Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2018

Liquidity Accounting Policy Disclosure [Policy Text Block]

Liquidity

The Condensed Consolidated Financial Statements of the Company have been prepared using accounting principles applicable to a going concern, which assumes realization of assets and settlement of liabilities in the normal course of business. The Company incurred losses of

$12.0

million for the

six

months ended

June 30, 2018,

compared to

$20.8

million for the

six

months ended

June 30, 2017.

The Company had working capital of

$17.7

million at

June 30, 2018,

and used cash in its operations of

$6.4

million for the

six

months ended

June 30, 2018.

Cash requirements during the

six

months ended

June 30, 2018

primarily reflect certain administrative costs related to the Company’s water project development efforts. Currently, the Company’s sole focus is the development of its land and water assets.

March 2018,

the Company entered into an At Market Issuance Sales Agreement with B. Riley FBR, Inc., under which the Company could issue and sell shares of its common stock having an aggregate offering price of up to

$15

million from time to time in an “at the market” offering (the “ATM Offering”) through B. Riley FBR acting as its sales agent. The Company completed the offering during

May 2018,

having issued

1,159,718

shares of common stock in the ATM Offering for gross proceeds of

$15

million and aggregate net proceeds of approximately

$14.6

million.

May 2017,

the Company entered into a new

$60

million credit agreement with funds affiliated with Apollo Global Management, LLC (“Apollo”) that replaced and refinanced its then existing

$45

million senior secured mortgage debt and provided

$15

million of new senior debt to fund immediate construction related expenditures ("Senior Secured Debt").

The Company’s Senior Secured Debt and its convertible notes contain representations, warranties and covenants that are typical for agreements of this type, including restrictions that would limit the Company’s ability to incur additional indebtedness, incur liens, pay dividends or make restricted payments, dispose of assets, make investments and merge or consolidate with another person. However, while there are affirmative covenants, there are

financial maintenance covenants and

restrictions on the Company’s ability to issue additional common stock to fund future working capital needs. The debt covenants associated with the Senior Secured Debt were negotiated by the parties with a view towards the Company’s operating and financial condition as it existed at the time the agreements were executed. At

June 30, 2018,

the Company was in compliance with its debt covenants.

The Company’s cash resources provide the Company with sufficient funds to meet its working capital needs for a period beyond

one

year from this quarterly report issuance date. The Company

may

meet working capital requirements beyond this period through a variety of means, including construction financing, equity or debt placements, through the sale or other disposition of assets or reductions in operating costs. Equity placements would be undertaken only to the extent necessary, so as to minimize the dilutive effect of any such placements upon the Company’s existing stockholders. Further, the Company’s option to acquire an additional

124

-mile extension of its Northern Pipeline will require a

$20

million payment by

December 2018.

The Company does

not

currently have the cash resources on hand to exercise this option and has engaged an investment banker to pursue alternatives that will provide the resources to allow the Company to exercise this option. If the Company is unable to exercise this option then its Northern Pipeline opportunities will be limited to the

-mile segment it currently owns.

Limitations on the Company’s liquidity and ability to raise capital

may

adversely affect it. Sufficient liquidity is critical to meet the Company’s resource development activities. Although the Company currently expects its sources of capital to be sufficient to meet its near-term liquidity needs, there can be

assurance that its liquidity requirements will continue to be satisfied. If the Company cannot raise needed funds, it might be forced to make substantial reductions in its operating expenses, which could adversely affect its ability to implement its current business plan and ultimately its viability as a company.

Cash Flow Supplemental [Policy Text Block]

Supplemental Cash Flow Information

Under the terms of the Senior Secured Debt, the Company is required to pay

25%

of all future quarterly interest payments in cash. During the

six

months ended

June 30, 2018,

approximately

$630

thousand in interest payments on the corporate secured debt was paid in cash.

other payments are due on the Senior Secured Debt or the Company’s convertible notes prior to their maturities.

During the

six

months ended

June 30, 2018,

approximately

$1.96

million in convertible notes were converted by certain of the Company’s lenders. As a result,

257,923

shares of common stock were issued to the lenders.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements

Accounting Guidance

Not

Yet Adopted

June 2018,

the Financial Accounting Standards Board (“FASB”) issued an accounting standards update which simplifies the accounting for share-based payments granted to nonemployees for goods and services. This update is effective for fiscal years beginning after

December 15, 2018,

and for interim periods within those fiscal years. The Company is currently evaluating this new guidance and cannot determine the impact of this standard at this time.

February 2016,

the FASB issued an accounting standards update related to lease accounting including enhanced disclosures. Under the new standard, a lease is defined as a contract, or part of a contract, that conveys the right to control the use of identified assets for a period of time in exchange for consideration. Lessees will classify leases with a term of more than

one

year as either operating or finance leases and will need to recognize a right-of-use asset and a lease liability. The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. Operating leases will result in straight-line expense while finance leases will result in a front-loaded expense pattern. This guidance is effective

January 1, 2019,

but early adoption is permitted. The Company is currently evaluating this new guidance and cannot determine the impact of this standard at this time.

July 2017,

the FASB issued an accounting standards update to provide new guidance for the classification analysis of certain equity-linked financial instruments, or embedded features, with down round features, as well as clarify existing disclosure requirements for equity-classified instruments. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature

longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The guidance is effective for fiscal years beginning after

December 15, 2019,

and interim periods within fiscal years beginning after

December 15, 2020,

with early adoption permitted. The Company is currently evaluating this new guidance and cannot determine the impact of this standard at this time.

Accounting Guidance Adopted

May 2014,

the FASB issued an accounting standards update on revenue recognition including enhanced disclosures. Under the new standard, revenue is recognized when (or as) a good or service is transferred to the customer and the customer obtains control of the good or service. The Company adopted this guidance on

January 1, 2018,

and the new standard did

not

have a material impact on the Company’s condensed consolidated financial statements.

August 2016,

the FASB issued an accounting standards update which eliminates the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows, by adding or clarifying guidance on

eight

specific cash flow issues. This guidance is effective for fiscal years beginning after

December 15, 2017,

and interim periods within those fiscal years. The Company adopted this guidance on

January 1, 2018,

and the new standard had

impact on the Company’s condensed consolidated financial statements.

November 2016,

the FASB issued an accounting standards update which requires amounts generally described as restricted cash and restricted cash equivalents to be included with cash and cash equivalents when reconciling the total beginning and ending amounts for the periods shown on the statement of cash flows. The Company adopted this guidance in the

first

quarter of

2018.

The balance of cash, cash equivalents, and restricted cash as shown in the condensed consolidated statements of cash flows is comprised of the following:

Cash, Cash Equivalents and Restricted Cash	June 30 , 2018		December 31, 2017		June 30 , 2017
(in thousands)

Cash and Cash Equivalents	$	20,237	$	13,030	$	19,434
Restricted Cash included in Other Assets		133		133		133
Cash, Cash Equivalents and Restricted Cash in the Consolidated Statement of Cash Flows	$	20,370	$	13,163	$	19,567

The restricted cash amounts included in Other Assets primarily represent a deposit from a water project participant related to a cost-sharing agreement.

May 2017,

the FASB issued an accounting standards update which clarifies which changes to terms or conditions of a share-based payment award require an entity to apply modification accounting, in accordance with Topic

218.

This guidance is effective for annual periods beginning after

December 15, 2017,

and interim periods within those. The Company adopted this guidance on

January 1, 2018,

and the new standard had

impact on the Company’s condensed consolidated financial statements.