Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Nov. 03, 2017 | |
Document Information [Line Items] | ||
Entity Registrant Name | RESERVE PETROLEUM CO | |
Entity Central Index Key | 83,350 | |
Trading Symbol | rsrv | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Entity Common Stock, Shares Outstanding (in shares) | 157,715 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Balance Sheets (Current Period
Balance Sheets (Current Period Unaudited) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Current Assets: | ||
Cash and Cash Equivalents | $ 5,328,037 | $ 8,071,854 |
Available-for-Sale Securities | 16,398,003 | 13,443,636 |
Trading Securities | 566,466 | 473,707 |
Refundable Income Taxes | 227,779 | 536,798 |
Receivables | 913,043 | 764,641 |
Total Current Assets | 23,433,328 | 23,290,636 |
Investments: | ||
Equity Investments | 795,197 | 822,570 |
Other Investments, at Cost | 1,910,189 | 1,906,856 |
Total Investments | 2,705,386 | 2,729,426 |
Property, Plant and Equipment: | ||
Unproved Properties | 2,541,840 | 2,180,018 |
Proved Properties | 53,074,649 | 53,030,034 |
Oil and Gas Properties, Gross | 55,616,489 | 55,210,052 |
Less – Accumulated Depreciation, Depletion, Amortization and Valuation Allowance | 44,876,843 | 44,456,113 |
Oil and Gas Properties, Net | 10,739,646 | 10,753,939 |
Other Property and Equipment, at Cost | 413,932 | 406,430 |
Less – Accumulated Depreciation | 255,780 | 231,887 |
Other Property and Equipment, Net | 158,152 | 174,543 |
Total Property, Plant and Equipment | 10,897,798 | 10,928,482 |
Total Assets | 37,036,512 | 36,948,544 |
Current Liabilities: | ||
Accounts Payable | 241,332 | 161,749 |
Other Current Liabilities | 61,589 | 25,590 |
Total Current Liabilities | 302,921 | 187,339 |
Long-Term Liabilities: | ||
Asset Retirement Obligation | 1,746,233 | 1,710,677 |
Dividends Payable | 1,279,817 | 1,278,266 |
Deferred Tax Liability, Net | 1,492,726 | 1,511,160 |
Total Long-Term Liabilities | 4,518,776 | 4,500,103 |
Total Liabilities | 4,821,697 | 4,687,442 |
Stockholders’ Equity: | ||
Common Stock | 92,368 | 92,368 |
Additional Paid-in Capital | 65,000 | 65,000 |
Retained Earnings | 33,577,367 | 33,600,718 |
Stockholders’ Equity Before Treasury Stock | 33,734,735 | 33,758,086 |
Less – Treasury Stock, at Cost | 1,519,920 | 1,496,984 |
Total Stockholders’ Equity | 32,214,815 | 32,261,102 |
Total Liabilities and Stockholders’ Equity | $ 37,036,512 | $ 36,948,544 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Operating Revenues: | ||||
Oil and Gas Sales | $ 1,404,721 | $ 1,512,304 | $ 4,616,713 | $ 3,902,237 |
Lease Bonuses and Other | 184,282 | 160,909 | 184,282 | 209,794 |
Total Operating Revenues | 1,589,003 | 1,673,213 | 4,800,995 | 4,112,031 |
Operating Costs and Expenses: | ||||
Production | 543,789 | 517,953 | 1,604,590 | 1,566,803 |
Exploration | 14,969 | 314,541 | 537,116 | 481,963 |
Depreciation, Depletion, Amortization and Valuation Provisions | 362,471 | 429,168 | 1,294,593 | 1,853,485 |
General, Administrative and Other | 349,561 | 350,017 | 1,158,826 | 1,186,137 |
Total Operating Costs and Expenses | 1,270,790 | 1,611,679 | 4,595,125 | 5,088,388 |
Income/(Loss) from Operations | 318,213 | 61,534 | 205,870 | (976,357) |
Other Income, Net | 53,339 | 72,879 | 650,863 | 341,356 |
Income/(Loss) Before Provision for Income Taxes | 371,552 | 134,413 | 856,733 | (635,001) |
Income Tax Provision/(Benefit): | ||||
Current | 31,308 | (81,261) | 109,577 | (70,606) |
Deferred | 36,766 | 102,656 | (18,435) | (203,784) |
Total Income Tax Provision/(Benefit) | 68,074 | 21,395 | 91,142 | (274,390) |
Net Income/(Loss) | $ 303,478 | $ 113,018 | $ 765,591 | $ (360,611) |
Per Share Data | ||||
Net Income/(Loss), Basic and Diluted (in dollars per share) | $ 1.92 | $ 0.72 | $ 4.85 | $ (2.28) |
Cash Dividends Declared and/or Paid (in dollars per share) | $ 5 | $ 5 | ||
Weighted Average Shares Outstanding, Basic and Diluted (in shares) | 157,765 | 158,041 | 157,815 | 158,163 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Net Cash Provided by Operating Activities | $ 2,653,307 | $ 1,273,657 |
Cash Applied to Investing Activities: | ||
Purchases of Available-for-Sale Securities | (16,398,003) | (8,641,014) |
Maturity of Available-for-Sale Securities | 13,443,636 | 8,642,053 |
Proceeds from Disposal of Property, Plant and Equipment | 188,993 | 21,395 |
Purchase of Property, Plant and Equipment | (1,842,774) | (1,267,879) |
Cash Paid for Investments | (3,333) | (1,030,000) |
Cash Distributions from Equity and Other Investments | 24,750 | 155,000 |
Net Cash Applied to Investing Activities | (4,586,731) | (2,120,445) |
Cash Applied to Financing Activities: | ||
Dividends Paid to Stockholders | (787,456) | (918,468) |
Purchase of Treasury Stock | (22,937) | (79,485) |
Total Cash Applied to Financing Activities | (810,393) | (997,953) |
Net Change in Cash and Cash Equivalents | (2,743,817) | (1,844,741) |
Cash and Cash Equivalents, Beginning of Period | 8,071,854 | 13,937,215 |
Cash and Cash Equivalents, End of Period | $ 5,328,037 | $ 12,092,474 |
Note 1 - Basis of Presentation
Note 1 - Basis of Presentation | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Basis of Accounting [Text Block] | Note 1 – BASIS OF PRESENTATION The accompanying balance sheet as of December 31, 2016, 10 December 31, 2016 “2016 10 In the opinion of Management, the accompanying financial statements reflect all adjustments (consisting only of normal recurring accruals) , which are necessary for a fair statement of the results of the interim periods presented. The results of operations for the current interim periods are not |
Note 2 - Other Income, Net
Note 2 - Other Income, Net | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Other Income and Other Expense Disclosure [Text Block] | Note 2 – OTHER INCOME, NET The following is an analysis of the components of Other Income, Net: Three Months Ended Nine Months Ended September 30, September 30, 201 7 201 6 201 7 201 6 Net Realized and Unrealized Gain $ 25,985 $ 55,544 $ 90,860 $ 57,264 Gain on Asset Sales --- --- 58,177 19,744 Interest Income 41,448 9,523 84,458 34,363 Equity Earnings /(Losses) in Investees (10,917 ) 13,838 (2,623 ) 49,088 Other Income 8,613 5,872 455,354 216,536 Interest and Other Expenses (11,790 ) (11,898 ) (35,363 ) (35,639 ) Other Income, Net $ 53,339 $ 72,879 $ 650,863 $ 341,356 |
Note 3 - Equity Investments and
Note 3 - Equity Investments and Related Commitments and Contingent Liabilities, Including Guarantees | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | Note 3 – EQUITY INVESTMENTS AND RELATED COMMITMENTS AND CONTINGENT LIABILITIES, INCLUDING GUARANTEES The Company ’s Equity Investments include a 33% no no The Company ’s Equity Investments also include a 47% November 2015. 26.3 |
Note 4 - Provision for Income T
Note 4 - Provision for Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | Note 4 – PROVISION FOR INCOME TAXES In 2017 2016, Excess federal percentage depletion, which is limited to certain production volumes and by certain income levels , reduces estimated taxable income projected for any year. The federal excess percentage depletion estimates will be updated throughout the year until finalized with the detail well-by-well calculations at year-end. When a provision for income taxes is recorded, federal excess percentage depletion benefits decrease the effective tax rate. When a benefit for income taxes is recorded, federal excess percentage depletion benefits increase the effective tax rate. The benefit of federal excess percentage depletion is not may |
Note 5 - Asset Retirement Oblig
Note 5 - Asset Retirement Obligation | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Asset Retirement Obligation Disclosure [Text Block] | Note 5 – ASSET RETIREMENT OBLIGATION The Company records the fair value of its estimated liability to retire its oil and natural gas producing properties in the period in which it is incurred (typically the date of first 4.08%. first 3.25%. A reconciliation of the Company ’s asset retirement obligation liability is as follows: Balance at December 31, 2016 $ 1,710,677 Liabilities incurred for new wells (net of revisions) 21,208 Liabilities settled (wells sold or plugged) (20,583 ) Accretion expense 34,931 Balance at September 30, 2017 $ 1,746,233 |
Note 6 - Fair Value Measurement
Note 6 - Fair Value Measurements | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Fair Value Disclosures [Text Block] | Note 6 – FAIR VALUE MEASUREMENTS Inputs used to measure fair value are organized into a fair value hierarchy based on the observability of the inputs. Level 1 2 3 Recurring Fair Value Measurements Certain of the Company ’s assets are reported at fair value in the accompanying balance sheets on a recurring basis. The Company determined the fair value of the available-for-sale securities using quoted market prices for securities with similar maturity dates and interest rates. At September 30, 2017 December 31, 2016, Se ptember 30, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Financial Assets: Available-for -Sale Securities – 2017 $ --- $ 16,398,003 $ --- Trading Securities: Domestic Equities 350,312 --- --- International Equities 181,407 --- --- Others 34,747 --- --- December 31, 2016 Level 1 Inputs Level 2 Inputs Level 3 Inputs Financial Assets: Available-for -Sale Securities – 2017 $ --- $ 13,443,636 $ --- Trading Securities: Domestic Equities 333,516 --- --- International Equities 83,948 --- --- Others 56,243 --- --- Non- R ecurring Fair Value Measurements The Company ’s asset retirement obligation annually represents a non-recurring fair value liability. The fair value of the non-financial liability incurred in the nine September 30 $21,208 2017 $10,855 2016 3 5 The impairment losses of $88,764 nine September 30, 2017, $508,964 2016, 3 7 Fair Value of Financial Instruments The Company ’s financial instruments consist primarily of cash and cash equivalents, trade receivables, marketable securities, trade payables and dividends payable. At September 30, 2017 December 31, 2016, |
Note 7 - Long-lived Assets Impa
Note 7 - Long-lived Assets Impairment Loss | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Long Lived Assets Impairment Loss [Text Block] | N ote 7 LONG-LIVED ASSETS IMPAIRMENT LOSS Oil and gas producing properties are monitored for potential impairment when circumstances indicate that they are not may Between periods in which reserves would normally be calculated, the Company updates the reserve calculations utilizing updated estimates of forward crude oil and natural gas prices. The assessment determined no three September 30, 2017 2016. nine September 30, 2017, $88,764 2016, $508,964. 2017 2016 may |
Note 8 - New Accounting Pronoun
Note 8 - New Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | Note 8 See the “New Accounting Pronouncements” disclosures on page 25 2016 10 no December 31, 2016 ’s financial position, results of operations or cash flows. |
Note 2 - Other Income, Net (Tab
Note 2 - Other Income, Net (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Tables | |
Interest and Other Income [Table Text Block] | Three Months Ended Nine Months Ended September 30, September 30, 201 7 201 6 201 7 201 6 Net Realized and Unrealized Gain $ 25,985 $ 55,544 $ 90,860 $ 57,264 Gain on Asset Sales --- --- 58,177 19,744 Interest Income 41,448 9,523 84,458 34,363 Equity Earnings /(Losses) in Investees (10,917 ) 13,838 (2,623 ) 49,088 Other Income 8,613 5,872 455,354 216,536 Interest and Other Expenses (11,790 ) (11,898 ) (35,363 ) (35,639 ) Other Income, Net $ 53,339 $ 72,879 $ 650,863 $ 341,356 |
Note 5 - Asset Retirement Obl14
Note 5 - Asset Retirement Obligation (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Tables | |
Schedule of Asset Retirement Obligations [Table Text Block] | Balance at December 31, 2016 $ 1,710,677 Liabilities incurred for new wells (net of revisions) 21,208 Liabilities settled (wells sold or plugged) (20,583 ) Accretion expense 34,931 Balance at September 30, 2017 $ 1,746,233 |
Note 6 - Fair Value Measureme15
Note 6 - Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Tables | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | Se ptember 30, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Financial Assets: Available-for -Sale Securities – 2017 $ --- $ 16,398,003 $ --- Trading Securities: Domestic Equities 350,312 --- --- International Equities 181,407 --- --- Others 34,747 --- --- December 31, 2016 Level 1 Inputs Level 2 Inputs Level 3 Inputs Financial Assets: Available-for -Sale Securities – 2017 $ --- $ 13,443,636 $ --- Trading Securities: Domestic Equities 333,516 --- --- International Equities 83,948 --- --- Others 56,243 --- --- |
Note 2 - Other Income, Net - Sc
Note 2 - Other Income, Net - Schedule of Components of Other Income, Net (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Net Realized and Unrealized Gain on Trading Securities | $ 25,985 | $ 55,544 | $ 90,860 | $ 57,264 |
Gain on Asset Sales | 58,177 | 19,744 | ||
Interest Income | 41,448 | 9,523 | 84,458 | 34,363 |
Equity Earnings/(Losses) in Investees | (10,917) | 13,838 | (2,623) | 49,088 |
Other Income | 8,613 | 5,872 | 455,354 | 216,536 |
Interest and Other Expenses | (11,790) | (11,898) | (35,363) | (35,639) |
Other Income, Net | $ 53,339 | $ 72,879 | $ 650,863 | $ 341,356 |
Note 3 - Equity Investments a17
Note 3 - Equity Investments and Related Commitments and Contingent Liabilities, Including Guarantees (Details Textual) - a | Sep. 30, 2017 | Nov. 30, 2015 |
Broadway Sixty-Eight Partnership [Member] | ||
Equity Method Investment, Ownership Percentage | 33.00% | |
Grand Woods Development, LLC [Member] | ||
Equity Method Investment, Ownership Percentage | 47.00% | |
Area of Real Estate Property | 26.3 |
Note 5 - Asset Retirement Obl18
Note 5 - Asset Retirement Obligation (Details Textual) | 9 Months Ended |
Sep. 30, 2017 | |
Current Year Inflation Rate | 4.08% |
Change In Present Value Percent | 3.25% |
Note 5 - Asset Retirement Obl19
Note 5 - Asset Retirement Obligation - Schedule of Asset Retirement Obligation (Details) | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Balance, asset retirement obligation | $ 1,710,677 |
Liabilities incurred for new wells (net of revisions) | 21,208 |
Liabilities settled (wells sold or plugged) | (20,583) |
Accretion expense | 34,931 |
Balance, asset retirement obligation | $ 1,746,233 |
Note 6 - Fair Value Measureme20
Note 6 - Fair Value Measurements (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Asset Retirement Obligation, Liabilities Incurred | $ 21,208 | |||
Impairment Of Oil And Gas Cost Properties | $ 0 | $ 0 | 88,764 | $ 508,964 |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||||
Asset Retirement Obligation, Liabilities Incurred | 21,208 | 10,855 | ||
Impairment Of Oil And Gas Cost Properties | $ 88,764 | $ 508,964 |
Note 6 - Fair Value Measureme21
Note 6 - Fair Value Measurement - Schedule of Fair Value Reported on a Recurring Basis (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Available-for-Sale Securities – U.S. Treasury Bills Maturing in 2017 | $ 16,398,003 | $ 13,443,636 |
Trading Securities | 566,466 | 473,707 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | US Treasury Securities [Member] | ||
Available-for-Sale Securities – U.S. Treasury Bills Maturing in 2017 | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Domestic Equities [Member] | ||
Trading Securities | 350,312 | 333,516 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | International Equities [Member] | ||
Trading Securities | 181,407 | 83,948 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Other [Member] | ||
Trading Securities | 34,747 | 56,243 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | US Treasury Securities [Member] | ||
Available-for-Sale Securities – U.S. Treasury Bills Maturing in 2017 | 16,398,003 | 13,443,636 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Domestic Equities [Member] | ||
Trading Securities | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | International Equities [Member] | ||
Trading Securities | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Other [Member] | ||
Trading Securities | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | US Treasury Securities [Member] | ||
Available-for-Sale Securities – U.S. Treasury Bills Maturing in 2017 | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Domestic Equities [Member] | ||
Trading Securities | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | International Equities [Member] | ||
Trading Securities | ||
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Other [Member] | ||
Trading Securities |
Note 7 - Long-lived Assets Im22
Note 7 - Long-lived Assets Impairment Loss (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Impairment Of Oil And Gas Cost Properties | $ 0 | $ 0 | $ 88,764 | $ 508,964 |