Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Aug. 31, 2020 | Oct. 13, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | Discovery Energy Corp. | |
Entity Central Index Key | 0001435387 | |
Document Type | 10-Q | |
Document Period End Date | Aug. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --02-28 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 154,340,396 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2021 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Aug. 31, 2020 | Feb. 29, 2020 |
Current Assets | ||
Cash | $ 37,907 | $ 8,115 |
Prepaid expenses | 95,580 | 34,480 |
Tax receivable | 12 | 624 |
Total Current Assets | 133,499 | 43,219 |
Oil and gas property - not subject to amortization (successful efforts method) | 2,883,915 | 2,883,915 |
Other assets | 36,770 | 32,620 |
Total Assets | 3,054,184 | 2,959,754 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 2,805,358 | 2,223,339 |
Accounts payable - related parties, net | 1,193,419 | 814,399 |
Convertible debentures payable, net of debt discount - current portion | 5,573,879 | |
Total Current Liabilities | 9,572,656 | 3,037,738 |
Convertible debentures payable, net of debt discount | 4,744,804 | |
Notes payable | 118,750 | |
Total Liabilities | 9,691,406 | 7,782,542 |
Commitments and Contingencies | ||
Shareholders' Deficit | ||
Preferred stock - 10,000,000 shares authorized, zero issued and outstanding | ||
Common stock - 500,000,000 shares authorized, $0.001 par value - 154,340,396 and 153,840,396 shares issued and outstanding, respectively | 154,340 | 153,840 |
Additional paid-in capital | 21,316,586 | 20,447,198 |
Accumulated other comprehensive income | 227,830 | 154,199 |
Accumulated deficit | (28,335,978) | (25,578,025) |
Total Shareholders' Deficit | (6,637,222) | (4,822,788) |
Total Liabilities and Shareholders' Deficit | $ 3,054,184 | $ 2,959,754 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Aug. 31, 2020 | Feb. 29, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares issued | 154,340,396 | 153,840,396 |
Common stock, shares outstanding | 154,340,396 | 153,840,396 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Operating Expenses | ||||
General and administrative | $ 1,133,869 | $ 760,075 | $ 1,538,757 | $ 2,389,711 |
Exploration costs | 23,750 | 26,600 | 26,925 | |
Total operating expenses | 1,157,619 | 760,075 | 1,565,357 | 2,416,636 |
Operating loss | (1,157,619) | (760,075) | (1,565,357) | (2,416,636) |
Other Income (Expense) | ||||
Interest expense | (602,525) | (555,548) | (1,192,600) | (1,100,897) |
Miscellaneous income | 2 | 172 | 4 | 859 |
Gain (loss) on foreign currency transactions | (282) | (381) | ||
Other income (expense) | (602,523) | (555,658) | (1,192,596) | (1,100,419) |
Net loss | $ (1,760,142) | $ (1,315,733) | $ (2,757,953) | $ (3,517,055) |
Loss per common share - basic and diluted | $ (0.01) | $ (0.01) | $ (0.02) | $ (0.02) |
Weighted average number of common shares outstanding - basic and diluted | 154,220,831 | 152,095,287 | 154,132,516 | 151,112,950 |
Comprehensive Income (Loss) | ||||
Net loss | $ (1,760,142) | $ (1,315,733) | $ (2,757,953) | $ (3,517,055) |
Other comprehensive income (loss) - gain (loss) on foreign currency translation | 841 | (4,728) | 73,631 | 78,204 |
Total comprehensive loss | $ (1,759,301) | $ (1,320,461) | $ (2,684,322) | $ (3,438,851) |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity (Deficit) (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income [Member] | Total |
Balance at Feb. 28, 2019 | $ 148,240 | $ 18,059,682 | $ (19,674,892) | $ 76,205 | $ (1,390,765) |
Balance, shares at Feb. 28, 2019 | 148,240,396 | ||||
Share-based compensation | $ 3,700 | 736,300 | 740,000 | ||
Share-based compensation, shares | 3,700,000 | ||||
Warrant modification expense | 364,683 | 364,683 | |||
Gain on foreign currency translation | 82,932 | 82,932 | |||
Net loss | (2,201,322) | (2,201,322) | |||
Balance at May. 31, 2019 | $ 151,940 | 19,160,665 | (21,876,214) | 159,137 | (2,404,472) |
Balance, shares at May. 31, 2019 | 151,940,396 | ||||
Balance at Feb. 28, 2019 | $ 148,240 | 18,059,682 | (19,674,892) | 76,205 | (1,390,765) |
Balance, shares at Feb. 28, 2019 | 148,240,396 | ||||
Net loss | (3,517,055) | ||||
Balance at Aug. 31, 2019 | $ 153,190 | 19,842,929 | (23,191,947) | 154,409 | (3,041,419) |
Balance, shares at Aug. 31, 2019 | 153,190,396 | ||||
Balance at May. 31, 2019 | $ 151,940 | 19,160,665 | (21,876,214) | 159,137 | (2,404,472) |
Balance, shares at May. 31, 2019 | 151,940,396 | ||||
Share-based compensation | $ 250 | 62,250 | 62,500 | ||
Share-based compensation, shares | 250,000 | ||||
Warrant modification expense | 371,014 | 371,014 | |||
Sale of common stock | $ 1,000 | 249,000 | 250,000 | ||
Sale of common stock, shares | 1,000,000 | ||||
Gain on foreign currency translation | (4,728) | (4,728) | |||
Net loss | (1,315,733) | (1,315,733) | |||
Balance at Aug. 31, 2019 | $ 153,190 | 19,842,929 | (23,191,947) | 154,409 | (3,041,419) |
Balance, shares at Aug. 31, 2019 | 153,190,396 | ||||
Balance at Feb. 29, 2020 | $ 153,840 | 20,447,198 | (25,578,025) | 154,199 | (4,822,788) |
Balance, shares at Feb. 29, 2020 | 153,840,396 | ||||
Sale of common stock | $ 250 | 49,750 | 50,000 | ||
Sale of common stock, shares | 250,000 | ||||
Gain on foreign currency translation | 72,790 | 72,790 | |||
Net loss | (997,811) | (997,811) | |||
Balance at May. 31, 2020 | $ 154,090 | 20,496,948 | (26,575,836) | 226,989 | (5,697,809) |
Balance, shares at May. 31, 2020 | 154,090,396 | ||||
Balance at Feb. 29, 2020 | $ 153,840 | 20,447,198 | (25,578,025) | 154,199 | (4,822,788) |
Balance, shares at Feb. 29, 2020 | 153,840,396 | ||||
Net loss | (2,757,953) | ||||
Balance at Aug. 31, 2020 | $ 154,340 | 21,316,586 | (28,335,978) | 227,830 | (6,637,222) |
Balance, shares at Aug. 31, 2020 | 154,340,396 | ||||
Balance at May. 31, 2020 | $ 154,090 | 20,496,948 | (26,575,836) | 226,989 | (5,697,809) |
Balance, shares at May. 31, 2020 | 154,090,396 | ||||
Warrant modification expense | 769,888 | 769,888 | |||
Sale of common stock | $ 250 | 49,750 | 50,000 | ||
Sale of common stock, shares | 250,000 | ||||
Gain on foreign currency translation | 841 | 841 | |||
Net loss | (1,760,142) | (1,760,142) | |||
Balance at Aug. 31, 2020 | $ 154,340 | $ 21,316,586 | $ (28,335,978) | $ 227,830 | $ (6,637,222) |
Balance, shares at Aug. 31, 2020 | 154,340,396 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Aug. 31, 2020 | May 31, 2020 | Aug. 31, 2019 | May 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Feb. 29, 2020 | |
Cash flows from operating activities | |||||||
Net loss | $ (1,760,142) | $ (997,811) | $ (1,315,733) | $ (2,201,322) | $ (2,757,953) | $ (3,517,055) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Amortization of debt discount | 418,790 | 386,422 | 829,075 | 764,991 | $ 4,612,321 | ||
Stock-based compensation | 802,500 | ||||||
Warrant modification expense | 769,888 | 735,697 | |||||
Foreign currency transaction (gain) loss | 381 | ||||||
Changes in operating assets and liabilities: | |||||||
Prepaid expenses | (61,100) | (21,576) | |||||
Tax receivable | 612 | 215 | |||||
Accounts payable and accrued liabilities | 577,869 | 303,225 | |||||
Accounts payable - related party, net | 379,020 | 380,840 | |||||
Net cash used in operating activities | (262,589) | (550,782) | |||||
Cash flows from financing activities | |||||||
Proceeds from borrowings on notes payable | 118,750 | ||||||
Proceeds from sale of common stock | 100,000 | 250,000 | |||||
Net cash flows provided by financing activities | 218,750 | 250,000 | |||||
Effect of foreign currency translation on cash | 73,631 | 78,204 | |||||
Change in cash during the period | 29,792 | (222,578) | |||||
Cash, beginning of the period | $ 8,115 | $ 405,908 | 8,115 | 405,908 | 405,908 | ||
Cash, end of the period | $ 37,907 | $ 183,330 | 37,907 | 183,330 | $ 8,115 | ||
Supplemental disclosures: | |||||||
Interest paid | |||||||
Income taxes paid |
Nature of Operations
Nature of Operations | 6 Months Ended |
Aug. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | 1. Nature of Operations The principal business of Discovery Energy Corp. (“Company”) is the exploration and development of the 584,651 gross acres (914 sq. miles) in South Australia (“Prospect”) covered by Petroleum Exploration License PEL 512 (“License”). In May 2012, the Company incorporated a wholly-owned Australian subsidiary, Discovery Energy SA Ltd., for the purpose of acquiring a 100% working interest in the License. On May 25, 2016, its status changed from a public to a private legal entity and its name changed to Discovery Energy SA Pty Ltd. (“Subsidiary”). To date, the Company has not determined whether or not the Prospect, which overlies portions of the Cooper and Eromanga basins, contains any crude oil and/or natural gas reserves that are economically recoverable. While the Company’s present focus is on the Prospect, it may consider pursuing other attractive crude oil and/or natural gas exploration opportunities. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Aug. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited interim consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules of the U.S. Securities and Exchange Commission (“SEC”). Principles of Consolidation These consolidated financial statements include the accounts of the Company and the Subsidiary. Inter-company transactions and balances have been eliminated upon consolidation. Use of Estimates The preparation of these financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of these financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid instruments with a maturity of three months or less at the time of acquisition to be cash equivalents. The Company maintains its cash in bank accounts which, at times, may exceed federally insured limits as guaranteed by the Federal Deposit Insurance Corporation. As of August 31, 2020, approximately $4,000 of the Company’s cash balances were uninsured, related to the Company’s Australian subsidiary. The Company has not experienced any losses on such accounts. Oil and Gas Property and Exploration Costs The Company is in the exploration stage of evaluating the Prospect and has not yet realized any revenues from its operations. It applies the successful efforts method of accounting for crude oil and natural gas properties. Under this method, exploration costs such as exploratory geological and geophysical costs, delay rentals and exploratory overhead are expensed as incurred. Costs to acquire mineral interests in crude oil and/or natural gas properties, drill and equip exploratory wells that find proved reserves and drill and equip development wells are capitalized. Acquisition costs of unproved leaseholds are assessed for impairment during the holding period and transferred to proven crude oil and/or natural gas properties to the extent associated with successful exploration activities. Significant undeveloped leases are assessed individually for impairment, based on the Company’s current exploration plans, and a valuation allowance is provided if impairment is indicated. Capitalized costs from successful exploration and development activities associated with producing crude oil and/or natural gas leases, along with capitalized costs for support equipment and facilities, are amortized to expense using the unit-of-production method based on proved crude oil and/or natural gas reserves on a field-by-field basis, as estimated by qualified petroleum engineers Long-lived Assets The carrying values of long-lived assets are reviewed on a regular basis for the existence of facts or circumstances that may suggest impairment. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value. Fair Value of Financial Instruments and Derivative Financial Instruments The carrying amounts of cash, receivables, accounts payable, accrued liabilities and shareholder loans approximate their fair values due to the short maturity of these items. Certain fair value estimates may be subject to and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. The Company does not hold or issue financial instruments for trading purposes, nor does it utilize derivative instruments in the management of its foreign exchange, commodity price, and/or interest rate market risks. Income Taxes Deferred income taxes are reported for timing differences between items of income or expense reported in these financial statements and those reported for income tax purposes. The Company uses the asset/liability method of accounting for income taxes. Deferred income taxes and tax benefits are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases, and for tax loss and credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company provides a valuation allowance for deferred taxes for the estimated future tax effects attributable to temporary differences and carry-forwards when realization is not more likely than not. The Tax Cuts and Jobs Act of 2017 was signed into law on December 22, 2017. The law includes significant changes to the U.S. corporate income tax system, including a federal corporate rate reduction from 34% to 21%. In accordance with ASC 740, the impact of a change in the tax law is recorded in the period of enactment. The Company accounts for uncertain income tax positions by recognizing in the financial statements, the impact of a tax position, if that position is more likely than not of being sustained on examination by taxation authorities, based on the technical merits of the position. Foreign Currency Translation The Company’s functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated using exchange rates prevailing at the balance sheet date. Non-monetary assets are translated at historical exchange rates, and revenue and expense items at average rates of exchange prevailing during the period. Differences resulting from translation are presented in equity as accumulated other comprehensive income (loss). Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian and Australian dollars. The Company has not, to the date of these financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations. Fair Value Considerations Historically, the Company followed Accounting Standards Codification (“ASC”) 820, “ Fair Value Measurements and Disclosures There are three levels of inputs to fair value measurements - Level 1, meaning the use of quoted prices for identical instruments in active markets; Level 2, meaning the use of quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or are directly or indirectly observable; and Level 3, meaning the use of unobservable inputs. The Company uses Level 1 inputs for its fair value measurements whenever there is an active market, with actual quotes, market prices, and observable inputs on the measurement date. The Company uses Level 2 inputs for fair value measurements whenever there are quoted prices for similar securities in an active market or quoted prices for identical securities in an inactive market. The Company uses observable market data whenever available. In accordance with ASC 815-40-25 and ASC 815-10-15 “Derivatives and Hedging” Liabilities-Distinguishing Liabilities from Equity” In July 2017, the FASB issued Accounting Standards Update (“ASU”) 2017-11, Earnings Per Share Distinguishing Liabilities from Equity Derivatives and Hedging Accounting for Certain Financial Instruments with Down Round Features Loss Per Share Basic Earnings Per Share (“EPS”) is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used to determine the number of shares assumed to be purchased from the exercise of stock options and/or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. For the six months ended August 31, 2020 and 2019, the following share equivalents related to convertible debt and warrants to purchase shares of common stock were excluded from the computation of diluted net loss per share, as the inclusion of such shares would be anti-dilutive. Three Months Ended Three Months Ended Six Months Ended Six Months Ended Common Shares Issuable for: August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Convertible debt 56,391,400 52,087,450 56,391,400 52,087,450 Stock warrants 19,125,000 19,125,000 19,125,000 19,125,000 75,516,400 71,212,450 75,516,400 71,212,450 Comprehensive Income (Loss) The Company recognizes currency translation adjustments as a component of comprehensive income (loss). Recent Accounting Pronouncements In August 2016, the FASB issued ASU 2016-15, “ Statement of Cash Flows Classification of Certain Cash Receipts and Cash Payments In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” “Leases (Topic 842): Targeted Improvements” On March 1, 2019, the Company adopted Topic 842 and elected practical expedients provided by the new standard whereby, the Company has elected to not reassess its prior conclusions about lease identification, lease classification, and initial direct costs and to retain off-balance sheet treatment of short-term leases (i.e., 12 months or less and does not contain a purchase option that the Company is reasonably certain to exercise). As a result of the short-term expedient election, the Company has no leases that require the recording of a net lease asset and lease liability on the Company’s consolidated balance sheet or have a material impact on consolidated earnings or cash flows as of March 1, 2019. Moving forward, the Company will evaluate any new lease commitments for application of Topic 842. The Company does not anticipate that the adoption of other recently issued accounting pronouncements will have a significant impact on its financial statements. |
Going Concern
Going Concern | 6 Months Ended |
Aug. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | 3. Going Concern These financial statements were prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has not generated revenues since inception, and is unlikely to generate earnings in the immediate or foreseeable future. The continuation of the Company as a going concern is dependent upon the ability of the Company to obtain necessary equity or debt financing to continue operations, successfully develop the Prospect and/or obtain producing properties, with a goal of attaining profitable operations. The Company is currently attempting to complete a significant financing, and in this connection might (a) place a significant amount of additional debentures similar to those described below, (b) secure an alternative financing arrangement, possibly involving the Company’s equity securities, or (c) some combination of (a) and (b). The Company has no assurance that it will be able to raise significant additional funds to develop the Prospect or the additional funds needed for general corporate purposes. As of August 31, 2020, the Company had not generated any revenues and had an accumulated deficit of $28,335,978 since inception. The cash balance of the Company was $37,907 as of August 31, 2020. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern for the 12 months following the issuance of these financial statements. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The current COVID-19 pandemic could continue to, and future similar epidemics or pandemics could also, materially and adversely impact our ability to finance and conduct the Company’s business once it becomes operational, and could materially and adversely impact its operations, financial condition and results. The COVID-19 pandemic has had no material impact on the Company’s current business activities which are primarily focused on compliance and fund raising tasks. The Company has had and continues to have the same staff, same service providers and same processes as was the case prior to the pandemic. |
Oil and Gas Properties
Oil and Gas Properties | 6 Months Ended |
Aug. 31, 2020 | |
Oil and Gas Exploration and Production Industries Disclosures [Abstract] | |
Oil and Gas Properties | 4. Oil and Gas Properties The License covers 584,651 gross acres (914 sq. miles) in the State of South Australia. The License grants a 100% working interest in the preceding acreage, which overlies portions of the Cooper and Eromanga basins. On October 26, 2012, a 100% interest in the License was officially issued to the Subsidiary. On May 19, 2014, the Company received notice from the Government of South Australia that it had issued certain modifications to the License and had suspended the License for a period of six months. Such a suspension functions like an extension. Under the amended License, the Company is required to drill 7 exploratory wells rather than 12, as originally required. The 7 required wells must be drilled in years 3, 4, and 5 (2, 2, and 3 wells, respectively). The amount of required 2D seismic was also reduced to 62 miles (100 km.) in year 3 from 155 miles (250 km.) in year 2 but the total 3D seismic work guarantee increased to 193 sq. miles (500 sq. km.) from 154 sq. miles (400 sq. km.). However, the 3D seismic survey requirement is spread over three years with 39 sq. miles (100 sq. km.) in year 2, 77 sq. miles (200 sq. km.) in year 3 and 77 sq. miles (200 sq. km.) in year 4. Subsequent to this modification and suspension, the Company received two additional six-month suspensions, one in February 2015 and one in July 2015 (this additional suspension commenced upon the conclusion of the suspension received in February 2015). In February 2016, the Company received a third additional suspension, which was for one year and which commenced upon the conclusion of the suspension received in July 2015. Combined, these three additional suspensions amount to an accumulated total suspension of two years. On June 22, 2016, the Company terminated the February 2016 License suspension in preparation for a 3D seismic survey (the “ Nike Survey In July 2017, the License suspension was lifted in order to conduct a Work Area Clearance Survey (“ WAC As a result of the activities, modifications and suspensions described above, the remaining work commitments are now as follows: * Year 3 ending October 28, 2021 - Shoot 2D seismic data totaling at least approximately 62 miles (100 km.) and shoot 3D seismic data totaling at a minimum approximately 77 sq. miles (200 sq. km.) and drill two wells. * Year 4 ending October 29, 2022 - Shoot 3D seismic data totaling at a minimum approximately 77 sq. miles (200 sq. km.) and drill two wells. * Year 5 ending October 29, 2023 - Drill three wells. In four transactions, the Company acquired portions of the royalty interest associated with the PEL 512 License so that the Company now owns an aggregate 5.0% royalty interest, while the previous holders of the original 7.0% royalty interest continue to hold a 2.0% royalty interest. The Company believes that it will be able to complete its Year 3 Commitment obligations by the October 28, 2021 due date. Accordingly, the Company does not intend to seek an extension of such obligations prior to the due date. While the Company has to date been successful in obtaining such extensions, it has no assurance that any further extensions will be obtained. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Aug. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 5. Related Party Transactions As of August 31, 2020 and February 29, 2020, the Company owed $1,193,419 and $814,399, respectively, to certain Company directors for accrued compensation and reimbursement of expenses paid on behalf of the Company. |
Notes Payable
Notes Payable | 6 Months Ended |
Aug. 31, 2020 | |
Debt Disclosure [Abstract] | |
Notes Payable | 6. Notes Payable In connection with the Paycheck Protection Program established by the Coronavirus Aid, Relief, and Economic Security Act, on April 27, 2020 the Company borrowed approximately $118,750 at an interest rate of 1% . The loan matures on April 27, 2022. In due course, the Company intends to apply for the forgiveness of this indebtedness to the maximum extent permitted by applicable law. Accrued interest for the three months and six months ended August 31, 2020 is $299 and $413, respectively, at a rate of 1% per annum. |
Convertible Debentures Payable
Convertible Debentures Payable | 6 Months Ended |
Aug. 31, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Debentures Payable | 7. Convertible Debentures Payable From May 27, 2016 through May 16, 2018, the Company issued eleven rounds (I thru XI) of senior secured convertible debentures, the proceeds of which have funded the initial Nike Survey, the interpretation of seismic data acquired, expenses associated with the Nike Survey, costs associated with the debenture issuances, and general and administrative expenses. The debentures are secured by virtually all of the Company’s assets owned, directly or indirectly, but for the License. As discussed elsewhere, the Company may in the future sell additional senior secured convertible debentures having the same terms as those currently outstanding. The table below provides a summary of the senior secured convertible debentures issued through August 31, 2020 and related debt discount and amortization details. Round Issue Maturity Interest Conversion Principal Debt Debentures, Outstanding as of February 29, 2020: I May 27, 2016 May 27, 2021 8 % $ 0.16 $ 3,500,000 $ 3,500,000 II Aug 16, 2016 May 27, 2021 8 % $ 0.16 200,000 199,999 Aug 16, 2016 May 27, 2021 8 % $ 0.16 250,000 250,000 III Dec 30, 2016 May 27, 2021 8 % $ 0.16 287,500 237,587 IV Feb 15, 2017 May 27, 2021 8 % $ 0.16 1,000,000 1,000,000 V Mar 31,2017 May 27, 2021 8 % $ 0.20 200,000 200,000 VI Jul 5, 2017 May 27, 2021 8 % $ 0.20 137,500 137,500 Jul 5, 2017 May 27, 2021 8 % $ 0.16 150,000 150,000 VII Sept 19, 2017 May 27, 2021 8 % $ 0.16 400,000 400,000 Sept 19, 2017 May 27, 2021 8 % $ 0.16 100,000 82,125 VIII Oct 10, 2017 May 27, 2021 8 % $ 0.20 137,500 72,806 IX Jan 3, 2018 May 27, 2021 8 % $ 0.20 137,500 137,500 X April 2, 2018 May 27, 2021 8 % $ 0.20 137,500 137,500 XI May 16, 2018 May 27, 2021 8 % $ 0.20 212,500 212,500 Amortized discount as of February 29, 2020 (4,612,321 ) Balance as of February 29, 2020 6,850,000 2,105,196 $ 4,744,804 Activity for the six months ended August 31, 2020: Amortization of discount for the six months ended August 31, 2020 (829,075 ) Balance as of August 31, 2020 $ 6,850,000 $ 1,276,121 $ 5,573,879 The Company recognized $418,790 and $386,422 in debt discount amortization related to all of the debentures during the three months ended August 31, 2020 and 2019, respectively. The Company recognized $829,075 and $764,991 in debt discount amortization related to all of the debentures during the six months ended August 31, 2020 and 2019, respectively. During the three months ended August 31, 2020 and 2019, the Company incurred interest expense directly related to the Convertible Debentures of $183,108 and $169,126, respectively, at a rate of 8% per year, compounded quarterly. During the six months ended August 31, 2020 and 2019, the Company incurred interest expense directly related to the Convertible Debentures of $362,595 and $ 335,906, respectively, at a rate of 8% per annum, compounded quarterly. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Aug. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 8. Commitments and Contingencies Office Lease The Company leases virtual office space in Houston, Texas, with a term ending March 31, 2021 for $193 per month and has a remaining obligation as of August 31, 2020 of $1,351. The Subsidiary leases virtual office space in Melbourne, Australia, on a month-to-month basis for AU$175. The Company’s server and office space located in the personal office of Keith McKenzie, an officer and director of the Company, is also leased on a month-to-month basis for CA$500. During the three months ended August 31, 2020 and 2019, the Company incurred lease expense of $2,234 and $2,644, respectively, for the combined leases. For the six months ended August 31, 2020 and 2019, the Company incurred lease expense of $4,234 and $5,369, respectively, for the combined leases. |
Shareholders' Deficit
Shareholders' Deficit | 6 Months Ended |
Aug. 31, 2020 | |
Equity [Abstract] | |
Shareholders' Deficit | 9. Shareholders’ Deficit The Company received gross proceeds of $100,000 from the private placement of 500,000 shares of common stock during the six months ended August 31, 2020 at a price of $0.20 per common share. On February 2, 2020, the Company received proceeds of $6,250 in a private placement for 25,000 shares of common stock at $0.25 per share. As of August 31, 2020, the 25,000 shares had not been issued. During the six months ended August 31, 2019, the Company issued 3,700,000 and 250,000 shares of its common stock for services at a price of $0.20 and $0.25 per share, respectively, to certain officers, board members, employees and professional service providers, based on the stock price on the date of grant with a total grant date fair value of $802,500 (of which 2,500,000 shares were issued to certain related parties). Additionally, the Company received gross proceeds of $250,000 from the private placement of 1,000,000 shares of common stock during the six months ended August 31, 2019 at a price of $0.25 per common share. Warrants Pursuant to debenture agreements dated May 27, 2016 and August 16, 2016, warrants to purchase 13,875,000 shares of the Company’s common stock had an original expiration date of May 27, 2019. On May 27, 2019, the Company entered into agreements to extend the related expiration dates to July 27, 2019. As a result of the modification, the Company recorded additional expense of approximately $365,000 for the incremental fair value of the warrants, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) risk free interest rate of 2.35%, (2) expected life of 2 months, (3) expected volatility of 80%, and (4) zero expected dividends. On July 27, 2019, the Company entered into agreements to further extend the related expiration dates to December 31, 2019. As a result of the modification, the Company recorded additional expense of approximately $371,000 for the incremental fair value of the warrants, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) risk free interest rate of 2.1%, (2) expected life of 5 months, (3) expected volatility of 80%, and (4) zero expected dividends. On December 31, 2019, the Company entered into agreements to further extend the related expiration dates to February 29, 2020. As a result of the modification, the Company recorded additional expense of approximately $26,000 for the incremental fair value of the warrants, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) risk free interest rate of 1.48%, (2) expected life of 2 months, (3) expected volatility of 80%, and (4) zero expected dividends. On February 29, 2020, the Company entered into agreements to further extend the related expiration dates to August 31, 2020. As a result of the modification, the Company recorded additional expense of approximately $340,000 for the incremental fair value of the warrants, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) risk free interest rate of 1.11%, (2) expected life of 6 months, (3) expected volatility of 100%, and (4) zero expected dividends. The expense related to these modifications was included in general and administrative expense on the statement of operations. On August 31, 2020 the Company entered into agreements to further extend the related expiration dates to February 28, 2021. As a result of the modification, the Company recorded additional expense of approximately $559,000 for the incremental fair value of the warrants, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) risk free interest rate of 0.105%, (2) expected life of 6 months, (3) expected volatility of 76%, and (4) zero expected dividends. The expense related to these modifications was included in general and administrative expense on the statement of operations. Pursuant to debenture agreements dated February 15, 2017, warrants to purchase 3,750,000 shares of the Company’s common stock had an original expiration date of February 15, 2020. On February 15, 2020, the Company entered into agreements to extend the related expiration dates to August 31, 2020. As a result of the modification, the Company recorded additional expense of approximately $82,000 for the incremental fair value of the warrants, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) risk free interest rate of 1.55%, (2) expected life of 6.5 months, (3) expected volatility of 101%, and (4) zero expected dividends. The expense related to these modifications was included in general and administrative expense on the statement of operations. On August 31, 2020 the Company entered into agreements to further extend the related expiration dates to February 28, 2021. As a result of the modification, the Company recorded additional expense of approximately $151,000 for the incremental fair value of the warrants, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) risk free interest rate of 0.105%, (2) expected life of 6 months, (3) expected volatility of 76%, and (4) zero expected dividends. The expense related to these modifications was included in general and administrative expense on the statement of operations. Pursuant to a debenture agreement dated September 19, 2017, warrants to purchase 1,500,000 shares of the Company’s common stock had an original expiration date of September 19, 2020. On August 31, 2020, the Company entered into agreements to extend the related expiration dates to February 28, 2021. As a result of the modification, the Company will record additional expense of approximately $60,000 for the incremental fair value of the warrants, calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) risk free interest rate of 0.105%, (2) expected life of 6 months, (3) expected volatility of 76%, and (4) zero expected dividends. The expense related to these modifications will be included in general and administrative expense on the statement of operations. No expense was recorded by the Company for the incremental fair value of the warrants due to the early adoption of ASU 2017-11 as noted in Footnote 2. Warrant activity during the six months ended August 31, 2020 is as follows: Weighted Average Weighted Remaining Number of Average Term Warrants Exercise Price (Years) Outstanding at February 29, 2020 19,125,000 $ 0.20 0.51 Expired/Cancelled - Outstanding and exercisable as of August 31, 2020 19,125,000 $ 0.20 0.50 The intrinsic value of warrants outstanding at August 31, 2020 and 2019 were $-0- and $765,000, respectively. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Aug. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules of the U.S. Securities and Exchange Commission (“SEC”). |
Principles of Consolidation | Principles of Consolidation These consolidated financial statements include the accounts of the Company and the Subsidiary. Inter-company transactions and balances have been eliminated upon consolidation. |
Use of Estimates | Use of Estimates The preparation of these financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of these financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid instruments with a maturity of three months or less at the time of acquisition to be cash equivalents. The Company maintains its cash in bank accounts which, at times, may exceed federally insured limits as guaranteed by the Federal Deposit Insurance Corporation. As of August 31, 2020, approximately $4,000 of the Company’s cash balances were uninsured, related to the Company’s Australian subsidiary. The Company has not experienced any losses on such accounts. |
Oil and Gas Property and Exploration Costs | Oil and Gas Property and Exploration Costs The Company is in the exploration stage of evaluating the Prospect and has not yet realized any revenues from its operations. It applies the successful efforts method of accounting for crude oil and natural gas properties. Under this method, exploration costs such as exploratory geological and geophysical costs, delay rentals and exploratory overhead are expensed as incurred. Costs to acquire mineral interests in crude oil and/or natural gas properties, drill and equip exploratory wells that find proved reserves and drill and equip development wells are capitalized. Acquisition costs of unproved leaseholds are assessed for impairment during the holding period and transferred to proven crude oil and/or natural gas properties to the extent associated with successful exploration activities. Significant undeveloped leases are assessed individually for impairment, based on the Company’s current exploration plans, and a valuation allowance is provided if impairment is indicated. Capitalized costs from successful exploration and development activities associated with producing crude oil and/or natural gas leases, along with capitalized costs for support equipment and facilities, are amortized to expense using the unit-of-production method based on proved crude oil and/or natural gas reserves on a field-by-field basis, as estimated by qualified petroleum engineers |
Long-Lived Assets | Long-lived Assets The carrying values of long-lived assets are reviewed on a regular basis for the existence of facts or circumstances that may suggest impairment. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value. |
Fair Value of Financial Instruments and Derivative Financial Instruments | Fair Value of Financial Instruments and Derivative Financial Instruments The carrying amounts of cash, receivables, accounts payable, accrued liabilities and shareholder loans approximate their fair values due to the short maturity of these items. Certain fair value estimates may be subject to and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. The Company does not hold or issue financial instruments for trading purposes, nor does it utilize derivative instruments in the management of its foreign exchange, commodity price, and/or interest rate market risks. |
Income Taxes | Income Taxes Deferred income taxes are reported for timing differences between items of income or expense reported in these financial statements and those reported for income tax purposes. The Company uses the asset/liability method of accounting for income taxes. Deferred income taxes and tax benefits are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases, and for tax loss and credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company provides a valuation allowance for deferred taxes for the estimated future tax effects attributable to temporary differences and carry-forwards when realization is not more likely than not. The Tax Cuts and Jobs Act of 2017 was signed into law on December 22, 2017. The law includes significant changes to the U.S. corporate income tax system, including a federal corporate rate reduction from 34% to 21%. In accordance with ASC 740, the impact of a change in the tax law is recorded in the period of enactment. The Company accounts for uncertain income tax positions by recognizing in the financial statements, the impact of a tax position, if that position is more likely than not of being sustained on examination by taxation authorities, based on the technical merits of the position. |
Foreign Currency Translation | Foreign Currency Translation The Company’s functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated using exchange rates prevailing at the balance sheet date. Non-monetary assets are translated at historical exchange rates, and revenue and expense items at average rates of exchange prevailing during the period. Differences resulting from translation are presented in equity as accumulated other comprehensive income (loss). Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian and Australian dollars. The Company has not, to the date of these financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations. |
Fair Value Considerations | Fair Value Considerations Historically, the Company followed Accounting Standards Codification (“ASC”) 820, “ Fair Value Measurements and Disclosures There are three levels of inputs to fair value measurements - Level 1, meaning the use of quoted prices for identical instruments in active markets; Level 2, meaning the use of quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or are directly or indirectly observable; and Level 3, meaning the use of unobservable inputs. The Company uses Level 1 inputs for its fair value measurements whenever there is an active market, with actual quotes, market prices, and observable inputs on the measurement date. The Company uses Level 2 inputs for fair value measurements whenever there are quoted prices for similar securities in an active market or quoted prices for identical securities in an inactive market. The Company uses observable market data whenever available. In accordance with ASC 815-40-25 and ASC 815-10-15 “Derivatives and Hedging” Liabilities-Distinguishing Liabilities from Equity” In July 2017, the FASB issued Accounting Standards Update (“ASU”) 2017-11, Earnings Per Share Distinguishing Liabilities from Equity Derivatives and Hedging Accounting for Certain Financial Instruments with Down Round Features |
Loss Per Share | Loss Per Share Basic Earnings Per Share (“EPS”) is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used to determine the number of shares assumed to be purchased from the exercise of stock options and/or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. For the six months ended August 31, 2020 and 2019, the following share equivalents related to convertible debt and warrants to purchase shares of common stock were excluded from the computation of diluted net loss per share, as the inclusion of such shares would be anti-dilutive. Three Months Ended Three Months Ended Six Months Ended Six Months Ended Common Shares Issuable for: August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Convertible debt 56,391,400 52,087,450 56,391,400 52,087,450 Stock warrants 19,125,000 19,125,000 19,125,000 19,125,000 75,516,400 71,212,450 75,516,400 71,212,450 |
Comprehensive Income (Loss) | Comprehensive Income (Loss) The Company recognizes currency translation adjustments as a component of comprehensive income (loss). |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2016, the FASB issued ASU 2016-15, “ Statement of Cash Flows Classification of Certain Cash Receipts and Cash Payments In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” “Leases (Topic 842): Targeted Improvements” On March 1, 2019, the Company adopted Topic 842 and elected practical expedients provided by the new standard whereby, the Company has elected to not reassess its prior conclusions about lease identification, lease classification, and initial direct costs and to retain off-balance sheet treatment of short-term leases (i.e., 12 months or less and does not contain a purchase option that the Company is reasonably certain to exercise). As a result of the short-term expedient election, the Company has no leases that require the recording of a net lease asset and lease liability on the Company’s consolidated balance sheet or have a material impact on consolidated earnings or cash flows as of March 1, 2019. Moving forward, the Company will evaluate any new lease commitments for application of Topic 842. The Company does not anticipate that the adoption of other recently issued accounting pronouncements will have a significant impact on its financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Aug. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | For the six months ended August 31, 2020 and 2019, the following share equivalents related to convertible debt and warrants to purchase shares of common stock were excluded from the computation of diluted net loss per share, as the inclusion of such shares would be anti-dilutive. Three Months Ended Three Months Ended Six Months Ended Six Months Ended Common Shares Issuable for: August 31, 2020 August 31, 2019 August 31, 2020 August 31, 2019 Convertible debt 56,391,400 52,087,450 56,391,400 52,087,450 Stock warrants 19,125,000 19,125,000 19,125,000 19,125,000 75,516,400 71,212,450 75,516,400 71,212,450 |
Convertible Debentures Payable
Convertible Debentures Payable (Tables) | 6 Months Ended |
Aug. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Debentures Payable | The table below provides a summary of the senior secured convertible debentures issued through August 31, 2020 and related debt discount and amortization details. Round Issue Maturity Interest Conversion Principal Debt Debentures, Outstanding as of February 29, 2020: I May 27, 2016 May 27, 2021 8 % $ 0.16 $ 3,500,000 $ 3,500,000 II Aug 16, 2016 May 27, 2021 8 % $ 0.16 200,000 199,999 Aug 16, 2016 May 27, 2021 8 % $ 0.16 250,000 250,000 III Dec 30, 2016 May 27, 2021 8 % $ 0.16 287,500 237,587 IV Feb 15, 2017 May 27, 2021 8 % $ 0.16 1,000,000 1,000,000 V Mar 31,2017 May 27, 2021 8 % $ 0.20 200,000 200,000 VI Jul 5, 2017 May 27, 2021 8 % $ 0.20 137,500 137,500 Jul 5, 2017 May 27, 2021 8 % $ 0.16 150,000 150,000 VII Sept 19, 2017 May 27, 2021 8 % $ 0.16 400,000 400,000 Sept 19, 2017 May 27, 2021 8 % $ 0.16 100,000 82,125 VIII Oct 10, 2017 May 27, 2021 8 % $ 0.20 137,500 72,806 IX Jan 3, 2018 May 27, 2021 8 % $ 0.20 137,500 137,500 X April 2, 2018 May 27, 2021 8 % $ 0.20 137,500 137,500 XI May 16, 2018 May 27, 2021 8 % $ 0.20 212,500 212,500 Amortized discount as of February 29, 2020 (4,612,321 ) Balance as of February 29, 2020 6,850,000 2,105,196 $ 4,744,804 Activity for the six months ended August 31, 2020: Amortization of discount for the six months ended August 31, 2020 (829,075 ) Balance as of August 31, 2020 $ 6,850,000 $ 1,276,121 $ 5,573,879 |
Shareholders' Deficit (Tables)
Shareholders' Deficit (Tables) | 6 Months Ended |
Aug. 31, 2020 | |
Equity [Abstract] | |
Summary of Warrant Activity | Warrant activity during the six months ended August 31, 2020 is as follows: Weighted Average Weighted Remaining Number of Average Term Warrants Exercise Price (Years) Outstanding at February 29, 2020 19,125,000 $ 0.20 0.51 Expired/Cancelled - Outstanding and exercisable as of August 31, 2020 19,125,000 $ 0.20 0.50 |
Nature of Operations (Details N
Nature of Operations (Details Narrative) - a | 6 Months Ended | |
Aug. 31, 2020 | May 31, 2012 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Proposed area for exploration and development | 584,651 | |
Proposed area for exploration and development, in miles | 914 | |
Working interest owned by company, percentage | 100.00% | 100.00% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) | 6 Months Ended |
Aug. 31, 2020USD ($) | |
Accounting Policies [Abstract] | |
Uninsured cash balance | $ 4,000 |
Income tax, description | The law includes significant changes to the U.S. corporate income tax system, including a federal corporate rate reduction from 34% to 21%. In accordance with ASC 740, the impact of a change in the tax law is recorded in the period of enactment. |
Income tax, federal corporate rate | 21.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | |
Common shares excluded from computation of diluted net loss per share | 75,516,400 | 71,212,450 | 75,516,400 | 71,212,450 |
Convertible Debt [Member] | ||||
Common shares excluded from computation of diluted net loss per share | 56,391,400 | 52,087,450 | 56,391,400 | 52,087,450 |
Stock Warrants [Member] | ||||
Common shares excluded from computation of diluted net loss per share | 19,125,000 | 19,125,000 | 19,125,000 | 19,125,000 |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | Aug. 31, 2020 | Feb. 29, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated loss | $ (28,335,978) | $ (25,578,025) |
Cash balance | $ 37,907 | $ 8,115 |
Oil and Gas Properties (Details
Oil and Gas Properties (Details Narrative) | Jun. 22, 2016km²mi² | May 19, 2014km²mi²Integer | May 18, 2014km²mi² | Oct. 26, 2012 | Jul. 31, 2017 | Aug. 31, 2020a | Feb. 29, 2020 | May 31, 2012 |
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
Principal business, proposed exploration and development area | a | 584,651 | |||||||
Principal business, proposed exploration and development area, miles | a | 914 | |||||||
Percent of working interest owned by company | 100.00% | 100.00% | ||||||
License interest, percentage | 100.00% | |||||||
Wells in process of drilling description | The Company is required to drill 7 exploratory wells rather than 12, as originally required. The 7 required wells must be drilled in years 3, 4, and 5 (2, 2, and 3 wells, respectively). The amount of required 2D seismic was also reduced to 62 miles (100 km.) in year 3 from 155 miles (250 km.) in year 2 but the total 3D seismic work guarantee increased to 193 sq. miles (500 sq. km.) from 154 sq. miles (400 sq. km.). However, the 3D seismic survey requirement is spread over three years with 39 sq. miles (100 sq. km.) in year 2, 77 sq. miles (200 sq. km.) in year 3 and 77 sq. miles (200 sq. km.) in year 4. | |||||||
Period of suspension of license | 6 months | 2 years | ||||||
Number of exploratory wells required to be drilled under license | Integer | 7 | |||||||
3D seismic survey work required to be completed (Sq.miles) | mi² | 193 | 154 | ||||||
3D seismic survey work required to be completed (Sq.km) | km² | 500 | 400 | ||||||
Area in terminated license suspension description | The Company terminated the February 2016 License suspension in preparation for a 3D seismic survey (the "Nike Survey") that was comprised of approximately 69 sq. miles (179 sq. km.) on the southwest portion of the Prospect. | |||||||
Area in terminated license suspension (Sq.miles) | mi² | 69 | |||||||
Area in terminated license suspension | km² | 179 | |||||||
Expiration date for license | Oct. 29, 2023 | |||||||
Liberty Petroleum Corp [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
Original owner's percentage of overriding royalty interest in acquisition | 7.00% | |||||||
Original owner's remaining percentage of overriding royalty interest in acquisition | 2.00% | |||||||
Royalty Deed Agreement [Member] | Liberty Petroleum Corp [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
Expiration date for license | Oct. 28, 2021 | |||||||
Total acquired percentage of overriding royalty interest in acquisition | 5.00% | |||||||
License Amendment [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
Suspension of license description | The Company requested and received five additional six-month suspensions in each of July 2017, June 2018, February 2019, July 2019 and January 2020 and one additional twelve-month suspension in August 2020 resulting in a new expiration date of October 29, 2023. | |||||||
In Three Year [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
3D seismic survey work required to be completed (Sq.miles) | mi² | 39 | |||||||
3D seismic survey work required to be completed (Sq.km) | km² | 100 | |||||||
In Year 4 [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
3D seismic survey work required to be completed (Sq.miles) | mi² | 77 | |||||||
3D seismic survey work required to be completed (Sq.km) | km² | 200 | |||||||
October 28, 2018 [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
2D seismic survey work required to be completed (Sq.miles) | mi² | 155 | |||||||
2D seismic survey work required to be completed (Sq.km) | km² | 250 | |||||||
October 28, 2018 [Member] | In Three Year [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
2D seismic survey work required to be completed (Sq.miles) | mi² | 62 | |||||||
2D seismic survey work required to be completed (Sq.km) | km² | 100 | |||||||
October 28, 2021 [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
Number of exploratory wells required to be drilled under license | Integer | 2 | |||||||
2D seismic survey work required to be completed (Sq.miles) | mi² | 62 | |||||||
2D seismic survey work required to be completed (Sq.km) | km² | 100 | |||||||
3D seismic survey work required to be completed (Sq.miles) | mi² | 77 | |||||||
3D seismic survey work required to be completed (Sq.km) | km² | 200 | |||||||
October 29, 2022 [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
Number of exploratory wells required to be drilled under license | Integer | 2 | |||||||
3D seismic survey work required to be completed (Sq.miles) | mi² | 77 | |||||||
3D seismic survey work required to be completed (Sq.km) | km² | 200 | |||||||
October 29, 2023 [Member] | ||||||||
Oil and Gas, Delivery Commitment [Line Items] | ||||||||
Number of exploratory wells required to be drilled under license | Integer | 3 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Aug. 31, 2020 | Feb. 29, 2020 |
Related Party Transactions [Abstract] | ||
Accounts payable - related parties, net | $ 1,193,419 | $ 814,399 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | Apr. 27, 2020 | Aug. 31, 2020 | Aug. 31, 2020 |
Loan interest rate | 1.00% | 1.00% | |
Accrued interest | $ 299 | $ 413 | |
Paycheck Protection Program [Member] | |||
Loans received | $ 118,750 | ||
Loan interest rate | 1.00% | ||
Loan maturity date | Apr. 27, 2022 |
Convertible Debentures Payabl_2
Convertible Debentures Payable (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Feb. 29, 2020 | |
Debt Disclosure [Abstract] | |||||
Amortization of debt discount | $ 418,790 | $ 386,422 | $ 829,075 | $ 764,991 | $ 4,612,321 |
Interest expense related to convertible debentures | $ 183,108 | $ 169,126 | $ 362,595 | $ 335,906 | |
Interest rate, compounded quarterly | 8.00% |
Convertible Debentures Payabl_3
Convertible Debentures Payable - Schedule of Convertible Debentures Payable (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Feb. 29, 2020 | |
Interest Rate | 1.00% | 1.00% | |||
Principal Amount | $ 6,850,000 | $ 6,850,000 | $ 6,850,000 | ||
Debt Discount | 1,276,121 | 1,276,121 | 2,105,196 | ||
Amortized discount | (418,790) | $ (386,422) | (829,075) | $ (764,991) | (4,612,321) |
Debentures, net of Debt Discount | $ 5,573,879 | $ 5,573,879 | $ 4,744,804 | ||
Senior Secured Convertible Debenture [Member] | Round I [Member] | |||||
Issue Date | May 27, 2016 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.16 | ||||
Principal Amount | $ 3,500,000 | ||||
Debt Discount | $ 3,500,000 | ||||
Senior Secured Convertible Debenture [Member] | Round II [Member] | |||||
Issue Date | Aug. 16, 2016 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.16 | ||||
Principal Amount | $ 200,000 | ||||
Debt Discount | $ 199,999 | ||||
Senior Secured Convertible Debenture [Member] | Round II [Member] | |||||
Issue Date | Aug. 16, 2016 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.16 | ||||
Principal Amount | $ 250,000 | ||||
Debt Discount | $ 250,000 | ||||
Senior Secured Convertible Debenture [Member] | Round III [Member] | |||||
Issue Date | Dec. 30, 2016 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.16 | ||||
Principal Amount | $ 287,500 | ||||
Debt Discount | $ 237,587 | ||||
Senior Secured Convertible Debenture [Member] | Round IV [Member] | |||||
Issue Date | Feb. 15, 2017 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.16 | ||||
Principal Amount | $ 1,000,000 | ||||
Debt Discount | $ 1,000,000 | ||||
Senior Secured Convertible Debenture [Member] | Round V [Member] | |||||
Issue Date | Mar. 31, 2017 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.20 | ||||
Principal Amount | $ 200,000 | ||||
Debt Discount | $ 200,000 | ||||
Senior Secured Convertible Debenture [Member] | Round VI [Member] | |||||
Issue Date | Jul. 5, 2017 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.20 | ||||
Principal Amount | $ 137,500 | ||||
Debt Discount | $ 137,500 | ||||
Senior Secured Convertible Debenture [Member] | Round VI [Member] | |||||
Issue Date | Jul. 5, 2017 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.16 | ||||
Principal Amount | $ 150,000 | ||||
Debt Discount | $ 150,000 | ||||
Senior Secured Convertible Debenture [Member] | Round VII [Member] | |||||
Issue Date | Sep. 19, 2017 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.16 | ||||
Principal Amount | $ 400,000 | ||||
Debt Discount | $ 400,000 | ||||
Senior Secured Convertible Debenture [Member] | Round VII [Member] | |||||
Issue Date | Sep. 19, 2017 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.16 | ||||
Principal Amount | $ 100,000 | ||||
Debt Discount | $ 82,125 | ||||
Senior Secured Convertible Debenture [Member] | Round VIII [Member] | |||||
Issue Date | Oct. 10, 2017 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.20 | ||||
Principal Amount | $ 137,500 | ||||
Debt Discount | $ 72,806 | ||||
Senior Secured Convertible Debenture [Member] | Round IX [Member] | |||||
Issue Date | Jan. 3, 2018 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.20 | ||||
Principal Amount | $ 137,500 | ||||
Debt Discount | $ 137,500 | ||||
Senior Secured Convertible Debenture [Member] | Round X [Member] | |||||
Issue Date | Apr. 2, 2018 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.20 | ||||
Principal Amount | $ 137,500 | ||||
Debt Discount | $ 137,500 | ||||
Senior Secured Convertible Debenture [Member] | Round XI [Member] | |||||
Issue Date | May 16, 2018 | ||||
Maturity Date | May 27, 2021 | ||||
Interest Rate | 8.00% | ||||
Conversion Price | $ 0.20 | ||||
Principal Amount | $ 212,500 | ||||
Debt Discount | $ 212,500 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) | 3 Months Ended | 6 Months Ended | ||||
Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($) | Aug. 31, 2020USD ($) | Aug. 31, 2020AUD ($) | Aug. 31, 2020CAD ($) | Aug. 31, 2019USD ($) | |
Operating lease expense | $ 2,234 | $ 2,644 | $ 4,234 | $ 5,369 | ||
CAD [Member] | Keith J. McKenzie [Member] | ||||||
Operating subsidiary lease expense | $ 500 | |||||
March 31, 2021 [Member] | ||||||
Operating lease expense | 193 | |||||
Remaining obligation | $ 1,351 | $ 1,351 | ||||
March 31, 2021 [Member] | AUD [Member] | ||||||
Operating subsidiary lease expense | $ 175 |
Shareholders' Deficit (Details
Shareholders' Deficit (Details Narrative) | Aug. 31, 2020USD ($)Integer$ / sharesshares | Aug. 31, 2020USD ($)Integer$ / sharesshares | Feb. 29, 2020USD ($)Integer | Feb. 15, 2020USD ($)Integer | Feb. 02, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($)Integer | Jul. 27, 2019USD ($)Integer | May 27, 2019USD ($)Integer | Sep. 19, 2017USD ($)shares | Feb. 15, 2017shares | Aug. 31, 2020USD ($)Integer$ / sharesshares | Aug. 31, 2019USD ($)$ / sharesshares |
Gross proceeds received from private placement | $ | $ 100,000 | |||||||||||
Number of common stock issued through private placement | shares | 500,000 | |||||||||||
Fair value of shares issued price per share | $ / shares | $ 0.20 | $ 0.20 | $ 0.20 | |||||||||
Number of common stock shares subsidiary, unissued | shares | 25,000 | 25,000 | 25,000 | |||||||||
Intrinsic value of outstanding warrants | $ | $ 0 | $ 0 | $ 0 | $ 765,000 | ||||||||
Stock Warrants [Member] | ||||||||||||
Warrants to purchase common stock | shares | 13,875,000 | 13,875,000 | 1,500,000 | 3,750,000 | 13,875,000 | |||||||
Warrants, expiration date | May 27, 2019 | May 27, 2019 | May 27, 2019 | |||||||||
Warrants, extended expiration date | Feb. 28, 2021 | Aug. 31, 2020 | Aug. 31, 2020 | Feb. 29, 2020 | Dec. 31, 2019 | Jul. 27, 2019 | Sep. 19, 2020 | Feb. 15, 2020 | ||||
Additional expense for incremental fair value of the warrants | $ | $ 559,000 | $ 340,000 | $ 82,000 | $ 26,000 | $ 371,000 | $ 365,000 | $ 60,000 | |||||
Stock Warrants [Member] | Extended Maturity [Member] | ||||||||||||
Warrants, extended expiration date | Feb. 28, 2021 | |||||||||||
Stock Warrants [Member] | Extention of Debenture Agreements [Member] | ||||||||||||
Warrants, extended expiration date | Feb. 28, 2021 | |||||||||||
Additional expense for incremental fair value of the warrants | $ | $ 151,000 | |||||||||||
Stock Warrants [Member] | Risk Free Interest Rate [Member] | ||||||||||||
Warrants and rights outstanding, measurement input | 0.105 | 0.105 | 1.11 | 1.55 | 1.48 | 2.1 | 2.35 | 0.105 | ||||
Stock Warrants [Member] | Risk Free Interest Rate [Member] | Extention of Debenture Agreements [Member] | ||||||||||||
Warrants and rights outstanding, measurement input | 0.105 | 0.105 | 0.105 | |||||||||
Stock Warrants [Member] | Risk Free Interest Rate [Member] | Agreements Related to Extend Expiration [Member] | ||||||||||||
Warrants and rights outstanding, measurement input | 0.105 | 0.105 | 0.105 | |||||||||
Stock Warrants [Member] | Debenture/Warrant Lives In Years [Member] | ||||||||||||
Warrants and rights outstanding, term | 6 months | 6 months | 6 months | 6 years 6 months | 2 months | 5 months | 2 months | 6 months | ||||
Stock Warrants [Member] | Debenture/Warrant Lives In Years [Member] | Extention of Debenture Agreements [Member] | ||||||||||||
Warrants and rights outstanding, term | 6 months | 6 months | 6 months | |||||||||
Stock Warrants [Member] | Debenture/Warrant Lives In Years [Member] | Agreements Related to Extend Expiration [Member] | ||||||||||||
Warrants and rights outstanding, term | 6 months | 6 months | 6 months | |||||||||
Stock Warrants [Member] | Expected Volatility [Member] | ||||||||||||
Warrants and rights outstanding, measurement input | 76 | 76 | 100 | 101 | 80 | 80 | 80 | 76 | ||||
Stock Warrants [Member] | Expected Volatility [Member] | Extention of Debenture Agreements [Member] | ||||||||||||
Warrants and rights outstanding, measurement input | 76 | 76 | 76 | |||||||||
Stock Warrants [Member] | Expected Volatility [Member] | Agreements Related to Extend Expiration [Member] | ||||||||||||
Warrants and rights outstanding, measurement input | 76 | 76 | 76 | |||||||||
Stock Warrants [Member] | Expected Dividend [Member] | ||||||||||||
Warrants and rights outstanding, measurement input | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||
Stock Warrants [Member] | Expected Dividend [Member] | Extention of Debenture Agreements [Member] | ||||||||||||
Warrants and rights outstanding, measurement input | 0 | 0 | 0 | |||||||||
Stock Warrants [Member] | Expected Dividend [Member] | Agreements Related to Extend Expiration [Member] | ||||||||||||
Warrants and rights outstanding, measurement input | 0 | 0 | 0 | |||||||||
Officers, Board Members, Employees and Professional Service [Member] | ||||||||||||
Number of common stock issued for services, shares | shares | 3,700,000 | |||||||||||
Shares issued price per share | $ / shares | $ 0.20 | |||||||||||
Officers, Board Members, Employees and Professional Service [Member] | Issuance of Shares of Common Stock [Member] | ||||||||||||
Number of common stock issued for services, shares | shares | 250,000 | |||||||||||
Shares issued price per share | $ / shares | $ 0.25 | |||||||||||
Officers, Board Members, Employees and Professional Service [Member] | AdditionalSharesIssuedMember | ||||||||||||
Gross proceeds received from private placement | $ | $ 250,000 | |||||||||||
Number of common stock issued through private placement | shares | 1,000,000 | |||||||||||
Fair value of shares issued price per share | $ / shares | $ 0.25 | |||||||||||
Certain Related Parties [Member] | ||||||||||||
Number of common stock issued for services | $ | $ 802,500 | |||||||||||
Number of shares issued for related parties | shares | 2,500,000 | |||||||||||
Private Placement [Member] | ||||||||||||
Gross proceeds received from private placement | $ | $ 6,250 | |||||||||||
Number of common stock issued through private placement | shares | 25,000 | |||||||||||
Fair value of shares issued price per share | $ / shares | $ 0.25 |
Shareholders' Deficit - Summary
Shareholders' Deficit - Summary of Warrant Activity (Details) | 6 Months Ended |
Aug. 31, 2020$ / sharesshares | |
Equity [Abstract] | |
Number of Warrants, Outstanding, beginning | shares | 19,125,000 |
Number of Warrants, Expired/Cancelled | shares | |
Number of Warrants, Outstanding and exercisable, ending | shares | 19,125,000 |
Weighted Average Exercise Price, Outstanding, beginning | $ / shares | $ 0.20 |
Weighted Average Exercise Price, Expired/Cancelled | $ / shares | |
Weighted Average Exercise Price, Outstanding and exercisable, ending | $ / shares | $ 0.20 |
Weighted Average Remaining Term (Years), Outstanding, Beginning | 6 months 3 days |
Weighted Average Remaining Term (Years), Outstanding and exercisable, ending | 6 months |