Commitments And Contingencies

12 Months Ended

Dec. 31, 2013

Commitments And Contingencies [Abstract]

Commitments And Contingencies

9. Commitments and Contingencies

     The Company is a party to lawsuits in the ordinary course of its business. The Company does not believe that it is probable that the outcome of any individual action will have a material adverse effect, or that it is likely that adverse outcomes of individually insignificant actions will be significant enough, in number or magnitude, to have in the aggregate a material adverse effect on its financial statements.

     On November 18, 2013, the Company entered into a month-to-month lease for office space in Knoxville, Tennessee. The payment on this lease is approximately $6,000 per month. On December 15, 2013, the Company entered into a 38 month lease (2 months free) for office space in Denver Colorado. The payment on this lease is approximately $2,700 per month and expires February 28, 2017. Future non-cancellable commitments related to this lease total approximately $29,000 due in 2014, $30,000 due in 2015, $34,000 due in 2016, and $6,000 due in 2017.

     Office rent expense for each of the three years ended December 31, 2013, 2012, and 2011 was $92,000, $80,000, and $73,000, respectively.

     The Company as designated operator was administratively issued an "Incidence of Non-Compliance" by BOEM concerning one of the Hoactzin wells subject to the Management Agreement. This action called for payment of a civil penalty of $386,000 for the late filing of certain reports in 2011 by a contractor on the facility. The Company has filed an appeal of this action in order to attempt to significantly reduce the civil penalty. This appeal required a fully collateralized appeal bond to stay payment of the obligation until the appeal is determined. On November 1, 2012, the Company posted and collateralized this bond with RLI Insurance Company. If the bond was not posted, the appeal would have been administratively denied and the order to the Company as operator to pay the $386,000 penalty would be final. While the Company believes it will ultimately prevail in the appeal process, it is reasonably possible to expect that the Company may be required to pay a portion of this penalty. The Company estimates the range of this possible payment to be between zero and $386,000. As of December 31, 2013 and 2012, the Company has not accrued any liabilities associated with this penalty.