Asset Retirement Obligations

9 Months Ended

Jan. 31, 2016

Asset Retirement Obligation Disclosure [Abstract]

Asset Retirement Obligations

The total future asset retirement obligation was estimated based on the Company’s ownership interest in all wells and facilities, the estimated legal obligations required to retire, dismantle, abandon and reclaim the wells and facilities and the estimated timing of such payments. The Company estimated the present value of its asset retirement obligations at both January 31, 2016 and April 30, 2015, based on a future undiscounted liability of $895,292 and $1,143,857, respectively. These costs are expected to be incurred within one to 24 years. A credit-adjusted risk-free discount rate of 10% and an inflation rate of 2% were used to calculate the present value.

Changes to the asset retirement obligation were as follows:

	Nine Months Ended January 31, 2016			Period from May 1, 2014 to April 30, 2015
Balance, beginning of period	$	918,430		$	818,010
Additions		-			52,514
Disposals		(207,827	)		-
Accretion		48,320			47,906
Total asset retirement obligations		758,923			918,430
Less: current portion of asset retirement obligations		(541,959	)		(541,959	)
Long-term portion of asset retirement obligations	$	216,964		$	376,471

Expected timing of asset retirement obligations:

Year Ending April 30,
2016 (remainder of year)		541,959
2017		20,000
2018		-
2019		-
2020		-
Thereafter		393,353
Subtotal		955,312
Effect of discount		(196,389	)
Total	$	758,923

As of January 31, 2016 and April 30, 2015, the Company has $0 of reclamation deposits with authorities to secure certain abandonment liabilities.