CoJax Oil & Gas Corp
For the period ended Dec 31, 2024. Filed Mar 31, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 31, 2025
CJAXStored price and day change unavailable
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-03-26.
0001753926-24-000615
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001753926-25-000532
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 54 previous paragraphs and 53 current paragraphs.
38 unchanged; 11 reworded; 4 added; 5 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (4)
Current report
Lease operating expenses were $355,644 for the year ended December 31, 2024, compared to $248,642 in the same period in 2023. The increase in lease operating expenses of 43.0% or $107,002 was primarily driven by the 2024 acquisition of additional mineral and oil and gas interests and the operation of those interests.
Current report
Other Expense, Net
Current report
Other expense, net was ($901) for the year ended December 31, 2024, compared to ($1,940) for the same period in 2023. The change in other expense, net, was attributable to an increase in interest income.
Current report
Recent Issued Accounting Pronouncements
Removed paragraphs (5)
Previous report
Lease operating expenses were $248,642 for the year ended December 31, 2023, compared to $321,103 in the same period in 2022. The decrease in lease operating expenses of 22.6% or $72,461 was primarily driven by $234,396 in workover expenses incurred during the year ended December 31, 2022, with no comparable activity in the same period in 2023. The decrease was partially offset by an increase in expense attributable to production, which is in line with the increase in revenue in 2023.
Previous report
Other Income (Expense)
Previous report
Other income (expense) was ($1,940) for the year ended December 31, 2023, compared to other income (expense) of $40,716 in the same period in 2022. The change in other income (expense) was primarily driven by a $41,665 gain on forgiveness of debt during the year ended December 31, 2022, with no comparable activity in the same period in 2023.
Previous report
On May 9, 2022, the Board of directors of the Company, after discussion with management, determined that the Company’s previously issued financial statements included in the 2020 Form 10-K need to be restated, to among other things, amend the statements used in the Original Form 10-K regarding the method of accounting it uses. On May 31, 2022, the Company filed an amendment to the Original Form 10-K in which it modified and restated certain statements, including that the Company uses the successful efforts method of accounting for oil and gas activities. Under this method, the costs of productive exploratory wells, all development wells, related asset retirement obligation assets and productive leases are capitalized and amortized, principally by field, on a units-of-production basis over the life of the remaining proved reserves. Exploration costs, including personnel costs, geological and geophysical expenses and delay rentals for oil and gas leases are charged to expense as incurred. Exploratory drilling costs are initially capitalized but charged to expense if and when the well is determined not to have found reserves in commercial quantities. All of our properties are located within the continental United States.
Previous report
Recent Accounting Pronouncements
Reworded paragraphs (11)
Previous wording
Since March 2020, and throughout the last three years, global markets and commodity prices have been extremely volatile due to the impacts from the COVID-19 pandemic, with further impacts on volatility caused by the war in Ukraine that began in February 2022. Commodity prices remained steady during the fourth quarter of 2022 as demand has continued to outpace relative supply. While recessionary concerns have placed some downward pressure on commodity prices, causing oil and gas prices to decline in the first quarter of 2023 from their earlier highs in 2022, worldwide commodity demand continues to exceed pre COVID-19 pandemic levels. Although supply has increased and we have seen continued recovery in commodity prices since the beginning of the pandemic, there is still an element of volatility and uncertainty that we expect to continue at least for the near-term and possibly longer, in part by the impact of the Russian-Ukrainian military conflict on global commodity and financial markets, and the associated effect of trade sanctions on imports of oil and natural gas from Russia. This volatility could negatively impact future prices for oil, natural gas, petroleum products and industrial products.
Current wording
Oil and natural gas prices have and may continue to be volatile. Recessionary concerns have placed some downward pressure on commodity prices, causing oil and gas prices to decline in the first quarter of 2023 from their earlier highs in 2022. Although supply has increased throughout the last three years, there is still an element of volatility and uncertainty that we expect to continue at least for the near-term and possibly longer, in part by the impact of the Russian-Ukrainian military conflict on global commodity and financial markets, and the associated effect of trade sanctions on imports of oil and natural gas from Russia. This volatility could negatively impact future prices for oil, natural gas, petroleum products and industrial products.
Previous wording
Revenues were $927,983 for the year ended December 31, 2023, and $106,554 for the year ended December 31, 2022. The Company is an early-stage company, having just begun to acquire assignments of hydrocarbon revenues and underlying oil and gas exploration and production rights, and therefore has just begun producing significant revenue in 2023.
Current wording
Revenues were $971,686 for the year ended December 31, 2024, and $927,983 for the year ended December 31, 2023. The Company is an early-stage company and began producing significant revenue in 2023. The increase in revenue of $43,703 is attributable to the acquisition of additional mineral and oil and gas interests during 2024.
Previous wording
General and administrative expenses consisted primarily of accounting and audit fees, legal and professional services fees, and payroll-related expenses. General and administrative expenses were $1,038,473 for the year ended December 31, 2023, compared to $2,111,761 in the same period in 2022, representing a decrease of 50.8% or $1,073,288. The decrease was primarily driven by a decrease in share-based compensation expense.
Current wording
General and administrative expenses consisted primarily of accounting and audit fees, legal and professional services fees, and payroll-related expenses. General and administrative expenses were $919,994 for the year ended December 31, 2024, compared to $1,038,473 in the same period in 2023, representing a decrease of 11.4% or $118,479. The decrease was primarily driven by a decrease in management fees.
Previous wording
Total operating loss was $1,627,962 for the year ended December 31, 2023, and $6,278,331 for the year ended December 31, 2022. The change in loss was primarily driven by the decreases in general and administrative expenses and impairment expense.
Current wording
Total operating loss was $1,608,945 for the year ended December 31, 2024, and $1,627,962 for the year ended December 31, 2023. The change in loss was primarily driven by the decrease in general and administrative expenses, offset by the increase in lease operating expenses.
Previous wording
As a result of the above factors, there was a net loss of $1,629,902 for the year ended December 31, 2023, compared to a net loss of $6,237,615 in the same period of 2022.
Current wording
As a result of the above factors, there was a net loss of $1,609,846 for the year ended December 31, 2024, compared to a net loss of $1,629,902 in the same period of 2023.
Previous wording
The Company had cash and cash equivalents of $75,908 at December 31, 2023. The Company has incurred net operating losses and operating cash flow deficits since inception, continuing through the years ended December 31, 2023, and December 31, 2022. Since inception, the primary sources of financing have been a combination of loans or contributions of Jeffrey J. Guzy, an officer and director of the Company, and $53,000 raised in the public offering. This limited funding has been inadequate as of the date of this Annual Report to fund our business strategy. The Company has not attained profitable operations and its ability to pursue any future plan of operation is dependent upon our ability to obtain additional financing.
Current wording
The Company had cash and cash equivalents of $46,738 at December 31, 2024. The Company has incurred net operating losses and operating cash flow deficits since inception, continuing through the years ended December 31, 2024, and December 31, 2023. Since inception, the primary sources of financing have been a combination of loans or contributions of Jeffrey J. Guzy, an officer and director of the Company, and $53,000 raised in the public offering. This limited funding has been inadequate as of the date of this Annual Report to fund our business strategy. The Company has not attained profitable operations and its ability to pursue any future plan of operation is dependent upon our ability to obtain additional financing.
Previous wording
Net cash from operating activities is derived from net loss from operations adjusted for non-cash items, changes in accounts receivables balances, prepaid expenses, accounts payables, and accrued expenses. For the period ended December 31, 2023, net cash provided by operating activities was $48,046 compared to net cash used in operating activities of $78,323 for the period ended December 31, 2022.
Current wording
Net cash from operating activities is derived from net loss from operations adjusted for non-cash items, changes in accounts receivables balances, prepaid expenses, accounts payables, and accrued expenses. For the period ended December 31, 2024, net cash used in operating activities was $19,187 compared to net cash provided by operating activities of $48,046 for the period ended December 31, 2023. The net decrease was primarily attributable to a net $317,004 decrease in the non-cash adjustment for common stock issued for services and salaries. This change was offset by the net increase in accounts receivable during the period ended December 31, 2024.
Previous wording
Net cash used in investing activities was $0 for the periods ended December 31, 2023, and December 31, 2022.
Current wording
Net cash used in investing activities was $0 for both the periods ended December 31, 2024, and December 31, 2023.
Previous wording
Total net cash used in financing activities was $9,888 for the period ended December 31, 2023. Net cash provided by financing activities was $103,975 for the periods ended December 31, 2022. The net decrease was primarily due to the decrease in SBA PPP loans and the proceeds from the related party loan in 2022.
Current wording
Total net cash used in financing activities was $9,983 for the period ended December 31, 2024. Net cash used in financing activities was $9,888 for the periods ended December 31, 2023. The net decrease was due to the decrease in payments made of the SBA PPP loan.
Previous wording
Successful Efforts Method of Accounting. We account for oil and natural gas properties in accordance with the successful efforts method. Under this method, all acquisition costs of proved properties are capitalized and amortized on a unit-of-production basis over the remaining life of the proved reserves. All development costs of proved properties are capitalized and amortized on a unit-of-production basis over the remaining life of the proved developed reserves. Costs of retired, sold, or abandoned properties that constitute a part of an amortization base are charged or credited, net of proceeds, to accumulated depreciation, depletion, and amortization unless doing so significantly affects the unit-of-production amortization rate, in which case a gain or loss is recognized in the current period. Gains or losses from the disposal of other properties are recognized in the current period. For assets acquired, we base the capitalized cost on the fair value at the acquisition date. We expense expenditures for maintenance and repairs necessary to maintain properties in operating condition, as well as annual lease rentals, as they are incurred. Estimated dismantlement and abandonment costs are capitalized at their estimated net present value and amortized over the remaining lives of the related assets. Interest is capitalized only during the periods in which these assets are brought to their intended use. We only capitalize the interest on borrowed funds related to our share of costs associated with qualifying capital expenditures.
Current wording
Successful Efforts Method of Accounting. We account for oil and natural gas properties in accordance with the successful efforts method. Under this method, all acquisition costs of proved properties are capitalized and amortized on a unit-of-production basis over the remaining life of the proved reserves. All development costs of proved properties are capitalized and amortized on a unit-of-production basis over the remaining life of the proved developed reserves. Costs of retired, sold, or abandoned properties that constitute a part of an amortization base are charged or credited, net of proceeds, to accumulated depreciation, depletion, and amortization unless doing so significantly affects the unit-of-production amortization rate, in which case a gain or loss is recognized in the current period. Gains or losses from the disposal of other properties are recognized in the current period. For assets acquired, we base the capitalized cost on the fair value at the acquisition date. We expense expenditures for maintenance and repairs necessary to maintain properties in operating condition, as well as annual lease rentals, as they are incurred. Estimated dismantlement andabandonment costs are capitalized at their estimated net present value and amortized over the remaining lives of the related assets. Interest is capitalized only during the periods in which these assets are brought to their intended use. We only capitalize the interest on borrowed funds related to our share of costs associated with qualifying capital expenditures.
Previous wording
Our estimates of reserves and future cash flow as of December 31, 2023, and 2022 were prepared using an average price equal to the unweighted arithmetic average of the first day of the month price for each month within the 12-month periods ended December 31, 2023, and 2022, respectively, in accordance with SEC guidelines. As of December 31, 2023, our reserves are based on an SEC average price of $75.81 per Bbl of WTI oil posted and $0 per MCF natural gas. As of December 31, 2022, our reserves are based on an SEC average price of $92.01 per Bbl of WTI oil posted and $6.957 per MCF natural gas. Prices are adjusted by local field and lease level differentials and are held constant for the life of reserves in accordance with SEC guidelines.
Current wording
Our estimates of reserves and future cash flow as of December 31, 2024, and 2023 were prepared using an average price equal to the unweighted arithmetic average of the first day of the month price for each month within the 12-month periods ended December 31, 2024, and 2023, respectively, in accordance with SEC guidelines. As of December 31, 2024, our reserves are based on an SEC average price of $73.68 per Bbl of WTI oil posted and $2.013 per MCF natural gas. As of December 31, 2023, our reserves are based on an SEC average price of $75.81 per Bbl of WTI oil posted and $0 per MCF natural gas. Prices are adjusted by local field and lease level differentials and are held constant for the life of reserves in accordance with SEC guidelines.