Nevada
|
4600
|
20-1673271
|
(State
or other jurisdiction of
incorporation
or organization)
|
(Primary
Standard Industrial
Classification
Code Number)
|
(I.R.S.
Employer
Identification
Number)
|
P.O
Box 488 Cut Bank, Montana
|
59427
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Large
accelerated filer
|
¨
|
Accelerated
filer
|
¨
|
Non-accelerated
filer
|
¨
|
Smaller
Reporting Company
|
x
|
PART
I — FINANCIAL INFORMATION
|
3
|
Item
1. Financial Statements
|
3
|
Item
2. Management’s Discussion and Analysis or Plan of
Operation.
|
10
|
Item
3. Quantitative and Qualitative Disclosure about Market
Risk
|
18
|
Item
4. Controls and Procedures.
|
18
|
PART
II — OTHER INFORMATION
|
18
|
Item
1. Legal Proceedings.
|
18
|
Item
1A. Risk Factors
|
19
|
Item
2. Unregistered Sales of Equity Securities and Use of
Proceeds.
|
19
|
Item
3. Defaults Upon Senior Securities.
|
19
|
Item
4. Submission of Matters to a Vote of Security Holders.
|
19
|
Item
5. Other Information.
|
19
|
Item
6. Exhibits.
|
19
|
September 30
|
||||||||
2009
|
December 31
|
|||||||
UNAUDITED
|
2008
|
|||||||
ASSETS
|
||||||||
Cash
and cash equivalents
|
$ | 51,549 | $ | 79,790 | ||||
Trade
receivables
|
7,046 | 24,070 | ||||||
Total
Current Assets
|
58,594 | 103,860 | ||||||
OIL
AND GAS PROPERTIES
|
||||||||
Oil
and gas properties, using the full cost method of
accounting:
|
||||||||
Properties
being amortized
|
455,894 | 455,894 | ||||||
Properties
not subject to amortization
|
202,531 | 138,383 | ||||||
Less
accumulated depletion, amortization and impairment
|
(159,900 | ) | (129,400 | ) | ||||
Net
Oil and Gas Properties
|
498,525 | 464,877 | ||||||
OTHER
ASSETS
|
||||||||
Website
development costs (less accumulated amortization)
|
610 | 1,240 | ||||||
Total
Other Assets
|
610 | 1,240 | ||||||
Total
Assets
|
$ | 557,729 | $ | 569,977 | ||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
LIABILITIES
|
||||||||
Accounts
payable and accrued liabilities
|
$ | 5,708 | $ | 5,708 | ||||
Production
taxes and royalties payable
|
1,589 | 4,409 | ||||||
Well
settlement payable
|
57,130 | - | ||||||
Total
Current Liabilities
|
64,427 | 10,117 | ||||||
Asset
retirement obligation
|
8,879 | 8,879 | ||||||
Total
Liabilities
|
73,306 | 18,996 | ||||||
STOCKHOLDERS'
EQUITY
|
||||||||
Common
stock, no par value-
|
||||||||
Authorized
Shares - 100,000,000
|
||||||||
Issued
& Outstanding: 7,808,000 shares at September 30,
2009;
|
1,155,500 | 1,155,500 | ||||||
7,808,000
at December 31, 2008
|
||||||||
Additional
paid in capital
|
21,295 | 21,295 | ||||||
Stock
subscription receivable
|
(2,000 | ) | (2,000 | ) | ||||
(Deficit)
accumulated during the development stage
|
(690,371 | ) | (623,814 | ) | ||||
Total
Stockholders' Equity
|
484,424 | 550,981 | ||||||
Total
Liabilities & Stockholders' Equity
|
$ | 557,729 | $ | 569,977 |
Inception
|
||||||||||||||||||||
Three Months
|
Three Months
|
Nine Months
|
Nine Months
|
(April 16, 2002)
|
||||||||||||||||
Ended
|
Ended
|
Ended
|
Ended
|
through
|
||||||||||||||||
September 30,
|
September 30,
|
September 30,
|
September 30,
|
September 30,
|
||||||||||||||||
2009
|
2008
|
2009
|
2008
|
2009
|
||||||||||||||||
UNAUDITED
|
UNAUDITED
|
UNAUDITED
|
UNAUDITED
|
UNAUDITED
|
||||||||||||||||
REVENUE
|
$ | 7,046 | $ | 38,103 | $ | 25,294 | $ | 108,757 | $ | 452,513 | ||||||||||
PRODUCTION
(LIFTING) COSTS
|
3,660 | 9,117 | 13,189 | 25,501 | 137,295 | |||||||||||||||
EXPLORATION
EXPENSES
|
- | - | - | - | 3,862 | |||||||||||||||
DEPLETION, DEPRECIATION
AND
AMORTIZATION
|
8,410 | 19,810 | 31,130 | 45,430 | 161,790 | |||||||||||||||
INCOME
FROM OIL & GAS PRODUCING ACTIVITIES
|
(5,024 | ) | 9,176 | (19,025 | ) | 37,826 | 149,566 | |||||||||||||
SELLING,
GENERAL & ADMINISTRATIVE EXPENSES
|
9,303 | 15,175 | 47,532 | 79,912 | 839,937 | |||||||||||||||
NET
(LOSS)
|
$ | (14,327 | ) | $ | (5,999 | ) | $ | (66,557 | ) | $ | (42,086 | ) | $ | (690,371 | ) | |||||
EARNINGS
PER SHARE
|
||||||||||||||||||||
Net
Income, basic and diluted
|
$ | (0.00 | ) | $ | (0.00 | ) | $ | (0.01 | ) | $ | (0.01 | ) | ||||||||
Weighted
average number of shares outstanding
|
7,808,000 | 7,638,769 | 7,808,000 | 7,638,769 | ||||||||||||||||
Diluted
potential shares - stock warrants
|
- | - | - | - | ||||||||||||||||
Adjusted
weighted average shares
|
7,808,000 | 7,638,769 | 7,808,000 | 7,638,769 |
(Deficit)
|
||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||
Additional
|
Stock
|
During
|
||||||||||||||||||||||
Common Stock
|
Paid In
|
Subscription
|
Development
|
|||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Receivable
|
Stage
|
Total
|
|||||||||||||||||||
BEGINNING
BALANCE, INCEPTION (APRIL 16, 2002) TO DECEMBER 31, 2004
|
- | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||
Common
stock issued
|
6,240,000 | 624,000 | - | - | - | 624,000 | ||||||||||||||||||
Net
(loss)
|
- | - | - | - | (346,422 | ) | (346,422 | ) | ||||||||||||||||
BALANCE,
DECEMBER 31, 2004
|
6,240,000 | 624,000 | - | - | (346,422 | ) | 277,578 | |||||||||||||||||
Common
stock issued
|
- | - | - | - | - | - | ||||||||||||||||||
Net
income
|
- | - | - | - | 66,381 | 66,381 | ||||||||||||||||||
BALANCE,
DECEMBER 31, 2005
|
6,240,000 | 624,000 | - | - | (280,041 | ) | 343,959 | |||||||||||||||||
Common
stock issued
|
- | - | - | - | - | - | ||||||||||||||||||
Net
(loss)
|
- | - | - | - | (20,068 | ) | (20,068 | ) | ||||||||||||||||
BALANCE,
DECEMBER 31, 2006
|
6,240,000 | 624,000 | - | - | (300,109 | ) | 323,891 | |||||||||||||||||
Common
stock issued for services
|
330,000 | 147,000 | - | - | - | 147,000 | ||||||||||||||||||
Common
stock warrants exercised
|
938,000 | 234,500 | - | (2,000 | ) | - | 232,500 | |||||||||||||||||
Common
stock options issued
|
- | - | 21,295 | - | - | 21,295 | ||||||||||||||||||
Net
(loss)
|
- | - | - | - | (255,025 | ) | (255,025 | ) | ||||||||||||||||
BALANCE,
DECEMBER 31, 2007
|
7,508,000 | 1,005,500 | 21,295 | (2,000 | ) | (555,134 | ) | 469,661 | ||||||||||||||||
Common
stock issued
|
300,000 | 150,000 | - | - | - | 150,000 | ||||||||||||||||||
Net
(loss)
|
- | - | - | - | (68,680 | ) | (68,680 | ) | ||||||||||||||||
BALANCE,
DECEMBER 31, 2008
|
7,808,000 | 1,155,500 | 21,295 | (2,000 | ) | (623,814 | ) | 550,981 | ||||||||||||||||
Net
(loss) for the nine months
|
||||||||||||||||||||||||
ended
September 30, 2009 (UNAUDITED)
|
- | - | - | - | (66,557 | ) | (66,557 | ) | ||||||||||||||||
BALANCE,
SEPTEMBER 30, 2009
|
7,808,000 | $ | 1,155,500 | $ | 21,295 | $ | (2,000 | ) | $ | (690,371 | ) | $ | 484,424 |
Inception
|
||||||||||||
Nine Months
|
Nine Months
|
(April 16, 2002)
|
||||||||||
Ended
|
Ended
|
Through
|
||||||||||
September 30, 2009
|
September 30, 2008
|
September 30, 2009
|
||||||||||
UNAUDITED
|
UNAUDITED
|
UNAUDITED
|
||||||||||
OPERATING
ACTIVITIES
|
||||||||||||
Net
(loss)
|
$ | (66,557 | ) | $ | (42,086 | ) | $ | (690,371 | ) | |||
Changes
and credits to net (loss) not affecting cash
|
||||||||||||
Depletion
and amortization
|
31,130 | 45,430 | 161,790 | |||||||||
Organizational
expenses paid with stock
|
- | - | 300,000 | |||||||||
Legal
fees paid with stock
|
- | - | 172,000 | |||||||||
Stock
compensation expense
|
- | - | 21,295 | |||||||||
Changes
in assets and liabilities
|
||||||||||||
Trade
receivables
|
17,024 | (20,462 | ) | (7,046 | ) | |||||||
Deposits
|
- | (10,000 | ) | - | ||||||||
Production
taxes and royalties payable
|
(2,821 | ) | 2,978 | 1,589 | ||||||||
Accounts
payable
|
1 | 2,385 | 5,708 | |||||||||
NET CASH FROM (USED FOR)
OPERATING
ACTIVITIES
|
(21,223 | ) | (21,755 | ) | (35,035 | ) | ||||||
INVESTING
ACTIVITIES
|
||||||||||||
Website
development
|
- | - | (2,500 | ) | ||||||||
Additions
to oil and gas properties
|
(7,018 | ) | (68,747 | ) | (432,416 | ) | ||||||
NET CASH (USED FOR)
INVESTING ACTIVITIES
|
(7,018 | ) | (68,747 | ) | (434,916 | ) | ||||||
FINANCING
ACTIVITIES
|
||||||||||||
Proceeds
from sale of common stock
|
- | 150,000 | 150,000 | |||||||||
Proceeds
from exercise of warrants
|
- | - | 371,500 | |||||||||
NET CASH PROVIDED BY
FINANCING ACTIVITIES
|
- | 150,000 | 521,500 | |||||||||
NET CHANGE IN CASH AND
CASH EQUIVALENTS
|
(28,241 | ) | 59,498 | 51,549 | ||||||||
CASH AND CASH EQUIVALENTS
AT BEGINNING OF
PERIOD
|
79,790 | 77,329 | - | |||||||||
CASH AND CASH EQUIVALENTS
AT END OF
PERIOD
|
$ | 51,549 | $ | 136,827 | $ | 51,549 |
Three Months
Ended
September
30, 2009
|
Three Months
Ended
September
30, 2008
|
|||||||
Revenue
|
$ | 7,046 | $ | 38,103 | ||||
Expenses
|
$ | 21,373 | $ | 44,102 | ||||
Net
Income (Loss)
|
$ | (14,327 | ) | $ | (5,999 | ) |
Ludwig State 36-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
July
|
211.41
|
1.39
|
243.17
|
7.71
|
||||||||||||
August
|
201.92
|
1.40
|
240.69
|
5.90
|
||||||||||||
September
|
190.58
|
1.19
|
225.84
|
4.52
|
Boucher
27-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
July
|
49.50
|
1.39
|
64.76
|
7.71
|
||||||||||||
August
|
47.85
|
1.40
|
70.33
|
5.90
|
||||||||||||
September
|
44.76
|
1.19
|
81.26
|
4.52
|
B. Ag #25-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
July
|
38.80
|
1.39
|
41.00
|
7.71
|
||||||||||||
August
|
35.20
|
1.40
|
39.40
|
5.90
|
||||||||||||
September
|
33.60
|
1.19
|
37.80
|
4.52
|
Vandenbos
#19-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
July
|
449.21 | 1.39 | 1,144.48 | 7.71 | ||||||||||||
August
|
434.36 | 1.40 | 1,047.34 | 5.90 | ||||||||||||
September
|
388.58 | 1.19 | 958.44 | 4.52 |
Boucher
#18-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
July
|
187.69 | 1.39 | 0 | 7.71 | ||||||||||||
August
|
194.49 | 1.40 | 471.49 | 5.90 | ||||||||||||
September
|
189.75 | 1.19 | 546.77 | 4.52 |
Stoltz
#18-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
July
|
12.80 | 1.39 | 0 | 7.71 | ||||||||||||
August
|
5.28 | 1.40 | 43.27 | 5.90 | ||||||||||||
September
|
0.41 | 1.19 | 54.03 | 4.52 |
Drilling
Activity
|
||||||||||||||||||||||||
Gross
Wells
|
Net
Wells
|
|||||||||||||||||||||||
Three
Months ended
September
30,
|
Total
|
Producing
|
Dry
|
Total
|
Producing
|
Dry
|
||||||||||||||||||
2009
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||
2008
|
2
|
2
|
2
|
0.5
|
0.5
|
0
|
Three
Months ended September 30,
|
2009
|
2008
|
||||||
Net
Production
|
||||||||
Oil
(Bbls)
|
40.06
|
0.00
|
||||||
Gas
(Mcf)
|
2,716.17
|
5,310.08
|
||||||
Average
Sales Prices
|
||||||||
Oil
(per Bbl)
|
$
|
53.08
|
$
|
0.00
|
||||
Gas
(per Mcf)
|
$
|
1.33
|
$
|
6.04
|
||||
Average
Production Cost Per MCF
|
$
|
1.34
|
$
|
1.71
|
Nine
months
Ended
September
30, 2009
|
Nine
months
Ended
September
30, 2008
|
|||||||
Revenue
|
$
|
25,294
|
$
|
108,757
|
||||
Expenses
|
$
|
91,851
|
$
|
150,843
|
||||
Net
Income (Loss)
|
$
|
(66,557)
|
$
|
(42,086)
|
Ludwig State 36-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
January
|
231.21
|
3.09
|
284.63
|
3.91
|
||||||||||||
February
|
211.20
|
2.34
|
265.65
|
4.45
|
||||||||||||
March
|
218.83
|
1.80
|
261.73
|
4.98
|
||||||||||||
April
|
194.49
|
1.56
|
255.96
|
5.36
|
||||||||||||
May
|
207.28
|
1.41
|
255.54
|
6.33
|
||||||||||||
June
|
198.83
|
1.59
|
246.09
|
6.75
|
||||||||||||
July
|
211.41
|
1.39
|
243.17
|
7.71
|
||||||||||||
August
|
201.92
|
1.40
|
240.69
|
5.90
|
||||||||||||
September
|
190.58
|
1.19
|
225.84
|
4.52
|
Boucher
27-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
January
|
110.14
|
3.09
|
89.10
|
3.91
|
||||||||||||
February
|
71.16
|
2.34
|
85.39
|
4.45
|
||||||||||||
March
|
56.72
|
1.80
|
73.22
|
4.98
|
||||||||||||
April
|
44.76
|
1.56
|
67.44
|
5.36
|
||||||||||||
May
|
47.23
|
1.41
|
67.03
|
6.33
|
||||||||||||
June
|
47.64
|
1.59
|
68.06
|
6.75
|
||||||||||||
July
|
49.50
|
1.39
|
64.76
|
7.71
|
||||||||||||
August
|
47.85
|
1.40
|
70.33
|
5.90
|
||||||||||||
September
|
44.76
|
1.19
|
81.26
|
4.52
|
B. Ag #25-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
January
|
38.80
|
3.09
|
40.80
|
3.91
|
||||||||||||
February
|
33.80
|
2.34
|
41.80
|
4.45
|
||||||||||||
March
|
36.80
|
1.80
|
42.20
|
4.98
|
||||||||||||
April
|
35.60
|
1.56
|
42.40
|
5.36
|
||||||||||||
May
|
37.80
|
1.41
|
41.00
|
6.33
|
||||||||||||
June
|
38.60
|
1.59
|
39.80
|
6.75
|
||||||||||||
July
|
38.80
|
1.39
|
41.00
|
7.71
|
||||||||||||
August
|
35.20
|
1.40
|
39.40
|
5.90
|
||||||||||||
September
|
33.60
|
1.19
|
37.80
|
4.52
|
Vandenbos #19-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
January
|
708.06 | 3.09 | 1792.93 | 3.91 | ||||||||||||
February
|
632.57 | 2.34 | 1658.87 | 4.45 | ||||||||||||
March
|
683.72 | 1.80 | 1578.84 | 4.98 | ||||||||||||
April
|
551.10 | 1.56 | 1390.95 | 5.35 | ||||||||||||
May
|
494.59 | 1.41 | 1328.66 | 6.33 | ||||||||||||
June
|
451.69 | 1.59 | 1219.14 | 6.75 | ||||||||||||
July
|
449.21 | 1.39 | 1,144.48 | 7.71 | ||||||||||||
August
|
434.36 | 1.40 | 1,047.34 | 5.90 | ||||||||||||
September
|
388.58 | 1.19 | 958.44 | 4.52 |
Boucher #18-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
January
|
413.33 | 3.09 | 0 | 3.91 | ||||||||||||
February
|
356.40 | 2.34 | 0 | 4.45 | ||||||||||||
March
|
365.48 | 1.80 | 0 | 4.98 | ||||||||||||
April
|
299.89 | 1.56 | 0 | 5.35 | ||||||||||||
May
|
237.81 | 1.41 | 0 | 6.33 | ||||||||||||
June
|
196.76 | 1.59 | 0 | 6.75 | ||||||||||||
July
|
187.69 | 1.39 | 0 | 7.71 | ||||||||||||
August
|
194.49 | 1.40 | 471.49 | 5.90 | ||||||||||||
September
|
189.75 | 1.19 | 546.77 | 4.52 |
Stoltz #18-1
|
Share of
Production
Volumes
|
Price
Per
MCF
|
Share of
Production
Volumes
|
Price
Per
MCF
|
||||||||||||
2009
|
2008
|
|||||||||||||||
January
|
27.83 | 3.09 | 0 | 3.91 | ||||||||||||
February
|
19.50 | 2.34 | 0 | 4.45 | ||||||||||||
March
|
13.41 | 1.80 | 0 | 4.98 | ||||||||||||
April
|
8.13 | 1.56 | 0 | 5.35 | ||||||||||||
May
|
10.77 | 1.41 | 0 | 6.33 | ||||||||||||
June
|
15.03 | 1.59 | 0 | 6.75 | ||||||||||||
July
|
12.80 | 1.39 | 0 | 7.71 | ||||||||||||
August
|
5.28 | 1.40 | 43.27 | 5.90 | ||||||||||||
September
|
0.41 | 1.19 | 54.03 | 4.52 |
Drilling
Activity
|
||||||||||||||||||||||||
Gross
Wells
|
Net
Wells
|
|||||||||||||||||||||||
Nine
months ended
September
30,
|
Total
|
Producing
|
Dry
|
Total
|
Producing
|
Dry
|
||||||||||||||||||
2009
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||
2008
|
2
|
2
|
2
|
0.5
|
0.5
|
0
|
Nine
months ended September 30,
|
2009
|
2008
|
||||||
Net
Production
|
||||||||
Oil
(Bbls)
|
40.06
|
|||||||
Gas
(Mcf)
|
10,063.08
|
16,547.28
|
||||||
Average
Sales Prices
|
||||||||
Oil
(per Bbl)
|
$
|
53.08
|
$
|
|||||
Gas
(per Mcf)
|
$
|
1.75
|
$
|
5.55
|
||||
Average
Production Cost Per MCF
|
$
|
1.31
|
$
|
1.54
|
Exhibit
|
Item
|
|
31.1
|
Certification
of Principal Executive and Principal Financial Officer pursuant to Section
302(a) of the Sarbanes-Oxley Act of 2002
|
|
32.1*
|
Certification
of Principal Executive and Principal Financial Officer pursuant to Section
302(a) of the Sarbanes-Oxley Act of
2002
|
MAJESTIC
OIL & GAS, INC.
|
||
Date: November 16,
2009
|
By:
|
/s/ Patrick
Montalban
|
(Authorized
Officer/principal Executive
Officer,
Principal Financial Officer/principal
Financial
Officer}
|
Exhibit
|
Item
|
|
31.1
|
Certification
of Principal Executive and Principal Financial Officer pursuant to Section
302(a) of the Sarbanes-Oxley Act of 2002
|
|
32.1*
|
Certification
of Principal Executive and Principal Financial Officer pursuant to Section
906 of the Sarbanes-Oxley Act of
2002
|