Empire Petroleum (EP) 10-Q 1 Aug 14 2014 Q2 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information (USD $)	6 Months Ended
	Jun. 30, 2014	Aug. 01, 2014
Document And Entity Information	'	'
Entity Registrant Name	'EMPIRE PETROLEUM CORPORATION	'
Entity Central Index Key	'0000887396	'
Document Type	'10-Q	'
Document Period End Date	30-Jun-14	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--12-31	'
Is Entity a Well-known Seasoned Issuer?	'No	'
Is Entity a Voluntary Filer?	'No	'
Is Entity's Reporting Status Current?	'No	'
Entity Filer Category	'Smaller Reporting Company	'
Entity Public Float	'	$4,098,154
Entity Common Stock, Shares Outstanding	'	7,630,609
Document Fiscal Period Focus	'Q2	'
Document Fiscal Year Focus	'2014	'

Balance_Sheets_Unaudited

Balance Sheets (Unaudited) (USD $)	Jun. 30, 2014	Dec. 31, 2013
Current assets:	'	'
Cash and cash equivalents	$795	$2,926
Accounts receivable	67	0
Prepaid expenses and other current assets	3,300	2,200
Total current assets	4,162	5,126
Property & equipment less accumulated depreciation and depletion	223,465	223,465
Total assets	227,627	228,591
Current liabilities:	'	'
Accounts payable and accrued liabilities	2,344	572
Notes payable - related party	115,180	91,580
Total current liabilities	117,524	92,152
Stockholders' equity:	'	'
Common stock	7,630	7,630
Additional paid in capital	14,691,533	14,616,533
Accumulated deficit	-14,589,060	-14,487,724
Total stockholders' equity	110,103	136,439
Total liabilities and stockholders' equity	$227,627	$228,591

Statements_of_Operations_Unaud

Statements of Operations (Unaudited) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Revenue:	'	'	'	'
Petroleum Sales	$0	$0	$0	$0
Costs and expenses:	'	'	'	'
Production & operating	276	2,090	4,923	7,187
General & administrative	32,958	50,662	94,562	107,401
Total costs and expenses	33,234	52,752	99,485	114,588
Operating loss	-33,234	-52,752	-99,485	-114,588
Other expense:	'	'	'	'
Interest expense	-935	0	-1,851	0
Total other expense	-935	0	-1,851	0
Net loss	($34,169)	($52,752)	($101,336)	($114,588)
Net loss per common share, basic & diluted	$0	$0.01	$0.01	$0.02
Weighted average number of common shares outstanding basic and diluted	7,630,609	7,630,609	7,630,609	7,630,609

Statements_of_Cash_Flows_Unaud

Statements of Cash Flows (Unaudited) (USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Statement of Cash Flows [Abstract]	'	'
Net loss	($101,336)	($114,588)
Adj to reconcile net loss to net cash used in operating activities:	'	'
Value of services contributed by employee	25,000	25,000
Accounts receivable and other assets	-67	79,008
Prepaid expenses and other current assets	-1,100	-1,100
Accounts payable and accrued liabilities	1,772	-5,947
Net cash used in operating activities	-75,731	-17,627
Cash flow from financing activities:	'	'
Proceeds from call option agreement	50,000	0
Proceeds from related party notes payable	23,600	0
Net cash from financing activities	76,300	0
Net change in cash	-2,131	-17,627
Cash - Beginning of period	2,926	20,766
Cash - End of period	$795	$3,139

Basis_Of_Presentation_and_Sign

Basis Of Presentation and Significant Accounting Policies	6 Months Ended
	Jun. 30, 2014
Accounting Policies [Abstract]	'
Basis Of Presentation and Significant Accounting Policies	'
	1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES:
	The accompanying unaudited financial statements of Empire Petroleum Corporation ("Empire" or the "Company") have been prepared in accordance with United States generally accepted accounting principles for interim financial information and the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by United States generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation of the Company's financial position, the results of operations, and the cash flows for the interim period are included. All adjustments are of a normal, recurring nature. Operating results for the interim period are not necessarily indicative of the results that may be expected for the year ending December 31, 2014.
	The information contained in this Form 10-Q should be read in conjunction with the audited financial statements and related notes for the year ended December 31, 2013 which are contained in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission (the "SEC") on March 3, 2014.
	The Company has incurred significant losses in recent years. The continuation of the Company as a going concern is dependent upon the ability of the Company to attain future profitable operations and/or additional debt or equity financing until profitable operations are achieved. These financial statements have been prepared on the basis of United States generally accepted accounting principles applicable to a company with continuing operations, which assume that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its obligations in the normal course of operations. Management believes the going concern assumption to be appropriate for these financial statements. If the going concern assumption were not appropriate for these financial statements, then adjustments might be necessary to adjust the carrying value of assets and liabilities and reported expenses.
	The Company continues to seek partners to help it explore and develop its oil and gas interests. The ultimate recoverability of the Company's investment in its oil and gas interests is dependent upon the existence and discovery of economically recoverable oil and gas reserves, confirmation of the Company's interest in the oil and gas interests, the ability of the Company to obtain necessary financing to further develop the interests, and the ability of the Company to attain future profitable production.
	As of June 30, 2014, the Company had $795 of cash on hand. In order to sustain the Company's operations on a long-term basis, the Company continues to look for merger opportunities and consider public or private financings.
	Reverse Stock Split
	The share and per share information for the prior periods has been retroactively adjusted to reflect the August 12, 2013 one-for-twelve reverse stock split described in Note 3.
	Compensation of Officers and Employees
	The Company's only executive officer serves without pay or other compensation. The fair value of these services is estimated by management and is recognized as a capital contribution. For the six months ended June 30, 2014, the Company recorded $25,000 as a capital contribution by its executive officer who is a stockholder.
	Fair Value Measurements
	The Financial Accounting Standards Board ("FASB") fair value measurement standards define fair value, establish a consistent framework for measuring fair value and establish a fair value hierarchy based on the observability of inputs used to measure fair value. The Company's primary marketable asset is cash, and it owns no marketable securities.

Property_Plant_And_Equipment_D

Property Plant And Equipment Disclosure	6 Months Ended
	Jun. 30, 2014
Property, Plant and Equipment [Abstract]	'
Property Plant And Equipment Disclosure	'
	2. PROPERTY AND EQUIPMENT:
	GABBS VALLEY PROSPECT
	The Company has an interest in 34,186 gross acres of federal oil and gas leases on the Gabbs Valley Prospect in Western Nevada. Since 2003, the Company has conducted extensive geological studies, conducted a seismic survey, carried out a geochemical imaging survey, conducted satellite and gravity studies and drilled two test wells.
	Both test wells had significant oil shows. The second test well resulted in a small oil discovery, however the Company deemed it non-commercial and elected to abandon it. One of the co-owners of the leases elected to take over the well and make further tests. The co-owner secured other parties to conduct such tests. Well completion equipment was installed and further production testing was carried out, however as of June 30, 2014, to the Company’s knowledge, commercial production has not been established. It is the Company’s understanding that further testing is being carried out, but no results have been reported. Empire does feel the prospect has considerable geological merit since the primary target, being the Triassic formation, was not reached in either of the two test wells. Empire has entered into a call option agreement with the owners of the lease on which the two test wells were drilled. See Note 3.
	SOUTH OKIE PROSPECT
	In 2009, the Company originally purchased 2,630 net acres of oil and gas leases known as the South Okie Prospect in Natrona County, Wyoming. The Tensleep Sand at depths from 3,300 feet to 4,500 feet is the primary target. As of December 31, 2009, the Company acquired 11 miles of seismic data and studies of this data were completed in early January 2010. An additional geological study was also completed in early January 2010. After further review of all the seismic and geological data and considering the Company’s financial condition it has reduced its holdings to 600 gross (110 net) acres.
	3. EQUITY
	Diluted Earnings per Share (“EPS”) gives effect to all dilutive potential common shares outstanding during the period. The computation of Diluted EPS does not assume conversion, exercise or contingent exercise of securities that would have an anti-dilutive effect on losses. As a result, if there is a loss from continuing operations, Diluted EPS is computed in the same manner as Basic EPS. At June 30, 2014 and 2013, the Company had, respectively, 60,417 and 103,750 post-split options outstanding, that were not included in the calculation of earnings per share for the periods then ended. Such financial instruments may become dilutive and would then need to be included in future calculations of Diluted EPS. At June 30, 2014 and 2013, the outstanding options were considered anti-dilutive since the strike prices were above the market price and since the Company has incurred losses year to date.
	On December 11, 2012, the Company entered in a note conversion agreement with the Albert E. Whitehead Living Trust (the “Whitehead Trust”). Pursuant to the note conversion agreement, on December 11, 2012, the Company converted $300,013 in debt owed by the Company to the Whitehead Trust into shares of Common Stock at a conversion rate of $0.60 per share (post-split), resulting in the issuance of 500,021 shares (6,000,250 pre-split shares) of Common Stock to the Whitehead Trust. Upon the issuance of such shares, such debt owed by the Company to the Whitehead Trust was deemed paid in full and certain notes issued by the Company and the other obligations relating to such debt were terminated. Albert E. Whitehead, the Chief Executive Officer of the Company and Chairman of its Board of Directors, is the trustee of the Whitehead Trust.
	At the Company’s annual shareholders meeting on July 10, 2013, shareholders approved a proposal to allow the Company’s Board of Directors to authorize a one-for-twelve reverse stock split. The Board of Directors approved the reverse stock split on July 29, 2013 which became effective August 12, 2013. The reverse split did not change the authorized number of shares of Common Stock of the Company or the par value of the Common Stock.
	On March 4, 2014, Empire, Albert E. Whitehead and Sierra Nevada Oil LLC (“Sierra”) entered into a Call Option Agreement (the “Call Option Agreement”). The Call Option Agreement provides Sierra with a call option to purchase 4,000,000 shares of common stock of the Company at a price of (i) $0.25 per share or an aggregate of $1,000,000, less (ii) the $50,000 paid by Sierra to the Company as consideration for the Call Option Agreement. The Call Option Agreement also provides that, if the Call Option is exercised by Sierra, Albert W. Whitehead, the Company’s Chief Executive Officer and the Chairman of the Company’s Board of Directors, will take commercially reasonable efforts to cause the current members of the Company’s Board of Directors, Albert E. Whitehead, Montague H. Hackett, Jr. and Kevin R. Seth, to resign from the Company’s Board of Directors and three of Sierra’s designees to be appointed to the Company’s Board of Directors. The agreement restricts use of the proceeds from the call option agreement from being used to pay related party debt. If the call option is exercised, the agreement requires the Company to use proceeds from the stock sale to pay outstanding related party indebtedness.
	On June 27, 2014, the parties to the Call Option Agreement agreed to extend the date by which Sierra may exercise the call option to September 1, 2014.

Related_Party_Transactions

Related Party Transactions	6 Months Ended
	Jun. 30, 2014
Related Party Transactions [Abstract]	'
Related Party Transactions	'
	4. RELATED PARTY TRANSACTIONS
	In 2014, Albert E. Whitehead, the Company’s Chief Executive Officer, has further advanced the Company $23,600 bringing the Company’s total notes payable to $115,180 plus accrued interest in the amount of $1,851 as of June 30, 2014.

Stockholders_Equity_Note

Stockholders Equity Note	6 Months Ended
	Jun. 30, 2014
Equity [Abstract]	'
Stockholders Equity Note	'
	3. EQUITY
	Diluted Earnings per Share (“EPS”) gives effect to all dilutive potential common shares outstanding during the period. The computation of Diluted EPS does not assume conversion, exercise or contingent exercise of securities that would have an anti-dilutive effect on losses. As a result, if there is a loss from continuing operations, Diluted EPS is computed in the same manner as Basic EPS. At June 30, 2014 and 2013, the Company had, respectively, 60,417 and 103,750 post-split options outstanding, that were not included in the calculation of earnings per share for the periods then ended. Such financial instruments may become dilutive and would then need to be included in future calculations of Diluted EPS. At June 30, 2014 and 2013, the outstanding options were considered anti-dilutive since the strike prices were above the market price and since the Company has incurred losses year to date.
	On December 11, 2012, the Company entered in a note conversion agreement with the Albert E. Whitehead Living Trust (the “Whitehead Trust”). Pursuant to the note conversion agreement, on December 11, 2012, the Company converted $300,013 in debt owed by the Company to the Whitehead Trust into shares of Common Stock at a conversion rate of $0.60 per share (post-split), resulting in the issuance of 500,021 shares (6,000,250 pre-split shares) of Common Stock to the Whitehead Trust. Upon the issuance of such shares, such debt owed by the Company to the Whitehead Trust was deemed paid in full and certain notes issued by the Company and the other obligations relating to such debt were terminated. Albert E. Whitehead, the Chief Executive Officer of the Company and Chairman of its Board of Directors, is the trustee of the Whitehead Trust.
	At the Company’s annual shareholders meeting on July 10, 2013, shareholders approved a proposal to allow the Company’s Board of Directors to authorize a one-for-twelve reverse stock split. The Board of Directors approved the reverse stock split on July 29, 2013 which became effective August 12, 2013. The reverse split did not change the authorized number of shares of Common Stock of the Company or the par value of the Common Stock.
	On March 4, 2014, Empire, Albert E. Whitehead and Sierra Nevada Oil LLC (“Sierra”) entered into a Call Option Agreement (the “Call Option Agreement”). The Call Option Agreement provides Sierra with a call option to purchase 4,000,000 shares of common stock of the Company at a price of (i) $0.25 per share or an aggregate of $1,000,000, less (ii) the $50,000 paid by Sierra to the Company as consideration for the Call Option Agreement. The Call Option Agreement also provides that, if the Call Option is exercised by Sierra, Albert W. Whitehead, the Company’s Chief Executive Officer and the Chairman of the Company’s Board of Directors, will take commercially reasonable efforts to cause the current members of the Company’s Board of Directors, Albert E. Whitehead, Montague H. Hackett, Jr. and Kevin R. Seth, to resign from the Company’s Board of Directors and three of Sierra’s designees to be appointed to the Company’s Board of Directors. The agreement restricts use of the proceeds from the call option agreement from being used to pay related party debt. If the call option is exercised, the agreement requires the Company to use proceeds from the stock sale to pay outstanding related party indebtedness.
	On June 27, 2014, the parties to the Call Option Agreement agreed to extend the date by which Sierra may exercise the call option to September 1, 2014.