Revenue and License Agreements

12 Months Ended

Sep. 30, 2012

Revenue and License Agreements [Abstract]

REVENUE AND LICENSE AGREEMENTS

NOTE 7 REVENUE AND LICENSE AGREEMENTS

The Company entered into a License Agreement effective March 31, 2012 (as amended by Amendment No. 1 effective April 1, 2012) with Future Fuel Limited, a British Virgin Islands limited liability company ("Licensee"), which is affiliated with Mr. Guangwei Guo, a member of our Board of Directors and a shareholder who has purchased a substantial number of shares of our Common Stock.

The Agreement grants the Licensee an exclusive right to use our Coal to Gas technology in the People's Republic of China and the Republic of Mongolia (the "Licensed Territory"). We did not grant the Licensee any rights outside the Licensed Territory.

The Licensee agreed to pay a license fee of Five Hundred Thousand ($500,000) Dollars (USD), within three months, but the Licensee receives a credit for Four Hundred Thousand ($400,000) Dollars the Licensee previously invested in field tests, which results in a net upfront payment to us of One Hundred Thousand ($100,000) Dollars which was paid to us in June 2012.

In addition, the Licensee agreed to pay an annual fee of a minimum of Thirty Thousand ($30,000) Dollars (USD) per Gas Generating Unit (or GGU) for each year the GGU is capable of producing gas. Each Gas Generating Unit is approximately 40,000 square meters of coal, lignite or other carbonaceous gas producing material of specified thickness in a field where our technology is used. A field could have multiple Gas Generating Units.

One half (50%) of the first payment is due within (20) days after the first production or injection well is drilled on a Gas Generating Unit and one half (50%) is due upon the presence of biogenic methane gas from that Gas Generating Unit. We received a $60,000 payment for four GGUs in June 2012.

The Company has an accounts receivable from Future Fuel Limited of $96,944 for nutrients sold.