan agreements with Veritex, but other defaults are ongoing as noted below. At September 30, 2020, LE and LRM were in violation of the debt service coverage ratio, current ratio, and debt to net worth ratio financial covenants under our secured loan agreements with Veritex. As a result, the debt associated with these loans was classified within current portion of long-term debt on our consolidated balance sheets at September 30, 2020 and December 31, 2019. We can provide no assurance that: (i) our assets or cash flow will be sufficient to fully repay borrowings under our secured loan agreements with Veritex, either upon maturity or if accelerated, (ii) LE and LRM will be able to refinance or restructure the payments of the debt, and/or (iii) Veritex, as first lien holder, will provide future default waivers. Defaults under our secured loan agreements with Veritex permit Veritex to declare the amounts owed under these loan agreements immediately due and payable, exercise its rights with respect to collateral securing obligors’ obligations under these loan agreements, and/or exercise any other rights and remedies available. Any exercise by Veritex of its rights and remedies under our secured loan agreements would have a material adverse effect on our business operations, including crude oil and condensate procurement and our customer relationships; financial condition; and results of operations. Further, the trading price of our common stock and the value of an investment in our common stock could significantly decrease, which could lead to holders of our common stock losing their investment in our common stock in its entirety. Amended Pilot Line of Credit Pursuant to a June 1, 2020 letter, Pilot notified the borrower and guarantors of its intent to apply Pilot’s payment obligations to us under each of (a) the Terminal Services Agreement (covering Tank Nos. 67, 71, 72, 73, 77, and 78), dated as of May, 2019, between borrower and Pilot, and (b) the Terminal Services Agreement (covering Tank No. 56), dated as of June 1, 2019, between the borrower and Pilot, against our payment obligations to Pilot under the Amended Pilot Line of Credit. Such setoff amounts only partially satisfy the Obligations, and Pilot expressly retained and reserved all its rights and remedies available to it at any time, including, without limitation, the right to exercise all rights and remedies available to Pilot under the Amended Pilot Line of Credit or applicable law or equity. For the three and nine-month periods ended September 30, 2020, the setoff amounts totaled $0.6 million and $0.8 million, respectively. The borrower and guarantors continue in active dialogue with Pilot to reach a negotiated settlement, and we believe that Pilot hopes to continue to work with the borrower to settle the Obligations. The borrower and guarantors are also working on the possible refinance of amounts owing and payable under the Amended Pilot Line of Credit. However, progress with potential lenders has been slow due to the ongoing COVID-19 pandemic. Our ability to repay, refinance, replace or otherwise extend this credit facility is dependent on, among other things, business conditions, our financial performance, and the general condition of the financial markets. Given the current financial markets, we could be forced to undertake alternate financings, including a sale of additional common stock, negotiate for an extension of the maturity, or sell assets and delay capital expenditures in order to generate proceeds that could be used to repay such indebtedness. We can provide no assurance that we will be able to consummate any such transaction on terms that are commercially reasonable, on terms acceptable to us or at all. In the event we are unsuccessful in such endeavors, we may be unable to pay the amounts outstanding under the Amended Pilot Line of Credit, which may require us to seek protection under bankruptcy laws. In such a case, the trading price of our common stock and the value of an investment in our common stock could significantly decrease, which could lead to holders of our common stock losing their investment in our common stock in its entirety. Notre Dame Debt See “Note (10)” and “Note (11)” to our consolidated financial statements for additional information related to defaults under our secured loan agreements with Veritex, Pilot, and the Notre Dame Debt and their potential effects on our business, financial condition, and results of operations. Margin Deterioration and Volatility Throughout 2020, energy supply and demand patterns have been adversely affected by reduced economic activity related to the COVID-19 pandemic. In some countries, including the U.S., recent increases in COVID-19 cases have renewed fears of a second wave of COVID-19. As a result, some countries have reinstated government-imposed restrictions, although to a much lesser extent than in March and April 2020, in order to stem the spread of the virus. Heightened levels of uncertainty have renewed downward pressure on crude oil and other commodity prices, and supply and demand are expected to remain volatile into 2021. Accordingly, we can provide no assurances that these events will not have a material adverse effect on our financial position or results of operations. Net Losses and Working Capital Deficits Net Losses Net loss for the nine months ended September 30, 2020 was $12.2 million, or a loss of $0.98 per share, compared to net income of $5.6 million, or income of $0.51 per share, for the nine months ended September 30, 2019. The significant increase in net loss was the result of less favorable margins per bbl and lower sales volume during the nine-month period ended September 30, 2020 compared to the same period a year earlier. Net income in 2019 included a $9.1 million gain on the extinguishment of debt related to the GEL Settlement. Working Capital Deficits Operating Risks Successful execution of our business strategy depends on several key factors, including having adequate working capital to meet operational needs and regulatory requirements, maintaining safe and reliable operations at the Nixon facility, meeting contractual obligations, and having favorable margins on refined products. As discussed under “Note (1) – Going Concern” above and throughout this report, we are currently unable to estimate the impact the ongoing COVID-19 pandemic will have on our future financial position and results of operations. Under earlier state and federal mandates that regulated business closures, our business was deemed as an essential and, as such, has remained open. As U.S. federal, state, and local officials contemplate renewed restrictive mandates due to resurging coronavirus cases, we expect to continue operating. However, such mandates, while necessary to address the virus, will result in further business and operational disruptions, including demand destruction, liquidity strains, supply chain challenges, travel restrictions, controls on in-person gathering, and workforce availability. Management believes that it has taken all prudent steps to mitigate risk, avoid business disruptions, manage cash flow, and remain competitive in a low oil price environment. Steps include managing cash flow by optimizing receivables and payables by prioritizing payments, managing inventory to avoid buildup, monitoring discretionary spending, and delaying capital expenditures. However, there can be no assurance that our business strategy will be successful, that Affiliates will continue to fund our working capital needs when we experience working capital deficits, that we will meet regulatory requirements to provide additional financial assurance (supplemental pipeline bonds) and decommission offshore pipelines and platform assets, that we will be able to obtain additional financing on commercially reasonable terms or at all, or that margins on our refined products will be favorable. Further, if Veritex and/or Pilot exercise their rights and remedies under our secured loan agreements, our business, financial condition, and results of operations will be materially adversely affected.

2. Principles of Consolidation

2. Principles of Consolidation and Significant Accounting Policies	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Principles of Consolidation and Significant Accounting Policies	Basis of Presentation The accompanying unaudited consolidated financial statements, which include Blue Dolphin and its subsidiaries, have been prepared in accordance with GAAP for interim consolidated financial information pursuant to the rules and regulations of the SEC under Article 10 of Regulation S-X and the instructions to Form 10-Q. Accordingly, certain information and footnote disclosures normally included in our audited financial statements have been condensed or omitted pursuant to the SEC’s rules and regulations. Significant intercompany transactions have been eliminated in the consolidation. In management’s opinion, all adjustments considered necessary for a fair presentation have been included, disclosures are adequate, and the presented information is not misleading. The consolidated balance sheet as of December 31, 2019 was derived from the audited financial statements at that date. The accompanying consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2019 as filed with the SEC. Operating results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020, or for any other period. As discussed further below within this “Note (2) – Significant Accounting Policies – Use of Estimates,” the ongoing COVID-19 pandemic has resulted in significant economic disruption globally. This disruption became more acute in the latter half of March 2020; therefore, our operating results for the three and nine months ended September 30, 2020 do not fully reflect the impact this disruption has had, and will likely continue to have, on us. Significant Accounting Policies The summary of significant accounting policies of Blue Dolphin is presented to assist in understanding our consolidated financial statements. Our consolidated financial statements and accompanying notes are representations of management, who is responsible for their integrity and objectivity. These accounting policies conform to GAAP and have been consistently applied in the preparation of our consolidated financial statements. Use of Estimates The nature of our business requires that we make estimates and assumptions in accordance with U.S. GAAP. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. The ongoing COVID-19 pandemic has impacted these estimates and assumptions and will continue to do so. We assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to us and the unknown future impacts of COVID-19 as of September 30, 2020 and through the filing date of this report. The accounting matters assessed included, but were not limited to, our allowance for doubtful accounts, inventory and related reserves, and the carrying value of long-lived assets. Cash and Cash Equivalents Restricted Cash Accounts Receivable and Allowance for Doubtful Accounts Inventory Property and Equipment Refinery and Facilities Pipelines and Facilities Oil and Gas Properties CIP Leases. We recognize ROU assets and lease liabilities for leasing arrangements with terms greater than one year. We account for lease and non-lease components in a contract as a single lease component for all classes of underlying assets. We allocate the consideration in these contracts based on pricing information contained in the lease. Expense for an operating lease is recognized as a single lease cost on a straight-line basis over the lease term and is reflected in the appropriate income statement line item based on the leased asset’s function. Amortization expense of a finance lease ROU asset is recognized on a straight-line basis over the lesser of the useful life of the leased asset or the lease term. However, if the lease transfers ownership of the finance lease ROU asset to us at the end of the lease term, the finance lease ROU asset is amortized over the useful life of the leased asset. Amortization expense is reflected in ‘depreciation and amortization expense.’ Interest expense is incurred based on the carrying value of the lease liability and is reflected in ‘interest and other expense.’ Revenue Recognition Refinery Operations Revenue We consider a variety of facts and circumstances in assessing the point of control transfer, including but not limited to: whether the purchaser can direct the use of the refined product, the transfer of significant risks and rewards, our rights to payment, and transfer of legal title. In each case, the term between the sale and when payment is due is not significant. Transportation, shipping, and handling costs incurred are included in cost of goods sold. Excise and other taxes that are collected from customers and remitted to governmental authorities are not included in revenue. Tolling and Terminaling Revenue We typically satisfy performance obligations for tolling and terminaling operations with the passage of time. We determine the transaction price at agreement inception based on the guaranteed minimum amount of revenue over the term of the agreement. We allocate the transaction price to the single performance obligation that exists under the agreement, and we recognize revenue in the amount for which we have a right to invoice. Generally, payment terms do not exceed 30 days. Revenue from tank storage customers may, from time to time, include fees for ancillary services, such as in-tank and tank-to-tank blending. These services are considered optional to the customer, and the price we charge for such services is not included in the fixed cost under the customer’s tank storage agreement. Ancillary services are considered a separate performance obligation by us under the tank storage agreement. The performance obligation is satisfied when the requested service has been performed in the applicable period. Deferred Revenue Income Taxes Significant judgment is required in evaluating uncertain tax positions and determining its provision for income taxes. As of each reporting date, we consider new evidence, both positive and negative, to determine the realizability of deferred tax assets. We consider whether it is more likely than not that a portion or all the deferred tax assets will be realized, which is dependent upon the generation of future taxable income prior to the expiration of any NOL carryforwards. When we determine that it is more likely than not that a tax benefit will not be realized, a valuation allowance is recorded to reduce deferred tax assets. A significant piece of objective negative evidence evaluated was cumulative losses incurred over the three-year period ended September 30, 2020. Such objective evidence limits the ability to consider other subjective evidence, such as projections for future growth. Based on this evaluation, we recorded a valuation allowance against the deferred tax assets for which realization was not deemed more likely than not as of September 30, 2020 and December 31, 2019. We expect to recover deferred tax assets related to AMT credit carryforwards. In addition, we have NOL carryforwards that remain available for future use. The benefit of an uncertain tax position is recognized in the financial statements if it meets a minimum recognition threshold. A determination is first made as to whether it is more likely than not that the income tax position will be sustained, based upon technical merits, upon examination by the taxing authorities. If the income tax position is expected to meet the more-likely-than-not criteria, the benefit recorded in the financial statements equals the largest amount that is greater than 50% likely to be realized upon its ultimate settlement. At September 30, 2020 and December 31, 2019, there were no uncertain tax positions for which a reserve or liability was necessary. See “Note (14)” to our consolidated financial statements for more information related to income taxes. Impairment or Disposal of Long-Lived Assets Asset Retirement Obligations We have concluded that there is no legal or contractual obligation to dismantle or remove the refinery and facilities assets. Further, we believe that these assets have indeterminate lives because dates or ranges of dates upon which we would retire these assets cannot reasonably be estimated at this time. When a legal or contractual obligation to dismantle or remove the refinery and facilities assets arises and a date or range of dates can reasonably be estimated for the retirement of these assets, we will estimate the cost of performing the retirement activities and record a liability for the fair value of that cost using present value techniques. We recorded an ARO liability related to future asset retirement costs associated with dismantling, relocating, or disposing of our offshore platform, pipeline systems, and related onshore facilities, as well as for plugging and abandoning wells and restoring land and sea-beds. Cost estimates for each of our assets were developed based upon regulatory requirements, structural makeup, water depth, reservoir characteristics, reservoir depth, equipment demand, current retirement procedures, and construction and engineering consultations. Estimating future costs are difficult and require management to make judgments that are subject to future revisions based upon numerous factors, including changing technology, political, and regulatory environments. We review our assumptions and estimates of future abandonment costs on an annual basis. See “Note (12)” to our consolidated financial statements for additional information related to AROs. Computation of Earnings Per Share New Pronouncements Adopted Income Taxes. Consolidation Codification Updates to SEC Sections New Pronouncements Issued, Not Yet Effective . Codification Improvements. Other new pronouncements issued but not yet effective are not expected to have a material impact on our financial position, results of operations, or liquidity.

3. Related-Party Transactions

3. Related-Party Transactions	9 Months Ended
	Sep. 30, 2020
Related Party Transactions [Abstract]
Related-Party Transactions	Affiliate Operational Agreements Summary Blue Dolphin and certain of its subsidiaries are party to several operational agreements with Affiliates. Management believes that these related-party transactions were consummated on terms equivalent to those that prevail in arm's-length transactions. Related-party agreements related to Blue Dolphin’s operations consist of the following: Agreement/Transaction Parties Effective Date Key Terms Refinery Equipment Purchase LTRI - LE 07/01/2019 LE purchase of two (2) refurbished heat exchangers for $0.08 million each Dock Tolling Agreement LMT - LE 05/24/2016 5-year term cancellable by either party any time; LE paid flat reservation fee for tolling volumes up to 84,000 gallons per day; excess tolling volumes subject to increased per gallon rate; terminated 07/01/2019 Jet Fuel Sales Agreement LEH - LE 04/01/2020 1-year term expiring earliest to occur of 03/31/2021 plus 30-day carryover or delivery of maximum jet fuel quantity; LEH bids on jet fuel contracts under preferential pricing terms due to a HUBZone certification Office Sub-Lease Agreement LEH - BDSC 01/01/2018 68-month term expiring 08/31/2023; office lease Houston, Texas; includes 6-month rent abatement period; rent approximately $0.02 million per month Amended and Restated Operating Agreement LEH – Blue Dolphin, LE, LRM, NPS, BDPL, BDPC and BDSC 04/01/2020 3-year term; expires 04/01/2023 or notice by either party at any time of material breach or 90 days Board notice; LEH receives management fee of 5% of all consolidated operating costs, excluding crude costs, depreciation, amortization and interest, of Blue Dolphin, LE, LRM, NPS, BDPL, BDPC and BDSC Working Capital We have historically depended on Affiliates for financing when revenue from operations and borrowings under bank facilities are insufficient to meet our liquidity and working capital needs. Such borrowings are reflected in our consolidated balance sheets in accounts payable, related party, and/or long-term debt, related party. Related-Party Long-Term Debt Loan Description Parties Maturity Date Interest Rate Loan Purpose March Carroll Note (in default) Jonathan Carroll – Blue Dolphin Jan 2019 8.00% Blue Dolphin working capital; reflects amounts owed to Jonathan Carroll under the guaranty fee agreements March Ingleside Note (in default) Ingleside – Blue Dolphin Jan 2019 8.00% Blue Dolphin working capital June LEH Note (in default) LEH – Blue Dolphin Jan 2019 8.00% Blue Dolphin working capital; reflects amounts owed to LEH under the Amended and Restated Operating Agreement BDPL-LEH Loan Agreement (in default) LEH - BDPL Aug 2018 16.00% Blue Dolphin working capital Amended and Restated Guaranty Fee Agreement(2) Jonathan Carroll - LE -- 2.00% Tied to payoff of LE $25 million Veritex loan Amended and Restated Guaranty Fee Agreement(2) Jonathan Carroll - LRM -- 2.00% Tied to payoff of LRM $10 million Veritex loan (1) The original principal amount of the BDPL-LEH Loan Agreement was $4.0 million. (2) As a condition for our secured loan agreements with Veritex, Jonathan Carroll was required to personally guarantee repayment of borrowed funds and accrued interest. Under the guaranty fee agreements, Mr. Carroll is entitled to receive guaranty fees. The fees are payable 50% in cash and 50% in Common Stock. The Common Stock portion is paid quarterly. For the foreseeable future, management does not intend to pay Mr. Carroll the cash portion due to Blue Dolphin’s working capital deficits. The cash portion will continue to accrue and be added to the outstanding principal balance owed to Mr. Carroll under the March Carroll Note. Guarantees and Security Loan Description Guarantees Security BDPL-LEH Loan Agreement --- ● Covenants The BDPL-LEH Loan Agreement contains representations and warranties, affirmative and negative covenants, and events of default that we consider usual and customary for a credit facility of this type. There are no covenants associated with the March Carroll Note, March Ingleside Note, or June LEH Note. Defaults Loan Description Event(s) of Default Covenant Violations March Carroll Note (in default) Failure of borrower to pay past due obligations; loan matured January 2019 -- March Ingleside Note (in default) Failure of borrower to pay past due obligations; loan matured January 2019 --- June LEH Note (in default) Failure of borrower to pay past due obligations; loan matured January 2019 --- BDPL-LEH Loan Agreement (in default) Failure of borrower to pay past due obligations; loan matured August 2018 --- Related-Party Financial Impact Consolidated Balance Sheets Accounts receivable, related party Accounts payable, related party Long-term debt, related party, current portion (in default) and accrued interest payable, related party. September 30, December 31, 2020 2019 (in thousands) LEH June LEH Note (in default) $ 5,733 $ - BDPL-LEH Loan Agreement 6,654 6,174 LEH Total 12,387 6,174 Ingleside March Ingleside Note (in default) 1,067 1,004 Jonathan Carroll March Carroll Note (in default) 1,373 997 14,827 8,175 Less: Long-term debt, related party, current portion, in default (12,173 ) (6,001 ) Less: Accrued interest payable, related party (in default) (2,654 ) (2,174 ) $ - $ - Consolidated Statements of Operations Total revenue from operations. Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands, except percent amounts) Refinery operations LEH $ 11,942 27.8 % $ 25,034 31.8 % $ 34,244 27.8 % $ 70,016 31.0 % Third-Parties 29,987 69.9 % 52,503 66.8 % 85,941 69.6 % 152,636 67.6 % Tolling and terminaling Third-Parties 1,001 2.3 % 1,096 1.4 % 3,214 2.6 % 3,253 1.4 % $ 42,930 100.0 % $ 78,633 100.0 % $ 123,399 100.0 % $ 225,905 100.0 % Interest expense. Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands) Jonathan Carroll Guaranty Fee Agreements First Term Loan Due 2034 $ 108 $ 110 $ 324 $ 333 Second Term Loan Due 2034 45 46 134 138 March Carroll Note (in default) 23 33 66 86 LEH BDPL-LEH Loan Agreement (in default) 160 160 480 480 June LEH Note (in default) 102 17 245 40 Ingleside March Ingleside Note (in default) 15 12 50 63 $ 453 $ 378 $ 1,299 $ 1,140 Other. Lease payments received under the office sub-lease agreement with LEH totaled approximately $0.01 million for both three-month periods ended September 30, 2020 and 2019. Lease payments received under the office sub-lease agreement with LEH totaled approximately $0.03 million for both nine-month periods ended September 30, 2020 and 2019. The LEH operating fee was flat, totaling approximately $0.2 million for both three-month periods ended September 30, 2020 and 2019. The LEH operating fee was also relatively flat, totaling approximately $0.05 million for both nine-month periods ended September 30, 2020 and 2019.

4. Revenue and Segment Informat

4. Revenue and Segment Information	9 Months Ended
	Sep. 30, 2020
Segment Reporting [Abstract]
Revenue and Segment Information	We have two reportable business segments: (i) refinery operations and (ii) tolling and terminaling. Refinery operations relate to the refining and marketing of petroleum products at our 15,000-bpd crude distillation tower. Tolling and terminaling operations relate to tolling and storage terminaling services under third-party lease agreements. Both operations are conducted at the Nixon facility. Corporate and other includes BDSC, BDPL and BDPC. Revenue from Contracts with Customers Disaggregation of Revenue Receivables from Contracts with Customers Contract Liabilities Remaining Performance Obligations Segment Information Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands) Net revenue (excluding intercompany fees and sales) Refinery operations $ 41,929 $ 77,537 $ 120,185 $ 222,652 Tolling and terminaling 1,001 1,096 3,214 3,253 Total net revenue 42,930 78,633 123,399 225,905 Intercompany fees and sales Refinery operations (595 ) (668 ) (1,618 ) (1,927 ) Tolling and terminaling 595 668 1,618 1,927 Total intercompany fees - - - - Operation costs and expenses(1) Refinery operations (43,691 ) (76,088 ) (124,942 ) (219,766 ) Tolling and terminaling (709 ) (285 ) (1,222 ) (1,012 ) Corporate and other (58 ) (52 ) (164 ) (165 ) Total operation costs and expenses (44,458 ) (76,425 ) (126,328 ) (220,943 ) Segment contribution margin (deficit) Refinery operations (2,357 ) 781 (6,375 ) 959 Tolling and terminaling 887 1,479 3,610 4,168 Corporate and other (58 ) (52 ) (164 ) (165 ) Total segment contribution margin (deficit) (1,528 ) 2,208 (2,929 ) 4,962 General and administrative expenses(2) Refinery operations (414 ) (292 ) (1,045 ) (898 ) Tolling and terminaling (132 ) (68 ) (268 ) (173 ) Corporate and other (307 ) (295 ) (1,052 ) (833 ) Total general and administrative expenses (853 ) (655 ) (2,365 ) (1,904 ) Depreciation and amortization Refinery operations (301 ) (481 ) (883 ) (1,429 ) Tolling and terminaling (338 ) (99 ) (956 ) (297 ) Corporate and other (51 ) (52 ) (153 ) (129 ) Total depreciation and amortization (690 ) (632 ) (1,992 ) (1,855 ) Interest and other non-operating expenses, net Refinery operations (679 ) 8,329 (2,171 ) 6,723 Tolling and terminaling (599 ) (824 ) (1,985 ) (1,599 ) Corporate and other (304 ) (259 ) (778 ) (712 ) Total interest and other non-operating expenses, net (1,582 ) 7,246 (4,934 ) 4,412 Income (loss) before income taxes Refinery operations (3,751 ) 8,337 (10,474 ) 5,355 Tolling and terminaling (182 ) 488 401 2,099 Corporate and other (720 ) (658 ) (2,147 ) (1,839 ) Total income (loss) before income taxes (4,653 ) 8,167 (12,220 ) 5,615 Income tax expense - - (15 ) - Net income (loss) $ (4,653 ) $ 8,167 $ (12,235 ) $ 5,615 (1) Operation costs include cost of goods sold. Also, operation costs within: (a) tolling and terminaling includes terminal operating expenses and an allocation of other costs (e.g. insurance and maintenance) and (b) corporate and other includes expenses related to BDSC, BDPC and BDPL. (2) General and administrative expenses within refinery operations include the LEH operating fee. Nine Months Ended September 30, 2020 2019 (in thousands) Capital expenditures Refinery operations $ 295 $ 1,375 Tolling and terminaling 790 83 Corporate and other - - Total capital expenditures $ 1,085 $ 1,458 September 30, December 31, 2020 2019 (in thousands) Identifiable assets Refinery operations $ 47,619 $ 51,317 Tolling and terminaling 18,815 18,401 Corporate and other 1,667 1,726 Total identifiable assets $ 67,651 $ 71,444

5. Concentration of Risk

5. Concentration of Risk	9 Months Ended
	Sep. 30, 2020
Risks and Uncertainties [Abstract]
Concentration of Risk	Bank Accounts Financial instruments that potentially subject us to concentrations of risk consist primarily of cash, trade receivables and payables. We maintain cash balances at financial institutions in Houston, Texas. The FDIC insures certain financial products up to a maximum of $250,000 per depositor. At both September 30, 2020 and December 31, 2019, we had cash balances (including restricted cash) that exceeded the FDIC insurance limit per depositor of approximately $0.3 million. Key Supplier Operation of the Nixon refinery depends on our ability to purchase adequate amounts of crude oil and condensate. We have a long-term crude supply agreement in place with Pilot. Under the initial term of the crude supply agreement, Pilot will sell us approximately 24.8 million net bbls of crude oil. Thereafter, the crude supply agreement will continue on a one-year evergreen basis. Effective March 1, 2020, Pilot assigned its rights, title, interest, and obligations in the crude supply agreement to Tartan Oil LLC, a Pilot affiliate. Either party may terminate the crude supply agreement by providing the other party 60 days prior written notice. Pilot also stores crude oil at the Nixon facility under two terminal services agreements. Under the terminal services agreements, Pilot stores crude oil at the Nixon facility at a specified rate per bbl of the storage tank’s shell capacity. Although the initial term of the terminal services agreement expired April 30, 2020, the agreement renewed on a one-year evergreen basis. Either party may terminate the terminal services agreement by providing the other party 60 days prior written notice. However, the terminal services agreement will automatically terminate upon expiration or termination of the crude supply agreement. Beginning on June 1, 2020, Pilot began applying payment obligations owed to us under the two terminal services agreements against our payment obligations owed to Pilot under the Amended Pilot Line of Credit. For the three and nine-month periods ended September 30, 2020, the setoff amounts totaled $0.6 million and $0.8 million, respectively. See “Note (1) Organization – Going Concern” to our consolidated financial statements for additional disclosures related to defaults in our debt obligations. Our financial health could be materially and adversely affected by defaults in our secured loan agreements, margin deterioration and volatility, historic net losses and working capital deficits, as well as termination of the crude supply agreement or terminal services agreement with Pilot, which could impact our ability to acquire crude oil and condensate. In addition, sustained periods of low crude oil prices due to market volatility associated with the COVID-19 pandemic has resulted in significant financial constraints on producers, which in turn has resulted in long term crude oil supply constraints and increased transportation costs. A failure to acquire crude oil and condensate when needed will have a material effect on our business results and operations. During the three- and nine-month periods ended September 30, 2020, our refinery experienced downtime as a result of lack of crude due to cash constraints. Significant Customers We routinely assess the financial strength of our customers and have not experienced significant write-downs in accounts receivable balances. We believe that our accounts receivable credit risk exposure is limited. Number Significant Customers % Total Revenue from Operations Portion of Accounts Receivable at Date Indicated Three Months Ended September 30, 2020 4 80% $0 September 30, 2019 4 97% $0.6 million Nine Months Ended September 30, 2020 4 82% $0 September 30, 2019 4 97% $0.6 million One of our significant customers is an Affiliate. The Affiliate, LEH, purchases our jet fuel under a Jet Fuel Sales Agreement and bids on jet fuel contracts under preferential pricing terms due to a HUBZone certification. LEH accounted for nearly 28% and 32% of our total revenue from operations for the three months ended September 30, 2020 and 2019, respectively. LEH accounted for nearly 28% and 31% of our total revenue from operations for the nine months ended September 30, 2020 and 2019, respectively. LEH represented $0 in accounts receivable at September 30, 2020. LEH represented $0.3 million in accounts receivable at September 30, 2019. Amounts outstanding relating to the Jet Fuel Sales Agreement can significantly vary period to period based on the timing of the related sales and payments received. The amounts are settled under normal business terms. The total amount owed to LEH under the June LEH Note and the BDPL-LEH Loan Agreement totaled $12.4 million and $6.2 million at September 30, 2020 and December 31, 2019, respectively. See “Note (3)” and “Note (16)” to our consolidated financial statements for additional disclosures related to transactions with Affiliates. Concentration of Customers Refined Product Sales Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands, except percent amounts) LPG mix $ - 0.0 % $ 8 0 % $ - 0.0 % $ 17 0 % Naphtha 7,847 18.7 % 14,147 18.2 % 22,523 18.7 % 43,358 19.5 % Jet fuel 11,942 28.5 % 25,035 32.3 % 34,244 28.5 % 70,017 31.4 % HOBM 12,196 29.1 % 17,044 22.0 % 31,077 25.9 % 49,951 22.5 % AGO 9,944 23.7 % 21,303 27.5 % 32,341 26.9 % 59,309 26.6 % $ 41,929 100.0 % $ 77,537 100.0 % $ 120,185 100.0 % $ 222,652 100.0 % An Affiliate, LEH, purchases all of our jet fuel. See “Note (3)” and “Note (16)” to our consolidated financial statements for additional disclosures related to Affiliate transactions.

6. Prepaid Expenses and Other C

6. Prepaid Expenses and Other Current Assets	9 Months Ended
	Sep. 30, 2020
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid Expenses and Other Current Assets	Prepaid expenses and other current assets as of the dates indicated consisted of the following: September 30, December 31, 2020 2019 (in thousands) Prepaid insurance $ 1,099 $ 417 Prepaid crude oil and condensate 374 1,651 Prepaid easement renewal fees 104 121 Other prepaids 40 87 $ 1,617 $ 2,276

7. Inventory

7. Inventory	9 Months Ended
	Sep. 30, 2020
Inventory Disclosure [Abstract]
Inventory	Inventory as of the dates indicated consisted of the following: September 30, December 31, 2020 2019 (in thousands) Crude oil and condensate $ 493 $ 959 Chemicals 143 120 AGO 118 440 Naphtha 88 95 Propane 13 26 LPG mix 7 5 $ 862 $ 1,645 Due to fluctuating commodity prices, we recorded a net realizable value adjustment to inventory of approximately $0.3 million and $0.3 million at September 30, 2020 and December 31, 2019, respectively.

8. Property, Plant and Equipmen

8. Property, Plant and Equipment, Net	9 Months Ended
	Sep. 30, 2020
Property, Plant and Equipment [Abstract]
Property, Plant and Equipment, Net	Property, plant and equipment, net, as of the dates indicated consisted of the following: September 30, December 31, 2020 2019 (in thousands) Refinery and facilities $ 71,855 $ 66,317 Land 566 566 Other property and equipment 903 833 73,324 67,716 Less: Accumulated depletion, depreciation, and amortization (14,577 ) (12,739 ) 58,747 54,977 CIP 4,392 8,916 $ 63,139 $ 63,893 We capitalize interest cost incurred on funds used to construct property, plant, and equipment. Capitalized interest is recorded as part of the asset it relates to and is depreciated over the asset’s useful life. Capitalized interest cost, which is included in CIP, was $0 and $0.7 million at September 30, 2020 and December 31, 2019. Capital expenditures for expansion at the Nixon facility were funded by long-term debt from Veritex, revenue from operations, and working capital from Affiliates. At September 30, 2020, unused amounts for capital expenditures derived from Veritex loans were reflected in restricted cash (current and non-current portions) on our consolidated balance sheets. See “Note (10)” to our consolidated financial statements for additional disclosures related to working capital deficits and borrowings for capital spending.

9. Accrued Expenses and Other C

9. Accrued Expenses and Other Current Liabilities	9 Months Ended
	Sep. 30, 2020
Other Liabilities, Current [Abstract]
Accrued Expenses and Other Current Liabilities	Accrued expenses and other current liabilities as of the dates indicated consisted of the following: September 30, December 31, 2020 2019 (in thousands) Unearned revenue from contracts with customers $ 2,441 $ 1,990 Insurance 525 159 Unearned contract renewal income 500 500 Property, fuel and other taxes 389 183 Other payable 186 228 Board of director fees payable 68 263 Customer deposits 10 10 $ 4,119 $ 3,333

10. Third-Party Long-Term Debt

10. Third-Party Long-Term Debt	9 Months Ended
	Sep. 30, 2020
Debt Disclosure [Abstract]
Third-Party Long-Term Debt	Loan Agreements Summary Loan Description Parties Original Principal Amount (in millions) Maturity Date Monthly Principal and Interest Payment Interest Rate Loan Purpose Veritex Loans(1) LE Term Loan Due 2034 ( in default LE-Veritex $25.0 Jun 2034 $0.2 million WSJ Prime + 2.75% Refinance loan; capital improvements LRM Term Loan Due 2034 in default LRM-Veritex $10.0 Dec 2034 $0.1 million WSJ Prime + 2.75% Refinance bridge loan; capital improvements Notre Dame Debt ( in default LE-Kissick $11.7 Jan 2018 No payments to date; payment rights subordinated 16.00% Working capital; reduced balance of GEL Final Arbitration Award SBA EIDLs LE Term Loan Due 2050(4) LE-SBA $0.15 Aug 2050 $0.0007 million 3.75% Working capital NPS Term Loan Due 2050(4) NPS-SBA $0.15 Aug 2050 $0.0007 million 3.75% Working capital (1) Proceeds were placed in a disbursement account whereby Veritex makes payments for construction related expenses. Amounts held in the disbursement account are reflected on our consolidated balance sheets as restricted cash (current portion) and restricted cash, noncurrent. At September 30, 2020, restricted cash (current portion) was $0.05 million and restricted cash, noncurrent was $0.5 million. At December 31, 2019, restricted cash (current portion) was $0.05 million and restricted cash, noncurrent was $0.6 million. (2) LE originally entered into a loan agreement with Notre Dame Investors, Inc. in the principal amount of $8.0 million. The debt is currently held by John Kissick. Pursuant to a 2017 sixth amendment, the Notre Dame Debt was amended to increase the principal amount by $3.7 million; the additional principal was used to reduce the GEL Final Arbitration Award by $3.6 million. (3) Pursuant to a 2015 subordination agreement, the holder of the Notre Dame Debt agreed to subordinate their right to payments, as well as any security interest and liens on the Nixon facility’s business assets, in favor of Veritex as holder of the LE Term Loan Due 2034. (4) Payments are deferred for the first twelve (12) months of the loan; interest accrues during the deferral period. SBA EIDLs are not forgivable. Outstanding Principal, Debt Issue Costs, and Accrued Interest Third-party long-term debt (outstanding principal and accrued interest), as of the dates indicated was as follows: September 30, December 31, 2020 2019 (in thousands) Veritex Loans LE Term Loan Due 2034 (in default) $ 22,424 $ 21,776 LRM Term Loan Due 2034 (in default) 9,299 9,031 SBA EIDLs LE Term Loan Due 2050 150 - NPS Term Loan Due 2050 150 - Notre Dame Debt (in default) 9,214 8,617 41,237 39,424 Less: Current portion of long-term debt, net (33,644 ) (33,836 ) Less: Unamortized debt issue costs (1,781 ) (1,877 ) Less: Accrued interest payable (in default) (5,512 ) (3,711 ) $ 300 $ - Unamortized debt issue costs associated with the Veritex loans as of the dates indicated consisted of the following: September 30, December 31, 2020 2019 (in thousands) Veritex Loans LE Term Loan Due 2034 (in default) $ 1,674 $ 1,674 LRM Term Loan Due 2034 (in default) 768 768 Less: Accumulated amortization (661 ) (565 ) $ 1,781 $ 1,877 Amortization expense was $0.03 million for both three-month periods ended September 30, 2020 and 2019. Amortization expense was $0.09 million for both nine-month periods ended September 30, 2020 and 2019. Accrued interest related to third-party long-term debt, reflected as accrued interest payable in our consolidated balance sheets, as of the dates indicated consisted of the following: September 30, December 31, 2020 2019 (in thousands) Notre Dame Debt (in default) $ 4,236 $ 3,639 Veritex Loans LE Term Loan Due 2034 (in default) 879 25 LRM Term Loan Due 2034 (in default) 397 47 5,512 3,711 Less: Accrued interest payable (in default) (5,512 ) (3,711 ) Long-term Interest Payable, Net of Current Portion $ - $ - Payment Deferments Veritex Loans SBA EIDLs Guarantees and Security Loan Description Guarantees Security Veritex Loans(1) LE Term Loan Due 2034 ( in default ● ● ● ● ● ● ● ● LRM Term Loan Due 2034 ( in default ● ● ● ● ● ● ● ● Notre Dame Debt ( in default --- ● SBA EIDLs LE Term Loan Due 2050 --- ● NPS Term Loan Due 2050 --- ● (1) As a condition of the LE Term Loan Due 2034 and LRM Term Loan Due 2034, Jonathan Carroll was required to personally guarantee repayment of borrowed funds and accrued interest. (2) Pursuant to a 2015 subordination agreement, the holder of the Notre Dame Debt agreed to subordinate their right to payments, as well as any security interest and liens on the Nixon facility’s business assets, in favor of Veritex as holder of the LE Term Loan Due 2034. The USDA, acting through its agencies, administers a federal rural credit program that makes direct loans and guarantees portions of loans made and serviced by USDA-qualified lenders for various purposes. Each USDA guarantee is a full faith and credit obligation of the U.S. with the USDA guaranteeing up to 100% of the principal amount. The lender for a USDA-guaranteed loan, in our case Veritex, is required by regulations to retain both the guaranteed and unguaranteed portions of the loan, to service the entire underlying loan, and to remain mortgage and/or secured party of record. Both the guaranteed and unguaranteed portions of the loan are to be secured by the same collateral with equal lien priority. The USDA-guaranteed portion of a loan cannot be paid later than, or in any way be subordinated to, the related unguaranteed portion. See “Note (3)” and “Note (16)” to our consolidated financial statements for additional disclosures related to Affiliate agreements and transactions, including long-term debt guarantees. Covenants The Veritex loans and SBA EIDLs contain representations and warranties, affirmative and negative covenants, and events of default that we consider usual and customary for credit facilities of this type. There are no covenants associated with the Notre Dame Debt. Defaults Loan Description Event(s) of Default Covenant Violations Veritex Loans LE Term Loan Due 2034 ( in default GEL Final Arbitration Award and associated material adverse effect conditions; failure to replenish $1.0 million payment reserve account; events of default under other secured loan agreements with Veritex Financial covenants: ● LRM Term Loan Due 2034 ( in default GEL Final Arbitration Award and associated material adverse effect conditions; events of default under other secured loan agreements with Veritex Financial covenants: ● Notre Dame Debt ( in default Failure of borrower to pay past due obligations; loan matured January 2019 --- As reflected in the table above and elsewhere in this report, we are in default under the LE Term Loan Due 2034, LRM Term Loan Due 2034, and the Notre Dame Debt. Defaults under the LE Term Loan Due 2034 and LRM Term Loan Due 2034 permit Veritex to declare the amounts owed under these loan agreements immediately due and payable, exercise its rights with respect to collateral securing obligors’ obligations under these loan agreements, and/or exercise any other rights and remedies available. The debt associated with the LE Term Loan Due 2034, LRM Term Loan Due 2034, and the Notre Dame Debt was classified within the current portion of long-term debt on our consolidated balance sheets at September 30, 2020 and December 31, 2019. Any exercise by Veritex of its rights and remedies under our secured loan agreements would have a material adverse effect on our business operations, including crude oil and condensate procurement and our customer relationships; financial condition; and results of operations. In such a case, the trading price of our common stock and the value of an investment in our common stock could significantly decrease, which could lead to holders of our common stock losing their investment in our common stock in its entirety. We can provide no assurance that: (i) our assets or cash flow will be sufficient to fully repay borrowings under our secured loan agreements with Vertitex, either upon maturity or if accelerated, (ii) LE and LRM will be able to refinance or restructure the payments of the debt, and/or (iii) Veritex, as first lien holder, will provide future default waivers. Defaults under our secured loan agreements and any exercise by Veritex of its rights and remedies related to such defaults may have a material adverse effect on the trading prices of our common stock and on the value of an investment in our common stock, and holders of our common stock could lose their investment in our common stock in its entirety. See “Note (1)” and “Note (11)” to our consolidated financial statements for additional information regarding defaults under our secured loan agreements and their potential effects on our business, financial condition, and results of operations.

11. Line of Credit Payable

11. Line of Credit Payable	9 Months Ended
	Sep. 30, 2020
Line of Credit Facility [Abstract]
Line of Credit Payable	Line of Credit Agreement Summary Line of Credit Description Original Principal Amount (in millions) Maturity Date Monthly Principal and Interest Payment Interest Rate Loan Purpose Amended Pilot Line of Credit in default $13.0 May 2020 ---- 14.00% GEL Settlement Payment, NPS purchase of crude oil from Pilot, and working capital Outstanding Principal, Debt Issue Costs, and Accrued Interest Line of credit payable, which represents outstanding principal and accrued interest, as of the dates indicated was as follows: September 30, December 31, 2020 2019 (in thousands) Amended Pilot Line of Credit (in default) $ 9,724 $ 11,786 Less: Unamortized debt issue costs - (219 ) Less: Interest payable, short-term (103 ) (103 ) $ 9,621 $ 11,464 Guarantees and Security Loan Description Guarantees Security Amended Pilot Line of Credit (in default) ● ● ● ● ● In an Agreement Regarding Attornment of Tank Leases dated April 30, 2019 between Veritex, LE, NPS, and Pilot, Veritex in its capacity as a secured lender of LE and LRM, agreed to permit the continued performance of obligations under a certain tank lease agreement if it were to foreclose on LE property that NPS was leasing from LE so long as certain conditions were met. The effectiveness of the Agreement Regarding Attornment of Tank Leases was subject to certain conditions, including the agreement and concurrence of the USDA that the Agreement Regarding Attornment of Tank Leases does not impair or void the LE Term Loan Due 2034 and LRM Term Loan Due 2034 or any associated guarantees. Veritex used commercially reasonable efforts to obtain such USDA concurrence, however, as of the filing date of this report such USDA concurrence had not been provided. Covenants The Amended Pilot Line of Credit contains customary affirmative and negative covenants and events of default. Defaults Loan Description Event(s) of Default Covenant Violations Amended Pilot Line of Credit ( in default Failure of borrower or any guarantor to pay past due obligations; loan matured May 2020 --- As reflected in the table above and elsewhere in this report, we are in default under the Amended Pilot Line of Credit. On May 4, 2020, Pilot sent NPS, as borrower, and LRM, LEH, LE and Blue Dolphin, each a guarantor and collectively guarantors, a notice demanding the immediate payment of the unpaid principal amount and all interest accrued and unpaid, and all other amounts owing or payable (the “Obligations”) under the Amended Pilot Line of Credit. Pursuant to the Amended Pilot Line of Credit, commencing on May 4, 2020, the Obligations began to accrue interest at a rate of fourteen percent (14%) per annum. Failure of the borrower or any guarantor to pay the past due Obligations constituted an event of default. Pilot expressly retained and reserved all its rights and remedies available to it at any time, including without limitation, the right to exercise all rights and remedies available to Pilot under the Amended Pilot Line of Credit or applicable law or equity. Any exercise by Pilot of its rights and remedies under the Amended Pilot Line of Credit would have a material adverse effect on our business operations, including crude oil and condensate procurement and our customer relationships; financial condition; and results of operations. Pursuant to a June 1, 2020 letter, Pilot notified the borrower and guarantors of its intent to apply Pilot’s payment obligations to us under each of (a) the Terminal Services Agreement (covering Tank Nos. 67, 71, 72, 73, 77, and 78), dated as of May, 2019, between borrower and Pilot, and (b) the Terminal Services Agreement (covering Tank No. 56), dated as of June 1, 2019, between the borrower and Pilot, against our payment obligations to Pilot under the Amended Pilot Line of Credit. Such setoff amounts only partially satisfy the Obligations, and Pilot expressly retained and reserved all its rights and remedies available to it at any time, including, without limitation, the right to exercise all rights and remedies available to Pilot under the Amended Pilot Line of Credit or applicable law or equity. For the three and nine-month periods ended September 30, 2020, the setoff amounts totaled $0.6 million and $0.8 million, respectively. The borrower and guarantors continue in active dialogue with Pilot to reach a negotiated settlement, and we believe that Pilot hopes to continue to work with the borrower to settle the Obligations. The borrower and guarantors are also working on the possible refinance of amounts owing and payable under the Amended Pilot Line of Credit. However, progress with potential lenders has been slow due to the ongoing COVID-19 pandemic. Our ability to repay, refinance, replace or otherwise extend this credit facility is dependent on, among other things, business conditions, our financial performance, and the general condition of the financial markets. Given the current financial markets, we could be forced to undertake alternate financings, including a sale of additional common stock, negotiate for an extension of the maturity, or sell assets and delay capital expenditures in order to generate proceeds that could be used to repay such indebtedness. We can provide no assurance that we will be able to consummate any such transaction on terms that are commercially reasonable, on terms acceptable to us or at all. In the event we are unsuccessful in such endeavors, we may be unable to pay the amounts outstanding under the Amended Pilot Line of Credit, which may require us to seek protection under bankruptcy laws. In such a case, the trading price of our common stock and the value of an investment in our common stock could significantly decrease, which could lead to holders of our common stock losing their investment in our common stock in its entirety.

12. ARO's

12. ARO's	9 Months Ended
	Sep. 30, 2020
Asset Retirement Obligation Disclosure [Abstract]
ARO's	Refinery and Facilities Management has concluded that there is no legal or contractual obligation to dismantle or remove the refinery and facilities assets. Management believes that the refinery and facilities assets have indeterminate lives under FASB ASC guidance for estimating AROs because dates or ranges of dates upon which we would retire these assets cannot reasonably be estimated at this time. When a legal or contractual obligation to dismantle or remove the refinery and facilities assets arises and a date or range of dates can reasonably be estimated for the retirement of these assets, we will estimate the cost of performing the retirement activities and record a liability for the fair value of that cost using present value techniques. Pipelines and Facilities and Oil and Gas Properties We have AROs associated with the decommissioning of our pipelines and facilities assets, as well as the plugging and abandonment of our oil and gas properties. We recorded a discounted liability for the fair value of an ARO with a corresponding increase to the carrying value of the related long-lived asset at the time the asset was installed or placed in service, and we depreciated the amount added to property and equipment and recognized accretion expense relating to the discounted liability over the remaining life of the asset. At September 30, 2020 and December 31, 2019, the liability was fully accreted. See “Note (16)” to our consolidated financial statements for disclosures related to decommissioning of our offshore pipelines and platform assets and related risks. ARO liability as of the dates indicated was as follows: September 30, December 31, 2020 2019 (in thousands) AROs, at the beginning of the period $ 2,565 $ 2,565 Liabilities settled (179 ) - 2,386 2,565 Less: AROs, current portion (2,386 ) (2,565 ) Long-term AROs, at the end of the period $ - $ - Liabilities settled reflects preparatory costs in the period associated with decommissioning our offshore pipelines and platform assets.

13. Lease Obligations

13. Lease Obligations	9 Months Ended
	Sep. 30, 2020
Leases, Operating [Abstract]
Lease Obligatons	Lease Obligations Operating Lease Office Lease Finance Leases Crane Backhoe Lease Agreement. The following table presents the lease-related assets and liabilities recorded on the consolidated balance sheet: September 30, December 31, Balance Sheet Location 2020 2019 (in thousands) Assets Operating lease ROU assets Operating lease ROU assets $ 787 $ 787 Less: Accumulated amortization on operating lease assets Operating lease ROU assets (249 ) (138 ) 538 649 Finance lease assets Property and equipment, net 86 180 Less: Accumulated amortization on finance lease assets Property and equipment, net (16 ) (34 ) 70 146 Total lease assets 608 795 Liabilities Current Operating lease Current portion of lease liabilities 190 175 Finance leases Current portion of lease liabilities 61 76 251 251 Noncurrent Operating lease Long-term lease liabilities, net of current 421 564 Total lease liabilities $ 672 $ 815 Weighted average remaining lease term in years Operating lease 2.92 Weighted average discount rate Operating lease 8.25 % Finance leases 8.25 % The following table presents information related to lease costs for operating and finance leases: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 (in thousands) Operating lease costs $ 51 $ 51 $ 154 $ 154 Finance lease costs: Depreciation of leased assets 3 4 13 12 Interest on lease liabilities - 2 3 4 Total lease cost $ 54 $ 57 $ 170 $ 170 The table below presents supplemental cash flow information related to leases as follows: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 (in thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating lease $ 44 $ 40 $ 130 $ 81 Operating cash flows for finance leases $ - $ 2 $ 4 $ 4 Financing cash flows for finance leases $ 5 $ 13 $ 17 $ 35 As of September 30, 2020, maturities of lease liabilities for the periods indicated were as follows: September 30, Operating Lease Financing Leases Total (in thousands) 2021 $ 190 $ 61 $ 251 2022 209 - 209 2023 212 - 212 $ 611 $ 61 $ 672 Future minimum annual lease commitments that are non-cancelable: Operating September 30, Lease (in thousands) 2021 $ 232 2022 236 2023 220 $ 688

14. Income Taxes

14. Income Taxes	9 Months Ended
	Sep. 30, 2020
Income Tax Disclosure [Abstract]
Income Taxes	Tax Provision The provision for income tax benefit (expense) for the periods indicated was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Current Federal $ - $ - $ (15 ) $ - State - - - - Deferred Federal 975 (1,833 ) 2,566 (1,190 ) State - - Change in valuation allowance (975 ) 1,833 (2,566 ) 1,190 Total provision for income taxes $ - $ - $ (15 ) $ - The TMT is treated as an income tax for financial reporting purposes. Deferred income taxes as of the dates indicated consisted of the following: September 30, December 31, 2020 2019 (in thousands) Deferred tax assets: NOL and capital loss carryforwards $ 14,854 $ 12,463 Business interest expense 2,995 1,923 Start-up costs (crude oil and condensate processing facility) 530 594 ARO liability/deferred revenue 501 539 AMT credit - 50 Other 1 11 Total deferred tax assets 18,881 15,580 Deferred tax liabilities: Basis differences in property and equipment (6,968 ) (6,183 ) Total deferred tax liabilities (6,968 ) (6,183 ) 11,913 9,397 Valuation allowance (11,913 ) (9,347 ) Deferred tax assets, net $ - $ 50 Deferred Income Taxes Deferred income tax balances reflect the effects of temporary differences between the carrying amounts of assets and liabilities and their tax basis, as well as from NOL carryforwards. We state those balances at the enacted tax rates we expect will be in effect when taxes are paid. NOL carryforwards and deferred tax assets represent amounts available to reduce future taxable income. NOL Carryforwards NOL Carryforwards Net Operating Loss Carryforward Pre-Ownership Change Post-Ownership Change Total (in thousands) Balance at December 31, 2018 $ 9,614 $ 37,335 $ 46,949 Net operating losses - 5,723 5,723 Balance at December 31, 2019 9,614 43,058 52,672 Net operating losses - 11,384 11,384 Balance at September 30, 2020 $ 9,614 $ 54,442 $ 64,056 Valuation Allowance

15. Earnings Per Share

15. Earnings Per Share	9 Months Ended
	Sep. 30, 2020
Earnings Per Share [Abstract]
Earnings Per Share	A reconciliation between basic and diluted income per share for the periods indicated was as follows: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Net income (loss) $ (4,653 ) $ 8,167 $ (12,235 ) $ 5,615 Basic and diluted income (loss) per share $ (0.37 ) $ 0.74 $ (0.98 ) $ 0.51 Basic and Diluted Weighted average number of shares of common stock outstanding and potential dilutive shares of common stock 12,693,514 10,975,514 12,534,493 10,975,215 Diluted EPS is computed by dividing net income available to common stockholders by the weighted average number of shares of common stock outstanding. Diluted EPS for the three and nine months ended September 30, 2020 and 2019 was the same as basic EPS as there were no stock options or other dilutive instruments outstanding.

16. Commitments and Contingenci

16. Commitments and Contingencies	9 Months Ended
	Sep. 30, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Amended and Restated Operating Agreement See “Note (3)” to our consolidated financial statements for additional disclosures related to operation and management of all Blue Dolphin properties by an Affiliate under the Amended and Restated Operating Agreement. BSEE Offshore Pipelines and Platform Decommissioning BDPL has pipelines and platform assets that are subject to BSEE’s idle iron regulations. Idle iron regulations mandate lessees and rights-of-way holders to permanently abandon and/or remove platforms and other structures when they are no longer useful for operations. Until such structures are abandoned or removed, lessees and rights-of-way holders are required to inspect and maintain the assets in accordance with regulatory requirements. In December 2018, BSEE issued an INC to BDPL for failure to flush and fill Pipeline Segment No. 13101. Management met with BSEE on August 15, 2019 to address BDPL’s plans with respect to decommissioning its offshore pipelines and platform assets. BSEE proposed that BDPL re-submit permit applications for pipeline and platform decommissioning, along with a safe boarding plan for the platform, within six (6) months (no later than February 15, 2020), and develop and implement a safe boarding plan for submission with such permit applications. Further, BSEE proposed that BDPL complete approved, permitted work within twelve (12) months (no later than August 15, 2020). BDPL timely submitted permit applications for decommissioning of the subject offshore pipelines and platform assets to BSEE on February 11, 2020 and the USACOE on March 25, 2020. Decommissioning of the offshore pipelines and platform assets is on hold due to financial constraints associated with COVID-19. We are also awaiting approval of regulatory permits on certain segments and/or fairways, which approvals are required prior to work commencement. We cannot currently estimate when decommissioning may occur. In April 2020, BSEE issued another INC to BDPL for failure to perform the required structural surveys for the GA-288C Platform. BDPL requested an extension to the INC related to the structural platform surveys, and BSEE approved BDPL’s extension request. The required platform surveys were completed, and the INC was resolved in June 2020. Lack of permit approvals does not relieve BDPL of its obligations to remedy the BSEE INCs or of BSEE’s authority to impose financial penalties. If BDPL fails to complete decommissioning of the offshore pipelines and platform assets and/or remedy the INCs within a timeframe determined to be prudent by BSEE, BDPL could be subject to regulatory oversight and enforcement, including but not limited to failure to correct an INC, civil penalties, and revocation of BDPL’s operator designation, which could have a material adverse effect on our earnings, cash flows and liquidity. We are currently unable to predict the outcome of the BSEE INCs. Accordingly, we have not recorded a liability on our consolidated balance sheet as of September 30, 2020. At September 30, 2020 and December 31, 2019, BDPL maintained $2.4 million and $2.6 million, respectively, in AROs related to abandonment of these assets. Defaults Under Secured Loan Agreements with Third Parties See “Note (1),” “Note (3),” “Note (10),” and “Note (11)” to our consolidated financial statements for additional disclosures related to defaults under our secured and unsecured debt agreements. Financing Agreements and Guarantees Indebtedness Guarantees Health, Safety and Environmental Matters Our operations are subject to extensive federal, state, and local environmental, health, and safety regulations governing, among other things, the generation, storage, handling, use and transportation of petroleum products and hazardous substances; the emission and discharge of materials into the environment; waste management; characteristics and composition of jet fuel and other products; and the monitoring, reporting and control of air emissions. Our operations also require numerous permits and authorizations under various environmental, health, and safety laws and regulations. Failure to obtain and comply with these permits or environmental, health, or safety laws generally could result in fines, penalties or other sanctions, or a revocation of our permits. Legal Matters BOEM Additional Financial Assurance (Supplemental Pipeline Bonds) BDPL has historically maintained $0.9 million in financial assurance to BOEM for the decommissioning of its trunk pipeline offshore in federal waters. Following an agency restructuring of the financial assurance program, in March 2018 BOEM ordered BDPL to provide additional financial assurance totaling approximately $4.8 million for five (5) existing pipeline rights-of-way within sixty (60) calendar days. In June 2018, BOEM issued BDPL INCs for each right-of-way that failed to comply. BDPL appealed the INCs to the IBLA, and the IBLA granted multiple extension requests that extended BDPL’s deadline for filing a statement of reasons for the appeal with the IBLA. On August 9, 2019, BDPL timely filed its statement of reasons for the appeal with the IBLA. Considering BDPL’s August 2019 meeting with BOEM and BSEE, BDPL requested a stay in the IBLA matter until August 2020. The Office of the Solicitor of the U.S. Department of the Interior was agreeable to a 10-day extension while it conferred with BOEM on BDPL’s stay request. In late October 2019, BDPL filed a motion to request the 10-day extension, which motion was subsequently granted by the IBLA. The solicitor’s office consented to an additional 14-day extension for BDPL to file its reply, and BDPL filed a motion to request the 14-day extension in November 2019. The solicitor’s office indicated that BOEM would not consent to further extensions. However, the solicitor’s office signaled that BDPL’s adherence to the milestones identified in an August 15, 2019 meeting between management and BSEE may help in future discussions with BOEM related to the INCs. Decommissioning of these assets will significantly reduce or eliminate the amount of financial assurance required by BOEM, which may serve to partially or fully resolve the INCs. See “Note (16) – BSEE Offshore Pipelines and Platform Decommissioning”. BDPL’s pending appeal of the BOEM INCs does not relieve BDPL of its obligations to provide additional financial assurance or of BOEM’s authority to impose financial penalties. There can be no assurance that we will be able to meet additional financial assurance (supplemental pipeline bond) requirements. If BDPL is required by BOEM to provide significant additional financial assurance (supplemental pipeline bonds) or is assessed significant penalties under the INCs, we will experience a significant and material adverse effect on our operations, liquidity, and financial condition. We are currently unable to predict the outcome of the BOEM INCs. Accordingly, we have not recorded a liability on our consolidated balance sheet as of September 30, 2020. At both September 30, 2020 and December 31, 2019, BDPL maintained approximately $0.9 million in credit and cash-backed pipeline rights-of-way bonds issued to BOEM. Resolved - GEL Settlement (in millions) Initial payment (September 2017) $ 3.7 GEL Interim Payments (July 2018 to April 2019) 8.0 Settlement Payment (Multiple Payments May 7 to 10, 2019) 10.0 Deferred Interim Installment Payments (June 2019 to August 2019) 0.5 $ 22.2 The GEL Settlement Effective Date occurred on August 23, 2019. As a result of the GEL Settlement: (i) the mutual releases became effective, (ii) GEL filed the stipulation of dismissal of claims against LE, and (iii) Blue Dolphin recognized a $9.1 million gain on the extinguishment of debt on its consolidated statements of operations in the third quarter of 2019. Until the GEL Settlement occurred, the debt was reflected on Blue Dolphin’s consolidated balance sheets as accrued arbitration award payable. At both September 30, 2020 and December 31, 2019, the accrued arbitration award payable was $0. Other Legal Matters Share Issuances (Sales of Unregistered Securities) We are obligated to issue shares of our Common Stock to: (i) non-employee directors for services rendered to the Board and (ii) to Jonathan Carroll pursuant to the Guaranty Fee Agreements. Set forth below is information regarding the sale or issuance of Common Stock related to these obligations during the three and nine months ended September 30, 2020: ● On April 30, 2020, we issued an aggregate of 231,065 restricted shares of Common Stock to Jonathan Carroll, which represents payment of the common stock component of guaranty fees for the period November 2019 through March 2020. The average cost basis was $0.69, the low was $0.52, and the high was $1.07. For the foreseeable future, management does not intend on paying Mr. Carroll the cash portion of guaranty fees due to Blue Dolphin’s working capital deficits. The cash portion will continue to be accrued and added to the principal balance of the March Carroll Note. See “Note (3)” to our consolidated financial statements for additional disclosures related to Affiliates and working capital deficits, as well as for information related to the guaranty fee agreements. ● On April 30, 2020, we also issued an aggregate of 135,084 restricted shares of Common Stock to certain of our non-employee, independent directors, which represents payment for services rendered to the Board for the three month periods ended September 30, 2018, March 31, 2019, September 30, 2019, and March 31, 2020. The average cost basis was $0.97, the low was $0.57, and the high was $1.18. The sale and issuance of these securities were exempt from registration under the Securities Act in reliance on Section 4(a)(2) of the Securities Act. We recognized a gain on the issuance of shares of $0 and $0.1 million for the three and nine months ended September 30, 2020, respectively.

2. Principles of Consolidatio_2

2. Principles of Consolidation and Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Use of Estimates	The ongoing COVID-19 pandemic and certain developments in the global oil markets have impacted and continue to impact our business. Oil and gas businesses were designated as ‘essential’ businesses under state and federal mandates and, as such, we have remained open throughout the pandemic. We have instituted various initiatives throughout the company as part of our business continuity programs, and we are working to mitigate risk when disruptions occur. The uncertainty around the availability and prices of crude oil, the prices and demand for our refined products, and the general business environment is expected to continue through the remainder of the year and beyond. Given diminished expectations for the global economy, and speculation regarding a second wave of the virus, we are unable to predict the ultimate economic impact of COVID-19 on our business. The nature of our business requires that we make estimates and assumptions in accordance with U.S. GAAP. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. The ongoing COVID-19 pandemic has impacted these estimates and assumptions and will continue to do so. We assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to us and the unknown future impacts of COVID-19 as of September 30, 2020 and through the filing date of this report. The accounting matters assessed included, but were not limited to, our allowance for doubtful accounts, inventory and related reserves, and the carrying value of long-lived assets.
Cash and Cash Equivalents	Cash and cash equivalents represent liquid investments with an original maturity of three months or less. Cash balances are maintained in depository and overnight investment accounts with financial institutions that, at times, may exceed insured deposit limits. We monitor the financial condition of the financial institutions and have experienced no losses associated with these accounts.
Restricted Cash	Restricted cash, current portion primarily represents a payment reserve account held by Veritex as security for payments under a loan agreement. Restricted cash, noncurrent represents funds held in the Veritex disbursement account for payment of construction related expenses to complete building new petroleum storage tanks.
Accounts Receivable and Allowance for Doubtful Accounts	Accounts receivable are presented net of any necessary allowance(s) for doubtful accounts. Receivables are recorded at the invoiced amount and generally do not bear interest. An allowance for doubtful accounts is established, when necessary, based on prior experience and other factors which, in management's judgment, deserve consideration in estimating bad debts. Management assesses collectability of the customer’s account based on current aging status, collection history, and financial condition. Based on a review of these factors, management establishes or adjusts the allowance for specific customers and the entire accounts receivable portfolio. We had an allowance for doubtful accounts of $0.1 million at both September 30, 2020 and December 31, 2019.
Inventory	Inventory primarily consists of refined products, crude oil and condensate, and chemicals. Inventory is valued at lower of cost or net realizable value with cost determined by the average cost method, and net realizable value determined based on estimated selling prices less associated delivery costs. If the net realizable value of our refined products inventory declines to an amount less than our average cost, we record a write-down of inventory and an associated adjustment to cost of goods sold. See “Note (7)” to our consolidated financial statements for additional disclosures related to inventory.
Property and Equipment	Refinery and Facilities Pipelines and Facilities Oil and Gas Properties CIP
Leases	We evaluate if a contract is or contains a lease at inception of the contract. If we determine that a contract is or contains a lease, we recognize ROU asset and lease liability at the commencement date of the lease based on the present value of lease payments over the lease term. The present value of the lease payments is determined by using the implicit rate when readily determinable. If not determinable, we use the incremental borrowing rate to discount lease payments to present value. Lease terms include options to extend or terminate the lease when it is reasonably certain that we will exercise those options. We recognize ROU assets and lease liabilities for leasing arrangements with terms greater than one year. We account for lease and non-lease components in a contract as a single lease component for all classes of underlying assets. We allocate the consideration in these contracts based on pricing information contained in the lease. Expense for an operating lease is recognized as a single lease cost on a straight-line basis over the lease term and is reflected in the appropriate income statement line item based on the leased asset’s function. Amortization expense of a finance lease ROU asset is recognized on a straight-line basis over the lesser of the useful life of the leased asset or the lease term. However, if the lease transfers ownership of the finance lease ROU asset to us at the end of the lease term, the finance lease ROU asset is amortized over the useful life of the leased asset. Amortization expense is reflected in ‘depreciation and amortization expense.’ Interest expense is incurred based on the carrying value of the lease liability and is reflected in ‘interest and other expense.’
Revenue Recognition	Refinery Operations Revenue We consider a variety of facts and circumstances in assessing the point of control transfer, including but not limited to: whether the purchaser can direct the use of the refined product, the transfer of significant risks and rewards, our rights to payment, and transfer of legal title. In each case, the term between the sale and when payment is due is not significant. Transportation, shipping, and handling costs incurred are included in cost of goods sold. Excise and other taxes that are collected from customers and remitted to governmental authorities are not included in revenue. Tolling and Terminaling Revenue We typically satisfy performance obligations for tolling and terminaling operations with the passage of time. We determine the transaction price at agreement inception based on the guaranteed minimum amount of revenue over the term of the agreement. We allocate the transaction price to the single performance obligation that exists under the agreement, and we recognize revenue in the amount for which we have a right to invoice. Generally, payment terms do not exceed 30 days. Revenue from tank storage customers may, from time to time, include fees for ancillary services, such as in-tank and tank-to-tank blending. These services are considered optional to the customer, and the price we charge for such services is not included in the fixed cost under the customer’s tank storage agreement. Ancillary services are considered a separate performance obligation by us under the tank storage agreement. The performance obligation is satisfied when the requested service has been performed in the applicable period. Deferred Revenue
Income Taxes	Deferred income taxes are determined based on the differences between the financial reporting and tax basis of assets and liabilities, as well as operating losses and tax credit carryforwards using currently enacted tax rates and laws in effect for the year in which the differences are expected to reverse. We record a valuation allowance against deferred income tax assets if it is more likely than not that those assets will not be realized. The provision for income taxes comprises our current tax liability and change in deferred income tax assets and liabilities. Significant judgment is required in evaluating uncertain tax positions and determining its provision for income taxes. As of each reporting date, we consider new evidence, both positive and negative, to determine the realizability of deferred tax assets. We consider whether it is more likely than not that a portion or all the deferred tax assets will be realized, which is dependent upon the generation of future taxable income prior to the expiration of any NOL carryforwards. When we determine that it is more likely than not that a tax benefit will not be realized, a valuation allowance is recorded to reduce deferred tax assets. A significant piece of objective negative evidence evaluated was cumulative losses incurred over the three-year period ended September 30, 2020. Such objective evidence limits the ability to consider other subjective evidence, such as projections for future growth. Based on this evaluation, we recorded a valuation allowance against the deferred tax assets for which realization was not deemed more likely than not as of September 30, 2020 and December 31, 2019. We expect to recover deferred tax assets related to AMT credit carryforwards. In addition, we have NOL carryforwards that remain available for future use. The benefit of an uncertain tax position is recognized in the financial statements if it meets a minimum recognition threshold. A determination is first made as to whether it is more likely than not that the income tax position will be sustained, based upon technical merits, upon examination by the taxing authorities. If the income tax position is expected to meet the more-likely-than-not criteria, the benefit recorded in the financial statements equals the largest amount that is greater than 50% likely to be realized upon its ultimate settlement. At September 30, 2020 and December 31, 2019, there were no uncertain tax positions for which a reserve or liability was necessary. See “Note (14)” to our consolidated financial statements for more information related to income taxes.
Impairment or Disposal of Long-Lived Assets	We periodically evaluate our long-lived assets for impairment. Additionally, we evaluate our long-lived assets when events or circumstances indicate that the carrying value of these assets may not be recoverable. The carrying value is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset or group of assets. If the carrying value exceeds the sum of the undiscounted cash flows, an impairment loss equal to the amount by which the carrying value exceeds the fair value of the asset or group of assets is recognized. Significant management judgment is required in the forecasting of future operating results that are used in the preparation of projected cash flows and, should different conditions prevail or judgments be made, material impairment charges could be necessary. The GEL Final Arbitration Award represented a significant adverse change that could have affected the value of certain of our long-lived assets, and management performed potential impairment testing of our refinery and facilities assets in 2019 and 2018. Upon completion of each testing, no impairment was deemed necessary. In addition, the market volatility of crude oil prices as a result of the ongoing COVID-19 pandemic could have affected the value of certain of our long-lived assets, and management performed impairment testing of our refinery and facilities assets at September 30, 2020. No impairment was deemed necessary based upon this testing, and we did not record any impairment of our refinery and facilities assets for the periods presented.
Asset Retirement Obligations	We record a liability for the discounted fair value of an ARO in the period incurred, and we also capitalize the corresponding cost by increasing the carrying amount of the related long-lived asset. The liability is accreted towards its future value each period, and the capitalized cost is depreciated over the useful life of the related asset. If the liability is settled for an amount other than the recorded amount, a gain or loss is recognized. We have concluded that there is no legal or contractual obligation to dismantle or remove the refinery and facilities assets. Further, we believe that these assets have indeterminate lives because dates or ranges of dates upon which we would retire these assets cannot reasonably be estimated at this time. When a legal or contractual obligation to dismantle or remove the refinery and facilities assets arises and a date or range of dates can reasonably be estimated for the retirement of these assets, we will estimate the cost of performing the retirement activities and record a liability for the fair value of that cost using present value techniques. We recorded an ARO liability related to future asset retirement costs associated with dismantling, relocating, or disposing of our offshore platform, pipeline systems, and related onshore facilities, as well as for plugging and abandoning wells and restoring land and sea-beds. Cost estimates for each of our assets were developed based upon regulatory requirements, structural makeup, water depth, reservoir characteristics, reservoir depth, equipment demand, current retirement procedures, and construction and engineering consultations. Estimating future costs are difficult and require management to make judgments that are subject to future revisions based upon numerous factors, including changing technology, political, and regulatory environments. We review our assumptions and estimates of future abandonment costs on an annual basis. See “Note (12)” to our consolidated financial statements for additional information related to AROs.
Computation of Earnings Per Share	We present basic and diluted EPS. Basic EPS excludes dilution and is computed by dividing net income available to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted EPS is computed by dividing net income available to common stockholders by the diluted weighted average number of common shares outstanding, which includes the potential dilution that could occur if securities or other contracts to issue shares of common stock were converted to common stock that then shared in the earnings of the entity. The number of shares related to restricted stock included in diluted EPS is based on the “Treasury Stock Method.” We do not have issued options, warrants, or similar instruments. See “Note (15)” to our consolidated financial statements for additional information related to EPS.
New Pronouncements	New Pronouncements Adopted Income Taxes. Consolidation Codification Updates to SEC Sections New Pronouncements Issued, Not Yet Effective . Codification Improvements. Other new pronouncements issued but not yet effective are not expected to have a material impact on our financial position, results of operations, or liquidity.

3. Related-Party Transactions (

3. Related-Party Transactions (Tables)	9 Months Ended
	Sep. 30, 2020
Related Party Transactions [Abstract]
Affiliate agreements/transactions	Agreement/Transaction Parties Effective Date Key Terms Refinery Equipment Purchase LTRI - LE 07/01/2019 LE purchase of two (2) refurbished heat exchangers for $0.08 million each Dock Tolling Agreement LMT - LE 05/24/2016 5-year term cancellable by either party any time; LE paid flat reservation fee for tolling volumes up to 84,000 gallons per day; excess tolling volumes subject to increased per gallon rate; terminated 07/01/2019 Jet Fuel Sales Agreement LEH - LE 04/01/2020 1-year term expiring earliest to occur of 03/31/2021 plus 30-day carryover or delivery of maximum jet fuel quantity; LEH bids on jet fuel contracts under preferential pricing terms due to a HUBZone certification Office Sub-Lease Agreement LEH - BDSC 01/01/2018 68-month term expiring 08/31/2023; office lease Houston, Texas; includes 6-month rent abatement period; rent approximately $0.02 million per month Amended and Restated Operating Agreement LEH – Blue Dolphin, LE, LRM, NPS, BDPL, BDPC and BDSC 04/01/2020 3-year term; expires 04/01/2023 or notice by either party at any time of material breach or 90 days Board notice; LEH receives management fee of 5% of all consolidated operating costs, excluding crude costs, depreciation, amortization and interest, of Blue Dolphin, LE, LRM, NPS, BDPL, BDPC and BDSC Related-Party Long-Term Debt Loan Description Parties Maturity Date Interest Rate Loan Purpose March Carroll Note (in default) Jonathan Carroll – Blue Dolphin Jan 2019 8.00% Blue Dolphin working capital; reflects amounts owed to Jonathan Carroll under the guaranty fee agreements March Ingleside Note (in default) Ingleside – Blue Dolphin Jan 2019 8.00% Blue Dolphin working capital June LEH Note (in default) LEH – Blue Dolphin Jan 2019 8.00% Blue Dolphin working capital; reflects amounts owed to LEH under the Amended and Restated Operating Agreement BDPL-LEH Loan Agreement (in default) LEH - BDPL Aug 2018 16.00% Blue Dolphin working capital Amended and Restated Guaranty Fee Agreement(2) Jonathan Carroll - LE -- 2.00% Tied to payoff of LE $25 million Veritex loan Amended and Restated Guaranty Fee Agreement(2) Jonathan Carroll - LRM -- 2.00% Tied to payoff of LRM $10 million Veritex loan (1) The original principal amount of the BDPL-LEH Loan Agreement was $4.0 million. (2) As a condition for our secured loan agreements with Veritex, Jonathan Carroll was required to personally guarantee repayment of borrowed funds and accrued interest. Under the guaranty fee agreements, Mr. Carroll is entitled to receive guaranty fees. The fees are payable 50% in cash and 50% in Common Stock. The Common Stock portion is paid quarterly. For the foreseeable future, management does not intend to pay Mr. Carroll the cash portion due to Blue Dolphin’s working capital deficits. The cash portion will continue to accrue and be added to the outstanding principal balance owed to Mr. Carroll under the March Carroll Note. Guarantees and Security Loan Description Guarantees Security BDPL-LEH Loan Agreement --- ● Defaults Loan Description Event(s) of Default Covenant Violations March Carroll Note (in default) Failure of borrower to pay past due obligations; loan matured January 2019 -- March Ingleside Note (in default) Failure of borrower to pay past due obligations; loan matured January 2019 --- June LEH Note (in default) Failure of borrower to pay past due obligations; loan matured January 2019 --- BDPL-LEH Loan Agreement (in default) Failure of borrower to pay past due obligations; loan matured August 2018 ---
Accounts payable, related party	September 30, December 31, 2020 2019 (in thousands) LEH June LEH Note (in default) $ 5,733 $ - BDPL-LEH Loan Agreement 6,654 6,174 LEH Total 12,387 6,174 Ingleside March Ingleside Note (in default) 1,067 1,004 Jonathan Carroll March Carroll Note (in default) 1,373 997 14,827 8,175 Less: Long-term debt, related party, current portion, in default (12,173 ) (6,001 ) Less: Accrued interest payable, related party (in default) (2,654 ) (2,174 ) $ - $ -
Refinery operating expenses	Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands, except percent amounts) Refinery operations LEH $ 11,942 27.8 % $ 25,034 31.8 % $ 34,244 27.8 % $ 70,016 31.0 % Third-Parties 29,987 69.9 % 52,503 66.8 % 85,941 69.6 % 152,636 67.6 % Tolling and terminaling Third-Parties 1,001 2.3 % 1,096 1.4 % 3,214 2.6 % 3,253 1.4 % $ 42,930 100.0 % $ 78,633 100.0 % $ 123,399 100.0 % $ 225,905 100.0 %
Accrued interest expenses	Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands) Jonathan Carroll Guaranty Fee Agreements First Term Loan Due 2034 $ 108 $ 110 $ 324 $ 333 Second Term Loan Due 2034 45 46 134 138 March Carroll Note (in default) 23 33 66 86 LEH BDPL-LEH Loan Agreement (in default) 160 160 480 480 June LEH Note (in default) 102 17 245 40 Ingleside March Ingleside Note (in default) 15 12 50 63 $ 453 $ 378 $ 1,299 $ 1,140

4. Revenue and Segment Inform_2

4. Revenue and Segment Information (Tables)	9 Months Ended
	Sep. 30, 2020
Segment Reporting [Abstract]
Business segment reporting	Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands) Net revenue (excluding intercompany fees and sales) Refinery operations $ 41,929 $ 77,537 $ 120,185 $ 222,652 Tolling and terminaling 1,001 1,096 3,214 3,253 Total net revenue 42,930 78,633 123,399 225,905 Intercompany fees and sales Refinery operations (595 ) (668 ) (1,618 ) (1,927 ) Tolling and terminaling 595 668 1,618 1,927 Total intercompany fees - - - - Operation costs and expenses(1) Refinery operations (43,691 ) (76,088 ) (124,942 ) (219,766 ) Tolling and terminaling (709 ) (285 ) (1,222 ) (1,012 ) Corporate and other (58 ) (52 ) (164 ) (165 ) Total operation costs and expenses (44,458 ) (76,425 ) (126,328 ) (220,943 ) Segment contribution margin (deficit) Refinery operations (2,357 ) 781 (6,375 ) 959 Tolling and terminaling 887 1,479 3,610 4,168 Corporate and other (58 ) (52 ) (164 ) (165 ) Total segment contribution margin (deficit) (1,528 ) 2,208 (2,929 ) 4,962 General and administrative expenses(2) Refinery operations (414 ) (292 ) (1,045 ) (898 ) Tolling and terminaling (132 ) (68 ) (268 ) (173 ) Corporate and other (307 ) (295 ) (1,052 ) (833 ) Total general and administrative expenses (853 ) (655 ) (2,365 ) (1,904 ) Depreciation and amortization Refinery operations (301 ) (481 ) (883 ) (1,429 ) Tolling and terminaling (338 ) (99 ) (956 ) (297 ) Corporate and other (51 ) (52 ) (153 ) (129 ) Total depreciation and amortization (690 ) (632 ) (1,992 ) (1,855 ) Interest and other non-operating expenses, net Refinery operations (679 ) 8,329 (2,171 ) 6,723 Tolling and terminaling (599 ) (824 ) (1,985 ) (1,599 ) Corporate and other (304 ) (259 ) (778 ) (712 ) Total interest and other non-operating expenses, net (1,582 ) 7,246 (4,934 ) 4,412 Income (loss) before income taxes Refinery operations (3,751 ) 8,337 (10,474 ) 5,355 Tolling and terminaling (182 ) 488 401 2,099 Corporate and other (720 ) (658 ) (2,147 ) (1,839 ) Total income (loss) before income taxes (4,653 ) 8,167 (12,220 ) 5,615 Income tax expense - - (15 ) - Net income (loss) $ (4,653 ) $ 8,167 $ (12,235 ) $ 5,615 (1) Operation costs include cost of goods sold. Also, operation costs within: (a) tolling and terminaling includes terminal operating expenses and an allocation of other costs (e.g. insurance and maintenance) and (b) corporate and other includes expenses related to BDSC, BDPC and BDPL. (2) General and administrative expenses within refinery operations include the LEH operating fee. Nine Months Ended September 30, 2020 2019 (in thousands) Capital expenditures Refinery operations $ 295 $ 1,375 Tolling and terminaling 790 83 Corporate and other - - Total capital expenditures $ 1,085 $ 1,458 September 30, December 31, 2020 2019 (in thousands) Identifiable assets Refinery operations $ 47,619 $ 51,317 Tolling and terminaling 18,815 18,401 Corporate and other 1,667 1,726 Total identifiable assets $ 67,651 $ 71,444

5. Concentration of Risk (Table

5. Concentration of Risk (Tables)	9 Months Ended
	Sep. 30, 2020
Risks and Uncertainties [Abstract]
Significant customers	Number Significant Customers % Total Revenue from Operations Portion of Accounts Receivable at Date Indicated Three Months Ended September 30, 2020 4 80% $0 September 30, 2019 4 97% $0.6 million Nine Months Ended September 30, 2020 4 82% $0 September 30, 2019 4 97% $0.6 million
Percentages of all refined petroleum products sales to total sales	Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands, except percent amounts) LPG mix $ - 0.0 % $ 8 0 % $ - 0.0 % $ 17 0 % Naphtha 7,847 18.7 % 14,147 18.2 % 22,523 18.7 % 43,358 19.5 % Jet fuel 11,942 28.5 % 25,035 32.3 % 34,244 28.5 % 70,017 31.4 % HOBM 12,196 29.1 % 17,044 22.0 % 31,077 25.9 % 49,951 22.5 % AGO 9,944 23.7 % 21,303 27.5 % 32,341 26.9 % 59,309 26.6 % $ 41,929 100.0 % $ 77,537 100.0 % $ 120,185 100.0 % $ 222,652 100.0 %

6. Prepaid Expenses and Other_2

6. Prepaid Expenses and Other Current Assets (Tables)	9 Months Ended
	Sep. 30, 2020
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid balances	September 30, December 31, 2020 2019 (in thousands) Prepaid insurance $ 1,099 $ 417 Prepaid crude oil and condensate 374 1,651 Prepaid easement renewal fees 104 121 Other prepaids 40 87 $ 1,617 $ 2,276

7. Inventory (Tables)

7. Inventory (Tables)	9 Months Ended
	Sep. 30, 2020
Inventory Disclosure [Abstract]
Inventory	September 30, December 31, 2020 2019 (in thousands) Crude oil and condensate $ 493 $ 959 Chemicals 143 120 AGO 118 440 Naphtha 88 95 Propane 13 26 LPG mix 7 5 $ 862 $ 1,645

8. Property, Plant and Equipm_2

8. Property, Plant and Equipment, Net (Tables)	9 Months Ended
	Sep. 30, 2020
Property, Plant and Equipment [Abstract]
Property and equipment	September 30, December 31, 2020 2019 (in thousands) Refinery and facilities $ 71,855 $ 66,317 Land 566 566 Other property and equipment 903 833 73,324 67,716 Less: Accumulated depletion, depreciation, and amortization (14,577 ) (12,739 ) 58,747 54,977 CIP 4,392 8,916 $ 63,139 $ 63,893

9. Accrued Expenses and Other_2

9. Accrued Expenses and Other Current Liabilities (Tables)	9 Months Ended
	Sep. 30, 2020
Other Liabilities, Current [Abstract]
Accrued expenses and other current liabilities	September 30, December 31, 2020 2019 (in thousands) Unearned revenue from contracts with customers $ 2,441 $ 1,990 Insurance 525 159 Unearned contract renewal income 500 500 Property, fuel and other taxes 389 183 Other payable 186 228 Board of director fees payable 68 263 Customer deposits 10 10 $ 4,119 $ 3,333

10. Third-Party Long-Term Debt

10. Third-Party Long-Term Debt (Tables)	9 Months Ended
	Sep. 30, 2020
Debt Disclosure [Abstract]
Loan agreements	Loan Description Parties Original Principal Amount (in millions) Maturity Date Monthly Principal and Interest Payment Interest Rate Loan Purpose Veritex Loans(1) LE Term Loan Due 2034 ( in default LE-Veritex $25.0 Jun 2034 $0.2 million WSJ Prime + 2.75% Refinance loan; capital improvements LRM Term Loan Due 2034 in default LRM-Veritex $10.0 Dec 2034 $0.1 million WSJ Prime + 2.75% Refinance bridge loan; capital improvements Notre Dame Debt ( in default LE-Kissick $11.7 Jan 2018 No payments to date; payment rights subordinated 16.00% Working capital; reduced balance of GEL Final Arbitration Award SBA EIDLs LE Term Loan Due 2050(4) LE-SBA $0.15 Aug 2050 $0.0007 million 3.75% Working capital NPS Term Loan Due 2050(4) NPS-SBA $0.15 Aug 2050 $0.0007 million 3.75% Working capital (1) Proceeds were placed in a disbursement account whereby Veritex makes payments for construction related expenses. Amounts held in the disbursement account are reflected on our consolidated balance sheets as restricted cash (current portion) and restricted cash, noncurrent. At September 30, 2020, restricted cash (current portion) was $0.05 million and restricted cash, noncurrent was $0.5 million. At December 31, 2019, restricted cash (current portion) was $0.05 million and restricted cash, noncurrent was $0.6 million. (2) LE originally entered into a loan agreement with Notre Dame Investors, Inc. in the principal amount of $8.0 million. The debt is currently held by John Kissick. Pursuant to a 2017 sixth amendment, the Notre Dame Debt was amended to increase the principal amount by $3.7 million; the additional principal was used to reduce the GEL Final Arbitration Award by $3.6 million. (3) Pursuant to a 2015 subordination agreement, the holder of the Notre Dame Debt agreed to subordinate their right to payments, as well as any security interest and liens on the Nixon facility’s business assets, in favor of Veritex as holder of the LE Term Loan Due 2034. (4) Payments are deferred for the first twelve (12) months of the loan; interest accrues during the deferral period. SBA EIDLs are not forgivable.
Long term debt	September 30, December 31, 2020 2019 (in thousands) Veritex Loans LE Term Loan Due 2034 (in default) $ 22,424 $ 21,776 LRM Term Loan Due 2034 (in default) 9,299 9,031 SBA EIDLs LE Term Loan Due 2050 150 - NPS Term Loan Due 2050 150 - Notre Dame Debt (in default) 9,214 8,617 41,237 39,424 Less: Current portion of long-term debt, net (33,644 ) (33,836 ) Less: Unamortized debt issue costs (1,781 ) (1,877 ) Less: Accrued interest payable (in default) (5,512 ) (3,711 ) $ 300 $ -
Debt issue costs	September 30, December 31, 2020 2019 (in thousands) Veritex Loans LE Term Loan Due 2034 (in default) $ 1,674 $ 1,674 LRM Term Loan Due 2034 (in default) 768 768 Less: Accumulated amortization (661 ) (565 ) $ 1,781 $ 1,877
Accrued interest related to our long-term debt, net	September 30, December 31, 2020 2019 (in thousands) Notre Dame Debt (in default) $ 4,236 $ 3,639 Veritex Loans LE Term Loan Due 2034 (in default) 879 25 LRM Term Loan Due 2034 (in default) 397 47 5,512 3,711 Less: Accrued interest payable (in default) (5,512 ) (3,711 ) Long-term Interest Payable, Net of Current Portion $ - $ -

11. Line of Credit Payable (Tab

11. Line of Credit Payable (Tables)	9 Months Ended
	Sep. 30, 2020
Line of Credit Facility [Abstract]
Line of credit agreement	Line of Credit Description Original Principal Amount (in millions) Maturity Date Monthly Principal and Interest Payment Interest Rate Loan Purpose Amended Pilot Line of Credit in default $13.0 May 2020 ---- 14.00% GEL Settlement Payment, NPS purchase of crude oil from Pilot, and working capital
Line of credit	September 30, December 31, 2020 2019 (in thousands) Amended Pilot Line of Credit (in default) $ 9,724 $ 11,786 Less: Unamortized debt issue costs - (219 ) Less: Interest payable, short-term (103 ) (103 ) $ 9,621 $ 11,464

12. AROs (Tables)

12. AROs (Tables)	9 Months Ended
	Sep. 30, 2020
Asset Retirement Obligation Disclosure [Abstract]
Asset retirement obligations	September 30, December 31, 2020 2019 (in thousands) AROs, at the beginning of the period $ 2,565 $ 2,565 Liabilities settled (179 ) - 2,386 2,565 Less: AROs, current portion (2,386 ) (2,565 ) Long-term AROs, at the end of the period $ - $ -

13. Lease Obligations (Tables)

13. Lease Obligations (Tables)	9 Months Ended
	Sep. 30, 2020
Leases [Abstract]
Lease-related assets and liabilities	September 30, December 31, Balance Sheet Location 2020 2019 (in thousands) Assets Operating lease ROU assets Operating lease ROU assets $ 787 $ 787 Less: Accumulated amortization on operating lease assets Operating lease ROU assets (249 ) (138 ) 538 649 Finance lease assets Property and equipment, net 86 180 Less: Accumulated amortization on finance lease assets Property and equipment, net (16 ) (34 ) 70 146 Total lease assets 608 795 Liabilities Current Operating lease Current portion of lease liabilities 190 175 Finance leases Current portion of lease liabilities 61 76 251 251 Noncurrent Operating lease Long-term lease liabilities, net of current 421 564 Total lease liabilities $ 672 $ 815 Weighted average remaining lease term in years Operating lease 2.92 Weighted average discount rate Operating lease 8.25 % Finance leases 8.25 %
Lease costs	Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 (in thousands) Operating lease costs $ 51 $ 51 $ 154 $ 154 Finance lease costs: Depreciation of leased assets 3 4 13 12 Interest on lease liabilities - 2 3 4 Total lease cost $ 54 $ 57 $ 170 $ 170
Supplemental cash flow information related to leases	Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 (in thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating lease $ 44 $ 40 $ 130 $ 81 Operating cash flows for finance leases $ - $ 2 $ 4 $ 4 Financing cash flows for finance leases $ 5 $ 13 $ 17 $ 35
Maturities of operating lease liabilities	September 30, Operating Lease Financing Leases Total (in thousands) 2021 $ 190 $ 61 $ 251 2022 209 - 209 2023 212 - 212 $ 611 $ 61 $ 672
Future minimum annual lease commitments	Operating September 30, Lease (in thousands) 2021 $ 232 2022 236 2023 220 $ 688

14. Income Taxes (Tables)

14. Income Taxes (Tables)	9 Months Ended
	Sep. 30, 2020
Income Tax Disclosure [Abstract]
Income tax benefit (expense)	Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Current Federal $ - $ - $ (15 ) $ - State - - - - Deferred Federal 975 (1,833 ) 2,566 (1,190 ) State - - Change in valuation allowance (975 ) 1,833 (2,566 ) 1,190 Total provision for income taxes $ - $ - $ (15 ) $ -
Deferred tax assets and deferred tax liabilities	September 30, December 31, 2020 2019 (in thousands) Deferred tax assets: NOL and capital loss carryforwards $ 14,854 $ 12,463 Business interest expense 2,995 1,923 Start-up costs (crude oil and condensate processing facility) 530 594 ARO liability/deferred revenue 501 539 AMT credit - 50 Other 1 11 Total deferred tax assets 18,881 15,580 Deferred tax liabilities: Basis differences in property and equipment (6,968 ) (6,183 ) Total deferred tax liabilities (6,968 ) (6,183 ) 11,913 9,397 Valuation allowance (11,913 ) (9,347 ) Deferred tax assets, net $ - $ 50
NOL carryforwards	Net Operating Loss Carryforward Pre-Ownership Change Post-Ownership Change Total (in thousands) Balance at December 31, 2018 $ 9,614 $ 37,335 $ 46,949 Net operating losses - 5,723 5,723 Balance at December 31, 2019 9,614 43,058 52,672 Net operating losses - 11,384 11,384 Balance at September 30, 2020 $ 9,614 $ 54,442 $ 64,056

15. Earnings Per Share (Tables)

15. Earnings Per Share (Tables)	9 Months Ended
	Sep. 30, 2020
Earnings Per Share [Abstract]
Earnings per share	Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Net income (loss) $ (4,653 ) $ 8,167 $ (12,235 ) $ 5,615 Basic and diluted income (loss) per share $ (0.37 ) $ 0.74 $ (0.98 ) $ 0.51 Basic and Diluted Weighted average number of shares of common stock outstanding and potential dilutive shares of common stock 12,693,514 10,975,514 12,534,493 10,975,215

16. Commitments and Contingen_2

16. Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Amounts from the Lazarus Parties toward reducing the outstanding balance of the Final Arbitration Award	(in millions) Initial payment (September 2017) $ 3.7 GEL Interim Payments (July 2018 to April 2019) 8.0 Settlement Payment (Multiple Payments May 7 to 10, 2019) 10.0 Deferred Interim Installment Payments (June 2019 to August 2019) 0.5 $ 22.2

1. Organization (Details Narrat

1. Organization (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net income (loss)	$ (4,653)	$ 8,167	$ (12,235)	$ 5,615
Net loss per common share	$ (0.37)	$ 0.74	$ (0.98)	$ 0.51
Working capital deficit	$ (70,600)		$ (70,600)		$ (59,400)
Cash and cash equivalents	275		275		72
Restricted cash	$ 49		$ 49		$ 49

2. Principles of Consolidatio_3

2. Principles of Consolidation and Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Allowance for doubtful accounts	$ 100	$ 100

3. Related-Party Transactions_2

3. Related-Party Transactions (Details)	9 Months Ended
	Sep. 30, 2020
LTRI LE
Type	Refinery Equipment Purchase
Effective date	7/1/2019
Key terms/purpose	LE purchase of two (2) refurbished heat exchangers for $0.08 million each
LMT - LE
Type	Dock Tolling Agreement
Effective date	5/24/2016
Key terms/purpose	5-year term cancellable by either party any time; LE paid flat reservation fee for tolling volumes up to 84,000 gallons per day; excess tolling volumes subject to increased per gallon rate; terminated 07/01/2019
LEH - LE
Type	Jet Fuel Sales Agreement
Effective date	4/1/2020
Key terms/purpose	1-year term expiring earliest to occur of 03/31/2021 plus 30-day carryover or delivery of maximum jet fuel quantity; LEH bids on jet fuel contracts under preferential pricing terms due to a HUBZone certification
LEH - BDSC
Type	Office Sub-Lease Agreement
Effective date	1/1/2018
Key terms/purpose	68-month term expiring 08/31/2023; office lease Houston, Texas; includes 6-month rent abatement period; rent approximately $0.02 million per month
LEH - Blue Dolphin, LE, LRM, NPS, BDPL, BDPC and BDSC
Type	Amended and Restated Operating Agreement
Effective date	4/1/2020
Key terms/purpose	3-year term; expires 04/01/2023 or notice by either party at any time of material breach or 90 days Board notice; LEH receives management fee of 5% of all consolidated operating costs, excluding crude costs, depreciation, amortization and interest, of Blue Dolphin, LE, LRM, NPS, BDPL, BDPC and BDSC
Jonathan Carroll - Blue Dolphin
Type	March Carroll Note (in default)
Maturity date	Jan 2019
Interest rate	8.00%
Key terms/purpose	Blue Dolphin working capital; reflects amounts owed to Jonathan Carroll under the guaranty fee agreements
Ingleside - Blue Dolphin
Type	March Ingleside Note (in default)
Maturity date	Jan 2019
Interest rate	8.00%
Key terms/purpose	Blue Dolphin working capital
LEH - Blue Dolphin
Type	June LEH Note (in default)
Maturity date	Jan 2019
Interest rate	8.00%
Key terms/purpose	Blue Dolphin working capital; reflects amounts owed to LEH under the Amended and Restated Operating Agreement
LEH - BDPL
Type	BDPL-LEH Loan Agreement (in default)
Maturity date	Aug 2018
Interest rate	16.00%
Key terms/purpose	Blue Dolphin working capital
Jonathan Carroll - LE
Type	Amended and Restated Guaranty Fee Agreement
Interest rate	2.00%
Key terms/purpose	Tied to payoff of LE $25 million Veritex loan
Jonathan Carroll - LRM
Type	Amended and Restated Guaranty Fee Agreement
Interest rate	2.00%
Key terms/purpose	Tied to payoff of LRM $10 million Veritex loan

3. Related-Party Transactions_3

3. Related-Party Transactions (Details 1) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Prepaid operating expenses, related party	$ 174,827	$ 8,175
Less: Long-term debt, related party, current portion, in default	(12,173)	(6,001)
Less: Interest payable, related party, in default	(2,654)	(2,174)
Long-term debt - net of current portion, related party	0	0
LEH
Prepaid operating expenses, related party	12,387	6,174
LEH | June LEH Note (in default)
Prepaid operating expenses, related party	5,733	0
LEH | BDPL Loan Agreement (in default)
Prepaid operating expenses, related party	6,654	6,174
Ingleside | March Ingleside Note (in default)
Prepaid operating expenses, related party	1,067	1,004
Jonathan Carroll | March Carroll Note (in default)
Prepaid operating expenses, related party	$ 1,373	$ 997

3. Related-Party Transactions_4

3. Related-Party Transactions (Details 2) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Total revenues	$ 42,930	$ 78,633	$ 123,399	$ 225,905
Total revenues, percent	100.00%	100.00%	100.00%	100.00%
LEH
Refinery operations revenues	$ 11,942	$ 25,034	$ 34,244	$ 70,016
Refinery operations revenues, percent	27.80%	31.80%	27.80%	31.00%
Third Parties
Refinery operations revenues	$ 29,987	$ 52,503	$ 85,941	$ 152,636
Tolling and terminaling revenues	$ 1,001	$ 1,096	$ 3,214	$ 3,253
Refinery operations revenues, percent	69.90%	66.80%	69.60%	67.60%
Tolling and terminaling revenues, percent	2.30%	1.40%	2.60%	1.40%

3. Related-Party Transactions_5

3. Related-Party Transactions (Details 3) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Interest expenses under loan and guarantee, related party	$ 1,299	$ 1,140	$ 453	$ 378
Jonathan Carroll | First Term Loan Due 2034
Interest expenses under loan and guarantee, related party	324	333	108	110
Jonathan Carroll | Second Term Loan Due 2034
Interest expenses under loan and guarantee, related party	134	138	45	46
Jonathan Carroll | March Carroll Note (in default)
Interest expenses under loan and guarantee, related party	66	86	23	33
LEH | BDPL Loan Agreement (in default)
Interest expenses under loan and guarantee, related party	480	480	160	160
LEH | June LEH Note (in default)
Interest expenses under loan and guarantee, related party	245	40	102	17
Ingleside | March Ingleside Note (in default)
Interest expenses under loan and guarantee, related party	$ 50	$ 63	$ 15	$ 12

3. Related-Party Transactions_6

3. Related-Party Transactions (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Related Party Transactions [Abstract]
Accounts receivable, related party	$ 0		$ 0		$ 1,364
Accounts payable, related party	155		155		$ 149
Dock Tolling Agreement with LMT fees	0	$ 50	0	$ 400
Lease payments received under the office sub-lease agreement with LEH	$ 10	$ 10	$ 30	$ 30

4. Revenue and Segment Inform_3

4. Revenue and Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Net revenues (excluding intercompany fees and sales)	$ 42,930	$ 78,633	$ 123,399	$ 225,905
General and administrative expenses	684	655	1,859	1,904
Net income (loss)	(4,653)	8,167	(12,235)	5,615
Identifiable assets	67,651		67,651		$ 71,444
Refinery Operations
Net revenues (excluding intercompany fees and sales)	41,929	77,537	120,185	222,652
Intercompany fees and sales	(595)	(668)	(1,618)	(1,927)
Operation costs and expenses	(43,691)	(76,088)	(124,942)	(219,766)
Segment contribution margin (deficit)	(2,357)	781	(6,375)	959
General and administrative expenses	(414)	(292)	(1,045)	(898)
Depreciation and amortization	(301)	(481)	(883)	(1,429)
Interest and other non-operating income (expenses)	(679)	8,329	(2,171)	6,723
Income (loss) before income taxes	(3,751)	8,337	(10,474)	5,355
Capital expenditures			295	1,375
Identifiable assets	47,169		47,169		51,317
Tolling and Terminaling
Net revenues (excluding intercompany fees and sales)	1,001	1,096	3,214	3,253
Intercompany fees and sales	595	668	1,618	1,927
Operation costs and expenses	(709)	(285)	(1,222)	(1,012)
Segment contribution margin (deficit)	887	1,479	3,610	4,168
General and administrative expenses	(132)	(68)	(268)	(173)
Depreciation and amortization	(338)	(99)	(956)	(297)
Interest and other non-operating income (expenses)	(599)	(824)	(1,985)	(1,599)
Income (loss) before income taxes	(182)	488	401	2,099
Capital expenditures			790	83
Identifiable assets	18,815		18,815		18,401
Corporate & Other
Operation costs and expenses	(58)	(52)	(164)	(165)
Segment contribution margin (deficit)	(58)	(52)	(164)	(165)
General and administrative expenses	(307)	(295)	(1,052)	(833)
Depreciation and amortization	(51)	(52)	(153)	(129)
Interest and other non-operating income (expenses)	(304)	(259)	(778)	(712)
Income (loss) before income taxes	(720)	(658)	(2,147)	(1,839)
Capital expenditures			0	0
Identifiable assets	1,667		1,667		1,726
Total
Net revenues (excluding intercompany fees and sales)	42,930	78,633	123,399	225,905
Intercompany fees and sales	0	0	0	0
Operation costs and expenses	(44,458)	(76,425)	(126,328)	(220,943)
Segment contribution margin (deficit)	(1,528)	2,208	(2,929)	4,962
General and administrative expenses	(853)	(655)	(2,365)	(1,904)
Depreciation and amortization	(690)	(632)	(1,992)	(1,855)
Interest and other non-operating income (expenses)	(1,582)	7,246	(4,934)	4,412
Income (loss) before income taxes	(4,653)	8,167	(12,220)	5,615
Income tax expense	0	0	(15)	0
Net income (loss)	(4,653)	$ 8,167	(12,235)	5,615
Capital expenditures			1,085	$ 1,458
Identifiable assets	$ 67,651		$ 67,651		$ 71,444

5. Concentration of Risk (Detai

5. Concentration of Risk (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Concentration of risk	100.00%	100.00%	100.00%	100.00%
4 Significant Customers
Concentration of risk	80.00%	97.00%	82.00%	97.00%
Portion of accounts receivable	$ 0	$ 600	$ 0	$ 600

5. Concentration of Risk (Det_2

5. Concentration of Risk (Details 1) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Total refined petroleum product sales	$ 41,929	$ 77,537	$ 120,185	$ 222,652
Concentration risk	100.00%	100.00%	100.00%	100.00%
LPG Mix
Total refined petroleum product sales	$ 0	$ 8	$ 0	$ 17
Concentration risk	0.00%	0.00%	0.00%	0.00%
Naphtha
Total refined petroleum product sales	$ 7,847	$ 14,147	$ 22,523	$ 43,358
Concentration risk	18.70%	18.20%	18.70%	19.50%
Jet Fuel
Total refined petroleum product sales	$ 11,942	$ 25,035	$ 34,244	$ 70,017
Concentration risk	28.50%	32.30%	28.50%	31.40%
HOBM
Total refined petroleum product sales	$ 12,196	$ 17,044	$ 31,077	$ 49,951
Concentration risk	29.10%	22.00%	25.90%	22.50%
AGO
Total refined petroleum product sales	$ 9,944	$ 21,303	$ 32,341	$ 59,309
Concentration risk	23.70%	27.50%	26.90%	26.60%

5. Concentration of Risk (Det_3

5. Concentration of Risk (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Risks and Uncertainties [Abstract]
Balances in excess of FDIC insurance limit	$ 300	$ 300

6. Prepaid Expenses and Other_3

6. Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid insurance	$ 1,099	$ 417
Other prepaids	374	87
Prepaid easement renewal fees	104	121
Prepaid crude oil and condensate	40	1,651
Prepaid expenses, net	$ 1,617	$ 2,276

7. Inventory (Details)

7. Inventory (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Inventories, net	$ 862	$ 1,645
Crude Oil and Condensate
Inventories, net	493	959
Chemicals
Inventories, net	143	120
AGO
Inventories, net	118	440
Naphtha
Inventories, net	88	95
Propane
Inventories, net	13	26
LPG Mix
Inventories, net	$ 7	$ 5

7. Inventory (Details Narrative

7. Inventory (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Inventory adjustment	$ 300	$ 300

8. Property, Plant and Equipm_3

8. Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Property, Plant and Equipment [Abstract]
Refinery and facilities	$ 71,855	$ 66,317
Land	566	566
Other property and equipment	903	833
Total	73,324	67,716
Less: Accumulated depletion, depreciation and amortization	(14,577)	(12,739)
Property, plant and equipment, gross	58,747	54,977
Construction in progress	4,392	8,916
Property, plant and equipment, net	$ 63,139	$ 63,893

8. Property, Plant and Equipm_4

8. Property, Plant and Equipment, Net (Details Narrative) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Property, Plant and Equipment [Abstract]
Interest cost capitalized	$ 0	$ 700

9. Accrued Expenses and Other_3

9. Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Other Liabilities, Current [Abstract]
Unearned revenue from contracts with customers	$ 2,441	$ 1,990
Insurance	525	159
Unearned contract renewal income	500	500
Property, fuel and other taxes	389	183
Other payable	186	228
Board of director fees payable	68	263
Customer deposits	10	10
Accrued expenses and other current liabilities, net	$ 4,119	$ 3,333

10. Third-Party Long-Term Deb_2

10. Third-Party Long-Term Debt (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020USD ($)
LE Term Loan Due 2034
Original principal amount	$ 25,000
Maturity date	Jun 2034
Interest rate	WSJ Prime + 2.75%
LRM Term Loan Due 2034
Original principal amount	$ 10,000
Maturity date	Dec 2034
Interest rate	WSJ Prime + 2.75%
Notre Dame Debt (in default)
Original principal amount	$ 11,700
Maturity date	Jan 2018
Interest rate	16.00%
LE Term Loan Due 2050
Original principal amount	$ 150
Maturity date	Aug 2050
Interest rate	3.75%
NPS Term Loan Due 2050
Original principal amount	$ 150
Maturity date	Aug 2050
Interest rate	3.75%

10. Third-Party Long-Term Deb_3

10. Third-Party Long-Term Debt (Details 1) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Principal balance outstanding	$ 41,237	$ 39,424
Less: current portion of long-term debt, net	(33,644)	(33,836)
Less: unamortized debt issue costs	(1,781)	(1,877)
Less: accrued interest payable (in default)	(5,512)	(3,711)
Long term debt	300	0
LE Term Loan Due 2034
Principal balance outstanding	22,424	21,776
Less: accrued interest payable (in default)	(879)	(25)
LRM Term Loan Due 2034
Principal balance outstanding	9,299	9,031
Less: accrued interest payable (in default)	(397)	(47)
LE Term Loan Due 2050
Principal balance outstanding	150	0
NPS Term Loan Due 2050
Principal balance outstanding	150	0
Notre Dame Debt (in default)
Principal balance outstanding	9,214	8,617
Less: accrued interest payable (in default)	$ (4,236)	$ (3,639)

10. Third-Party Long-Term Deb_4

10. Third-Party Long-Term Debt (Details 2) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Less: accumulated amortization	$ (661)	$ (565)
Unamortized debt issue costs, net	1,781	1,877
LE Term Loan Due 2034
Unamortized debt issue costs, gross	1,674	1,674
LRM Term Loan Due 2034
Unamortized debt issue costs, gross	$ 768	$ 768

10. Third-Party Long-Term Deb_5

10. Third-Party Long-Term Debt (Details 3) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Accrued interest	$ 5,512	$ 3,711
Less: accrued interest payable (in default)	(5,512)	(3,711)
Long-term interest payable, net of current portion	0	0
Notre Dame Debt (in default)
Accrued interest	4,236	3,639
LE Term Loan Due 2034
Accrued interest	879	25
LRM Term Loan Due 2034
Accrued interest	$ 397	$ 47

11. Line of Credit Payable (Det

11. Line of Credit Payable (Details) - Amended Pilot Line Of Credit (in default) $ in Thousands	9 Months Ended
	Sep. 30, 2020USD ($)
Principal amount	$ 13,000
Maturity date	May 2020
Interest rate	14.00%

11. Line of Credit Payable (D_2

11. Line of Credit Payable (Details 1) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Line of credit, gross	$ 41,237	$ 39,424
Less: unamortized debt issue costs	(1,781)	(1,877)
Less: interest payable, short term	(5,512)	(3,711)
Amended Pilot Line Of Credit (in default)
Line of credit, gross	9,724	11,786
Less: unamortized debt issue costs	0	(219)
Less: interest payable, short term	(103)	(103)
Line of credit	$ 9,621	$ 11,464

12. ARO'S (Details)

12. ARO'S (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Asset Retirement Obligation Disclosure [Abstract]
AROs, at the beginning of the period	$ 2,565	$ 2,565
Liabilities settled	(179)	0
Asset retirement obligations	2,386	2,565
Less: asset retirement obligations, current portion	(2,386)	(2,565)
Long-term asset retirement obligations, at the end of the period	$ 0	$ 2,565

13. Lease Obligations (Details)

13. Lease Obligations (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Leases [Abstract]
Operating lease right-of-use assets, gross	$ 787		$ 787
Less: accumulated amortization on operating lease assets	(249)	$ (138)
Operating lease right-of-use assets, net	538		649
Finance lease assets, gross	86		180
Less: accumulated amortization on finance lease assets	(16)	$ (34)
Finance lease assets, net	70		140
Total lease assets	608		795
Current portion of operating lease	190		175
Current portion of finance lease	161		76
Total current lease liability	251		251
Long-term portion of operating lease	421		564
Total lease liabilities	$ 672		$ 815
Weighted average remaining lease term in years - operating lease	2 years 11 months 1 day
Weighted average discount rate - operating lease	8.25%
Weighted average discount rate - finance lease	8.25%

13. Lease Obligations (Details

13. Lease Obligations (Details 1) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Leases [Abstract]
Operating lease costs	$ 51	$ 51	$ 154	$ 154
Depreciation of leased assets	3	4	13	12
Interest on lease liabilities	0	2	3	4
Total lease cost	$ 54	$ 57	$ 170	$ 170

13. Lease Obligations (Detail_2

13. Lease Obligations (Details 2) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Leases [Abstract]
Operating cash flows for operating lease	$ 44	$ 40	$ 130	$ 81
Operating cash flows for finance leases	0	2	4	4
Financing cash flows for finance leases	$ 5	$ 13	$ 17	$ 35

13. Lease Obligations (Detail_3

13. Lease Obligations (Details 3) $ in Thousands	Sep. 30, 2020USD ($)
Operating Lease
2021	$ 190
2022	209
2023	212
Total minimum rental payments	611
Finance Lease
2021	61
2022	0
2023	0
Total minimum rental payments	61
Total
2021	251
2022	209
2023	212
Total minimum rental payments	$ 672

13. Lease Obligations (Detail_4

13. Lease Obligations (Details 4) $ in Thousands	Sep. 30, 2020USD ($)
Leases [Abstract]
2021	$ 232
2022	236
2023	220
Total	$ 688

14. Income Taxes (Details)

14. Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Income Tax Disclosure [Abstract]
Current federal	$ 0	$ 0	$ (15)	$ 0
Current state	0	0	0	0
Deferred federal	975	(1,833)	2,566	(1,190)
Deferred state	0	0	0	0
Change in valuation allowance	(975)	1,833	(2,566)	1,190
Total provision for income taxes	$ 0	$ 0	$ (15)	$ 0

14. Income Taxes (Details 1)

14. Income Taxes (Details 1) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Deferred tax assets:
NOL and capital loss carryforwards	$ 14,854	$ 12,463
Business interest expense	2,995	1,923
Start-up costs (crude oil and condensate processing facility)	530	594
ARO liability/deferred revenue	501	539
AMT credit	0	50
Other	1	11
Total deferred tax assets	18,881	15,580
Deferred tax liabilities:
Basis differences in property and equipment	(6,968)	(6,183)
Total deferred tax liabilities	(6,968)	(6,183)
Deferred tax assets, net	11,913	9,397
Valuation allowance	(11,913)	(9,347)
Deferred tax assets, net	$ 0	$ 50

14. Income Taxes (Details 2)

14. Income Taxes (Details 2) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Beginning balance	$ 52,672	$ 46,949
Net operating losses	11,384	5,723
Ending balance	64,056	52,672
Pre-Ownership Change
Beginning balance	9,614	9,614
Net operating losses	0	0
Ending balance	9,614	9,614
Post-Ownership Change
Beginning balance	43,058	37,335
Net operating losses	11,384	5,723
Ending balance	$ 54,442	$ 43,058

15. Earnings per share (Details

15. Earnings per share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Earnings Per Share [Abstract]
Net income (loss)	$ (4,653)	$ 8,167	$ (12,235)	$ 5,615
Basic and diluted income (loss) per share	$ (.37)	$ .74	$ (.98)	$ .51
Basic and Diluted
Weighted average number of shares of common stock outstanding and potential dilutive shares of common stock	12,693,514	10,975,514	12,534,493	10,975,215

16. Commitments and Contingen_3

16. Commitments and Contingencies (Details) $ in Thousands	Sep. 30, 2020USD ($)
Amounts received to reduce the outstanding balance of the Final Arbitration Award	$ 22,200
Initial Payment (September 2017)
Amounts received to reduce the outstanding balance of the Final Arbitration Award	3,700
GEL Interim Payments (July 2018 to April 2019)
Amounts received to reduce the outstanding balance of the Final Arbitration Award	8,000
Settlement Payment (Multiple Payments May 7 to 10, 2019)
Amounts received to reduce the outstanding balance of the Final Arbitration Award	10,000
Deferred Interim Installment Payments (June 2019 to August 2019)
Amounts received to reduce the outstanding balance of the Final Arbitration Award	$ 500