Extractive Industries

3 Months Ended

Dec. 31, 2012

Oil and Gas Exploration and Production Industries Disclosures [Abstract]

Oil and Gas Exploration and Production Industries Disclosures [Text Block]

NOTE 4 - UNPROVED PROPERTIES AND IMPAIRMENT 

The total of the Company's investment in unproved properties at December 31, 2012 and September 30, 2012, consists of the following capitalized costs respectively:

				December 31, 2012		September 30, 2012
UNPROVED AND DEVELOPED PROPERTIES
Kansas Girard Project
	Field equipment - Jayhawk Gas Transport Company		$	2,605,871	$	2,605,871
	Field equipment - Girard			579,027		587,091
	Capitalized drilling costs			662,899		662,899
		Subtotal		3,847,797		3,855,861
	Less impairments			(2,432,087)		(2,435,637)
	Less accumulated DD&A			(1,128,350)		(1,127,463)
Total unproved and developed properties, net				287,360		292,761
UNPROVED AND UNDEVELOPED PROPERTIES
Kansas Girard Project				1,421,199		1,421,199
	Less impairments			(839,363)		(839,363)
	Less: accumulated amortization			(581,837)		(581,837)
Girard Project, net				-		-
North Dakota Project				40,325		87,610
North Dakota Project, net				40,325		87,610
Total unproved and undeveloped properties				40,325		87,610
TOTAL UNPROVED PROPERTIES			$	327,685	$	380,371

Impairment of Girard Project:  In 2012, management made a review of its Kansas Girard project.  Management's outlook for the U.S. natural gas prices indicated it is unlikely that sufficient U.S. demand for natural gas would materialize in the foreseeable future.  Internal cash flow estimates prepared by management of the Company did not prove significant fair value exists in the properties. Therefore, the undeveloped and unproved Kansas natural gas properties and equipment have had impairment losses recorded, to the extent net book value exceeds estimated salvage value of such equipment.  The Company also recognized impairment to its unproved and undeveloped properties in Girard, Kansas.  Thus, the Company recognized impairment loss of $3,275,000 on the Girard project for the year ended September 30, 2012.

NOTE 5 - PROVED PROPERTIES AND IMPAIRMENT   

Net capitalized costs are comprised of the following; detailed by property:

			December 31,2012		September 30, 2012
Crosby, North Dakota Properties
	Proved Reserves	$	2,357,753	$	2,357,753
	Field Equipment		1,200,247		1,200,247
	Capitalized Drilling Costs		416,429		416,429
	Subtotal		3,974,429		3,974,429
	Less: Impairments		(1,092,302)		(1,092,302)
	Less: Accumulated DD&A		(2,430,111)		(2,372,422)
Total Proved Oil and Gas Properties		$	452,017	$	509,705

For the year ended September 30, 2012, the Company performed an analysis to determine whether the carrying amounts in its financial statements exceeded the net present value of the reserve estimates for the Crosby, North Dakota property.  Management determined that the net value reflected in the financial statements did not exceed the net discounted present value of the reserves estimated by the independent reserve engineer.