INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2013

INCOME TAXES [Abstract]

Components of Income Tax Expense (benefit)

The provision for income tax expense (benefit) for the years ended December 31, 2013, 2012, and 2011 consists of the following:
	(in thousands)
	Years ended December 31,
	2013		2012			2011
Current income tax expense (benefit)
Federal	$	--	$	--		$	--
State		--		--			--
	$	--	$	--		$	--
Deferred income tax expense (benefit)
Federal	$	--	$	(1,093	)	$	(3,316	)
State		--		(64	)		(195	)
	$	--	$	(1,157	)	$	(3,511	)

Effective Income Tax Reconciliation

The effective income tax rate differs from the U.S. Federal Statutory income tax rate due to the following:

	(in thousands)
	Years ended December 31,
	2013			2012			2011
Federal statutory income tax rate	$	(2,509	)	$	(4,164	)	$	(2,828	)
State income taxes, net of federal benefit		(158	)		(245	)		(166	)
Incentive stock options		43			12			246
Percent depletion carryover		(174	)		(177	)		(807	)
Valuation analysis		2,717			3,512			--
Other		81			(95	)		44
	$	--		$	(1,157	)	$	(3,511	)

Components of Deferred Tax Assets and Liabilities

The components of deferred tax assets and liabilities as of December 31, 2013 and 2012 are as follows:

	December 31,			December 31,
	2013			2012
Deferred tax assets:
Net operating loss	$	6,930		$	2,899
Derivative instruments		96			(170	)
Asset retirement obligation		294			247
Stock based compensation		228			313
Deferred compensation		385			382
Alternative minimum tax credit		706			706
Contribution carryover		37			37
Equity investments		643			(91	)
Percentage depletion carryover		2,421			2,100
	$	11,740		$	6,423
Deferred tax liabilities:
Property and equipment		(5,446	)		(2,854	)
State tax		(9	)		--
Marketable securities		(16	)		(57	)
	$	(5,471	)	$	(2,911	)
Net deferred tax assets (liabilities)		6,269			3,512
Less: Valuation Allowance		(6,269	)		(3,512	)
Deferred tax liability	$	--		$	--