Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 05, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 000-08157 | |
Entity Registrant Name | RESERVE PETROLEUM CO | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 73-0237060 | |
Entity Address, Address Line One | 6801 BROADWAY EXT., | |
Entity Address, Address Line Two | SUITE 300 | |
Entity Address, City or Town | OKLAHOMA CITY | |
Entity Address, State or Province | OK | |
Entity Address, Postal Zip Code | 73116-9037 | |
City Area Code | 405 | |
Local Phone Number | 848-7551 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 155,850 | |
Entity Central Index Key | 0000083350 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 | |
Current Assets: | |||
Cash and Cash Equivalents | [1] | $ 5,468,633 | $ 7,299,224 |
Available-for-Sale Debt Securities | [1] | 4,629,750 | 4,208,648 |
Equity Securities | [1] | 2,952,309 | 2,302,959 |
Refundable Income Taxes | [1] | 182,814 | 120,230 |
Accounts Receivable | [1] | 1,898,080 | 2,318,183 |
Total Current Assets | [1] | 15,131,586 | 16,249,244 |
Investments: | |||
Equity Method Investments | [1] | 2,827,715 | 2,469,644 |
Other Investments | [1] | 5,191,303 | 5,085,806 |
Total Investments | [1] | 8,019,018 | 7,555,450 |
Property, Plant and Equipment: | |||
Unproved Properties | [1] | 1,945,734 | 1,846,543 |
Proved Properties | [1] | 66,777,316 | 65,328,501 |
Oil and Gas Properties, Gross | [1] | 68,723,050 | 67,175,044 |
Less – Accumulated Depreciation, Depletion, Amortization and Valuation Allowance | [1] | (53,823,903) | (52,773,978) |
Oil and Gas Properties, Net | [1] | 14,899,147 | 14,401,066 |
Other Property and Equipment, at Cost | [1] | 725,991 | 758,256 |
Less – Accumulated Depreciation | [1] | (239,288) | (236,883) |
Other Property and Equipment, Net | [1] | 486,703 | 521,373 |
Total Property, Plant and Equipment, Net | [1] | 15,385,850 | 14,922,439 |
Total Assets | [1] | 38,536,454 | 38,727,133 |
Current Liabilities: | |||
Accounts Payable | [1] | 308,724 | 399,735 |
Other Current Liabilities | [1] | 372,980 | 75,675 |
Note Payable, Current Portion | [1] | 139,280 | 136,637 |
Total Current Liabilities | [1] | 820,984 | 612,047 |
Long-Term Liabilities: | |||
Asset Retirement Obligation | [1] | 2,839,906 | 2,809,257 |
Deferred Tax Liability, Net | [1] | 1,901,034 | 1,619,595 |
Note Payable, Less Current Portion | [1] | 1,230,525 | 1,300,872 |
Total Long-Term Liabilities | [1] | 5,971,465 | 5,729,724 |
Total Liabilities | [1] | 6,792,449 | 6,341,771 |
Equity: | |||
Common Stock | [1] | 92,368 | 92,368 |
Additional Paid-in Capital | [1] | 65,000 | 65,000 |
Retained Earnings | [1] | 33,167,536 | 33,828,418 |
Equity Before Treasury Stock | [1] | 33,324,904 | 33,985,786 |
Less – Treasury Stock, at Cost | [1] | (1,762,887) | (1,749,858) |
Total Equity Applicable to The Reserve Petroleum Company | [1] | 31,562,017 | 32,235,928 |
Non-Controlling Interests | [1] | 181,988 | 149,434 |
Total Equity | [1] | 31,744,005 | 32,385,362 |
Total Liabilities and Equity | [1] | $ 38,536,454 | $ 38,727,133 |
[1]Amounts presented include balances held by our consolidated variable interest entities (“VIEs”), Grand Woods and TWS, as further discussed in Note 5 – Non-Controlling Interest and Variable Interest Entities. As of June 30, 2023, total assets and liabilities of Grand Woods, which are included in the consolidated balance sheets, were $2,284,151 and $1,369,805, respectively, including $112,323 of cash. Grand Woods note holder has partial recourse to the Company. As of June 30, 2023, total assets and liabilities of TWS, which are included in the consolidated balance sheets, were $944,375 and $358,514, respectively, including $508,010 of cash. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 | |
Assets | [1] | $ 38,536,454 | $ 38,727,133 |
Liabilities | [1] | 6,792,449 | 6,341,771 |
Variable Interest Entity, Primary Beneficiary | Grand Woods | |||
Assets | 2,284,151 | 2,195,878 | |
Liabilities | 1,369,805 | 1,437,509 | |
Cash | 112,323 | 24,050 | |
Variable Interest Entity, Primary Beneficiary | TWS | |||
Assets | 944,375 | 681,136 | |
Liabilities | 358,514 | 58,742 | |
Cash | $ 508,010 | $ 281,654 | |
[1]Amounts presented include balances held by our consolidated variable interest entities (“VIEs”), Grand Woods and TWS, as further discussed in Note 5 – Non-Controlling Interest and Variable Interest Entities. As of June 30, 2023, total assets and liabilities of Grand Woods, which are included in the consolidated balance sheets, were $2,284,151 and $1,369,805, respectively, including $112,323 of cash. Grand Woods note holder has partial recourse to the Company. As of June 30, 2023, total assets and liabilities of TWS, which are included in the consolidated balance sheets, were $944,375 and $358,514, respectively, including $508,010 of cash. |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Operating Revenues: | ||||
Total Operating Revenues | $ 2,818,837 | $ 4,411,654 | $ 5,918,478 | $ 8,158,666 |
Operating Costs and Expenses: | ||||
Depreciation, Depletion, Amortization and Valuation Provision | 380,595 | 295,400 | 1,315,330 | 630,446 |
Gain on Disposition of Oil and Gas Properties | 0 | (279) | 0 | (199,025) |
General, Administrative and Other | 702,171 | 399,910 | 1,315,758 | 934,077 |
Total Operating Costs and Expenses | 2,439,575 | 1,789,755 | 5,585,567 | 3,334,137 |
Income from Operations | 379,262 | 2,621,899 | 332,911 | 4,824,529 |
Equity Income/(Loss) in Investees | 26,977 | (50,133) | 58,633 | (133,590) |
Interest Expense | (17,096) | 0 | (34,049) | 0 |
Other Income/(Loss), Net | 188,709 | (1,466,938) | 757,542 | (1,532,044) |
Income Before Income Taxes and Non-Controlling Interest | 577,852 | 1,104,828 | 1,115,037 | 3,158,895 |
Income Tax Provision/(Benefit): | ||||
Current | (61,208) | (638,138) | (49,674) | (586,968) |
Deferred | 159,526 | 917,056 | 281,439 | 1,234,474 |
Total Income Tax Provision | 98,318 | 278,918 | 231,765 | 647,506 |
Net Income | 479,534 | 825,910 | 883,272 | 2,511,389 |
Less: Net Loss Attributable to Non-Controlling Interest | (7,629) | 0 | (16,550) | 0 |
Net Income Attributable to Common Stockholders | $ 487,163 | $ 825,910 | $ 899,822 | $ 2,511,389 |
Per Share Data | ||||
Net Income Attributable to Common Stockholders, Basic (in dollars per share) | $ 3.12 | $ 5.29 | $ 5.76 | $ 16.08 |
Cash Dividends Declared and/or Paid (in dollars per share) | $ 10 | $ 10 | $ 10 | $ 10 |
Weighted Average Shares Outstanding, Basic (in shares) | 156,089 | 156,161 | 156,123 | 156,167 |
Oil and Gas Sales | ||||
Operating Revenues: | ||||
Total Operating Revenues | $ 2,707,455 | $ 4,038,353 | $ 5,642,896 | $ 7,472,177 |
Lease Bonuses and Other | ||||
Operating Revenues: | ||||
Total Operating Revenues | 0 | 104,147 | 0 | 141,801 |
Water Well Drilling Services | ||||
Operating Revenues: | ||||
Total Operating Revenues | 111,382 | 269,154 | 275,582 | 544,688 |
Operating Costs and Expenses: | ||||
Operating costs and expenses | 147,997 | 221,096 | 314,570 | 370,617 |
Production | ||||
Operating Costs and Expenses: | ||||
Operating costs and expenses | 1,009,591 | 825,870 | 2,066,340 | 1,604,045 |
Exploration | ||||
Operating Costs and Expenses: | ||||
Operating costs and expenses | $ 199,221 | $ 47,758 | $ 573,569 | $ (6,023) |
Consolidated Statements of Equi
Consolidated Statements of Equity (Unaudited) - USD ($) | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Treasury Stock | Non- Controlling Interests | |
Beginning balance at Dec. 31, 2021 | $ 29,798,830 | $ 92,368 | $ 65,000 | $ 31,389,240 | $ (1,747,778) | $ 0 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income/(Loss) | 2,511,389 | 2,511,389 | |||||
Dividends Declared | (1,561,573) | (1,561,573) | |||||
Purchase of Treasury Stock | (2,080) | (2,080) | |||||
Ending balance at Jun. 30, 2022 | 30,746,566 | 92,368 | 65,000 | 32,339,056 | (1,749,858) | 0 | |
Beginning balance at Mar. 31, 2022 | 31,484,309 | 92,368 | 65,000 | 33,074,719 | (1,747,778) | 0 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income/(Loss) | 825,910 | 825,910 | |||||
Dividends Declared | (1,561,573) | (1,561,573) | |||||
Purchase of Treasury Stock | (2,080) | (2,080) | |||||
Ending balance at Jun. 30, 2022 | 30,746,566 | 92,368 | 65,000 | 32,339,056 | (1,749,858) | 0 | |
Beginning balance at Dec. 31, 2022 | 32,385,362 | [1] | 92,368 | 65,000 | 33,828,418 | (1,749,858) | 149,434 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income/(Loss) | 883,272 | 899,822 | (16,550) | ||||
Dividends Declared | (1,560,704) | (1,560,704) | |||||
Purchase of Treasury Stock | (13,029) | (13,029) | |||||
Contributions | 49,104 | 49,104 | |||||
Ending balance at Jun. 30, 2023 | 31,744,005 | [1] | 92,368 | 65,000 | 33,167,536 | (1,762,887) | 181,988 |
Beginning balance at Mar. 31, 2023 | 32,812,398 | 92,368 | 65,000 | 34,241,077 | (1,749,858) | 163,811 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income/(Loss) | 479,534 | 487,163 | (7,629) | ||||
Dividends Declared | (1,560,704) | (1,560,704) | |||||
Purchase of Treasury Stock | (13,029) | (13,029) | |||||
Contributions | 25,806 | 25,806 | |||||
Ending balance at Jun. 30, 2023 | $ 31,744,005 | [1] | $ 92,368 | $ 65,000 | $ 33,167,536 | $ (1,762,887) | $ 181,988 |
[1]Amounts presented include balances held by our consolidated variable interest entities (“VIEs”), Grand Woods and TWS, as further discussed in Note 5 – Non-Controlling Interest and Variable Interest Entities. As of June 30, 2023, total assets and liabilities of Grand Woods, which are included in the consolidated balance sheets, were $2,284,151 and $1,369,805, respectively, including $112,323 of cash. Grand Woods note holder has partial recourse to the Company. As of June 30, 2023, total assets and liabilities of TWS, which are included in the consolidated balance sheets, were $944,375 and $358,514, respectively, including $508,010 of cash. |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Statement of Cash Flows [Abstract] | ||
Net Cash Provided by Operating Activities | $ 2,644,446 | $ 4,391,434 |
Cash Provided by/(Applied to) Investing Activities: | ||
Maturity of Available-for-Sale Debt Securities | 4,478,841 | 0 |
Purchase of Available-for-Sale Debt Securities | (4,899,943) | 0 |
Proceeds from Disposal of Property, Plant and Equipment | 33,866 | 457,898 |
Purchase of Property, Plant and Equipment | (1,885,765) | (3,083,402) |
Purchase of Equity Method and Other Investments | (432,434) | (1,029,426) |
Cash Distributions from Other Investments | 340,399 | 81,205 |
Sale of Equity Securities | 305,781 | 2,059,005 |
Purchase of Equity Securities | (817,901) | (2,408,898) |
Net Change in Cash and Cash Equivalents | (1,830,591) | (1,095,837) |
Net Cash Applied to Investing Activities | (2,877,156) | (3,923,618) |
Cash Provided by/(Applied to) Financing Activities: | ||
Dividends Paid to Stockholders | (1,560,704) | (1,561,573) |
Purchase of Treasury Stock | (13,029) | (2,080) |
Payments of Note Payable | (67,704) | 0 |
Capital Contributions from Non-Controlling Interests | 43,556 | 0 |
Total Cash Applied to Financing Activities | (1,597,881) | (1,563,653) |
Cash and Cash Equivalents, Beginning of Period | 7,299,224 | 10,129,157 |
Cash and Cash Equivalents, End of Period | $ 5,468,633 | $ 9,033,320 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | Note 1 – BASIS OF PRESENTATION The Reserve Petroleum Company, a Delaware corporation, is an independent oil and gas company engaged in oil and natural gas exploration, development and minerals management with areas of concentration in Arkansas, Kansas, Oklahoma, South Dakota, Texas and Wyoming, a single business segment. The Company is also engaged in investments and joint ventures that are not significant business segments. The Company’s consolidated subsidiaries consist of Grand Woods Development, LLC (“Grand Woods”), an Oklahoma limited liability company and Trinity Water Services, LLC, an Oklahoma limited liability company, which has a water well drilling joint venture agreement with TWS South, LLC, a Texas limited liability company (Collectively, “TWS”). Unless otherwise specified or the context otherwise requires, all references in these notes to “the Company,” “its,” “our,” and “we” are to The Reserve Petroleum Company and its consolidated subsidiaries. The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). The consolidated financial statements include the accounts of The Reserve Petroleum Company and its subsidiaries in which the Company holds a controlling interest, reflecting ownership of a majority of the voting interest, as of the financial statement date. Additionally, the Company consolidates Variable Interest Entities (“VIEs”) under certain criteria discussed further below. All intercompany accounts and transactions have been eliminated in consolidation. When necessary, reclassifications that are not material to the consolidated financial statements are made to prior period financial information to conform to the current year presentation. The accompanying consolidated financial statements and notes thereto should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the Securities and Exchange Commission (hereinafter the “2022 Form 10-K”). In the opinion of management, the accompanying consolidated financial statements reflect all adjustments (consisting only of normal recurring accruals), which are necessary for a fair statement of the results of the interim periods presented. The results of operations for the current interim periods are not necessarily indicative of the operating results for the full year. Variable Interest Entities The Company decides at the inception of each arrangement whether an entity in which an investment is made or in which we have other variable interests is considered a VIE. Generally, an entity is a VIE if (1) the entity does not have sufficient equity at risk to finance its activities without additional subordinated financial support from other parties, (2) the entity’s investors lack any characteristics of a controlling financial interest or (3) the entity was established with non-substantive voting rights. The Company consolidates VIEs when the Company is deemed to be the primary beneficiary. The primary beneficiary of a VIE is generally the party that both: (1) has the power to make decisions that most significantly affect the economic performance of the VIE and (2) has the obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the VIE. If the Company is not deemed to be the primary beneficiary of a VIE, the Company accounts for the investment or other variable interests in a VIE in accordance with applicable GAAP. Non-Controlling Interests When the Company consolidates an entity, 100% of the assets, liabilities, revenues and expenses of the subsidiary are included in the consolidated financial statements. For those consolidated entities in which the Company’s ownership is less than 100%, the Company records a non-controlling interest as a component of equity on the consolidated balance sheets, which represents the third-party ownership in the net assets of the respective consolidated subsidiary. Additionally, the portion of the net income or loss attributable to the non-controlling interest is reported as net income (loss) attributable to non-controlling interest on the consolidated statements of income. Changes in ownership interests in an entity that do not result in deconsolidation are generally recognized within equity. See Note 5 for additional details on non-controlling interests. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2023 | |
Revenue Recognition [Abstract] | |
REVENUE RECOGNITION | Note 2 – REVENUE RECOGNITION A portion of oil and natural gas sales recorded in the consolidated statements of income are the result of estimated volumes and pricing for oil and natural gas payments not yet received for the period. For the six months ended June 30, 2023 and 2022, that estimate represented $1,748,836 and $2,144,069, respectively, of oil and natural gas sales included in the consolidated statements of income. The Company’s disaggregated revenue has two primary revenue sources, which are oil sales and natural gas sales. The following is an analysis of the components of oil and natural gas sales: Three Months Ended Six Months Ended 2023 2022 2023 2022 Oil Sales $ 2,195,462 $ 2,629,073 $ 4,539,499 $ 4,981,206 Natural Gas Sales 436,431 1,288,688 971,832 2,225,496 Miscellaneous Oil and Gas Product Sales 75,562 120,592 131,565 265,475 $ 2,707,455 $ 4,038,353 $ 5,642,896 $ 7,472,177 |
Other Income (Loss), Net
Other Income (Loss), Net | 6 Months Ended |
Jun. 30, 2023 | |
Other Income and Expenses [Abstract] | |
OTHER INCOME/(LOSS), NET | Note 3 – OTHER INCOME/(LOSS), NET The following is an analysis of the components of Other Income/(Loss), Net: Three Months Ended Six Months Ended 2023 2022 2023 2022 Net Realized and Unrealized Gain/(Loss), Equity Securities $ 54,596 $ (1,583,840) $ 137,231 $ (1,729,916) Interest Income 121,748 9,670 235,566 17,199 Dividend Income 16,589 87,824 26,889 184,126 Income/(Loss) from Other Investments 19,401 48,137 329,097 56,455 Miscellaneous Income/(Expenses) (23,625) (28,729) 28,759 (59,908) Other Income/(Loss), Net $ 188,709 $ (1,466,938) $ 757,542 $ (1,532,044) |
Investments and Related Commitm
Investments and Related Commitments and Contingent Liabilities, Including Guaranties | 6 Months Ended |
Jun. 30, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENTS AND RELATED COMMITMENTS AND CONTINGENT LIABILITIES, INCLUDING GUARANTIES | Note 4 – INVESTMENTS AND RELATED COMMITMENTS AND CONTINGENT LIABILITIES, INCLUDING GUARANTIES The Company’s Equity Method Investments include: Broadway Sixty-Eight, LLC (“Broadway 68”), an Oklahoma limited liability company, with a 33% ownership, owns and operates an office building in Oklahoma City, Oklahoma. The Company leases its corporate office from Broadway 68 on a month-to-month basis under the terms of the modified lease agreement. Rent expense for lease of the corporate office from Broadway 68 was $22,358 and $19,874 during the six months ended June 30, 2023 and 2022, respectively. The Company’s investment in Broadway 68 totaled $131,593 and $115,093 at June 30, 2023, and December 31, 2022, respectively. Broadway Seventy-Two, LLC (“Broadway 72”), an Oklahoma limited liability company, with a 40% ownership, was acquired in 2021. Broadway 72 owns and operates a commercial building in Oklahoma City, Oklahoma. The Company’s investment in Broadway 72 totaled $1,107,595 and $1,080,465 at June 30, 2023, and December 31, 2022, respectively. QSN Office Park, LLC (“QSN”), an Oklahoma limited liability company, with a 20% ownership, was acquired in 2016. QSN is constructing and selling office buildings in a new office park. The Company has guarantied 20% of a $953,931 development loan that matures July 15, 2025, and 20% of a construction loan of $585,000 that matures July 25, 2024. The Company’s investment in QSN totaled $280,878 and $284,249 at June 30, 2023, and December 31, 2022, respectively. The Company does not anticipate the need to perform on the guaranties of the loans. Stott’s Mill, with a 50% ownership, was acquired in May 2022. Stott’s Mill consists of two residential lots in a developing subdivision located in Basalt, Colorado. The Company’s investment in Stott’s Mill totaled $704,046 and $688,575 at June 30, 2023, and December 31, 2022, respectively. Victorum BRH2 Investment, LLC (“BRH2”), with a 16.3% ownership, was acquired in August 2021. BRH2 serves as a special purpose investment vehicle to hold an investment in Berry-Rock Capital, LP (“Berry-Rock”). Berry-Rock is a provider of a rent-to-own program for individuals unable to qualify for a mortgage. The Company receives quarterly distributions on an 11% annualized return on investment. The Company’s investment in BRH2 totaled $301,442 and $300,754 at June 30, 2023, and December 31, 2022, respectively. Victorum BRH3 Investment, LLC (“BRH3”), with a 27.27% ownership, was acquired in November 2022. BRH3 serves as a special purpose investment vehicle to hold an investment in Berry-Rock. The Company receives quarterly distributions on an 11% annualized return on investment. The Company’s investment in BRH3 totaled $302,161 and $301,261 at June 30, 2023, and December 31, 2022, respectively. The Company’s Other Investments primarily include: Bailey Hilltop Pipeline, LLC (“Bailey”), with a 10% ownership, was acquired in 2008. Bailey is a gas gathering system pipeline for the Bailey Hilltop Prospect oil and gas properties in Grady County, Oklahoma. The Company’s investment in Bailey totaled $77,377 at June 30, 2023, and December 31, 2022. Cloudburst International, Inc. (“Cloudburst”), with a 12.99% ownership, was acquired in 2019. Cloudburst owns exclusive rights to a water purification process technology that is being developed and currently tested. The Company’s investment in Cloudburst totaled $1,596,007 at June 30, 2023, and December 31, 2022. Genlith, Inc. (“Genlith”), with a 5.15% ownership, was acquired in July 2020. Genlith identifies and structures investments in the new energy economy through corporate ventures, advisory and fund management. The Company’s investment in Genlith totaled $311,958 and $460,000 at June 30, 2023, and December 31, 2022, respectively. Chilean Cobalt Corp. ("C3") is a spin-off from Genlith that has submitted an S-1 filing with the SEC to become a publicly traded entity. The Company owns 740,211 of S-1 Registered Shares of C3, representing less than 2% of outstanding shares, and entered into a twelve month lock-up agreement on May 11, 2023, whereby the Company agreed that it will not attempt to sell, transfer, or otherwise dispose of the Registered Shares, subject to a "trickle" into market, except at a rate not to exceed 30,000 shares per month on a non-cumulative basis. The Company's investment in C3 totaled $148,042 at June 30, 2023. OKC Industrial Properties, LC (“OKC”), with a 10% ownership, was acquired in 1992. OKC originally owned approximately 260 acres of undeveloped land in north Oklahoma City. In March 2023, OKC sold 10 acres, resulting in a gain of $290,000 for the Company. There was no basis adjustment in accordance with the sale and there is approximately 13 acres of land remaining. The Company’s investment in OKC totaled $82,482 at June 30, 2023, and December 31, 2022. Grand Woods holds approximately 26.56 acres of undeveloped real estate in northeast Oklahoma City. The accumulated costs of the land totaled $2,171,828 at June 30, 2023, and December 31, 2022. See Note 5 for information related to Grand Woods. Victorum Capital Club (“VCC”) invests in and manages special investment vehicles that hold investments in various startup companies. The Company participates with minority ownership in an assortment of investments held with VCC. The Company’s investment in VCC special investment vehicles totaled $357,259 at June 30, 2023, and December 31, 2022. VCC Venture Fund I, LP (“VCC Venture”), serves as a limited partnership to be used for investments in start-up entities and is managed by Victorum Capital Club. The Company committed to a $250,000 investment in VCC Venture. The Company’s investment in VCC Venture totaled $62,500 and $31,250 at June 30, 2023, and December 31, 2022, respectively. The balance at June 30, 2023, represents 25% of the Company's capital commitment. |
Non-Controlling Interest and Va
Non-Controlling Interest and Variable Interest Entities | 6 Months Ended |
Jun. 30, 2023 | |
Noncontrolling Interest [Abstract] | |
NON-CONTROLLING INTEREST AND VARIABLE INTEREST ENTITIES | Note 5 – NON-CONTROLLING INTEREST AND VARIABLE INTEREST ENTITIES TWS and Grand Woods are accounted for as consolidated VIEs. The Company owns an 80.37% interest in Grand Woods in the form of 47.08 Class A units and 546,735 Class C units, with the remaining non-controlling member interests held by other members, including 8.72% owned by executive officers of the Company. Grand Woods holds approximately 26.56 acres of undeveloped real estate in northeast Oklahoma City. On September 15, 2022, Grand Woods entered into an agreement (“the 2022 Agreement”) with its members that resulted in the Company having the power to direct the activities significant to Grand Woods and becoming the primary beneficiary; therefore, consolidation of Grand Woods became required and effective for the period ended September 30, 2022. The Company is the only guarantor of $1,200,000 of a note payable held by Grand Woods. See Note 6 for terms and guaranty of debt held by Grand Woods, which is included in the consolidated balance sheets. As a result of the Company’s guaranty of $1,200,000 of Grand Woods debt, the note holder has partial recourse to the Company for the consolidated VIE’s liabilities. The following table presents the summarized assets and liabilities of Grand Woods and TWS included in the consolidated balance sheets as of June 30, 2023, and December 31, 2022. The assets of Grand Woods and TWS in the table below may only be used to settle obligations of Grand Woods or TWS, respectively. The assets and liabilities in the table below include third party assets and liabilities only and exclude intercompany balances that eliminate in consolidation. June 30, 2023 Grand Woods TWS Total Assets: Cash $ 112,323 $ 508,010 $ 620,333 Accounts Receivable — 122,982 122,982 Total Current Assets 112,323 630,992 743,315 Other Investments (Land) 2,171,828 — 2,171,828 Other Property and Equipment, at Cost — 442,244 442,244 Less – Accumulated Depreciation — (128,861) (128,861) Other Property and Equipment, Net — 313,383 313,383 Total Assets $ 2,284,151 $ 944,375 $ 3,228,526 Liabilities: Accounts Payable $ — $ 19,529 $ 19,529 Note Payable, Current Portion 139,280 — 139,280 Deferred Revenue — 338,985 338,985 Total Current Liabilities 139,280 358,514 497,794 Note Payable, Less Current Portion 1,230,525 — 1,230,525 Total Liabilities $ 1,369,805 $ 358,514 $ 1,728,319 December 31, 2022 Grand Woods TWS Total Assets: Cash $ 24,050 $ 281,654 $ 305,704 Accounts Receivable — 72,716 72,716 Total Current Assets 24,050 354,370 378,420 Other Investments (Land) 2,171,828 — 2,171,828 Other Property and Equipment, at Cost — 419,044 419,044 Less – Accumulated Depreciation — (92,278) (92,278) Other Property and Equipment, Net — 326,766 326,766 Total Assets $ 2,195,878 $ 681,136 $ 2,877,014 Liabilities: Accounts Payable $ — $ 58,742 $ 58,742 Note Payable, Current Portion 136,637 — 136,637 Total Current Liabilities 136,637 58,742 195,379 Note Payable, Less Current Portion 1,300,872 — 1,300,872 Total Liabilities $ 1,437,509 $ 58,742 $ 1,496,251 |
Note Payable
Note Payable | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
NOTE PAYABLE | Note 6 – NOTE PAYABLE Grand Woods has a note payable (“the Note”) that was used for the purchase and development of property. The Note has a 4% interest rate and matures November 23, 2026. The Note has scheduled payments of principal and interest in the amount of $16,034 per month, with a balloon payment of any unpaid principal balance due on November 23, 2026. The balance of the Note at June 30, 2023, and December 31, 2022, is $1,369,805 and $1,437,509, respectively, of which $139,280 is classified as current at June 30, 2023. Interest paid on the Note in the period ended June 30, 2023, totaled $28,501, with none in 2022. The Note is secured by the underlying property and a $1,200,000 guaranty issued by the Company. Covenants of the Note include a pay down requirement that states that sales of parcels will require a pay down on the loan of 90% of the net proceeds received from the purchaser less capital gains tax obligation. The remaining 10% shall be held in an operating reserve account for operating expenses and the use in payment of taxes. No distributions to partners, except for taxes, are permitted throughout the term of the loan. The intent of the Grand Woods investment manager and members is that proceeds from the sale of all, or part of, the property will be used to reduce or eliminate the Note. The Company does not anticipate the need to perform on the guaranty of the Note. Below is a schedule of future principal payments on the outstanding Note at June 30, 2023: Years Ending December 31, Principal Payments 2023 $ 68,933 2024 142,136 2025 148,155 2026 1,010,581 Total $ 1,369,805 |
Provision for Income Taxes
Provision for Income Taxes | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
PRROVISION FOR INCOME TAXES | Note 7 – PROVISION FOR INCOME TAXES In 2023 and 2022, the effective tax rate differed from the statutory rate, primarily as a result of allowable depletion for tax purposes in excess of the cost basis in oil and natural gas properties. Excess federal percentage depletion, which is limited to certain production volumes and by certain income levels, reduces estimated taxable income projected for any year. The federal excess percentage depletion estimates will be updated throughout the year until finalized with the detail well-by-well calculations at year-end. When a provision for income taxes is recorded, federal excess percentage depletion benefits decrease the effective tax rate. When a benefit for income taxes is recorded, federal excess percentage depletion benefits increase the effective tax rate. The benefit of federal excess percentage depletion is not directly related to the amount of pre-tax income recorded in a period. Accordingly, in periods where a recorded pre-tax income is relatively small, the proportional effect of these items on the effective tax rate may be significant. |
Asset Retirement Obligation
Asset Retirement Obligation | 6 Months Ended |
Jun. 30, 2023 | |
Asset Retirement Obligation [Abstract] | |
ASSET RETIREMENT OBLIGATION | Note 8 – ASSET RETIREMENT OBLIGATION The Company records the fair value of its estimated liability to retire its oil and natural gas producing properties in the period in which it is incurred (typically the date of first sale). The estimated liability is calculated by obtaining current estimated plugging costs from the well operators and inflating it over the life of the property. Current year inflation rate used is 4.08%. When the liability is first recorded, a corresponding increase in the carrying amount of the related long-lived asset is also recorded. Subsequently, the asset is amortized to expense over the life of the property and the liability is increased annually for the change in its present value which is currently 3.25%. A reconciliation of the Company’s asset retirement obligation liability is as follows: Balance at December 31, 2022 $ 2,809,257 Liabilities settled (wells sold or plugged) (5,793) Accretion expense 36,442 Balance at June 30, 2023 $ 2,839,906 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | Note 9 – FAIR VALUE MEASUREMENTS The Company uses a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level 1 – Unadjusted quoted prices for identical assets or liabilities in active markets. Level 2 – Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs or significant value drivers are observable. Level 3 – Unobservable inputs that reflect the Company’s own assumptions. Recurring Fair Value Measurements Certain of the Company’s assets are reported at fair value in the accompanying consolidated balance sheets on a recurring basis. The Company determined the fair value of equity securities and available-for-sale debt securities using quoted market prices, and where applicable, securities with similar maturity dates and interest rates. At June 30, 2023, and December 31, 2022, the Company’s assets reported at fair value on a recurring basis are summarized as follows: June 30, 2023 Level 1 Inputs Level 2 Inputs Level 3 Inputs Financial Assets: Available-for-Sale Debt Securities – U.S. Treasury Bills Maturing within 1 Year $ — $ 4,629,750 $ — Equity Securities: Domestic Equities 2,501,833 — — International Equities 293,494 — — Others 156,982 — — $ 2,952,309 $ 4,629,750 $ — December 31, 2022 Level 1 Inputs Level 2 Inputs Level 3 Inputs Financial Assets: Available-for-Sale Debt Securities – U.S. Treasury Bills Maturing within 1 Year $ — $ 4,208,648 $ — Equity Securities: Domestic Equities $ 1,720,410 $ — $ — International Equities 448,405 — — Others 134,144 — — $ 2,302,959 $ 4,208,648 $ — Non-Recurring Fair Value Measurements The Company’s asset retirement obligation annually represents a non-recurring fair value liability, for which there were no liabilities incurred in the periods ended June 30, 2023 or 2022. See Note 8 above for more information about this liability and the inputs used for calculating fair value. Impairment losses recorded on oil and gas assets in the six months ended June 30, 2023 were $443,456, with none in the comparable period in 2022. This also relates to non-recurring fair value measurements calculated using Level 3 inputs. Certain oil and natural gas producing properties have been deemed to be impaired because the assets, evaluated on a property-by-property basis, are not expected to recover their entire carrying value through future cash flows. Impairment losses, when recorded, are included in the consolidated statements of income in the line-item Depreciation, Depletion, Amortization and Valuation Provisions. Impairments are calculated by reducing the carrying value of the individual properties to an estimated fair value equal to the discounted present value of the future cash flow from these properties. Forward pricing is used for calculating future revenue and cash flow. Fair Value of Financial Instruments The Company’s other financial instruments consist primarily of cash and cash equivalents, trade receivables, and trade payables. At June 30, 2023, and December 31, 2022, the historical cost of cash and cash equivalents, trade receivables and trade payables are considered to be representative of their respective fair values due to the short-term maturities of these items. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The Reserve Petroleum Company, a Delaware corporation, is an independent oil and gas company engaged in oil and natural gas exploration, development and minerals management with areas of concentration in Arkansas, Kansas, Oklahoma, South Dakota, Texas and Wyoming, a single business segment. The Company is also engaged in investments and joint ventures that are not significant business segments. The Company’s consolidated subsidiaries consist of Grand Woods Development, LLC (“Grand Woods”), an Oklahoma limited liability company and Trinity Water Services, LLC, an Oklahoma limited liability company, which has a water well drilling joint venture agreement with TWS South, LLC, a Texas limited liability company (Collectively, “TWS”). Unless otherwise specified or the context otherwise requires, all references in these notes to “the Company,” “its,” “our,” and “we” are to The Reserve Petroleum Company and its consolidated subsidiaries. The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). The consolidated financial statements include the accounts of The Reserve Petroleum Company and its subsidiaries in which the Company holds a controlling interest, reflecting ownership of a majority of the voting interest, as of the financial statement date. Additionally, the Company consolidates Variable Interest Entities (“VIEs”) under certain criteria discussed further below. All intercompany accounts and transactions have been eliminated in consolidation. When necessary, reclassifications that are not material to the consolidated financial statements are made to prior period financial information to conform to the current year presentation. The accompanying consolidated financial statements and notes thereto should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the Securities and Exchange Commission (hereinafter the “2022 Form 10-K”). In the opinion of management, the accompanying consolidated financial statements reflect all adjustments (consisting only of normal recurring accruals), which are necessary for a fair statement of the results of the interim periods presented. The results of operations for the current interim periods are not necessarily indicative of the operating results for the full year. |
Variable Interest Entities | Variable Interest Entities The Company decides at the inception of each arrangement whether an entity in which an investment is made or in which we have other variable interests is considered a VIE. Generally, an entity is a VIE if (1) the entity does not have sufficient equity at risk to finance its activities without additional subordinated financial support from other parties, (2) the entity’s investors lack any characteristics of a controlling financial interest or (3) the entity was established with non-substantive voting rights. The Company consolidates VIEs when the Company is deemed to be the primary beneficiary. The primary beneficiary of a VIE is generally the party that both: (1) has the power to make decisions that most significantly affect the economic performance of the VIE and (2) has the obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the VIE. If the Company is not deemed to be the primary beneficiary of a VIE, the Company accounts for the investment or other variable interests in a VIE in accordance with applicable GAAP. |
Non-Controlling Interest | Non-Controlling Interests When the Company consolidates an entity, 100% of the assets, liabilities, revenues and expenses of the subsidiary are included in the consolidated financial statements. For those consolidated entities in which the Company’s ownership is less than 100%, the Company records a non-controlling interest as a component of equity on the consolidated balance sheets, which represents the third-party ownership in the net assets of the respective consolidated subsidiary. Additionally, the portion of the net income or loss attributable to the non-controlling interest is reported as net income (loss) attributable to non-controlling interest on the consolidated statements of income. Changes in ownership interests in an entity that do not result in deconsolidation are generally recognized within equity. See Note 5 for additional details on non-controlling interests. |
Fair Value Measuremens | The Company uses a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level 1 – Unadjusted quoted prices for identical assets or liabilities in active markets. Level 2 – Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs or significant value drivers are observable. Level 3 – Unobservable inputs that reflect the Company’s own assumptions. Recurring Fair Value Measurements Certain of the Company’s assets are reported at fair value in the accompanying consolidated balance sheets on a recurring basis. The Company determined the fair value of equity securities and available-for-sale debt securities using quoted market prices, and where applicable, securities with similar maturity dates and interest rates. Non-Recurring Fair Value Measurements The Company’s asset retirement obligation annually represents a non-recurring fair value liability, for which there were no liabilities incurred in the periods ended June 30, 2023 or 2022. See Note 8 above for more information about this liability and the inputs used for calculating fair value. Impairment losses recorded on oil and gas assets in the six months ended June 30, 2023 were $443,456, with none in the comparable period in 2022. This also relates to non-recurring fair value measurements calculated using Level 3 inputs. Certain oil and natural gas producing properties have been deemed to be impaired because the assets, evaluated on a property-by-property basis, are not expected to recover their entire carrying value through future cash flows. Impairment losses, when recorded, are included in the consolidated statements of income in the line-item Depreciation, Depletion, Amortization and Valuation Provisions. Impairments are calculated by reducing the carrying value of the individual properties to an estimated fair value equal to the discounted present value of the future cash flow from these properties. Forward pricing is used for calculating future revenue and cash flow. Fair Value of Financial Instruments The Company’s other financial instruments consist primarily of cash and cash equivalents, trade receivables, and trade payables. At June 30, 2023, and December 31, 2022, the historical cost of cash and cash equivalents, trade receivables and trade payables are considered to be representative of their respective fair values due to the short-term maturities of these items. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Revenue Recognition [Abstract] | |
Schedule of Disaggregation of Revenue | The Company’s disaggregated revenue has two primary revenue sources, which are oil sales and natural gas sales. The following is an analysis of the components of oil and natural gas sales: Three Months Ended Six Months Ended 2023 2022 2023 2022 Oil Sales $ 2,195,462 $ 2,629,073 $ 4,539,499 $ 4,981,206 Natural Gas Sales 436,431 1,288,688 971,832 2,225,496 Miscellaneous Oil and Gas Product Sales 75,562 120,592 131,565 265,475 $ 2,707,455 $ 4,038,353 $ 5,642,896 $ 7,472,177 |
Other Income (Loss), Net (Table
Other Income (Loss), Net (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Income/(Loss) | The following is an analysis of the components of Other Income/(Loss), Net: Three Months Ended Six Months Ended 2023 2022 2023 2022 Net Realized and Unrealized Gain/(Loss), Equity Securities $ 54,596 $ (1,583,840) $ 137,231 $ (1,729,916) Interest Income 121,748 9,670 235,566 17,199 Dividend Income 16,589 87,824 26,889 184,126 Income/(Loss) from Other Investments 19,401 48,137 329,097 56,455 Miscellaneous Income/(Expenses) (23,625) (28,729) 28,759 (59,908) Other Income/(Loss), Net $ 188,709 $ (1,466,938) $ 757,542 $ (1,532,044) |
Non-Controlling Interest and _2
Non-Controlling Interest and Variable Interest Entities (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Noncontrolling Interest [Abstract] | |
Schedule of Variable Interest Entities | The following table presents the summarized assets and liabilities of Grand Woods and TWS included in the consolidated balance sheets as of June 30, 2023, and December 31, 2022. The assets of Grand Woods and TWS in the table below may only be used to settle obligations of Grand Woods or TWS, respectively. The assets and liabilities in the table below include third party assets and liabilities only and exclude intercompany balances that eliminate in consolidation. June 30, 2023 Grand Woods TWS Total Assets: Cash $ 112,323 $ 508,010 $ 620,333 Accounts Receivable — 122,982 122,982 Total Current Assets 112,323 630,992 743,315 Other Investments (Land) 2,171,828 — 2,171,828 Other Property and Equipment, at Cost — 442,244 442,244 Less – Accumulated Depreciation — (128,861) (128,861) Other Property and Equipment, Net — 313,383 313,383 Total Assets $ 2,284,151 $ 944,375 $ 3,228,526 Liabilities: Accounts Payable $ — $ 19,529 $ 19,529 Note Payable, Current Portion 139,280 — 139,280 Deferred Revenue — 338,985 338,985 Total Current Liabilities 139,280 358,514 497,794 Note Payable, Less Current Portion 1,230,525 — 1,230,525 Total Liabilities $ 1,369,805 $ 358,514 $ 1,728,319 December 31, 2022 Grand Woods TWS Total Assets: Cash $ 24,050 $ 281,654 $ 305,704 Accounts Receivable — 72,716 72,716 Total Current Assets 24,050 354,370 378,420 Other Investments (Land) 2,171,828 — 2,171,828 Other Property and Equipment, at Cost — 419,044 419,044 Less – Accumulated Depreciation — (92,278) (92,278) Other Property and Equipment, Net — 326,766 326,766 Total Assets $ 2,195,878 $ 681,136 $ 2,877,014 Liabilities: Accounts Payable $ — $ 58,742 $ 58,742 Note Payable, Current Portion 136,637 — 136,637 Total Current Liabilities 136,637 58,742 195,379 Note Payable, Less Current Portion 1,300,872 — 1,300,872 Total Liabilities $ 1,437,509 $ 58,742 $ 1,496,251 |
Note Payable (Tables)
Note Payable (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Maturities of Note Payable | Below is a schedule of future principal payments on the outstanding Note at June 30, 2023: Years Ending December 31, Principal Payments 2023 $ 68,933 2024 142,136 2025 148,155 2026 1,010,581 Total $ 1,369,805 |
Asset Retirement Obligation (Ta
Asset Retirement Obligation (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Asset Retirement Obligation [Abstract] | |
Schedule of Asset Retirement Obligations | A reconciliation of the Company’s asset retirement obligation liability is as follows: Balance at December 31, 2022 $ 2,809,257 Liabilities settled (wells sold or plugged) (5,793) Accretion expense 36,442 Balance at June 30, 2023 $ 2,839,906 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | At June 30, 2023, and December 31, 2022, the Company’s assets reported at fair value on a recurring basis are summarized as follows: June 30, 2023 Level 1 Inputs Level 2 Inputs Level 3 Inputs Financial Assets: Available-for-Sale Debt Securities – U.S. Treasury Bills Maturing within 1 Year $ — $ 4,629,750 $ — Equity Securities: Domestic Equities 2,501,833 — — International Equities 293,494 — — Others 156,982 — — $ 2,952,309 $ 4,629,750 $ — December 31, 2022 Level 1 Inputs Level 2 Inputs Level 3 Inputs Financial Assets: Available-for-Sale Debt Securities – U.S. Treasury Bills Maturing within 1 Year $ — $ 4,208,648 $ — Equity Securities: Domestic Equities $ 1,720,410 $ — $ — International Equities 448,405 — — Others 134,144 — — $ 2,302,959 $ 4,208,648 $ — |
Revenue Recognition - Narrative
Revenue Recognition - Narrative (Details) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Revenue Recognition [Abstract] | ||
Estimate of oil and natural gas payments not yet received | $ 1,748,836 | $ 2,144,069 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregated Revenue (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 2,707,455 | $ 4,038,353 | $ 5,642,896 | $ 7,472,177 |
Oil Sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 2,195,462 | 2,629,073 | 4,539,499 | 4,981,206 |
Natural Gas Sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 436,431 | 1,288,688 | 971,832 | 2,225,496 |
Miscellaneous Oil and Gas Product Sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 75,562 | $ 120,592 | $ 131,565 | $ 265,475 |
Other Income (Loss), Net - Sche
Other Income (Loss), Net - Schedule of Components of Other Income, Net (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Other Income and Expenses [Abstract] | ||||
Net Realized and Unrealized Gain/(Loss), Equity Securities | $ 54,596 | $ (1,583,840) | $ 137,231 | $ (1,729,916) |
Interest Income | 121,748 | 9,670 | 235,566 | 17,199 |
Dividend Income | 16,589 | 87,824 | 26,889 | 184,126 |
Income/(Loss) from Other Investments | 19,401 | 48,137 | 329,097 | 56,455 |
Miscellaneous Income/(Expenses) | (23,625) | (28,729) | 28,759 | (59,908) |
Other Income/(Loss), Net | $ 188,709 | $ (1,466,938) | $ 757,542 | $ (1,532,044) |
Investments and Related Commi_2
Investments and Related Commitments and Contingent Liabilities, Including Guaranties (Details) | 1 Months Ended | 6 Months Ended | |||||
Mar. 31, 2023 USD ($) a | Jun. 30, 2023 USD ($) a | Jun. 30, 2022 USD ($) | May 11, 2023 shares | Dec. 31, 2022 USD ($) | Dec. 31, 1992 a | ||
Schedule of Equity Method Investments [Line Items] | |||||||
Equity method investments | [1] | $ 2,827,715 | $ 2,469,644 | ||||
Other Investments | [1] | 5,191,303 | 5,085,806 | ||||
Special investment vehicles | [1] | 725,991 | 758,256 | ||||
Corporate Office from Broadway | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Rent expense | 22,358 | $ 19,874 | |||||
Equity method investments | $ 131,593 | 115,093 | |||||
Broadway 68 | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 33% | ||||||
Broadway 72 | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 40% | ||||||
Equity method investments | $ 1,107,595 | 1,080,465 | |||||
QSN | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 20% | ||||||
Equity method investments | $ 280,878 | 284,249 | |||||
QSN | Development Loan | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Value of guaranteed loans | 953,931 | ||||||
QSN | Construction Loan | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Value of guaranteed loans | $ 585,000 | ||||||
Stott's Mill | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 50% | ||||||
Other Investments | $ 704,046 | 688,575 | |||||
BHR2 | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 16.30% | ||||||
Other Investments | $ 301,442 | 300,754 | |||||
Annual return on investment (as a percent) | 11% | ||||||
BRH3 | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 27.27% | ||||||
Other Investments | $ 302,161 | 301,261 | |||||
Bailey | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 10% | ||||||
Other Investments | $ 77,377 | 77,377 | |||||
Cloudburst | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 12.99% | ||||||
Other Investments | $ 1,596,007 | 1,596,007 | |||||
Genlith | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 5.15% | ||||||
Other Investments | $ 311,958 | 460,000 | |||||
OKC | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership percentage (as a percent) | 10% | ||||||
Other Investments | $ 82,482 | 82,482 | |||||
Area of land (Acre) | a | 13 | 260 | |||||
OKC Industrial Properties Sold | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Area of land (Acre) | a | 10 | ||||||
Proceeds from sale of land | $ 290,000 | ||||||
Grand Woods | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Area of land (Acre) | a | 26.56 | ||||||
Other Investments (Land) | $ 2,171,828 | 2,171,828 | |||||
VCC | Oil And Gas, Special Investment Vehicles | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Special investment vehicles | 357,259 | 357,259 | |||||
VCC Venture | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Other Investments | 62,500 | $ 31,250 | |||||
Committed investment | $ 250,000 | ||||||
Committed investment ratio (as a percent) | 25% | ||||||
Cortado II-A | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Other Investments | $ 375,000 | ||||||
Committed investment | $ 1,000,000 | ||||||
Committed investment ratio (as a percent) | 37.50% | ||||||
C3 | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Investment owned (in shares) | shares | 740,211 | ||||||
Number of shares allowed to be sold, transferred, or disposed of per month (in shares) | shares | 30,000 | ||||||
Value of investment owned | $ 148,042 | ||||||
[1]Amounts presented include balances held by our consolidated variable interest entities (“VIEs”), Grand Woods and TWS, as further discussed in Note 5 – Non-Controlling Interest and Variable Interest Entities. As of June 30, 2023, total assets and liabilities of Grand Woods, which are included in the consolidated balance sheets, were $2,284,151 and $1,369,805, respectively, including $112,323 of cash. Grand Woods note holder has partial recourse to the Company. As of June 30, 2023, total assets and liabilities of TWS, which are included in the consolidated balance sheets, were $944,375 and $358,514, respectively, including $508,010 of cash. |
Non-Controlling Interest and _3
Non-Controlling Interest and Variable Interest Entities - Narrative (Details) $ in Millions | 6 Months Ended | |
Jun. 30, 2023 a shares | Sep. 15, 2022 USD ($) | |
Common Class A | ||
Variable Interest Entity [Line Items] | ||
Units owned (in shares) | 47.08 | |
Common Class C | ||
Variable Interest Entity [Line Items] | ||
Units owned (in shares) | 546,735 | |
Grand Woods | ||
Variable Interest Entity [Line Items] | ||
Area of land (Acre) | a | 26.56 | |
Variable Interest Entity, Primary Beneficiary | Partial recourse | Secured Debt | ||
Variable Interest Entity [Line Items] | ||
Note payable | $ | $ 1.2 | |
Variable Interest Entity, Primary Beneficiary | Grand Woods | ||
Variable Interest Entity [Line Items] | ||
Ownership (as a percent) | 80.37% | |
Variable Interest Entity, Primary Beneficiary | Grand Woods | Executive Officer | ||
Variable Interest Entity [Line Items] | ||
Ownership (as a percent) | 8.72% |
Non-Controlling Interest and _4
Non-Controlling Interest and Variable Interest Entities - Schedule of Balance Sheet Information (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 | |
Assets: | |||
Accounts Receivable | [1] | $ 1,898,080 | $ 2,318,183 |
Total Current Assets | [1] | 15,131,586 | 16,249,244 |
Other Property and Equipment, Net | [1] | 486,703 | 521,373 |
Total Assets | [1] | 38,536,454 | 38,727,133 |
Liabilities: | |||
Accounts Payable | [1] | 308,724 | 399,735 |
Note Payable, Current Portion | [1] | 139,280 | 136,637 |
Total Current Liabilities | [1] | 820,984 | 612,047 |
Note Payable, Less Current Portion | [1] | 1,230,525 | 1,300,872 |
Total Liabilities | [1] | 6,792,449 | 6,341,771 |
Variable Interest Entity, Primary Beneficiary | Total | |||
Assets: | |||
Cash | 620,333 | 305,704 | |
Accounts Receivable | 122,982 | 72,716 | |
Total Current Assets | 743,315 | 378,420 | |
Other Investments (Land) | 2,171,828 | 2,171,828 | |
Other Property and Equipment, at Cost | 442,244 | 419,044 | |
Less – Accumulated Depreciation | (128,861) | (92,278) | |
Other Property and Equipment, Net | 313,383 | 326,766 | |
Total Assets | 3,228,526 | 2,877,014 | |
Liabilities: | |||
Accounts Payable | 19,529 | 58,742 | |
Note Payable, Current Portion | 139,280 | 136,637 | |
Deferred Revenue | 338,985 | ||
Total Current Liabilities | 497,794 | 195,379 | |
Note Payable, Less Current Portion | 1,230,525 | 1,300,872 | |
Total Liabilities | 1,728,319 | 1,496,251 | |
Variable Interest Entity, Primary Beneficiary | Grand Woods | |||
Assets: | |||
Cash | 112,323 | 24,050 | |
Accounts Receivable | 0 | 0 | |
Total Current Assets | 112,323 | 24,050 | |
Other Investments (Land) | 2,171,828 | 2,171,828 | |
Other Property and Equipment, at Cost | 0 | 0 | |
Less – Accumulated Depreciation | 0 | 0 | |
Other Property and Equipment, Net | 0 | 0 | |
Total Assets | 2,284,151 | 2,195,878 | |
Liabilities: | |||
Accounts Payable | 0 | 0 | |
Note Payable, Current Portion | 139,280 | 136,637 | |
Deferred Revenue | 0 | ||
Total Current Liabilities | 139,280 | 136,637 | |
Note Payable, Less Current Portion | 1,230,525 | 1,300,872 | |
Total Liabilities | 1,369,805 | 1,437,509 | |
Variable Interest Entity, Primary Beneficiary | TWS | |||
Assets: | |||
Cash | 508,010 | 281,654 | |
Accounts Receivable | 122,982 | 72,716 | |
Total Current Assets | 630,992 | 354,370 | |
Other Investments (Land) | 0 | 0 | |
Other Property and Equipment, at Cost | 442,244 | 419,044 | |
Less – Accumulated Depreciation | (128,861) | (92,278) | |
Other Property and Equipment, Net | 313,383 | 326,766 | |
Total Assets | 944,375 | 681,136 | |
Liabilities: | |||
Accounts Payable | 19,529 | 58,742 | |
Note Payable, Current Portion | 0 | 0 | |
Deferred Revenue | 338,985 | ||
Total Current Liabilities | 358,514 | 58,742 | |
Note Payable, Less Current Portion | 0 | 0 | |
Total Liabilities | $ 358,514 | $ 58,742 | |
[1]Amounts presented include balances held by our consolidated variable interest entities (“VIEs”), Grand Woods and TWS, as further discussed in Note 5 – Non-Controlling Interest and Variable Interest Entities. As of June 30, 2023, total assets and liabilities of Grand Woods, which are included in the consolidated balance sheets, were $2,284,151 and $1,369,805, respectively, including $112,323 of cash. Grand Woods note holder has partial recourse to the Company. As of June 30, 2023, total assets and liabilities of TWS, which are included in the consolidated balance sheets, were $944,375 and $358,514, respectively, including $508,010 of cash. |
Note Payable - Narrative (Detai
Note Payable - Narrative (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Sep. 15, 2022 | Jun. 30, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | |||
Current portion of note payable | $ 139,280 | ||
Notes Payable | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 4% | ||
Monthly principal payment | $ 16,034 | ||
Note payable | 1,369,805 | $ 1,437,509 | |
Interest paid | $ 28,501 | $ 0 | |
Pay down requirement included in covenant (as a percent) | 90% | ||
Remaining portion of pay down covenant (as a percent) | 10% | ||
Secured Debt | Variable Interest Entity, Primary Beneficiary | Partial recourse | |||
Debt Instrument [Line Items] | |||
Note payable | $ 1,200,000 |
Note Payable - Schedule of Futu
Note Payable - Schedule of Future Principal Payments (Details) - Notes Payable - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
2023 | $ 68,933 | |
2024 | 142,136 | |
2025 | 148,155 | |
2026 | 1,010,581 | |
Total | $ 1,369,805 | $ 1,437,509 |
Asset Retirement Obligation - N
Asset Retirement Obligation - Narrative (Details) | 6 Months Ended |
Jun. 30, 2023 | |
Asset Retirement Obligation [Abstract] | |
Current year inflation (as a percent) | 4.08% |
Change in net present value (as a percent) | 3.25% |
Asset Retirement Obligation - S
Asset Retirement Obligation - Schedule of Asset Retirement Obligation (Details) | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | |
Beginning balance | $ 2,809,257 |
Liabilities settled (wells sold or plugged) | (5,793) |
Accretion expense | 36,442 |
Ending balance | $ 2,839,906 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value Reported on a Recurring Basis (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 | |
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Available-for-Sale Debt Securities – U.S. | [1] | $ 4,629,750 | $ 4,208,648 |
Equity Securities | [1] | 2,952,309 | 2,302,959 |
Fair Value, Recurring | Level 1 Inputs | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Total assets measured at fair value | 2,952,309 | 2,302,959 | |
Fair Value, Recurring | Level 1 Inputs | Treasury Bills Maturing within 1 Year | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Available-for-Sale Debt Securities – U.S. | 0 | 0 | |
Fair Value, Recurring | Level 1 Inputs | Domestic Equities | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Equity Securities | 2,501,833 | 1,720,410 | |
Fair Value, Recurring | Level 1 Inputs | International Equities | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Equity Securities | 293,494 | 448,405 | |
Fair Value, Recurring | Level 1 Inputs | Others | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Equity Securities | 156,982 | 134,144 | |
Fair Value, Recurring | Level 2 Inputs | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Total assets measured at fair value | 4,629,750 | 4,208,648 | |
Fair Value, Recurring | Level 2 Inputs | Treasury Bills Maturing within 1 Year | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Available-for-Sale Debt Securities – U.S. | 4,629,750 | 4,208,648 | |
Fair Value, Recurring | Level 2 Inputs | Domestic Equities | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Equity Securities | 0 | 0 | |
Fair Value, Recurring | Level 2 Inputs | International Equities | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Equity Securities | 0 | 0 | |
Fair Value, Recurring | Level 2 Inputs | Others | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Equity Securities | 0 | 0 | |
Fair Value, Recurring | Level 3 Inputs | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Total assets measured at fair value | 0 | 0 | |
Fair Value, Recurring | Level 3 Inputs | Treasury Bills Maturing within 1 Year | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Available-for-Sale Debt Securities – U.S. | 0 | 0 | |
Fair Value, Recurring | Level 3 Inputs | Domestic Equities | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Equity Securities | 0 | 0 | |
Fair Value, Recurring | Level 3 Inputs | International Equities | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Equity Securities | 0 | 0 | |
Fair Value, Recurring | Level 3 Inputs | Others | |||
Fair Value, Option, Quantitative Disclosures [Line Items] | |||
Equity Securities | $ 0 | $ 0 | |
[1]Amounts presented include balances held by our consolidated variable interest entities (“VIEs”), Grand Woods and TWS, as further discussed in Note 5 – Non-Controlling Interest and Variable Interest Entities. As of June 30, 2023, total assets and liabilities of Grand Woods, which are included in the consolidated balance sheets, were $2,284,151 and $1,369,805, respectively, including $112,323 of cash. Grand Woods note holder has partial recourse to the Company. As of June 30, 2023, total assets and liabilities of TWS, which are included in the consolidated balance sheets, were $944,375 and $358,514, respectively, including $508,010 of cash. |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Fair Value, Nonrecurring | ||
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | ||
Impairment of oil and natural gas producing properties | $ 443,456 | $ 0 |