Financials

v3.7.0.1
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($)
Sep. 30, 2016
Dec. 31, 2015
Current Assets:    
Cash $ 259,340 $ 521,666
Accounts receivable - oil and gas sales 18,581 2,539
Subscription receivable 105,000
Prepaid expenses and other 11,832 32,554
Total Current Assets 289,753 661,759
Oil and gas properties, at cost, successful efforts method:    
Proved properties 8,431,505 8,683,273
Unevaluated properties 154,977 154,836
Furniture and equipment 22,522 22,522
Total property and equipment 8,609,004 8,860,631
Less accumulated depreciation, depletion and amortization (3,573,522) (3,245,522)
Net Property and Equipment 5,035,482 5,615,109
TOTAL ASSETS 5,325,235 6,276,868
Accounts payable:    
Trade accounts payable 143,197 64,896
Accounts payable - DNR Oil & Gas, Inc. 367,504 501,281
Accounts payable - directors and affiliates 53,398
Dividends payable:    
Dividends payable 5,999
Dividends payable - directors and affiliates 41,992
Accrued interest expense:    
Accrued interest expense 3,983 2,532
Accrued interest expense - directors and affiliates 16,374 9,442
Notes and advances payable - current portion:    
Notes and advances payable 81,502 989,853
Notes and advances payable - directors and affiliates 134,595 13,152
Current portion of asset retirement obligations 426,600 409,621
Other accrued costs and expenses 61,745 68,577
Total Current Liabilities 1,336,889 2,059,354
Notes and advances payable, net of current portion:    
Notes and advances payable 1,198,439 173,519
Notes and advances payable - Directors and affiliates 20,057 151,379
Asset retirement obligations, net of current portion 639,400 585,576
Total Long-Term Liabilities 1,857,896 910,474
Total Liabilities 3,194,785 2,969,828
Stockholders' Equity:    
Convertible Class A preferred stock; $10,000 face value per share, authorized 1,000,000 shares: Series 2; authorized 2,500 shares, 272 and 267 shares issued and outstanding at September 30 2016 and December 31 2015, respectively, liquidation preference $2,767,991 at September 30, 2016. 2,720,000 2,670,000
Common stock, no par value; 499,000,000 shares authorized, 14,674,580 and 14,295,413 issued and outstanding at September 30, 2016 and December 31, 2015, respectively. 21,535,469 21,502,635
Accumulated deficit (22,125,019) (20,865,595)
Total Stockholders' Equity 2,130,450 3,307,040
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 5,325,235 6,276,868
Series A1 Preferred Stock [Member]    
Stockholders' Equity:    
Convertible Class A preferred stock; $10,000 face value per share, authorized 1,000,000 shares: Series 2; authorized 2,500 shares, 272 and 267 shares issued and outstanding at September 30 2016 and December 31 2015, respectively, liquidation preference $2,767,991 at September 30, 2016.
Series A2 Preferred Stock [Member]    
Stockholders' Equity:    
Convertible Class A preferred stock; $10,000 face value per share, authorized 1,000,000 shares: Series 2; authorized 2,500 shares, 272 and 267 shares issued and outstanding at September 30 2016 and December 31 2015, respectively, liquidation preference $2,767,991 at September 30, 2016. $ 2,720,000 $ 2,670,000
v3.7.0.1
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2016
Sep. 30, 2015
Sep. 30, 2016
Sep. 30, 2015
Revenues:        
Oil sales $ 219,404 $ 230,728 $ 633,961 $ 617,906
Natural gas sales 20,220 22,507 65,638 112,554
Royalty revenues 483 514 1,760 4,455
Sale of oil and natural gas properties 27,120
Total revenues 240,107 253,749 701,359 762,035
Oil and gas producing activities:        
Lease operating expenses 313,086 270,719 800,541 685,587
Production taxes 19,367 29,101 55,434 66,900
Depreciation, depletion, amortization and accretion 104,523 189,335 403,333 531,292
Impairment 252,000
Gas gathering:        
Operating expenses 1,406
Depreciation 11,055 33,165
General and administrative expenses:        
Director fees 10,000 13,333 30,000 35,333
Investor relations 1,097 30,897 8,410 41,525
Legal, auditing and professional fees 23,185 6,458 109,069 80,313
Consulting fees executive services-Related Parties 14,000 43,333 54,732 126,733
Other administrative expenses 10,103 20,699 33,275 65,138
Depreciation 143 428
Total operating expenses 495,361 615,073 1,746,794 1,667,820
Operating loss (255,254) (361,324) (1,045,435) (905,785)
Other expense        
Interest expense net (25,067) (28,372) (70,019) (87,052)
Loss before income taxes (280,321) (389,696) (1,115,454) (992,837)
Income tax benefit (expense)
Net loss attributable to Arete Industries, Inc. (280,321) (389,696) (1,115,454) (992,837)
Net Income Applicable to Common Stockholders:        
Net loss (280,321) (389,696) (1,115,454) (992,837)
Preferred stock dividends declared (47,991) (143,970)
Net loss applicable to common stockholders $ (328,312) $ (389,696) $ (1,259,424) $ (992,837)
Loss Per Share Applicable to Common Stockholders:        
Basic $ (0.02) $ (0.03) $ (0.09) $ (0.08)
Diluted $ (0.02) $ (0.03) $ (0.09) $ (0.08)
Weighted Average Number of Common Shares Outstanding:        
Basic 14,673,700 12,966,000 14,450,550 12,764,000
Diluted 14,673,700 12,966,000 14,450,550 12,764,000
v3.7.0.1
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
9 Months Ended
Sep. 30, 2016
Sep. 30, 2015
Cash Flows from Operating Activities:    
Net loss $ (1,115,454) $ (992,837)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:    
Depreciation, depletion and amortization 328,000 509,698
Accretion of discount on asset retirement obligations 75,333 55,187
Gain on sale of oil and gas properties (27,120)
Common stock issued in exchange for services 25,334 55,165
Impairment expense 252,000
Changes in operating assets and liabilities:    
Accounts receivable (16,042) 79,443
Prepaid expenses and other 20,722 25,715
Accounts payable (2,078) 118,044
Amortization of loan servicing fees 938
Settlement of Asset Retirement Obligation (4,530)
Other accrued expenses and accrued interest 1,551 115,133
Net cash used in operating activities (434,226) (61,572)
Cash Flows from Investing Activities:    
Capital expenditures for property and equipment (373) (64,416)
Proceeds from sale of oil and gas properties 50,000
Net cash used in investing activities (373) (14,416)
Cash Flows from Financing Activities:    
Proceeds from notes payable 250,500 67,000
Principal payments on notes payable (137,248) (19,658)
Proceeds received from subscription receivable 105,000
Preferred stock dividends paid (95,979)
Proceeds received from issuance of Series A Two Preferred Stock 50,000
Net cash provided financing activities 172,273 47,342
Net decrease in cash and equivalents (262,326) (28,646)
Cash and equivalents, beginning of year 521,666 30,755
Cash and equivalents, end of year 259,340 2,109
Supplemental Disclosure of Cash Flow Information:    
Additions to oil & gas properties financed through accounts payable 3,465
Cash paid for interest 62,052 55,913
Accrued dividends 47,991
Common stock issued as a prepayment for services 13,333
Common stock issued for director fees payable 20,900
Common stock issued for loan closing costs $ 7,500