XML 37 R18.htm IDEA: XBRL DOCUMENT

INCOME TAXES

12 Months Ended

Dec. 31, 2015

Income Tax Disclosure [Abstract]

INCOME TAXES

12.

INCOME TAXES

The Company incurred a net loss for each of the years ended December 31, 2015, 2014 and 2013, and the Company has recorded valuation allowances for its net deferred tax assets for each of those years. Accordingly, the Company has not recognized a benefit for income taxes in the accompanying financial statements. Income tax benefit using the Company’s effective income tax rate differs from the U.S. Federal Statutory income tax rate due to the following:

		2015				2014				2013

Income tax benefit at federal statutory rate		$	31,585			$	711			$	2,509
State income tax benefit, net of federal impact			1,440				34				158
Incentive stock options and restricted stock not deductible for tax purposes			(269	)			(79	)			(43	)
Percentage depletion carryover			-				129				174
Other, net			171				(183	)			(81	)
Increase in valuation allowance			(32,927	)			(612	)			(2,717	)

Income tax benefit (expense)		$	-			$	-			$	-

The components of deferred tax assets and liabilities as of December 31, 2015 and 2014 are as follows:

		2015				2014

Deferred tax assets:
Net operating loss carryover		$	19,947			$	10,382
Property and equipment			15,645				-
Percentage depletion and contribution carryovers			2,433				2,444
Alternative minimum tax credit carryover			706				706
Equity method investment and other			630				629
Deferred compensation liability			262				439
Asset retirement obligations			442				404
Stock-based compensation			302				248

Total deferred tax assets			40,367				15,252

Deferred tax liabilities:
Property and equipment			-				(8,351	)
Oil price risk derivatives			(538	)			-
Other			(4	)			(3	)

Total deferred tax liabilities			(542	)			(8,354	)

Net deferred tax assets			39,825				6,898
Less valuation allowance			(39,825	)			(6,898	)

Net deferred tax asset		$	-			$	-

The Company has net operating loss carryovers as of December 31, 2015 of approximately $57,000 for federal income tax purposes. The net operating loss carryovers may be carried back two years and forward twenty years from the year the net operating loss was generated. The net operating losses may be used to offset future taxable income and expire in varying amounts through 2035. In addition, the Company has alternative minimum tax credit carry-forwards of approximately $700 which are available to offset future federal income taxes over an indefinite period.

The statute of limitations is closed for the tax years through 2010. The Company recognizes, measures, and discloses uncertain tax positions whereby tax positions must meet a “more-likely-than-not” threshold to be recognized. During the years ended December 31, 2015, 2014 and 2013, no adjustments were recognized for uncertain tax positions.