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Supplemental Oil Reserve Information (Unaudited) | 12 Months Ended
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Dec. 31, 2012
Supplemental Oil Reserve Information [Abstract] |
Supplemental Financial Information For Oil and Gas Producing Activities Disclosure [Text Block] | Note 15 – Supplemental Oil Reserve Information (Unaudited) Results of operations from oil producing activities The following table shows the results of operations from the Company’s oil producing activities. Results of operations from these activities are determined using historical revenues, production costs and depreciation and depletion. The results of operations from the Company’s oil producing activities below exclude non-oil revenues, general and administrative expenses, interest income and interest expense. Income tax expense was determined by applying the statutory rates to pretax operating results.
|  | Year Ended December 31, 2012 |  |  | Year Ended December 31, 2011 |
Production revenues |  | $ | 8,496,519 |  |  | $ | 6,285,411 |
Production costs |  |  | (3,102,321 | ) |  |  | (3,440,228 | )
Depletion and depreciation |  |  | (1,541,069 | ) |  |  | (1,128,712 | )
Income tax |  |  | (1,305,513 | ) |  |  | (583,600 | )
Results of operations for producing activities |  | $ | 2,547,616 |  |  | $ | 1,132,871 |
Capitalized costs The following table summarizes the Company’s capitalized costs of oil properties.
|  | Year Ended December 31, 2012 |  |  | Year Ended December 31, 2011 |
Unevaluated properties not subject to amortization |  | $ | 7,830,828 |  |  | $ | 7,922,734 |
Properties subject to amortization |  |  | 30,466,951 |  |  |  | 21,602,640 |
Capitalized costs |  |  | 38,297,779 |  |  |  | 29,525,374 |
Accumulated depletion |  |  | (5,094,881 | ) |  |  | (3,764,874 | )
Net capitalized costs |  | $ | 33,202,898 |  |  | $ | 25,760,500 |
Cost incurred in property acquisition, exploration and development activities
|  | Year Ended December 31, 2012 |  |  | Year Ended December 31, 2011 |
Acquisition of properties |  | $ | - |  |  | $ | 1,422,590 |
Exploration costs |  |  | - |  |  |  | - |
Development costs |  |  | 10,247,539 |  |  |  | 4,926,105 |
Net capitalized costs |  | $ | 10,247,539 |  |  | $ | 6,348,695 |
Estimated quantities of proved reserves Our ownership interests in estimated quantities of proved oil reserves and changes in net proved reserves all of which are located in the United States are summarized below. Proved reserves are estimated quantities of oil that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions. Proved developed reserves are those that are expected to be recovered through existing wells with existing equipment and operating methods. Reserves are stated in barrels (stb) of oil. Geological and engineering estimates by MHA Petroleum Consultants, LLC of proved oil reserves at one point in time are highly interpretive, inherently imprecise and subject to ongoing revisions that may be substantial in amount. Although every reasonable effort is made to ensure that the reserve estimates are accurate, by their nature reserve estimates are generally less precise than other estimates presented in connection with financial statement disclosures.
|  | Year Ended December 31, 2012 |  |  | Year Ended December 31, 2011 |
|  | Oil-stb |  |  | Oil-stb |
Proved reserves: |  |  |  |  |  |  |  |
Beginning |  |  | 2,714,150 |  |  |  | 2,320,150 |
Revisions of previous estimates |  |  | (193,059 | ) |  |  | (130,908 | )
Purchase of minerals in place |  |  | - |  |  |  | 700,190 |
Extension and discoveries |  |  | 502,751 |  |  |  | 316,049 |
Sale of minerals in place |  |  | - |  |  |  | (221,365 | )
Sales of Rantoul Partners interest |  |  |  |  |  |  | (198,187 | )
Production |  |  | (96,842 | ) |  |  | (71,729 | )
Ending |  |  | 2,927,000 |  |  |  | 2,714,200 |
Proved developed reserves for December 31, 2012 and 2011 consisted of 100% oil and totaled 1,546.3 and 643.1 MBbls, respectively. Proved undeveloped reserves at December 31, 2012 and 2011 were 1,380.8 and 2,071.1 MBbls, respectively. Standardized measure of discounted future net cash flows The standardized measure of discounted future net cash flows from our proved reserves for the periods presented in the financial statements is summarized below.
|  | Year Ended December 31, 2012 |  |  | Year Ended December 31, 2011 |
Future production revenue |  | $ | 246,535,000 |  |  | $ | 242,383,840 |
Future production costs |  |  | (69,131,000 | ) |  |  | (93,373,850 | )
Future development costs |  |  | (11,766,000 | ) |  |  | (12,767,540 | )
Future cash flows before income tax |  |  | 165,638,000 |  |  |  | 136,242,450 |
Future income taxes |  |  | (33,550,000 | ) |  |  | (22,864,737 | )
Future net cash flows |  |  | 132,088,000 |  |  |  | 113,377,713 |
10% annual discount for estimating of future cash flows |  |  | (83,215,000 | ) |  |  | (69,730,808 | )
Standardized measure of discounted net cash flows |  | $ | 48,873,000 |  |  | $ | 43,646,905 |
Changes in Standardized Measure of Discounted Future Net Cash Flows The following is a summary of a Standardized Measure of discounted net future cash flows related to the Company’s proved oil reserves. The information presented is based on a calculation of estimated proved reserves using discounted cash flows based on the 12-month average price for oil calculated as the unweighted arithmetic average of the first-day-of-the-month price for each month within the 12-month prior period. The additions to estimated proved reserves from new discoveries and extensions could vary significantly from year to year. Additionally, the impact of changes to reflect current prices and costs of reserves proved in prior years could also be significant.
|  | Year Ended December 31, 2012 |  |  | Year Ended December 31, 2011 |
Balance beginning of year |  | $ | 43,646,905 |  |  | $ | 25,304,892 |
Sales, net of production costs |  |  | (5,394,198 | ) |  |  | (2,869,339 | )
Net change in pricing and production costs |  |  | 2,870,156 |  |  |  | 11,287,884 |
Net change in future estimated development costs |  |  | (1,001,445 | ) |  |  | (702,640 | )
Purchase of minerals in place |  |  | - |  |  |  | 16,834,878 |
Extensions and discoveries |  |  | 11,274,543 |  |  |  | 7,598,861 |
Sale of minerals in place |  |  | - |  |  |  | (5,322,346 | )
Sale of Rantoul Partners interest |  |  | - |  |  |  | (4,765,069 | )
Revisions |  |  | (4,329,483 | ) |  |  | (3,147,460 | )
Accretion of discount |  |  | 5,324,900 |  |  |  | 3,119,577 |
Change in income tax |  |  | (3,518,817 | ) |  |  | (3,692,333 | )
Balance end of year |  | $ | 48,872,560 |  |  | $ | 43,646,905 |

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