OIL AND NATURAL GAS PROPERTIES

12 Months Ended

Dec. 31, 2012

OIL AND NATURAL GAS PROPERTIES [Abstract]

OIL AND NATURAL GAS PROPERTIES

2. Oil and Natural Gas Properties

The Company made no purchases of oil and natural gas properties during the years ended December 31, 2012 and 2011.  The Company drilled a successful developmental well in New Mexico in 2012, for which the net cost to the Company was approximately $3,000,000. The Company also drilled a successful developmental well in New Mexico in 2011, for which the net cost to the Company was approximately $4,200,000.

The Company sold its interest in the South Vacuum Field in October 2012 for net proceeds of $204,000.  A gain of $204,000 was recognized on the sale as the property had been fully impaired previously.