Note 14 - Oil Revenue

6 Months Ended

Jun. 30, 2013

Oil Revenue Disclosure [Abstract]

Oil Revenue Disclosure [Text Block]

Note 14— Oil Revenue

The oil is delivered by vessel to the refinery owned by the Peruvian national oil company, Petroleos del Peru - PETROPERU S.A. (“Petroperu”), in Talara, Peru, located approximately 70 miles south of the platform.  Produced oil is kept in production inventory until inventory quantities are at a sufficient level to make a delivery to the refinery in Talara.  Although all of the Company’s oil sales are to Petroperu, it believes that the loss of Petroperu as its sole customer would not materially impact the Company’s business because it could readily find other purchasers for the Company’s oil production both in Peru and throughout the world.

The Company’s revenues are reported net of royalties owed to the government of Peru. Royalties are assessed by Perupetro, as stipulated in the Block Z-1 License Contract based on production.

The following table is the amount of royalty costs of approximately 5% of gross revenues for the three and six months ended June 30, 2013 and 2012:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(in thousands)
Royalty costs	$	697	$	1,771	$	1,403	$	3,826
	$	697	$	1,771	$	1,403	$	3,826