Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 14, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 000-55586 | |
Entity Registrant Name | Truleum, Inc. | |
Entity Incorporation, State or Country Code | CO | |
Entity Tax Identification Number | 90-1020566 | |
Entity Address, Address Line One | 14143 Denver West Parkway, Suite 100 | |
Entity Address, City or Town | Golden | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80401 | |
City Area Code | 800 | |
Local Phone Number | 819-0604 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 21,736,178 | |
Entity Central Index Key | 0000855787 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Consolidated Balance Sheets (Cu
Consolidated Balance Sheets (Current Period Unaudited) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 13,102 | $ 95,362 |
Joint interest billing receivable | 7,940 | 31,492 |
Prepaid assets and other current assets | 85,545 | 81,690 |
Total current assets | 106,587 | 208,544 |
Noncurrent assets: | ||
Property and equipment, net | 85,061 | 88,020 |
Oil and gas property, unproved, full cost | 1,606,232 | 1,460,674 |
Total noncurrent assets | 1,691,293 | 1,548,694 |
Total assets | 1,797,880 | 1,757,238 |
Current liabilities: | ||
Advances - related party | 130,381 | 0 |
Interest payable - related parties | 55,119 | 22,183 |
Convertible credit line payable - related party | 239,841 | 0 |
Convertible note payable | 1,210,000 | 1,210,000 |
Total current liabilities | 2,439,089 | 1,895,215 |
Asset retirement obligation | 2,754 | 918 |
Total liabilities | 3,693,263 | 3,095,862 |
Commitments and Contingencies | ||
Stockholders' deficit: | ||
Preferred Stock, Shares Authorized (in shares) | 10,000,000 | |
Series A convertible preferred stock, $0.001 par value, 2,000,000 shares authorized and 0 shares issued and outstanding | $ 0 | 0 |
Common stock, $0.001 par value, 65,000,000 shares authorized and 21,724,178 and 21,653,326 shares issued and outstanding, respectively | 21,724 | 21,653 |
Additional paid-in capital | 6,190,019 | 5,731,830 |
Accumulated deficit | (8,107,126) | (7,092,107) |
Total stockholders' deficit | (1,895,383) | (1,338,624) |
Total liabilities and stockholders' deficit | 1,797,880 | 1,757,238 |
Secured Senior Secured Convertible Note [Member] | ||
Current liabilities: | ||
Senior secured convertible notes payable, related party, net of discount of $68,540 and $120,231, respectively | 1,251,420 | 1,199,729 |
Nonrelated Party [Member] | ||
Current liabilities: | ||
Accounts payable and accrued expenses | 773,748 | 334,657 |
Related Party [Member] | ||
Current liabilities: | ||
Accounts payable and accrued expenses | $ 30,000 | $ 328,375 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Preferred Stock, Shares Authorized (in shares) | 10,000,000 | |
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.001 | |
Preferred Stock, Shares Authorized (in shares) | 10,000,000 | |
Common Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized (in shares) | 65,000,000 | 65,000,000 |
Common Stock, Shares, Issued (in shares) | 21,724,178 | 21,653,326 |
Common Stock, Shares, Outstanding (in shares) | 21,724,178 | 21,653,326 |
Series A Preferred Stock [Member] | ||
Preferred Stock, Shares Authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred Stock, Shares Issued (in shares) | 0 | 0 |
Preferred Stock, Shares Outstanding, Ending Balance (in shares) | 0 | 0 |
Secured Senior Secured Convertible Note [Member] | ||
Debt Instrument, Unamortized Discount, Noncurrent | $ 68,540 | |
Senior Secured Note Purchase Agreement [Member] | ||
Debt Instrument, Unamortized Discount, Noncurrent | $ 120,231 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Oil and gas sales | $ 35,540 | $ 5,239 | $ 107,256 | $ 5,239 |
Lease operating expenses | 69,518 | 47,558 | 248,959 | 49,434 |
Gross loss | (33,978) | (42,319) | (141,703) | (44,195) |
Operating expenses: | ||||
Professional services | 181,527 | 61,005 | 292,010 | 209,693 |
Board of director fees | 36,000 | 36,000 | 72,000 | 84,000 |
General and administrative | 257,076 | 215,264 | 408,606 | 364,594 |
Total operating expenses | 474,603 | 312,269 | 772,616 | 658,287 |
Loss from operations | (508,581) | (354,588) | (914,319) | (702,482) |
Other income (expense): | ||||
Other income | 516 | 0 | 1,655 | 0 |
Interest expense | (47,132) | (54,916) | (102,355) | (80,402) |
Gain (loss) on change in fair value of derivative liabilities | 0 | 14,969 | 0 | 12,211 |
Total other income (expense) | (46,616) | (39,947) | (100,700) | (68,191) |
Net loss | $ (555,197) | $ (394,535) | $ (1,015,019) | $ (770,673) |
Loss per share: | ||||
Basic (in dollars per share) | $ (0.03) | $ (0.02) | $ (0.05) | $ (0.04) |
Diluted (in dollars per share) | $ (0.03) | $ (0.02) | $ (0.05) | $ (0.04) |
Weighted average shares outstanding: | ||||
Basic (in shares) | 21,708,433 | 18,824,106 | 21,680,880 | 18,824,106 |
Diluted (in shares) | 21,708,433 | 19,256,426 | 21,680,880 | 19,256,426 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Deficit (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Balance (in shares) at Dec. 31, 2021 | 18,824,106 | |||
Balance at Dec. 31, 2021 | $ 18,824 | $ 2,739,634 | $ (5,371,918) | $ (2,613,460) |
Stock-based compensation | 0 | 63,000 | 0 | 63,000 |
Net loss | $ 0 | 0 | (376,138) | (376,138) |
Balance (in shares) at Mar. 31, 2022 | 18,824,106 | |||
Balance at Mar. 31, 2022 | $ 18,824 | 2,802,634 | (5,748,056) | (2,926,598) |
Balance (in shares) at Dec. 31, 2021 | 18,824,106 | |||
Balance at Dec. 31, 2021 | $ 18,824 | 2,739,634 | (5,371,918) | (2,613,460) |
Net loss | (770,673) | |||
Balance (in shares) at Jun. 30, 2022 | 18,824,106 | |||
Balance at Jun. 30, 2022 | $ 18,824 | 2,853,634 | (6,142,591) | (3,270,133) |
Balance (in shares) at Mar. 31, 2022 | 18,824,106 | |||
Balance at Mar. 31, 2022 | $ 18,824 | 2,802,634 | (5,748,056) | (2,926,598) |
Stock-based compensation | 0 | 51,000 | 0 | 51,000 |
Net loss | $ 0 | 0 | (394,535) | (394,535) |
Balance (in shares) at Jun. 30, 2022 | 18,824,106 | |||
Balance at Jun. 30, 2022 | $ 18,824 | 2,853,634 | (6,142,591) | (3,270,133) |
Balance (in shares) at Dec. 31, 2022 | 21,653,326 | |||
Balance at Dec. 31, 2022 | $ 21,653 | 5,731,830 | (7,092,107) | (1,338,624) |
Stock-based compensation | 0 | 62,000 | 0 | 62,000 |
Net loss | $ 0 | 0 | (459,822) | (459,822) |
Balance (in shares) at Mar. 31, 2023 | 21,653,326 | |||
Balance at Mar. 31, 2023 | $ 21,653 | 5,793,830 | (7,551,929) | (1,736,446) |
Balance (in shares) at Dec. 31, 2022 | 21,653,326 | |||
Balance at Dec. 31, 2022 | $ 21,653 | 5,731,830 | (7,092,107) | (1,338,624) |
Net loss | (1,015,019) | |||
Balance (in shares) at Jun. 30, 2023 | 21,724,178 | |||
Balance at Jun. 30, 2023 | $ 21,724 | 6,190,019 | (8,107,126) | (1,895,383) |
Balance (in shares) at Mar. 31, 2023 | 21,653,326 | |||
Balance at Mar. 31, 2023 | $ 21,653 | 5,793,830 | (7,551,929) | (1,736,446) |
Stock-based compensation | 0 | 42,000 | 0 | 42,000 |
Net loss | $ 0 | 0 | (555,197) | (555,197) |
Shares issued for the settlement of accounts payable, related party (in shares) | 70,852 | |||
Shares issued for the settlement of accounts payable, related party | $ 71 | 354,189 | 0 | 354,260 |
Balance (in shares) at Jun. 30, 2023 | 21,724,178 | |||
Balance at Jun. 30, 2023 | $ 21,724 | $ 6,190,019 | $ (8,107,126) | $ (1,895,383) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Cash flows from operating activities: | |||||||
Net loss | $ (555,197) | $ (459,822) | $ (394,535) | $ (376,138) | $ (1,015,019) | $ (770,673) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Stock-based compensation | 104,000 | 114,000 | |||||
Depreciation expense | 13,033 | 0 | |||||
Amortization of debt discount | 51,691 | 38,942 | |||||
Asset retirement obligation expense | 1,836 | 0 | |||||
(Gain) loss on change in fair value of derivative liabilities | 0 | (14,969) | 0 | (12,211) | |||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | 0 | (7,890) | |||||
Joint interest billing receivable | 23,552 | 0 | |||||
Prepaid expenses and other current assets | (3,855) | (1,250) | |||||
Accounts payable | 439,091 | 111,332 | |||||
Accounts payable-related party | 55,885 | (13,085) | |||||
Interest payable | 32,936 | 17,863 | |||||
Net cash used in operating activities | (296,850) | (522,972) | |||||
Cash flows from investing activities: | |||||||
Cash paid for purchase of property and equipment | (10,074) | 0 | |||||
Acquisition of oil and gas property | (145,558) | (756,298) | |||||
Net cash used in investing activities | (155,632) | (756,298) | |||||
Cash flows from financing activities: | |||||||
Proceeds from convertible credit line, related party | 239,841 | 0 | |||||
Proceeds from advances, related parties | 130,381 | 110,235 | |||||
Proceeds from senior secured convertible notes payable, related party | 0 | 499,996 | |||||
Proceeds from unexecuted subscription agreements | 0 | 1,761,570 | |||||
Net cash provided by financing activities | 370,222 | 2,371,801 | |||||
Net change in cash and cash equivalents | (82,260) | 1,092,531 | |||||
Cash and cash equivalents, at beginning of period | $ 95,362 | $ 217 | 95,362 | 217 | $ 217 | ||
Cash and cash equivalents, at end of period | $ 13,102 | $ 1,092,748 | 13,102 | 1,092,748 | $ 95,362 | ||
Supplemental disclosures of cash flow information: | |||||||
Cash paid for interest | 16,210 | 23,596 | |||||
Cash paid for income taxes | 0 | 0 | |||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Debt discount on senior secured convertible notes payable – related party and convertible credit line payable – related party | 0 | 208,476 | |||||
Shares issued for the settlement of accounts payable, related party | 354,260 | 0 | |||||
Related Party Advances and Promissory Note Converted into 7.25% Note [Member] | |||||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Advances and other liabilities converted to senior secured convertible notes payable, related party | $ 0 | $ 819,963 |
Note 1 - Basis of Presentation
Note 1 - Basis of Presentation | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Basis of Presentation and Significant Accounting Policies [Text Block] | NOTE 1 BASIS OF PRESENTATION The interim unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and should be read in conjunction with the audited consolidated financial statements and notes thereto for the years ended December 31, 2022 and 2021 which are included on the Form 10-K filed on April 17, 2023. In the opinion of management, all adjustments which include normal recurring adjustments, necessary to present fairly the financial position, results of operations, and cash flows for the periods shown have been reflected herein. The results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the operating results for the full year. Certain information and footnote disclosures which would substantially duplicate the disclosures contained in the audited consolidated financial statements for the years ended December 31, 2022, and 2021 have been omitted. On April 27, 2023, the Company amended its articles of incorporation to change their name from Alpha Energy, Inc. to Truleum, Inc. Principles of Consolidation Our consolidated financial statements include our accounts and the accounts of our 100% owned subsidiary, Alpha Energy Texas Operating, LLC. All intercompany transactions and balances have been eliminated. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates. Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company’s system of internal accounting control is designed to assure, among other items, that (1) recorded transactions are valid; (2) all valid transactions are recorded and (3) transactions are recorded in the period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the company for the respective periods being presented. Basic and Diluted Loss per share Net loss per share is provided in accordance with FASB ASC 260-10, “Earnings (Loss) per Share”. Basic loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. For the six months ended June 31, 2023 and 2022, there were 263,992 shares issuable from the senior secured convertible notes payable and 159,894 and 168,328 shares issuable from the convertible credit line payable which were considered for their dilutive effects but were determined to be anti-dilutive due to the Company’s net loss, respectively. Fair Value of Financial Instruments The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. The carrying amount of the Company’s financial instruments consisting of cash and cash equivalents, accounts payable, notes payable and convertible notes approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements. Reclassification Certain reclassifications may have been made to our prior year’s financial statements to conform to our current year presentation. These reclassifications had no effect on our previously reported results of operations or accumulated deficit. Recently Issued Accounting Standards Not Yet Adopted The Company has reviewed all recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any, on its results of operations, financial position or cash flows. Based on that review, the Company believes that there are no recently issued accounting pronouncements that will have a significant effect on its financial statements. |
Note 2 - Going Concern
Note 2 - Going Concern | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Substantial Doubt about Going Concern [Text Block] | NOTE 2 GOING CONCERN The Company’s interim unaudited consolidated financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has minimal cash or other current assets and does not have an established ongoing source of revenues sufficient to cover its operating costs and to allow it to continue as a going concern. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity and/or debt financing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
Note 3 - Oil and Gas Properties
Note 3 - Oil and Gas Properties | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Oil and Gas Properties [Text Block] | NOTE 3 OIL AND GAS PROPERTIES Oil and gas properties at June 30, 2023 and December 31, 2022 consisted of the following: Balance Balance Account 12/31/2022 Additions 6/30/2023 Leasehold Improvements - Chico Rica, LLC $ 40,000 $ - $ 40,000 Leasehold Improvements - Undeveloped 62,596 1,377 63,973 Lease Acquisition and Development Costs - Logan County 1,358,078 144,181 1,502,259 Total oil and gas related assets $ 1,460,674 $ 145,558 $ 1,606,232 |
Note 4 - Related Party Transact
Note 4 - Related Party Transactions | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Related Party Transactions Disclosure [Text Block] | NOTE 4 RELATED PARTY TRANSACTIONS Advances from Related Party The Company received advances from AEI Management, Inc., a Company owned by a significant shareholder, totaling $0 and $88,956 during the six months ended June 30, 2023 and 2022, respectively. The advances are unsecured, non-interest bearing and are payable on demand. During the six months ended June 30, 2022, the Company repaid $10,000 of the advances and converted $413,206 of advances to a senior secured convertible note due February 24, 2024. The Company received advances from Jay Leaver, President of the Company, totaling $130,381 and $31,280 during the six months ended June 30, 2023 and 2022, respectively. The advances are unsecured, non-interest bearing and is payable on demand. During the six months ended June 30, 2022, the Company converted $325,580 of advances to a senior secured convertible note due February 24, 2024. Accounts Payable and Accrued Expenses - Related Parties As of June 30, 2023 and December 31, 2022, there was $30,000 and $328,375 of accounts payable related parties due to Leaverite Exploration, Inc. d/b/a Leaverite Consulting (“Leaverite Exploration”), a corporation wholly-owned by our President, Jay Leaver pursuant to a consulting agreement. On April 10, 2023, the Company issued 70,852 shares of common stock valued at $5.00 per share to settle outstanding consulting invoices in the amount of $354,260 owed to Jay Leaver, President. Senior Secured Convertible Notes Payable Related Party On February 25, 2022, the Company entered into a secured senior secured convertible note for the purchase and sale of convertible promissory notes (“Convertible Note”) in the principal amount of $5,000,000. The Senior Convertible Note is convertible at any time after the date of issuance into shares of the Company’s common stock at a fixed conversion price of $5.00 per share. Upon conversion of the convertible note into the Company’s common stock, the noteholder would be issued 1,000,000 shares of the Company’s common stock. Interest on the Convertible Note shall be paid to the investors at a rate of 7.25% per annum, paid on a quarterly basis, and the maturity date of the Convertible Note is two years after the issuance date. The Convertible Note purports to be secured by certain oil and gas leases, lands, minerals and other properties of the Company, subject to prior liens and security interests. See Note 5 – Related Party Transactions. $413,206 from a related party were exchanged for a Convertible Note. Due to the variable conversion price in the convertible credit line, this fixed senior secured convertible note is treated as derivatives due to the possibility of insufficient shares available at conversion to settle the notes. The day one derivative liability was $65,262, which was recorded as a discount on the senior secured convertible notes payable. During the six months ended June 30, 2023, the Company amortized $16,182 of the discount as interest expense. As of June 30, 2023, the unamortized discount was $21,456. The outstanding principal balance on the senior secured convertible notes payable as of June 30, 2023 and December 31, 2022 amounted to $413,206. On February 25, 2022, Mr. Leaver assigned a $406,750 promissory note and advances of $500,000 to 20 Shekels, an affiliated Company. On the same day, the assigned promissory note and advance totaling $906,750 were transferred into a secured senior secured convertible note. The convertible note bears interest at 7.25% and matures on February 25, 2024. The note is convertible into shares of the Company at $5.00 per share. Due to the variable convertible credit line, this fixed senior secured convertible note are treated as derivatives due to the possibility of insufficient shares available at conversion to settle the notes. The day one derivative liability was $143,214, which was recorded as a discount on the senior secured convertible notes payable. During the six months ended June 30, 2023, the Company amortized $35,509 of the discount as interest expense. As of June 30, 2023, the unamortized discount was $47,084. The outstanding principal balance on the senior secured convertible notes payable as of June 30, 2023 and December 31, 2022 amounted to $906,754. As of June 30, 2023 and December 31, 2022, the senior secured convertible notes payable balance, net of discount was $1,251,420 and $1,199,729 with accrued interest of $30,983 and $0, respectively. Convertible Credit Line Related Party On June 1, 2021, the Company entered into a new convertible credit line agreement to borrow up to $1,500,000 and matures The outstanding balance accrues interest at a rate of 7% per annum and the outstanding balance is convertible to common stock of the Company at the lesser of the close price of the common stock as quoted on the OTCBB on the day interest is due and payable immediately preceding the conversion or $1.50. On February 11, 2023, the Company and AEI Acquisition Company, LLC. (“AEI”), the Company’s majority shareholder, entered into a First Amendment to Revolving Credit Note (the “Amendment”) which amended the convertible Revolving Credit Note dated June 1, 2021 and matures on December 31, 2023 in the maximum amount of $1,500,000 by and between the Company and AEI (the “Revolving Credit Line”). The Amendment amends the Revolving Credit Line to provide that any outstanding amount of principal and/or interest under the Revolving Credit Line may be converted into fully paid and non-assessable shares of common stock, $0.001 per share par value, at a fixed conversion price of $1.50 per share subject to adjustment for stock dividends, stock splits, recapitalizations, or other similar transactions that affect the rights of common stockholders generally. As of June 30, 2023, the Company has drawn $239,841 on the convertible note, with accrued interest of $1,952. |
Note 5 - Common Stock
Note 5 - Common Stock | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Equity [Text Block] | NOTE 5 COMMON STOCK The Company is authorized to issue 75,000,000 shares of its capital stock, consisting of 10,000,000 shares of preferred stock, par value $0.001 per share, and 65,000,000 shares of common stock, par value $0.001 per share. The Company compensates each of its directors with 4,000 shares of common stock each month. During the six months ended June 30, 2023, the Company recorded stock compensation of $72,000 for the directors which was recorded in additional paid in capital. On September 2, 2022, the Company entered into a six-month agreement with a consultant that includes the issuance of 60,000 common shares. During the year ended December 31, 2022, the Company issued 60,000 common shares and recorded $40,000 of expense related to this agreement. During the six months ended June 30, 2023, the Company recorded stock compensation of $20,000 for this agreement which was recorded in additional paid in capital. On October 15, 2022, the Company entered into a one-year agreement with a consultant. Per the agreement, the Company will compensate the consultant $10,000 and issue 2,000 common shares per month. During the six months ended June 30, 2023, the Company recorded issued 12,000 shares of common stock related to this agreement. On April 10, 2023, the Company issued 70,852 shares of common stock valued at $5.00 per share to settle outstanding consulting invoices owed to Jay Leaver, President. |
Note 6 - Convertible Notes Paya
Note 6 - Convertible Notes Payable | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Short-Term Debt [Text Block] | NOTE 6 CONVERTIBLE NOTES PAYABLE On March 30, 2019, the Company executed a promissory note for $50,000 to ZQH (75%) (25%) As of June 30, 2023 and December 31, 2022, the convertible note payable balance was $1,210,000 with accrued interest of $22,183. The Company is in legal discussions with ZQH to relieve the loan as the properties in the purchase agreement were not held by title. |
Note 7 - Subsequent Events
Note 7 - Subsequent Events | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Subsequent Events [Text Block] | NOTE 7 SUBSEQUENT EVENTS On July 1, 2023, the Company has adopted a revised Board of Directors compensation plan providing for awards to be made under the Plan and intended to replace the current director compensation plan which had provided for monthly grants to non-employee directors of 4,000 shares of restricted Common Stock per month. Under the new plan, each director shall receive compensation for their service on the Board and receive reimbursements for certain expenses in accordance with the Company’s reimbursement policy. Until the Company’s Common Stock is listed on a national securities exchange, each non-employee director shall receive options to purchase shares of Common Stock valued at $150,000 by the Black-Scholes pricing model on an annual basis, payable quarterly, with an exercise price equal to the closing price of the Company’s common stock on the last business day of the quarter. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation Our consolidated financial statements include our accounts and the accounts of our 100% owned subsidiary, Alpha Energy Texas Operating, LLC. All intercompany transactions and balances have been eliminated. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates. Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company’s system of internal accounting control is designed to assure, among other items, that (1) recorded transactions are valid; (2) all valid transactions are recorded and (3) transactions are recorded in the period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the company for the respective periods being presented. |
Earnings Per Share, Policy [Policy Text Block] | Basic and Diluted Loss per share Net loss per share is provided in accordance with FASB ASC 260-10, “Earnings (Loss) per Share”. Basic loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. For the six months ended June 31, 2023 and 2022, there were 263,992 shares issuable from the senior secured convertible notes payable and 159,894 and 168,328 shares issuable from the convertible credit line payable which were considered for their dilutive effects but were determined to be anti-dilutive due to the Company’s net loss, respectively. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. The carrying amount of the Company’s financial instruments consisting of cash and cash equivalents, accounts payable, notes payable and convertible notes approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements. |
Reclassification, Comparability Adjustment [Policy Text Block] | Reclassification Certain reclassifications may have been made to our prior year’s financial statements to conform to our current year presentation. These reclassifications had no effect on our previously reported results of operations or accumulated deficit. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Issued Accounting Standards Not Yet Adopted The Company has reviewed all recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any, on its results of operations, financial position or cash flows. Based on that review, the Company believes that there are no recently issued accounting pronouncements that will have a significant effect on its financial statements. |
Note 3 - Oil and Gas Properti_2
Note 3 - Oil and Gas Properties (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Notes Tables | |
Property, Plant and Equipment [Table Text Block] | Balance Balance Account 12/31/2022 Additions 6/30/2023 Leasehold Improvements - Chico Rica, LLC $ 40,000 $ - $ 40,000 Leasehold Improvements - Undeveloped 62,596 1,377 63,973 Lease Acquisition and Development Costs - Logan County 1,358,078 144,181 1,502,259 Total oil and gas related assets $ 1,460,674 $ 145,558 $ 1,606,232 |
Note 1 - Basis of Presentation
Note 1 - Basis of Presentation (Details Textual) - shares | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Convertible Debt Securities [Member] | Secured Senior Secured Convertible Note [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 263,992 | 263,992 |
Convertible Debt Securities [Member] | Convertible Credit Line [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 159,894 | 168,328 |
Alpha Energy Texas Operating, LLC [Member] | ||
Subsidiary, Ownership Percentage, Parent | 100% |
Note 3 - Oil and Gas Properti_3
Note 3 - Oil and Gas Properties - Schedule of Oil and Gas Properties (Details) | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Leasehold Improvements, Oil and Gas Properties [Member] | Chicorica, LLC [Member] | |
Balance | $ 40,000 |
Additions | 0 |
Balance | 40,000 |
Leasehold Improvements, Oil and Gas Properties [Member] | Undeveloped [Member] | |
Balance | 62,596 |
Additions | 1,377 |
Balance | 63,973 |
Lease Acquisition Costs , Logan County Project I [Member] | |
Balance | 1,358,078 |
Additions | 144,181 |
Balance | 1,502,259 |
Oil and Gas Properties [Member] | |
Balance | 1,460,674 |
Additions | 145,558 |
Balance | $ 1,606,232 |
Note 4 - Related Party Transa_2
Note 4 - Related Party Transactions (Details Textual) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Apr. 10, 2023 USD ($) $ / shares shares | Feb. 25, 2022 USD ($) $ / shares | Jun. 30, 2023 USD ($) $ / shares | Jun. 30, 2023 USD ($) $ / shares | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) $ / shares | Feb. 11, 2023 USD ($) $ / shares | Jun. 01, 2021 USD ($) | |
Stock Issued During Period, Value, Settlement of Liabilities | $ 354,260 | |||||||
Amortization of Debt Discount (Premium) | $ 51,691 | $ 38,942 | ||||||
Common Stock, Par or Stated Value Per Share (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Secured Senior Secured Convertible Note [Member] | ||||||||
Debt Instrument, Face Amount | $ 5,000,000 | |||||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 5 | |||||||
Debt Instrument, Convertible, Number of Equity Instruments | 1,000,000 | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 7.25% | |||||||
Debt Instrument, Unamortized Discount | $ 65,262 | $ 21,456 | $ 21,456 | |||||
Amortization of Debt Discount (Premium) | 16,182 | |||||||
Long-Term Debt, Gross | 413,206 | 413,206 | $ 413,206 | |||||
Notes Payable | 1,199,729 | 1,199,729 | 1,251,420 | |||||
Interest Payable | 30,983 | 30,983 | 0 | |||||
Convertible Credit Line Payable, Related Party [Member] | ||||||||
Debt Instrument, Face Amount | $ 1,500,000 | $ 1,500,000 | ||||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 1.50 | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 7% | |||||||
Interest Payable | 1,952 | 1,952 | ||||||
Long-Term Line of Credit | 239,841 | 239,841 | ||||||
Related Party Advances Converted into 7.25% Note [Member] | ||||||||
Debt Conversion, Original Debt, Amount | $ 413,206 | |||||||
Related Party Advances and Promissory Note Converted into 7.25% Note [Member] | ||||||||
Debt Conversion, Original Debt, Amount | 0 | 819,963 | ||||||
AEI Management, Inc. [Member] | ||||||||
Cash and Noncash Proceeds from Related Party Debt | 0 | 88,956 | ||||||
Repayments of Related Party Debt | 10,000 | |||||||
AEI Management, Inc. [Member] | Related Party Advances Converted into 7.25% Note [Member] | ||||||||
Debt Conversion, Original Debt, Amount | 413,206 | |||||||
President [Member] | ||||||||
Cash and Noncash Proceeds from Related Party Debt | 130,381 | 31,280 | ||||||
Stock Issued During Period, Shares, Settlement of Liabilities | shares | 70,852 | |||||||
Shares Issued, Price Per Share | $ / shares | $ 5 | |||||||
Stock Issued During Period, Value, Settlement of Liabilities | $ 354,260 | |||||||
President [Member] | Secured Senior Secured Convertible Note [Member] | ||||||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 5 | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 7.25% | |||||||
Debt Instrument, Unamortized Discount | $ 143,214 | 47,084 | ||||||
Amortization of Debt Discount (Premium) | 35,509 | |||||||
Long-Term Debt, Gross | 906,754 | 906,754 | 906,754 | |||||
President [Member] | Related Party Advances Converted into 7.25% Note [Member] | ||||||||
Debt Conversion, Original Debt, Amount | 500,000 | |||||||
President [Member] | Related Party Advanced Converted Into Senior Secured Convertible Note Due February 2024 [Member] | ||||||||
Debt Conversion, Original Debt, Amount | $ 325,580 | |||||||
President [Member] | Related Party Promissory Note Converted into 7.25% Note [Member] | ||||||||
Debt Conversion, Original Debt, Amount | 406,750 | |||||||
President [Member] | Related Party Advances and Promissory Note Converted into 7.25% Note [Member] | ||||||||
Debt Conversion, Converted Instrument, Amount | $ 906,750 | |||||||
Leaverite Exploration [Member] | ||||||||
Accounts Payable | $ 30,000 | $ 30,000 | $ 328,375 |
Note 5 - Common Stock (Details
Note 5 - Common Stock (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||
Apr. 10, 2023 | Oct. 15, 2022 | Sep. 02, 2022 | Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Dec. 31, 2022 | Feb. 11, 2023 | |
Capital Stock, Shares Authorized | 75,000,000 | 75,000,000 | ||||||||
Preferred Stock, Shares Authorized (in shares) | 10,000,000 | 10,000,000 | ||||||||
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.001 | $ 0.001 | ||||||||
Common Stock, Shares Authorized (in shares) | 65,000,000 | 65,000,000 | 65,000,000 | |||||||
Common Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||||||
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | $ 42,000 | $ 62,000 | $ 51,000 | $ 63,000 | ||||||
President [Member] | ||||||||||
Stock Issued During Period, Shares, Settlement of Liabilities | 70,852 | |||||||||
Shares Issued, Price Per Share | $ 5 | |||||||||
Consultant [Member] | ||||||||||
Stock Issued During Period, Shares, Issued for Services | 60,000 | 60,000 | ||||||||
Share-Based Payment Arrangement, Expense | $ 40,000 | |||||||||
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount | $ 20,000 | $ 20,000 | ||||||||
Consultant Two [Member] | ||||||||||
Stock Issued During Period, Shares, Issued for Services | 12,000 | |||||||||
Consulting Agreement, Compensation Per Month | $ 10,000 | |||||||||
Consulting Agreement, Shares Issued Per Month | 2,000 | |||||||||
Director [Member] | ||||||||||
Stock Issued During Period, Shares Per Month Per Director | 4,000 | |||||||||
APIC, Share-Based Payment Arrangement, Increase for Cost Recognition | $ 72,000 |
Note 6 - Convertible Notes Pa_2
Note 6 - Convertible Notes Payable (Details Textual) | 12 Months Ended | |||||
Mar. 28, 2021 USD ($) $ / shares | Jun. 25, 2020 USD ($) | Mar. 30, 2019 USD ($) $ / shares | Dec. 31, 2020 USD ($) $ / shares | Jun. 30, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Gain (Loss) on Extinguishment of Debt | $ 10,750 | |||||
Convertible Notes Payable, Current | $ 1,210,000 | $ 1,210,000 | ||||
Oklahoma Oil and Gas Assets [Member] | Pure and ZQH [Member] | ||||||
Business Combination, Consideration Transferred | $ 1,000,000 | |||||
Notes Issued for Acquisition [Member] | ||||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 1 | |||||
Interest Payable | 10,000 | 22,183 | 22,183 | |||
Notes Payable | 1,060,000 | $ 1,160,000 | ||||
Note Payable, Monthly Increase | 50,000 | |||||
Note Payable, Monthly Increase, Maximum Amount | $ 200,000 | |||||
Note Principal, Accrued Interest | 200,000 | |||||
Debt Instrument, Periodic Payment | $ 100,000 | |||||
Debt Instrument, Monthly Interest Rate | 1% | |||||
Convertible Notes Payable, Current | $ 1,210,000 | $ 1,210,000 | ||||
Notes Issued for Acquisition [Member] | Pure and ZQH [Member] | ||||||
Debt Instrument, Periodic Payment, Interest | $ 10,083 | |||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 1 | |||||
Debt Instrument, Percentage of Annual Interest on Purchased Price, Compounded Monthly | 1% | |||||
Notes Payable, Other Payables [Member] | Promissory Notes Payable [Member] | ZHQ Holdings, LLP and Pure Oil & Gas, Inc [Member] | ||||||
Debt Instrument, Face Amount | $ 50,000 | |||||
Debt Instrument, Periodic Payment, Interest | $ 50 | |||||
Debt Instrument, Convertible, Number of Equity Instruments | $ / shares | 50,000 | |||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 1 | |||||
Notes Payable, Other Payables [Member] | Promissory Notes Payable [Member] | ZHQ Holdings [Member] | ||||||
Debt Instrument, Percentage of Total Debt Loaned | 75% | |||||
Notes Payable, Other Payables [Member] | Promissory Notes Payable [Member] | Pure Oil & Gas, Inc [Member] | ||||||
Debt Instrument, Percentage of Total Debt Loaned | 25% |
Note 7 - Subsequent Events (Det
Note 7 - Subsequent Events (Details Textual) - Director [Member] - USD ($) | 6 Months Ended | |
Jul. 01, 2023 | Jun. 30, 2023 | |
Stock Issued During Period, Shares Per Month Per Director | 4,000 | |
Subsequent Event [Member] | ||
Stock Issued During Period, Shares Per Month Per Director | 4,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Granted Yearly, Intrinsic Value | $ 150,000 |