Quarterly report pursuant to Section 13 or 15(d)

CONSOLIDATED STATEMENTS OF OPERATIONS

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CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)
3 Months Ended 9 Months Ended
Sep. 30, 2014
Sep. 30, 2013
Sep. 30, 2014
Sep. 30, 2013
Revenues:        
Oil and natural gas sales $ 555,984 $ 664,206 $ 1,721,223 $ 1,638,218
Sale of oil and natural gas properties 108,479 27,500 350,951 28,449
Royalty revenue 755 553 2,525 533
Total revenues 665,218 692,259 2,074,699 1,667,200
Oil and gas producing activities:        
Lease operating expenses 196,134 187,126 566,068 528,526
Production taxes 52,245 58,586 143,891 135,451
Depreciation, depletion, amortization and accretion 210,335 209,611 502,180 532,946
Gas gathering:        
Operating expenses 609 3,543 7,979 11,228
Depreciation 11,055 11,055 33,165 33,165
General and administrative expenses:        
Director fees 10,000 450 10,450 1,800
Investor relations 2,448 10,922 37,634 86,349
Legal, auditing and professional services 37,109 21,580 115,753 118,470
Consulting and executive services:        
Related parties 41,250 30,750 168,750 92,250
Other administrative expenses 18,084 3,653 59,166 44,215
Depreciation 143 142 428 427
Total operating expenses 579,412 537,418 1,645,464 1,584,827
Operating income 85,806 154,841 429,235 82,373
Other income (expense):        
Interest income       1
Interest expense (33,350) (36,693) (103,328) (98,493)
Income (loss) before income taxes 52,456 118,148 325,907 (16,119)
Income tax benefit (expense) 0 0 0 0
Net Income (loss) 52,456 118,148 325,907 (16,119)
Net Income Applicable to Common Stockholders:        
Net Income (loss) 52,456 118,148 325,907 (16,119)
Redemption of preferred stock 17,951 106,661 17,951 3,160,026
Accrued preferred stock dividends (1,875) (3,750) (9,375) (209,063)
Net income (loss) applicable to common stockholders $ 68,532 $ 221,059 $ 334,483 $ 2,934,844
Earnings (Loss) Per Share Applicable to Common Stockholders:        
Basic $ 0.01 $ 0.02 $ 0.03 $ 0.30
Diluted $ 0.01 $ 0.02 $ 0.03 $ 0.22
Weighted Average Number of Common Shares Outstanding:        
Basic 12,408,000 13,400,000 12,532,000 9,850,000
Diluted 12,408,000 13,451,466 12,532,000 13,451,466