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Property | 6 Months Ended
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Jun. 30, 2024
Property, Plant and Equipment [Abstract] |
Property | Note 3 – Property The Company follows the successful efforts method of accounting for its oil and natural gas activities. Under this method, costs to acquire oil and natural gas properties and costs incurred to drill and equip development and exploratory wells are deferred until exploration and completion results are evaluated. Exploration drilling costs are expensed if recoverable reserves are not found. Upon sale or retirement of oil and natural gas properties, the costs and related accumulated depreciation, depletion and amortization are eliminated from the accounts and the resulting gain or loss is recognized. Costs incurred to maintain wells and related equipment and lease and well operating costs are charged to expense as incurred. Depletion is calculated on a units-of-production basis at the field level based on total proved developed reserves. Proved oil and natural gas properties are reviewed for impairment at least annually, or as indicators of impairment arise. There have been no indicators of impairment during the six months ended June 30, 2024. Aggregate capitalized costs of oil and natural gas properties are as follows:
|  | June 30, 2024 |  |  | December 31, 2023 |
Proved properties |  | $ | 119,421,112 |  |  | $ | 75,346,623 |
Unproved properties |  |  | 3,820,480 |  |  |  | 3,245,431 |
Work in process |  |  | 267,982 |  |  |  | 14,917,749 |
Gross capitalized costs |  |  | 123,509,574 |  |  |  | 93,509,803 |
Depreciation, depletion, amortization and impairment |  |  | (27,040,862 | ) |  |  | (22,996,805 | )
Total oil and gas properties, net |  | $ | 96,468,712 |  |  | $ | 70,512,998 |
Depletion and amortization expense related to oil and gas properties for the three months ended June 30, 2024 and 2023 was approximately $2,613,000 and $657,000, respectively. Depletion and amortization expense related to oil and gas properties for the six months ended June 30, 2024 and 2023 was approximately $4,044,000 and $1,221,000, respectively. The Company has completed eight wells in North Dakota related to our Starbuck Drilling program during the first half of 2024. On April 9, 2024, the Company partially exercised a purchase option originally issued on August 9, 2023 (the “Purchase Option”) to acquire additional working interests in certain of the Company’s New Mexico properties from Energy Evolution, a related party. The additional assets acquired represent approximately 60% of the total assets collectively acquired by the Company and Energy Evolution in the third quarter of 2023 (the “Option Assets”). As consideration, upon closing of the partial exercise of the Purchase Option, the Company issued Energy Evolution 600,000 shares of common stock of the Company based on an agreed upon price of $5.00 per share for an aggregate agreed upon value of $3,000,000 which was 60% of the purchase price of $5,000,000 under the Purchase Option. Pursuant to the remaining unexercised portion of the Purchase Option, the Company had the right to extend the initial one-year Purchase Option period for two successive one-year periods by agreeing to issue additional shares of common stock prior to the end of the one-year period then in effect. On August 8, 2024, the Company successfully extended the Purchase Option with the issuance of 16,800 shares of common stock to Energy Evolution, and as such, the Company has the right to acquire the remaining Option Assets for an exercise price of $2,000,000, subject to certain adjustments and payable in cash, unless the parties agree that some or all may be paid by issuance of common stock to Energy Evolution. The Purchase Option now expires on August 9, 2026. Other property and equipment consists of operating lease assets, vehicles, office furniture, and equipment with lives ranging from three to five years. The capitalized costs of other property and equipment are as follows: Schedule of other property plant and equipment
|  | June 30, 2024 |  |  | December 31, 2023 |
Other property and equipment, at cost |  | $ | 3,117,909 |  |  | $ | 2,998,018 |
Less: Accumulated depreciation |  |  | (1,492,039 | ) |  |  | (1,114,807 | )
Other property and equipment, net |  | $ | 1,625,870 |  |  | $ | 1,883,211 |
Depreciation expense related to other property and equipment for the three months ended June 30, 2024 and 2023 was approximately $64,000 and $54,000, respectively. Depreciation expense related to other property and equipment for the six months ended June 30, 2024 and 2023 was approximately $123,000 and $113,000, respectively.

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- Definition The entire disclosure for long-lived, physical asset used in normal conduct of business and not intended for resale. Includes, but is not limited to, work of art, historical treasure, and similar asset classified as collections. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 360 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/360/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 6 -SubTopic 360 -Topic 958 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477798/958-360-50-6 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (d) -SubTopic 360 -Topic 958 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477798/958-360-50-1 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 7 -SubTopic 360 -Topic 958 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477798/958-360-50-7 + Details
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