HUSA Houston American Energy Corp

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 10-Q

 

(Mark One)

 

☒	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended June 30, 2024

 

OR

 

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ___________ to ______________.

 

Commission File Number 1-32955

 

HOUSTON AMERICAN ENERGY CORP.

(Exact name of registrant as specified in its charter)

 

Delaware		76-0675953
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

 

801 Travis Street, Suite 1425, Houston, Texas 77002

(Address of principal executive offices)(Zip Code)

 

(713) 222-6966

(Registrant’s telephone number, including area code)

 

 

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.001 par value per share		HUSA		NYSE American

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer	☐	Accelerated filer	☐	Non-accelerated filer	☒
Smaller reporting company	☒	Emerging growth company	☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes ☐ No ☒

 

As of August 14, 2024, we had 10,906,353 shares of $0.001 par value common stock outstanding.

 

 

 

HOUSTON AMERICAN ENERGY CORP.

 

FORM 10-Q

 

INDEX

 

			Page No.
PART I.		FINANCIAL INFORMATION
Item 1.		Financial Statements	3
		Consolidated Balance Sheets as of June 30, 2024 (Unaudited) and December 31, 2023	3
		Consolidated Statements of Operations for the Three Months Ended June 30, 2024 and 2023 (Unaudited)	4
		Consolidated Statements of Changes in Shareholders’ Equity for the Three Months Ended June 30, 2024 and 2023 (Unaudited)	5
		Consolidated Statements of Cash Flows for the Three Months Ended June 30, 2024 and 2023 (Unaudited)	6
		Notes to Consolidated Financial Statements (Unaudited)	7
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3.		Quantitative and Qualitative Disclosures About Market Risk	15
Item 4.		Controls and Procedures	15
PART II		OTHER INFORMATION
Item 6.		Exhibits	16

 

 

ITEM 1

Financial Statements

 

PART I - FINANCIAL INFORMATION

HOUSTON AMERICAN ENERGY CORP.

CONSOLIDATED BALANCE SHEETS

 

		June 30, 2024				December 31, 2023
		(Unaudited)
ASSETS
CURRENT ASSETS
Cash		$	3,380,769			$	4,059,182
Accounts receivable – oil and gas sales			32,108				71,736
Prepaid expenses and other current assets			104,236				35,244
TOTAL CURRENT ASSETS			3,517,113				4,166,162
PROPERTY AND EQUIPMENT
Oil and gas properties, full cost method
Costs subject to amortization			62,777,666				62,776,561
Office equipment			90,004				90,004
Total			62,867,670				62,866,565
Accumulated depletion, depreciation, amortization, and impairment			(61,370,349	)			(61,307,264	)
PROPERTY AND EQUIPMENT, NET			1,497,321				1,559,301
Equity investment – Hupecol Meta LLC			5,271,628				4,505,358
Right of use asset			108,582				145,021
Other assets			3,167				3,167
TOTAL ASSETS		$	10,397,811			$	10,379,009
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable		$	252,049			$	156,572
Accrued expenses			17,065				17,083
Current portion of lease liability			80,683				75,276
TOTAL CURRENT LIABILITIES			349,797				248,931
LONG-TERM LIABILITIES
Lease liability, net of current portion			29,286				71,083
Reserve for plugging and abandonment costs			64,189				63,084
TOTAL LONG-TERM LIABILITIES			93,475				134,167
TOTAL LIABILITIES			443,272				383,098
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY
Common stock, par value $0.001; 20,000,000 shares authorized 10,906,353 shares issued and outstanding			10,907				10,907
Additional paid-in capital			87,047,414				86,984,001
Accumulated deficit			(77,103,782	)			(76,998,997	)
TOTAL SHAREHOLDERS’ EQUITY			9,954,539				9,995,911
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	10,397,811			$	10,379,009

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 

HOUSTON AMERICAN ENERGY CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2024 AND 2023

(Unaudited)

 

		2024				2023				2024				2023
		Six Months Ended June 30,								Three Months Ended June 30,
		2024				2023				2024				2023
OIL AND GAS REVENUE		$	263,490				434,414			$	115,805				204,390
EXPENSES OF OPERATIONS
Lease operating expense and severance tax			305,233				215,400				142,203				101,714
General and administrative expense			713,554				1,046,434				355,747				716,615
Depreciation and depletion			63,085				91,896				28,107				44,941
Total operating expenses			1,081,872				1,353,730				526,057				863,270
Loss from operations			(818,382	)			(919,316	)			(410,252	)			(658,880	)
OTHER INCOME, NET
Interest income			59,455				74,635				28,241				44,135
Other income			654,142				648,475				292,926				314,364
Total other income			713,597				723,110				321,167				358,499
Net (loss) income before taxes			(104,785	)			(196,206	)			(89,085	)			(300,381	)
Income tax expense			—								—
Net (loss) income		$	(104,785	)			(196,206	)		$	(89,085	)			(300,381	)
Basic and diluted (loss) income per common share		$	(0.01	)			(0.02	)		$	(0.01	)			(0.03	)
Based and diluted weighted average number of common shares outstanding			10,906,353				10,659,076				10,906,353				10,896,996

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 

HOUSTON AMERICAN ENERGY CORP.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED JUNE 30, 2024 AND 2023

(Unaudited)

 

		Shares				Amount				Capital				Deficit				Total
										Additional
		Common Stock								Paid-in				Accumulated
		Shares				Amount				Capital				Deficit				Total
Balance at December 31, 2023			10,906,353			$	10,907			$	86,984,001			$	(76,998,997	)		$	9,995,911
Stock-based compensation			—				—				50,667				—				50,667
Net loss			—				—				—				(15,699	)			(15,699	)
Balance at March 31, 2024			10,906,353				10,907				87,034,668				(77,014,697	)			10,030,879
Stock-based compensation			—				—				12,746				—				12,746
Net loss			—				—				—				(89,085	)			(89,085	)
Balance at June 30, 2024			10,906,353			$	10,907			$	87,047,414			$	(77,103,782	)			9,954,539

 

		Shares				Amount				Capital				Deficit				Total
										Additional
		Common Stock								Paid-in				Accumulated
		Shares				Amount				Capital				Deficit				Total
Balance at December 31, 2022			10,327,646			$	10,328			$	85,094,266			$	(73,787,720	)		$	11,316,874
Stock-based compensation			—				—				84,445				—				84,445
Issuance of common stock for cash, net			294,872				295				901,205				—				901,500
Net income			—				—				—				104,175				104,175
Balance at March 31, 2023			10,662,518			$	10,623			$	86,079,916			$	(73,683,545	)		$	12,406,994
Balance			10,662,518			$	10,623			$	86,079,916			$	(73,683,545	)		$	12,406,994
Stock-based compensation			—				—				77,870				—				77,870
Issuance of common stock for cash, net			283,835				284				750,216				—				750,500
Net income			—				—				—				(300,381	)			(300,381	)
Net income (loss)			—				—				—				(300,381	)			(300,381	)
Balance at June 30, 2023			10,936,353			$	10,907			$	86,908,002			$	(73,983,926	)		$	12,934,983
Balance			10,936,353			$	10,907			$	86,908,002			$	(73,983,926	)		$	12,934,983

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 

HOUSTON AMERICAN ENERGY CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2023

(Unaudited)

 

		2024				2023
		For the Six Months Ended June 30,
		2024				2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income		$	(104,785	)		$	(196,206	)
Adjustments to reconcile net income (loss) to net cash used in operations:
Depreciation and depletion			63,085				91,896
Accretion of asset retirement obligation			1,105				2,678
Stock-based compensation			63,413				162,315
Amortization of right of use asset			36,385				32,836
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable			39,628				(113,971	)
Decrease (increase) in accrued earnings distributions from Hupecol Meta, LLC			—				(648,475	)
Decrease (increase) in prepaid expenses and other current assets			(68,992	)			534,155
(Decrease) increase in accounts payable and accrued expenses			94,354				(51,101	)
Decrease in operating lease liability			(36,390	)			(31,594	)
Net cash provided by (used in) operating activities			87,803				(217,467	)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for capital contribution for equity investment			(766,216	)			(448,909	)
Net cash used in investing activities			(766,216	)			(448,909	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock for cash, net of offering costs			—				1,652,000
Net cash provided by financing activities			—				1,652,000
Increase (decrease) in cash			(678,413	)			985,624
Cash, beginning of period			4,059,182				4,547,210
Cash, end of period		$	3,380,769			$	5,532,834
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid		$	—			$	—
Taxes paid		$	—			$	—
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES
Changes in estimate of asset retirement obligations, net			—				1,259
Changes in accrued equity investment contributions and distributions			—				33,038
Change in accrued Oil and Gas development			1,105				—

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 

HOUSTON AMERICAN ENERGY CORP.

Notes to Consolidated Financial Statements

(Unaudited)

 

NOTE 1 – BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

 

The accompanying unaudited consolidated financial statements of Houston American Energy Corp., a Delaware corporation (the “Company”), have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q. They do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for a complete financial presentation. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, considered necessary for a fair presentation, have been included in the accompanying unaudited consolidated financial statements. Operating results for the periods presented are not necessarily indicative of the results that may be expected for the full year.

 

These unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and footnotes, which are included as part of the Company’s Form 10-K for the year ended December 31, 2023.

 

Consolidation

 

The accompanying consolidated financial statements include all accounts of the Company and its subsidiary (HAEC Louisiana E&P, Inc.). All significant inter-company balances and transactions have been eliminated in consolidation.

 

Liquidity and Capital Requirements

 

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the issuance date of these consolidated financial statements. The Company has incurred continuing losses since 2011, with an accumulated deficit of $77.1 million as of June 30, 2024.

 

The Company believes that it has the ability to fund, from cash on hand, its operating costs and anticipated drilling operations for at least the next twelve months following the issuance of these financial statements.

 

The actual timing and number of wells drilled during 2024 and beyond will be principally controlled by the operators of the Company’s acreage, based on a number of factors, including but not limited to availability of financing, performance of existing wells on the subject acreage, energy prices and industry condition and outlook, costs of drilling and completion services and equipment and other factors beyond the Company’s control or that of its operators.

 

In the event that the Company pursues additional acreage acquisitions or expands its drilling plans, the Company may be required to secure additional funding beyond our resources on hand. While the Company may, among other efforts, seek additional funding from “at-the-market” sales of common stock, and private sales of equity and debt securities, it presently does not have any commitments to provide additional funding, has limited shares of common stock available to support capital raising efforts and there can be no assurance that the Company can secure the necessary capital to fund its share of drilling, acquisition or other costs on acceptable terms or at all. If, for any reason, the Company is unable to fund its share of drilling and completion costs, it would forego participation in one or more of such wells. In such event, the Company may be subject to penalties or to the possible loss of some of its rights and interests in prospects with respect to which it fails to satisfy funding obligations and it may be required to curtail operations and forego opportunities.

 

Accounting Principles and Use of Estimates

 

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. In preparing financial statements, management makes informed judgments and estimates that affect the reported amounts of assets and liabilities as of the date of the financial statements and affect the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management reviews its estimates, including those related to such potential matters as litigation, environmental liabilities, income taxes and the related valuation allowance, determination of proved reserves of oil and gas and asset retirement obligations. Changes in facts and circumstances may result in revised estimates and actual results may differ from these estimates.

 

7

 

Concentration of Credit Risk

 

Financial instruments that potentially subject the Company to a concentration of credit risk include cash, cash equivalents (if any) and any marketable securities (if any). The Company had cash deposits of $3,130,769 in excess of the FDIC’s current insured limit on interest bearing accounts of $250,000 as of June 30, 2024. The Company also had cash deposits of $284 in Colombian banks at June 30, 2024 that are not insured by the FDIC. The Company has not experienced any losses on its deposits of cash and cash equivalents.

 

Earnings (Loss) per Share

 

Basic earnings (loss) per share is computed by dividing net loss available to common shareholders by the weighted average common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted in common shares that then shared in the earnings of the Company. In periods in which the Company reports a net loss, dilutive securities are excluded from the calculation of diluted net loss per share amounts as the effect would be anti-dilutive.

 

Subsequent Events

 

The Company has evaluated all transactions from June 30, 2024 through the financial statement issuance date for subsequent event disclosure consideration.

 

NOTE 2 – REVENUE FROM CONTRACTS WITH CUSTOMERS

 

Disaggregation of Revenue from Contracts with Customers

 

The following table disaggregates revenue by significant product type for the three and six-month periods ended June 30, 2024 and 2023:

 SCHEDULE OF DISAGGREGATES REVENUE BY SIGNIFICANT PRODUCT

		2024				2023				2024				2023
		Three Months Ended June 30,								Six Months Ended June 30,
		2024				2023				2024				2023
Oil sales		$	102,923				150,767			$	205,971				313,049
Natural gas sales			(8,248	)			16,963				8,068				41,874
Natural gas liquids sales			21,130				36,660				49,452				79,491
Total revenue from customers		$	115,805				204,390			$	263,490				434,414

 

There were no significant contract liabilities or transaction price allocations to any remaining performance obligations as of June 30, 2024 or 2023.

 

NOTE 3 – OIL AND GAS PROPERTIES

 

During the three and six months ended June 30, 2024, the Company recorded depletion expense of $28,107 and $63,085, respectively. During the three and six months ended June 30, 2023, the Company recorded depletion expense of $44,941 and $79,640, respectively

 

Geographical Information

 

The Company currently has properties in the United States. Revenues for the six months ended June 30, 2024 and long-lived assets (net of depletion, amortization, and impairments) as of June 30, 2024 are presented below:

 SCHEDULE OF REVENUES AND LONG LIVED ASSETS ATTRIBUTABLE TO GEOGRAPHICAL AREA

		Six Months Ended June 30, 2024				As of June 30, 2024
		Revenues				Long Lived Assets, Net
United States		$	263,490			$	1,497,321
Total		$	263,490			$	1,497,321

 

Revenues and long-lived assets attributable to the Company’s investments in Hupecol Meta LLC (“Hupecol Meta”), and its underlying assets and operations in Colombia, are excluded from the above table.

 

8

 

NOTE 4 – EQUITY INVESTMENT

 

The Company’s carrying value of its holdings in Hupecol Meta is reflected in the line item “equity investment – Hupecol Meta LLC” on the Company’s Consolidated Balance Sheet.

 

During the three months ended June 30, 2024, the Company made capital contributions totaling $766,216, to Hupecol Meta to cover its share of required capital contributions. During the three months ended June 30, 2024, the Company received distributions, totaling $654,142, from Hupecol Meta representing the Company’s share of distributable net profits of Hupecol Meta.

 

NOTE 5 – STOCK-BASED COMPENSATION EXPENSE

 

In 2008, the Company adopted the Houston American Energy Corp. 2008 Equity Incentive Plan (the “2008 Plan”). The terms of the 2008 Plan, as amended in 2012 and 2013, allow for the issuance of up to 480,000 shares of the Company’s common stock pursuant to the grant of stock options and restricted stock.

 

In 2017, the Company adopted the Houston American Energy Corp. 2017 Equity Incentive Plan (the “2017 Plan”). The terms of the 2017 Plan, allow for the issuance of up to 400,000 shares of the Company’s common stock pursuant to the grant of stock options and restricted stock.

 

In 2021, the Company adopted the Houston American Energy 2021 Equity Incentive Plan (the “2021 Plan” and, together with the 2008 Plan and the 2017 Plan, the “Plans”). The terms of the 2021 Plan allow for the issuance of up to 500,000 shares of the Company’s common stock pursuant to the grant of stock options and restricted stock.

 

Persons eligible to participate in the Plans are key employees, consultants and directors of the Company.

 

The Company periodically grants options to employees, directors and consultants under the Plans and is required to make estimates of the fair value of the related instruments and recognize expense over the period benefited, usually the vesting period.

 

Stock Option Activity

 

A summary of stock option activity and related information for the three months ended June 30, 2024 is presented below:

 SCHEDULE OF STOCK OPTION ACTIVITY

		Options				Weighted-Average Exercise Price				Aggregate Intrinsic Value
Outstanding at January 1, 2024			1,000,807			$	2.46
Granted			60,000				1.21
Exercised			—				—
Expired			(152,668	)			3.98
Outstanding at June 30, 2024			908,139			$	2.17			$	—
Exercisable at June 30, 2024			862,813			$	2.17			$	—

 

During the six months ended June 30, 2024, options to purchase an aggregate of 60,000 shares of the Company’s common stock were granted to the Company’s directors. The options have a ten-year life, are exercisable at $1.21 per share, vest 20% on the date of grant and 80% nine months from the date of grant. The grant date fair value of these stock options was $63,730 based on the Black-Scholes Option Pricing model based on the following assumptions: market value of common stock on grant date – $1.21; risk free interest rate based on the applicable US Treasury bill rate – 0%; dividend yield – 0%; volatility factor based on the trading history of the Company – 97.8%; weighted average expected life in years – 10; and expected forfeiture rate – 0%.

 

During the three and six-months ended June 30, 2024, the Company recognized $12,746 and $63,413, respectively, of stock-based compensation expense attributable to the amortization of stock options. As of June 30, 2024, total unrecognized stock-based compensation expense related to non-vested stock options was approximately $50,988. The unrecognized expense is expected to be recognized over a weighted average period of 0.72 years and the weighted average remaining contractual term of the outstanding options and exercisable options at June 30, 2024 is 6.44 years and 6.22 years, respectively.

 

9

 

As of June 30, 2024, there were 61,333 shares of common stock available for issuance pursuant to future stock or option grants under the Plans.

 

Stock-Based Compensation Expense

 

The following table reflects total stock-based compensation recorded by the Company for the three and six months ended June 30, 2024 and 2023:

 SCHEDULE OF STOCK-BASED COMPENSATION

		2024				2023				2024				2023
		Three Months Ended June 30,								Six Months Ended June 30,
		2024				2023				2024				2023
Stock-based compensation expense included in general and administrative expense		$	12,746			$	77,870			$	63,413			$	162,315
Earnings per share effect of share-based compensation expense – basic and diluted		$	(0.00	)		$	(0.01	)		$	(0.00	)		$	(0.02	)

 

NOTE 6 – CAPITAL STOCK

 

Warrants

 

A summary of warrant activity and related information for 2024 is presented below:

 SCHEDULE OF WARRANT ACTIVITY

		Warrants				Weighted-Average Exercise Price				Aggregate Intrinsic Value
Outstanding at January 1, 2024			94,400			$	2.46
Issued			—				—
Exercised			—				—
Expired			—				—
Outstanding at June 30, 2024			94,400			$	2.46			$	—
Exercisable at June 30, 2024			94,400			$	2.46			$	—

 

NOTE 7 – EARNINGS PER COMMON SHARE

 

Earnings (loss) per common share-basic is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Net income (loss) per common share-diluted assumes the conversion of all potentially dilutive securities and is calculated by dividing net (loss) income by the sum of the weighted average number of shares of common stock, as defined above, outstanding plus potentially dilutive securities. Net income (loss) per common share-diluted considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential common shares, as defined above, would have an anti-dilutive effect.

 

The calculation of earnings (loss) per common share for the periods indicated below were as follows:

 SCHEDULE OF EARNINGS (LOSS) PER COMMON SHARE

		2024				2023				2024				2023
		Three Months Ended June 30,								Six Months Ended June 30,
		2024				2023				2024				2023
Numerator:
Net (loss) income		$	(89,085	)			(300,381	)		$	(104,785	)			(196,206	)
Effect of common stock equivalents			—				—				—				—
Net (loss) income adjusted for common stock equivalents		$	(89,085	)			(300,381	)		$	(104,785	)			(196,206	)
Denominator:
Weighted average common shares – basic			10,906,353				10,896,996				10,906,353				10,659,076
Dilutive effect of common stock equivalents:
Options and warrants			—				—				—				—
Denominator:
Weighted average common shares – diluted			10,906,353				10,896,996				10,906,353				10,659,076
(Loss) earnings per common share – basic		$	(0.01	)			(0.03	)		$	(0.01	)			(0.02	)
(Loss) earnings per common share – diluted		$	(0.01	)			(0.03	)		$	(0.01	)			(0.02	)

 

10

 

For the six months ended June 30, 2024 and 2023, the following warrants and options to purchase shares of common stock were excluded from the computation of diluted net income (loss) per common share, as the inclusion of such shares would be anti-dilutive:

 SCHEDULE OF ANTI-DILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF DILUTED NET INCOME LOSS

		2024				2023				2024				2023
		Six Months Ended June 30,								Three Months Ended June 30,
		2024				2023				2024				2023
Stock warrants			94,400				94,400				94,400				94,400
Stock options			908,139				1,004,177				908,139				1,004,177
Total			1,002,539				1,098,577				1,002,539				1,098,577

 

NOTE 8 – COMMITMENTS AND CONTINGENCIES

 

Lease Commitment

 

The Company leases office facilities under an operating lease agreement that expires October 31, 2025. During the three and six months ended June 30, 2024, the operating cash outflows related to operating lease liabilities of $22,137 and $44,274, respectively, and the expense for the right of use asset for operating leases totaled $18,492 and $36,440, respectively. As of June 30, 2024, the Company’s operating lease had a weighted-average remaining term of 1.58 years and a weighted average discount rate of 12%. As of June 30, 2024, the lease agreement requires future payments as follows:

 SCHEDULE OF FUTURE PAYMENTS UNDER LEASE AGREEMENT

Year		Amount
2024		$	44,526
2025			75,051
Total future lease payments			119,577
Less: imputed interest			(9,608	)
Present value of future operating lease payments			109,969
Less: current portion of operating lease liabilities			(80,683	)
Operating lease liabilities, net of current portion		$	29,286
Right of use assets		$	108,582

 

Total base rental expense was $22,161 and $22,570 for the three months ended June 30, 2024 and 2023, respectively, and $44,322 and $45,731 for the six months ended June 30, 2024 and 2023, respectively. The Company does not have any capital leases or other operating lease commitments.

 

 

ITEM 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

Forward-Looking Information

 

This Form 10-Q quarterly report of Houston American Energy Corp. (the “Company”) for the three months ended June 30, 2024, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. To the extent that there are statements that are not recitations of historical fact, such statements constitute forward-looking statements that, by definition, involve risks and uncertainties. In any forward-looking statement, where we express an expectation or belief as to future results or events, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the statement of expectation or belief will be achieved or accomplished.

 

The actual results or events may differ materially from those anticipated and as reflected in forward-looking statements included herein. Factors that may cause actual results or events to differ from those anticipated in the forward-looking statements included herein include the Risk Factors described in Item 1A herein and in our Form 10-K for the year ended December 31, 2023.

 

Readers are cautioned not to place undue reliance on the forward-looking statements contained herein, which speak only as of the date hereof. We believe the information contained in this Form 10-Q to be accurate as of the date hereof. Changes may occur after that date, and we will not update that information except as required by law in the normal course of our public disclosure practices.

 

Additionally, the following discussion regarding our financial condition and results of operations should be read in conjunction with the financial statements and related notes contained in Item 1 of Part 1 of this Form 10-Q, as well as the Risk Factors in Item 1A and the financial statements in Item 7 of Part II of our Form 10-K for the fiscal year ended December 31, 2023.

 

Critical Accounting Estimates

 

Critical accounting estimates are those estimates made in accordance with GAAP that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations. Our critical accounting estimates include use of the full cost method of accounting for oil and gas activities, revenue recognition, unevaluated oil and gas properties, and stock-based compensation. There were no material changes in our critical accounting estimates from those reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

 

A description of our critical accounting policies, including estimates, was provided in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

 

Recent Developments

 

Drilling and Operating Activity

 

During the three months ended June 30, 2024, no drilling activities were conducted on properties of Hupecol Meta. At June 30, 2024, we had 4 wells on production in the U.S. Permian Basin.

 

In June 2024, the Company entered into a joint venture agreement with EOG Resources, Inc. (“EOG”) with respect to the drilling of six wells on the State Finkle Unit in the Wolfcamp formation in Reeves County, Texas. During June 2024, the Company elected to participate in all six wells.

 

Pursuant to the joint venture agreement, EOG will act as operator of the unit and is the principal working interest owner in the unit. The unit includes acreage subject to our existing O’Brien lease. We will hold an approximately 0.0078 working interest in the unit. The first well was scheduled to spud June 23, 2024 with all six wells anticipated to be spud by September 1, 2024. Houston American’s cost of participating in the drilling program is estimated at $550,000.

 

Operations, Planned Drilling and Divestiture in Colombia

 

At June 30, 2024, Hupecol Meta operated four wells in the Venus Exploration Area of the CPO-11 block in Colombia. Each of the four wells operated by Hupecol Meta were shut-in from February 20 to March 18, 2024 as a result of a dispute with local residents regarding maintenance of the road serving the wells.

 

 

We own an approximately 18% interest in Hupecol Meta, representing an approximately 16% interest in the wells operated in the Venus Exploration Area. We do not report results of Hupecol Meta in our consolidated operating results but include our investment in Hupecol Meta on our balance sheet as “Equity Investment – Hupecol Meta” with distributions from Hupecol Meta reported as “Other Income” on our Statement of Operations.

 

Hupecol Meta has advised that it intends to evaluate potential monetization or some form of divestiture of its assets in Colombia, including the interest in the CPO-11 block held by Hupecol Meta. Pending the outcome of Hupecol Meta’s evaluation of, and potential efforts regarding, divestiture or monetization of the CPO-11 block Hupecol Meta plans to drill one vertical well in the third quarter of 2024 on the CPO-11 block. We expect to continue to operate our existing wells in the CPO-11 block. There is no assurance as to the timing or outcome of Hupecol Meta’s potential monetization or divestiture of assets.

 

Capital Investments

 

During the quarter ended June 30, 2024, our capital investment expenditures totaled $766,216, attributable to investments in our equity investment in Hupecol Meta LLC (“Hupecol Meta”).

 

Distributions from Equity Investment

 

During the three and six months ended June 30, 2024, we received distributions, totaling $292,926 and $654,142, respectively, from Hupecol Meta, representing our share of distributable net income and reflected as “Other Income” on our Statement of Operations.

 

Results of Operations

 

Oil and Gas Revenues. Total oil and gas revenues decreased 43% to $115,805 in the three months ended June 30, 2024, compared to $204,390 in the three months ended June 30, 2023. Oil and gas revenues declined 39% to $263,490 in the six months ended June 30, 2024, compared to $434,414 for the six months ended June 30, 2023. The decrease in revenue was due to decreases in average sales price of natural gas (down 72%), oil production (down 37%), and natural gas production (down 38%), partially offset by an increase in average sales price of oil (up 7%).

 

The following table sets forth the gross and net producing wells, net oil and gas production volumes and average hydrocarbon sales prices for the quarters ended June 30, 2024 and 2023:

 

		Six Months Ended June 30,(1)								Three Months Ended June 30,(1)
		2024				2023				2024				2023
Gross producing wells			4				4				4				4
Net producing wells			0.68				0.68				0.68				0.68
Net oil production (Bbl)			2,690				4,359				1,091				2,116
Net gas production (Mcf)			21,164				33,456				7,722				15,862
Average sales price – oil (per barrel)		$	76.56			$	71.82			$	79.71			$	71.23
Average sales price – natural gas (per Mcf)		$	0.38			$	1.25			$	1.38			$	1.07

 

(1) All well, production and price information excludes wells operated by Hupecol Meta.

 

The change in production volumes was primarily attributable to the natural decline in production.

 

The change in average oil and natural gas sales price realized reflects global energy trends.

 

Oil and gas sales revenues are entirely attributable to our U.S. properties.

 

Lease Operating Expenses. Lease operating expenses increased 40% to $142,203 during the three months ended June 30, 2024, from $101,714 during the three months ended June 30, 2023. Lease operating expenses increased 42% to $305,233 during the six months ended June 30, 2024, from $215,400 during the six months ended June 30, 2023. The increase in lease operating expenses was attributable to additional severance tax expense from prior periods and increase in production expenses during the three months ended June 30, 2024.

 

 

Lease operating expenses are entirely attributable to our U.S. properties and exclude lease operating expenses of Hupecol Meta.

 

Depreciation and Depletion Expense. Depreciation and depletion expense was $28,107 and $44,941 for the three months ended June 30, 2024 and 2023, respectively, and $63,085 and $91,896 for the six months ended June 30, 2024 and 2023, respectively. The change in depreciation and depletion was principally due to the decline in oil production during the six months ended June 30, 2024.

 

General and Administrative Expenses (excluding stock-based compensation). General and administrative expense decreased by 52% to $343,001 during the three months ended June 30, 2024 from $716,615 during the three months ended June 30, 2023, and decreased 33% to $650,141 during the six months ended June 30, 2024, from $1,046,434 during the six months ended June 30, 2023. The decrease in general and administrative expense was primarily attributable to a bonus of $200,000 paid to our CEO in the second quarter of 2023, which was not repeated this quarter.

 

Stock-Based Compensation. Stock-based compensation decreased to 12,746 during the three months ended June 30, 2024 and $60,413 during six months ended June 30, 2024 from $77,780 during the three months ended June 30, 2023 and $162,315 during the six months ended June 30, 2023.

 

Other Income (Expense). Other income/expense, net, totaled $321,167 of income during the three months ended June 30, 2024, compared to $358,499 of income during the three months ended June 30, 2023, and totaled $713,597 during the six months ended June 30, 2024, compared to $723,110 during the six months ended June 30, 2023. The change in income for the three month period was primarily attributable to the decline in oil production. Other income consisted of equity investment distributions totaling $654,142 and $648,475, respectively, from Hupecol Meta, representing our share of distributable net income for the six months ended June 30, 2024 and 2023, respectively, and interest income on cash balances during the six months ended June 30, 2024 and 2023.

 

Financial Condition

 

Liquidity and Capital Resources. At June 30, 2024, we had a cash balance of $3,380,769 and working capital of $3,167,316, compared to a cash balance of $4,059,182 and working capital of $3,917,231 at December 31, 2023.

 

Cash Flows. Operating activities provided $87,803 of cash during the six months ended June 30, 2024, compared to cash outflows of $217,467 during the six months ended June 30, 2023. The change in operating cash flow was attributable to a bonus of $200,000 paid to our CEO in the second quarter of 2023, which was not repeated this quarter.

 

Investing activities used cash of $766,216 during the six months ended June 30, 2024, compared to $448,909 used during the six months ended June 30, 2023. Cash used in investing activities for both periods was attributable to investments in Hupecol Meta to support our share of costs in Colombia.

 

Financing activities provided $0 during the six months ended June 30, 2024, compared to $1,652,000 provided during the six months ended June 30, 2023. Cash provided by financing activities during the six months ended June 30, 2023 was attributable to funds received from the sale of common stock in the company’s 2022 ATM offering.

 

Long-Term Liabilities. At June 30, 2024, we had long-term liabilities of $93,475, compared to $134,167 at December 31, 2023. Long-term liabilities at June 30, 2024 and December 31, 2023, consisted of a reserve for plugging costs and the long-term lease liability.

 

Capital and Exploration Expenditures and Commitments. Our principal capital and exploration expenditures relate to ongoing efforts to acquire, drill and complete prospects. During 2023, capital expenditures relating to Hupecol Meta increased with our investments in Hupecol Meta to fund our share of costs associated with the initial wells drilled on the CPO-11 block. Based on discussions with Hupecol Meta, we anticipate that one additional vertical well will be drilled on the CPO-11 block by mid-2024 pending efforts by Hupecol Meta to monetize its interest in the CPO-11 block. Our costs relating to the drilling of such well is estimated at approximately $550,000. There are no present plans to conduct additional drilling operations on our U.S. properties. The actual timing and number of well operations undertaken, if any, will be principally controlled by the operators of our acreage based on a number of factors, including but not limited to availability of financing, performance of existing wells on the subject acreage, energy prices and industry condition and outlook, costs of drilling and completion services and equipment and other factors beyond our control or that of our operators.

 

In addition to possible operations on our existing acreage holdings, we continue to evaluate drilling prospects in which may acquire an interest and participate.

 

 

During the three months ended June 30, 2024, we invested $766,216 for the acquisition and development of oil and gas properties, consisting of capital contributions to Hupecol Meta. The $766,216 invested in Hupecol Meta was capitalized to our equity investment in Hupecol Meta.

 

As our allocable share of well costs will vary depending on the timing and number of wells drilled as well as our working interest in each such well and the level of participation of other interest owners, we have not established a drilling budget but will budget on a well-by-well basis as our operators propose wells. We believe that we have the ability, through our cash on-hand, to fund operations and our cost for all planned wells expected to be drilled during 2024.

 

In the event that we pursue additional acreage acquisitions or expand our drilling plans, we may be required to secure additional funding beyond our resources on hand. While we may, among other efforts, seek additional funding from “at-the-market” sales of common stock, and private sales of equity and debt securities, we presently have limited authorized shares of common stock available for issuance to support equity capital raises and we have no commitments to provide additional funding, and there can be no assurance that we can secure the necessary capital to fund our share of drilling, acquisition or other costs on acceptable terms or at all. If, for any reason, we are unable to fund our share of drilling and completion costs and fail to satisfy commitments relative to our interest in our acreage, we may be subject to penalties or to the possible loss of some of our rights and interests in prospects with respect to which we fail to satisfy funding commitments and we may be required to curtail operations and forego opportunities.

 

Off-Balance Sheet Arrangements

 

We had no off-balance sheet arrangements or guarantees of third party obligations at June 30, 2024.

 

ITEM 3

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Commodity Price Risk

 

The price we receive for our oil and gas production heavily influences our revenue, profitability, access to capital and future rate of growth. Crude oil and natural gas are commodities and, therefore, their prices are subject to wide fluctuations in response to relatively minor changes in supply and demand. Historically, the markets for oil and gas have been volatile, and these markets will likely continue to be volatile in the future. The price we receive for production depends on numerous factors beyond our control.

 

We have not historically entered into any hedges or other transactions designed to manage, or limit, exposure to oil and gas price volatility.

 

ITEM 4

CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

Under the supervision and the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation as of June 30, 2024 of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were not effective as of June 30, 2024. Such conclusion reflects the 2013 departure of our chief financial officer and assumption of duties of principal financial officer by our chief executive officer and the resulting lack of an appropriate level of accounting knowledge and experience commensurate with the financial reporting requirements for a public company, in particular with respect to technical accounting knowledge regarding accounting for certain transactions, and a related lack of segregation of duties. Until we are able to remedy these material weaknesses, we are relying on third party consultants to assist with financial reporting.

 

Changes in Internal Control over Financial Reporting

 

No change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) occurred during the quarter ended June 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

 

PART II

 

ITEM 6

EXHIBITS

 

Exhibit

 

	Number		Description
	31.1		Certification of CEO and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	32.1		Certification of CEO and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
	101.INS		Inline XBRL Instance Document
	101.SCH		Inline XBRL Taxonomy Extension Schema Document
	101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
	101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
	101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
	101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
	104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on behalf by the undersigned thereunto duly authorized.

 

	HOUSTON AMERICAN ENERGY CORP.
Date: August 14, 2024
	By:	/s/ John Terwilliger
		John Terwilliger
		CEO and President (Principal Executive Officer and Principal Financial Officer)

 

 

Exhibit 31.1

 

CERTIFICATION OF CEO PURSUANT TO 15 U.S.C. SECTION 10A, AS ADOPTED

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, John Terwilliger, certify that:

 

1.	I have reviewed this quarterly report on Form 10-Q of Houston American Energy Corp.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respect the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

	a)	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
	b)	designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c)	evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d)	disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.	I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

 

	a)	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

 

Date: August 14, 2024

 

	/s/ John Terwilliger
	John Terwilliger,
	Chief Executive Officer and Principal Financial Officer

 

 

 

Exhibit 32.1

 

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

I, John Terwilliger, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Houston American Energy Corp. on Form 10-Q for the quarterly period ended June 30, 2024 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-Q fairly presents in all material respects the financial condition and results of operations of Houston American Energy Corp.

 

	By:	/s/ John Terwilliger
	Name:	John Terwilliger
	Title:	Chief Executive Officer and Principal Financial Officer
	Dated:	August 14, 2024

 

 

v3.24.2.u1

Cover - $ / shares	6 Months Ended
	Jun. 30, 2024	Aug. 14, 2024
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2024
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-31
Entity File Number	1-32955
Entity Registrant Name	HOUSTON AMERICAN ENERGY CORP.
Entity Central Index Key	0001156041
Entity Tax Identification Number	76-0675953
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	801 Travis Street
Entity Address, Address Line Two	Suite 1425
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77002
City Area Code	(713)
Local Phone Number	222-6966
Title of 12(b) Security	Common Stock, $0.001 par value per share
Trading Symbol	HUSA
Security Exchange Name	NYSE
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		10,906,353
Entity Listing, Par Value Per Share	$ 0.001

v3.24.2.u1

Consolidated Balance Sheets - USD ($)	Jun. 30, 2024	Dec. 31, 2023
CURRENT ASSETS
Cash	$ 3,380,769	$ 4,059,182
Accounts receivable – oil and gas sales	32,108	71,736
Prepaid expenses and other current assets	104,236	35,244
TOTAL CURRENT ASSETS	3,517,113	4,166,162
PROPERTY AND EQUIPMENT
Costs subject to amortization	62,777,666	62,776,561
Office equipment	90,004	90,004
Total	62,867,670	62,866,565
Accumulated depletion, depreciation, amortization, and impairment	(61,370,349)	(61,307,264)
PROPERTY AND EQUIPMENT, NET	1,497,321	1,559,301
Equity investment – Hupecol Meta LLC	5,271,628	4,505,358
Right of use asset	108,582	145,021
Other assets	3,167	3,167
TOTAL ASSETS	10,397,811	10,379,009
CURRENT LIABILITIES
Accounts payable	252,049	156,572
Accrued expenses	17,065	17,083
Current portion of lease liability	80,683	75,276
TOTAL CURRENT LIABILITIES	349,797	248,931
LONG-TERM LIABILITIES
Lease liability, net of current portion	29,286	71,083
Reserve for plugging and abandonment costs	64,189	63,084
TOTAL LONG-TERM LIABILITIES	93,475	134,167
TOTAL LIABILITIES	443,272	383,098
SHAREHOLDERS’ EQUITY
Common stock, par value $0.001; 20,000,000 shares authorized 10,906,353 shares issued and outstanding	10,907	10,907
Additional paid-in capital	87,047,414	86,984,001
Accumulated deficit	(77,103,782)	(76,998,997)
TOTAL SHAREHOLDERS’ EQUITY	9,954,539	9,995,911
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$ 10,397,811	$ 10,379,009

v3.24.2.u1

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	20,000,000	20,000,000
Common stock, shares issued	10,906,353	10,906,353
Common stock, shares outstanding	10,906,353	10,906,353

v3.24.2.u1

Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Statement [Abstract]
OIL AND GAS REVENUE	$ 115,805	$ 204,390	$ 263,490	$ 434,414
EXPENSES OF OPERATIONS
Lease operating expense and severance tax	142,203	101,714	305,233	215,400
General and administrative expense	355,747	716,615	713,554	1,046,434
Depreciation and depletion	28,107	44,941	63,085	91,896
Total operating expenses	526,057	863,270	1,081,872	1,353,730
Loss from operations	(410,252)	(658,880)	(818,382)	(919,316)
OTHER INCOME, NET
Interest income	28,241	44,135	59,455	74,635
Other income	292,926	314,364	654,142	648,475
Total other income	321,167	358,499	713,597	723,110
Net (loss) income before taxes	(89,085)	(300,381)	(104,785)	(196,206)
Income tax expense
Net (loss) income	$ (89,085)	$ (300,381)	$ (104,785)	$ (196,206)
Basic net income ( loss) per common share	$ (0.01)	$ (0.03)	$ (0.01)	$ (0.02)
Diluted net income ( loss) per common share	$ (0.01)	$ (0.03)	$ (0.01)	$ (0.02)
Basic weighted average number of common shares outstanding	10,906,353	10,896,996	10,906,353	10,659,076
Diluted weighted average number of common shares outstanding	10,906,353	10,896,996	10,906,353	10,659,076

v3.24.2.u1

Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance at Dec. 31, 2022	$ 10,328	$ 85,094,266	$ (73,787,720)	$ 11,316,874
Balance, shares at Dec. 31, 2022	10,327,646
Stock-based compensation		84,445		84,445
Net income (loss)			104,175	104,175
Issuance of common stock for cash, net	$ 295	901,205		901,500
Issuance of common stock for cash, net, shares	294,872
Balance at Mar. 31, 2023	$ 10,623	86,079,916	(73,683,545)	12,406,994
Balance, shares at Mar. 31, 2023	10,662,518
Balance at Dec. 31, 2022	$ 10,328	85,094,266	(73,787,720)	11,316,874
Balance, shares at Dec. 31, 2022	10,327,646
Net income (loss)				(196,206)
Balance at Jun. 30, 2023	$ 10,907	86,908,002	(73,983,926)	12,934,983
Balance, shares at Jun. 30, 2023	10,936,353
Balance at Mar. 31, 2023	$ 10,623	86,079,916	(73,683,545)	12,406,994
Balance, shares at Mar. 31, 2023	10,662,518
Stock-based compensation		77,870		77,870
Net income (loss)			(300,381)	(300,381)
Issuance of common stock for cash, net	$ 284	750,216		750,500
Issuance of common stock for cash, net, shares	283,835
Balance at Jun. 30, 2023	$ 10,907	86,908,002	(73,983,926)	12,934,983
Balance, shares at Jun. 30, 2023	10,936,353
Balance at Dec. 31, 2023	$ 10,907	86,984,001	(76,998,997)	9,995,911
Balance, shares at Dec. 31, 2023	10,906,353
Stock-based compensation		50,667		50,667
Net income (loss)			(15,699)	(15,699)
Balance at Mar. 31, 2024	$ 10,907	87,034,668	(77,014,697)	10,030,879
Balance, shares at Mar. 31, 2024	10,906,353
Balance at Dec. 31, 2023	$ 10,907	86,984,001	(76,998,997)	9,995,911
Balance, shares at Dec. 31, 2023	10,906,353
Net income (loss)				(104,785)
Balance at Jun. 30, 2024	$ 10,907	87,047,414	(77,103,782)	9,954,539
Balance, shares at Jun. 30, 2024	10,906,353
Balance at Mar. 31, 2024	$ 10,907	87,034,668	(77,014,697)	10,030,879
Balance, shares at Mar. 31, 2024	10,906,353
Stock-based compensation		12,746		12,746
Net income (loss)			(89,085)	(89,085)
Balance at Jun. 30, 2024	$ 10,907	$ 87,047,414	$ (77,103,782)	$ 9,954,539
Balance, shares at Jun. 30, 2024	10,906,353

v3.24.2.u1

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$ (104,785)	$ (196,206)
Adjustments to reconcile net income (loss) to net cash used in operations:
Depreciation and depletion	63,085	91,896
Accretion of asset retirement obligation	1,105	2,678
Stock-based compensation	63,413	162,315
Amortization of right of use asset	36,385	32,836
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable	39,628	(113,971)
Decrease (increase) in accrued earnings distributions from Hupecol Meta, LLC		(648,475)
Decrease (increase) in prepaid expenses and other current assets	(68,992)	534,155
(Decrease) increase in accounts payable and accrued expenses	94,354	(51,101)
Decrease in operating lease liability	(36,390)	(31,594)
Net cash provided by (used in) operating activities	87,803	(217,467)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for capital contribution for equity investment	(766,216)	(448,909)
Net cash used in investing activities	(766,216)	(448,909)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock for cash, net of offering costs		1,652,000
Net cash provided by financing activities		1,652,000
Increase (decrease) in cash	(678,413)	985,624
Cash, beginning of period	4,059,182	4,547,210
Cash, end of period	3,380,769	5,532,834
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES
Changes in estimate of asset retirement obligations, net		1,259
Changes in accrued equity investment contributions and distributions		33,038
Change in accrued Oil and Gas development	$ 1,105

v3.24.2.u1

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES	NOTE 1 – BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES   The accompanying unaudited consolidated financial statements of Houston American Energy Corp., a Delaware corporation (the “Company”), have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q. They do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for a complete financial presentation. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, considered necessary for a fair presentation, have been included in the accompanying unaudited consolidated financial statements. Operating results for the periods presented are not necessarily indicative of the results that may be expected for the full year.   These unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and footnotes, which are included as part of the Company’s Form 10-K for the year ended December 31, 2023.   Consolidation   The accompanying consolidated financial statements include all accounts of the Company and its subsidiary (HAEC Louisiana E&P, Inc.). All significant inter-company balances and transactions have been eliminated in consolidation.   Liquidity and Capital Requirements   The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the issuance date of these consolidated financial statements. The Company has incurred continuing losses since 2011, with an accumulated deficit of $77.1 million as of June 30, 2024.   The Company believes that it has the ability to fund, from cash on hand, its operating costs and anticipated drilling operations for at least the next twelve months following the issuance of these financial statements.   The actual timing and number of wells drilled during 2024 and beyond will be principally controlled by the operators of the Company’s acreage, based on a number of factors, including but not limited to availability of financing, performance of existing wells on the subject acreage, energy prices and industry condition and outlook, costs of drilling and completion services and equipment and other factors beyond the Company’s control or that of its operators.   In the event that the Company pursues additional acreage acquisitions or expands its drilling plans, the Company may be required to secure additional funding beyond our resources on hand. While the Company may, among other efforts, seek additional funding from “at-the-market” sales of common stock, and private sales of equity and debt securities, it presently does not have any commitments to provide additional funding, has limited shares of common stock available to support capital raising efforts and there can be no assurance that the Company can secure the necessary capital to fund its share of drilling, acquisition or other costs on acceptable terms or at all. If, for any reason, the Company is unable to fund its share of drilling and completion costs, it would forego participation in one or more of such wells. In such event, the Company may be subject to penalties or to the possible loss of some of its rights and interests in prospects with respect to which it fails to satisfy funding obligations and it may be required to curtail operations and forego opportunities.   Accounting Principles and Use of Estimates   The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. In preparing financial statements, management makes informed judgments and estimates that affect the reported amounts of assets and liabilities as of the date of the financial statements and affect the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management reviews its estimates, including those related to such potential matters as litigation, environmental liabilities, income taxes and the related valuation allowance, determination of proved reserves of oil and gas and asset retirement obligations. Changes in facts and circumstances may result in revised estimates and actual results may differ from these estimates.     Concentration of Credit Risk   Financial instruments that potentially subject the Company to a concentration of credit risk include cash, cash equivalents (if any) and any marketable securities (if any). The Company had cash deposits of $3,130,769 in excess of the FDIC’s current insured limit on interest bearing accounts of $250,000 as of June 30, 2024. The Company also had cash deposits of $284 in Colombian banks at June 30, 2024 that are not insured by the FDIC. The Company has not experienced any losses on its deposits of cash and cash equivalents.   Earnings (Loss) per Share   Basic earnings (loss) per share is computed by dividing net loss available to common shareholders by the weighted average common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted in common shares that then shared in the earnings of the Company. In periods in which the Company reports a net loss, dilutive securities are excluded from the calculation of diluted net loss per share amounts as the effect would be anti-dilutive.   Subsequent Events   The Company has evaluated all transactions from June 30, 2024 through the financial statement issuance date for subsequent event disclosure consideration.

v3.24.2.u1

REVENUE FROM CONTRACTS WITH CUSTOMERS	6 Months Ended
	Jun. 30, 2024
Revenue from Contract with Customer [Abstract]
REVENUE FROM CONTRACTS WITH CUSTOMERS	NOTE 2 – REVENUE FROM CONTRACTS WITH CUSTOMERS   Disaggregation of Revenue from Contracts with Customers   The following table disaggregates revenue by significant product type for the three and six-month periods ended June 30, 2024 and 2023:  SCHEDULE OF DISAGGREGATES REVENUE BY SIGNIFICANT PRODUCT     2024     2023     2024     2023       Three Months Ended June 30,     Six Months Ended June 30,       2024     2023     2024     2023   Oil sales   $ 102,923       150,767     $ 205,971       313,049   Natural gas sales     (8,248 )     16,963       8,068       41,874   Natural gas liquids sales     21,130       36,660       49,452       79,491   Total revenue from customers   $ 115,805       204,390     $ 263,490       434,414     There were no significant contract liabilities or transaction price allocations to any remaining performance obligations as of June 30, 2024 or 2023.

v3.24.2.u1

OIL AND GAS PROPERTIES	6 Months Ended
	Jun. 30, 2024
Extractive Industries [Abstract]
OIL AND GAS PROPERTIES	NOTE 3 – OIL AND GAS PROPERTIES   During the three and six months ended June 30, 2024, the Company recorded depletion expense of $28,107 and $63,085, respectively. During the three and six months ended June 30, 2023, the Company recorded depletion expense of $44,941 and $79,640, respectively   Geographical Information   The Company currently has properties in the United States. Revenues for the six months ended June 30, 2024 and long-lived assets (net of depletion, amortization, and impairments) as of June 30, 2024 are presented below:  SCHEDULE OF REVENUES AND LONG LIVED ASSETS ATTRIBUTABLE TO GEOGRAPHICAL AREA     Six Months Ended June 30, 2024     As of June 30, 2024       Revenues     Long Lived Assets, Net   United States   $ 263,490     $ 1,497,321   Total   $ 263,490     $ 1,497,321     Revenues and long-lived assets attributable to the Company’s investments in Hupecol Meta LLC (“Hupecol Meta”), and its underlying assets and operations in Colombia, are excluded from the above table.

v3.24.2.u1

EQUITY INVESTMENT	6 Months Ended
	Jun. 30, 2024
Equity Investment
EQUITY INVESTMENT	NOTE 4 – EQUITY INVESTMENT   The Company’s carrying value of its holdings in Hupecol Meta is reflected in the line item “equity investment – Hupecol Meta LLC” on the Company’s Consolidated Balance Sheet.   During the three months ended June 30, 2024, the Company made capital contributions totaling $766,216, to Hupecol Meta to cover its share of required capital contributions. During the three months ended June 30, 2024, the Company received distributions, totaling $654,142, from Hupecol Meta representing the Company’s share of distributable net profits of Hupecol Meta.

v3.24.2.u1

STOCK-BASED COMPENSATION EXPENSE	6 Months Ended
	Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]
STOCK-BASED COMPENSATION EXPENSE	NOTE 5 – STOCK-BASED COMPENSATION EXPENSE   In 2008, the Company adopted the Houston American Energy Corp. 2008 Equity Incentive Plan (the “2008 Plan”). The terms of the 2008 Plan, as amended in 2012 and 2013, allow for the issuance of up to 480,000 shares of the Company’s common stock pursuant to the grant of stock options and restricted stock.   In 2017, the Company adopted the Houston American Energy Corp. 2017 Equity Incentive Plan (the “2017 Plan”). The terms of the 2017 Plan, allow for the issuance of up to 400,000 shares of the Company’s common stock pursuant to the grant of stock options and restricted stock.   In 2021, the Company adopted the Houston American Energy 2021 Equity Incentive Plan (the “2021 Plan” and, together with the 2008 Plan and the 2017 Plan, the “Plans”). The terms of the 2021 Plan allow for the issuance of up to 500,000 shares of the Company’s common stock pursuant to the grant of stock options and restricted stock.   Persons eligible to participate in the Plans are key employees, consultants and directors of the Company.   The Company periodically grants options to employees, directors and consultants under the Plans and is required to make estimates of the fair value of the related instruments and recognize expense over the period benefited, usually the vesting period.   Stock Option Activity   A summary of stock option activity and related information for the three months ended June 30, 2024 is presented below:  SCHEDULE OF STOCK OPTION ACTIVITY     Options     Weighted-Average Exercise Price     Aggregate Intrinsic Value                       Outstanding at January 1, 2024     1,000,807     $ 2.46           Granted     60,000       1.21           Exercised     —       —           Expired     (152,668 )     3.98           Outstanding at June 30, 2024   908,139     $ 2.17     $ —   Exercisable at June 30, 2024     862,813     $ 2.17     $ —     During the six months ended June 30, 2024, options to purchase an aggregate of 60,000 shares of the Company’s common stock were granted to the Company’s directors. The options have a ten-year life, are exercisable at $1.21 per share, vest 20% on the date of grant and 80% nine months from the date of grant. The grant date fair value of these stock options was $63,730 based on the Black-Scholes Option Pricing model based on the following assumptions: market value of common stock on grant date – $1.21; risk free interest rate based on the applicable US Treasury bill rate – 0%; dividend yield – 0%; volatility factor based on the trading history of the Company – 97.8%; weighted average expected life in years – 10; and expected forfeiture rate – 0%.   During the three and six-months ended June 30, 2024, the Company recognized $12,746 and $63,413, respectively, of stock-based compensation expense attributable to the amortization of stock options. As of June 30, 2024, total unrecognized stock-based compensation expense related to non-vested stock options was approximately $50,988. The unrecognized expense is expected to be recognized over a weighted average period of 0.72 years and the weighted average remaining contractual term of the outstanding options and exercisable options at June 30, 2024 is 6.44 years and 6.22 years, respectively.     As of June 30, 2024, there were 61,333 shares of common stock available for issuance pursuant to future stock or option grants under the Plans.   Stock-Based Compensation Expense   The following table reflects total stock-based compensation recorded by the Company for the three and six months ended June 30, 2024 and 2023:  SCHEDULE OF STOCK-BASED COMPENSATION      2024     2023      2024     2023       Three Months Ended June 30,     Six Months Ended June 30,       2024     2023     2024     2023                             Stock-based compensation expense included in general and administrative expense   $ 12,746     $ 77,870     $ 63,413     $ 162,315   Earnings per share effect of share-based compensation expense – basic and diluted   $ (0.00 )   $ (0.01 )   $ (0.00 )   $ (0.02 )

v3.24.2.u1

CAPITAL STOCK	6 Months Ended
	Jun. 30, 2024
Equity [Abstract]
CAPITAL STOCK	NOTE 6 – CAPITAL STOCK   Warrants   A summary of warrant activity and related information for 2024 is presented below:  SCHEDULE OF WARRANT ACTIVITY     Warrants     Weighted-Average Exercise Price     Aggregate Intrinsic Value                       Outstanding at January 1, 2024     94,400     $ 2.46           Issued     —       —           Exercised     —       —           Expired     —       —           Outstanding at June 30, 2024     94,400     $ 2.46     $ —   Exercisable at June 30, 2024     94,400     $ 2.46     $ —

v3.24.2.u1

EARNINGS PER COMMON SHARE	6 Months Ended
	Jun. 30, 2024
Earnings Per Share [Abstract]
EARNINGS PER COMMON SHARE	NOTE 7 – EARNINGS PER COMMON SHARE   Earnings (loss) per common share-basic is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Net income (loss) per common share-diluted assumes the conversion of all potentially dilutive securities and is calculated by dividing net (loss) income by the sum of the weighted average number of shares of common stock, as defined above, outstanding plus potentially dilutive securities. Net income (loss) per common share-diluted considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential common shares, as defined above, would have an anti-dilutive effect.   The calculation of earnings (loss) per common share for the periods indicated below were as follows:  SCHEDULE OF EARNINGS (LOSS) PER COMMON SHARE     2024     2023     2024     2023       Three Months Ended June 30,     Six Months Ended June 30,       2024     2023     2024     2023   Numerator:                                 Net (loss) income   $ (89,085 )     (300,381 )   $ (104,785 )     (196,206 )                                   Effect of common stock equivalents     —       —       —       —   Net (loss) income adjusted for common stock equivalents   $ (89,085 )     (300,381 )   $ (104,785 )     (196,206 )                                   Denominator:                                 Weighted average common shares – basic     10,906,353       10,896,996       10,906,353       10,659,076                                     Dilutive effect of common stock equivalents:                                 Options and warrants     —       —       —       —                                     Denominator:                                 Weighted average common shares – diluted     10,906,353       10,896,996       10,906,353       10,659,076                                     (Loss) earnings per common share – basic   $ (0.01 )     (0.03 )   $ (0.01 )     (0.02 )                                   (Loss) earnings per common share – diluted   $ (0.01 )     (0.03 )   $ (0.01 )     (0.02 )     For the six months ended June 30, 2024 and 2023, the following warrants and options to purchase shares of common stock were excluded from the computation of diluted net income (loss) per common share, as the inclusion of such shares would be anti-dilutive:  SCHEDULE OF ANTI-DILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF DILUTED NET INCOME LOSS     2024     2023     2024     2023       Six Months Ended June 30,     Three Months Ended June 30,       2024     2023     2024     2023   Stock warrants     94,400       94,400       94,400       94,400   Stock options     908,139       1,004,177       908,139       1,004,177   Total     1,002,539       1,098,577       1,002,539       1,098,577

v3.24.2.u1

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 8 – COMMITMENTS AND CONTINGENCIES   Lease Commitment   The Company leases office facilities under an operating lease agreement that expires October 31, 2025. During the three and six months ended June 30, 2024, the operating cash outflows related to operating lease liabilities of $22,137 and $44,274, respectively, and the expense for the right of use asset for operating leases totaled $18,492 and $36,440, respectively. As of June 30, 2024, the Company’s operating lease had a weighted-average remaining term of 1.58 years and a weighted average discount rate of 12%. As of June 30, 2024, the lease agreement requires future payments as follows:  SCHEDULE OF FUTURE PAYMENTS UNDER LEASE AGREEMENT Year   Amount   2024   $ 44,526   2025     75,051   Total future lease payments     119,577   Less: imputed interest     (9,608 ) Present value of future operating lease payments     109,969   Less: current portion of operating lease liabilities     (80,683 ) Operating lease liabilities, net of current portion   $ 29,286   Right of use assets   $ 108,582     Total base rental expense was $22,161 and $22,570 for the three months ended June 30, 2024 and 2023, respectively, and $44,322 and $45,731 for the six months ended June 30, 2024 and 2023, respectively. The Company does not have any capital leases or other operating lease commitments.

v3.24.2.u1

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Consolidation	Consolidation   The accompanying consolidated financial statements include all accounts of the Company and its subsidiary (HAEC Louisiana E&P, Inc.). All significant inter-company balances and transactions have been eliminated in consolidation.
Liquidity and Capital Requirements	Liquidity and Capital Requirements   The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the issuance date of these consolidated financial statements. The Company has incurred continuing losses since 2011, with an accumulated deficit of $77.1 million as of June 30, 2024.   The Company believes that it has the ability to fund, from cash on hand, its operating costs and anticipated drilling operations for at least the next twelve months following the issuance of these financial statements.   The actual timing and number of wells drilled during 2024 and beyond will be principally controlled by the operators of the Company’s acreage, based on a number of factors, including but not limited to availability of financing, performance of existing wells on the subject acreage, energy prices and industry condition and outlook, costs of drilling and completion services and equipment and other factors beyond the Company’s control or that of its operators.   In the event that the Company pursues additional acreage acquisitions or expands its drilling plans, the Company may be required to secure additional funding beyond our resources on hand. While the Company may, among other efforts, seek additional funding from “at-the-market” sales of common stock, and private sales of equity and debt securities, it presently does not have any commitments to provide additional funding, has limited shares of common stock available to support capital raising efforts and there can be no assurance that the Company can secure the necessary capital to fund its share of drilling, acquisition or other costs on acceptable terms or at all. If, for any reason, the Company is unable to fund its share of drilling and completion costs, it would forego participation in one or more of such wells. In such event, the Company may be subject to penalties or to the possible loss of some of its rights and interests in prospects with respect to which it fails to satisfy funding obligations and it may be required to curtail operations and forego opportunities.
Accounting Principles and Use of Estimates	Accounting Principles and Use of Estimates   The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. In preparing financial statements, management makes informed judgments and estimates that affect the reported amounts of assets and liabilities as of the date of the financial statements and affect the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management reviews its estimates, including those related to such potential matters as litigation, environmental liabilities, income taxes and the related valuation allowance, determination of proved reserves of oil and gas and asset retirement obligations. Changes in facts and circumstances may result in revised estimates and actual results may differ from these estimates.
Concentration of Credit Risk	Concentration of Credit Risk   Financial instruments that potentially subject the Company to a concentration of credit risk include cash, cash equivalents (if any) and any marketable securities (if any). The Company had cash deposits of $3,130,769 in excess of the FDIC’s current insured limit on interest bearing accounts of $250,000 as of June 30, 2024. The Company also had cash deposits of $284 in Colombian banks at June 30, 2024 that are not insured by the FDIC. The Company has not experienced any losses on its deposits of cash and cash equivalents.
Earnings (Loss) per Share	Earnings (Loss) per Share   Basic earnings (loss) per share is computed by dividing net loss available to common shareholders by the weighted average common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted in common shares that then shared in the earnings of the Company. In periods in which the Company reports a net loss, dilutive securities are excluded from the calculation of diluted net loss per share amounts as the effect would be anti-dilutive.
Subsequent Events	Subsequent Events   The Company has evaluated all transactions from June 30, 2024 through the financial statement issuance date for subsequent event disclosure consideration.

v3.24.2.u1

REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables)	6 Months Ended
	Jun. 30, 2024
Revenue from Contract with Customer [Abstract]
SCHEDULE OF DISAGGREGATES REVENUE BY SIGNIFICANT PRODUCT	The following table disaggregates revenue by significant product type for the three and six-month periods ended June 30, 2024 and 2023:  SCHEDULE OF DISAGGREGATES REVENUE BY SIGNIFICANT PRODUCT     2024     2023     2024     2023       Three Months Ended June 30,     Six Months Ended June 30,       2024     2023     2024     2023   Oil sales   $ 102,923       150,767     $ 205,971       313,049   Natural gas sales     (8,248 )     16,963       8,068       41,874   Natural gas liquids sales     21,130       36,660       49,452       79,491   Total revenue from customers   $ 115,805       204,390     $ 263,490       434,414

v3.24.2.u1

OIL AND GAS PROPERTIES (Tables)	6 Months Ended
	Jun. 30, 2024
Extractive Industries [Abstract]
SCHEDULE OF REVENUES AND LONG LIVED ASSETS ATTRIBUTABLE TO GEOGRAPHICAL AREA	The Company currently has properties in the United States. Revenues for the six months ended June 30, 2024 and long-lived assets (net of depletion, amortization, and impairments) as of June 30, 2024 are presented below:  SCHEDULE OF REVENUES AND LONG LIVED ASSETS ATTRIBUTABLE TO GEOGRAPHICAL AREA     Six Months Ended June 30, 2024     As of June 30, 2024       Revenues     Long Lived Assets, Net   United States   $ 263,490     $ 1,497,321   Total   $ 263,490     $ 1,497,321

v3.24.2.u1

STOCK-BASED COMPENSATION EXPENSE (Tables)	6 Months Ended
	Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]
SCHEDULE OF STOCK OPTION ACTIVITY	A summary of stock option activity and related information for the three months ended June 30, 2024 is presented below:  SCHEDULE OF STOCK OPTION ACTIVITY     Options     Weighted-Average Exercise Price     Aggregate Intrinsic Value                       Outstanding at January 1, 2024     1,000,807     $ 2.46           Granted     60,000       1.21           Exercised     —       —           Expired     (152,668 )     3.98           Outstanding at June 30, 2024   908,139     $ 2.17     $ —   Exercisable at June 30, 2024     862,813     $ 2.17     $ —
SCHEDULE OF STOCK-BASED COMPENSATION	The following table reflects total stock-based compensation recorded by the Company for the three and six months ended June 30, 2024 and 2023:  SCHEDULE OF STOCK-BASED COMPENSATION      2024     2023      2024     2023       Three Months Ended June 30,     Six Months Ended June 30,       2024     2023     2024     2023                             Stock-based compensation expense included in general and administrative expense   $ 12,746     $ 77,870     $ 63,413     $ 162,315   Earnings per share effect of share-based compensation expense – basic and diluted   $ (0.00 )   $ (0.01 )   $ (0.00 )   $ (0.02 )

v3.24.2.u1

CAPITAL STOCK (Tables)	6 Months Ended
	Jun. 30, 2024
Equity [Abstract]
SCHEDULE OF WARRANT ACTIVITY	A summary of warrant activity and related information for 2024 is presented below:  SCHEDULE OF WARRANT ACTIVITY     Warrants     Weighted-Average Exercise Price     Aggregate Intrinsic Value                       Outstanding at January 1, 2024     94,400     $ 2.46           Issued     —       —           Exercised     —       —           Expired     —       —           Outstanding at June 30, 2024     94,400     $ 2.46     $ —   Exercisable at June 30, 2024     94,400     $ 2.46     $ —

v3.24.2.u1

EARNINGS PER COMMON SHARE (Tables)	6 Months Ended
	Jun. 30, 2024
Earnings Per Share [Abstract]
SCHEDULE OF EARNINGS (LOSS) PER COMMON SHARE	The calculation of earnings (loss) per common share for the periods indicated below were as follows:  SCHEDULE OF EARNINGS (LOSS) PER COMMON SHARE     2024     2023     2024     2023       Three Months Ended June 30,     Six Months Ended June 30,       2024     2023     2024     2023   Numerator:                                 Net (loss) income   $ (89,085 )     (300,381 )   $ (104,785 )     (196,206 )                                   Effect of common stock equivalents     —       —       —       —   Net (loss) income adjusted for common stock equivalents   $ (89,085 )     (300,381 )   $ (104,785 )     (196,206 )                                   Denominator:                                 Weighted average common shares – basic     10,906,353       10,896,996       10,906,353       10,659,076                                     Dilutive effect of common stock equivalents:                                 Options and warrants     —       —       —       —                                     Denominator:                                 Weighted average common shares – diluted     10,906,353       10,896,996       10,906,353       10,659,076                                     (Loss) earnings per common share – basic   $ (0.01 )     (0.03 )   $ (0.01 )     (0.02 )                                   (Loss) earnings per common share – diluted   $ (0.01 )     (0.03 )   $ (0.01 )     (0.02 )
SCHEDULE OF ANTI-DILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF DILUTED NET INCOME LOSS	For the six months ended June 30, 2024 and 2023, the following warrants and options to purchase shares of common stock were excluded from the computation of diluted net income (loss) per common share, as the inclusion of such shares would be anti-dilutive:  SCHEDULE OF ANTI-DILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF DILUTED NET INCOME LOSS     2024     2023     2024     2023       Six Months Ended June 30,     Three Months Ended June 30,       2024     2023     2024     2023   Stock warrants     94,400       94,400       94,400       94,400   Stock options     908,139       1,004,177       908,139       1,004,177   Total     1,002,539       1,098,577       1,002,539       1,098,577

v3.24.2.u1

COMMITMENTS AND CONTINGENCIES (Tables)	6 Months Ended
	Jun. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
SCHEDULE OF FUTURE PAYMENTS UNDER LEASE AGREEMENT	SCHEDULE OF FUTURE PAYMENTS UNDER LEASE AGREEMENT Year   Amount   2024   $ 44,526   2025     75,051   Total future lease payments     119,577   Less: imputed interest     (9,608 ) Present value of future operating lease payments     109,969   Less: current portion of operating lease liabilities     (80,683 ) Operating lease liabilities, net of current portion   $ 29,286   Right of use assets   $ 108,582

v3.24.2.u1

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	Jun. 30, 2024	Dec. 31, 2023
Product Information [Line Items]
Accumulated deficit	$ 77,103,782	$ 76,998,997
Cash deposits	3,130,769
Current insured limit on interest bearing accounts	250,000
Colombian Bank [Member]
Product Information [Line Items]
Cash deposits	$ 284

v3.24.2.u1

SCHEDULE OF DISAGGREGATES REVENUE BY SIGNIFICANT PRODUCT (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Disaggregation of Revenue [Line Items]
Total revenue from customers	$ 115,805	$ 204,390	$ 263,490	$ 434,414
Oil Sales [Member]
Disaggregation of Revenue [Line Items]
Total revenue from customers	102,923	150,767	205,971	313,049
Natural Gas Sales [Member]
Disaggregation of Revenue [Line Items]
Total revenue from customers	(8,248)	16,963	8,068	41,874
Natural Gas Liquids Sales [Member]
Disaggregation of Revenue [Line Items]
Total revenue from customers	$ 21,130	$ 36,660	$ 49,452	$ 79,491

v3.24.2.u1

REVENUE FROM CONTRACTS WITH CUSTOMERS (Details Narrative) - USD ($)	Jun. 30, 2024	Jun. 30, 2023
Revenue from Contract with Customer [Abstract]
Remaining performance obligations	$ 0	$ 0

v3.24.2.u1

SCHEDULE OF REVENUES AND LONG LIVED ASSETS ATTRIBUTABLE TO GEOGRAPHICAL AREA (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 115,805	$ 204,390	$ 263,490	$ 434,414
Long Lived Assets, Net	1,497,321		1,497,321
UNITED STATES
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues			263,490
Long Lived Assets, Net	$ 1,497,321		$ 1,497,321

v3.24.2.u1

OIL AND GAS PROPERTIES (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Extractive Industries [Abstract]
Depletion expense	$ 28,107	$ 44,941	$ 63,085	$ 79,640

v3.24.2.u1

EQUITY INVESTMENT (Details Narrative)	6 Months Ended
	Jun. 30, 2024 USD ($)
Equity Investment
Direct investment operations	$ 766,216
Total distributions received during period	$ 654,142

v3.24.2.u1

SCHEDULE OF STOCK OPTION ACTIVITY (Details)	6 Months Ended
	Jun. 30, 2024 USD ($) $ / shares shares
Share-Based Payment Arrangement [Abstract]
Options, Outstanding, Beginning Balance | shares	1,000,807
Weighted-Average Exercise Price, Outstanding, Beginning Balance | $ / shares	$ 2.46
Options, Granted | shares	60,000
Weighted-Average Exercise Price, Granted | $ / shares	$ 1.21
Options, Exercised | shares
Weighted-Average Exercise Price, Exercised | $ / shares
Options, Expired | shares	(152,668)
Weighted-Average Exercise Price, Expired | $ / shares	$ 3.98
Options, Outstanding, Ending Balance | shares	908,139
Weighted-Average Exercise Price, Outstanding, Ending Balance | $ / shares	$ 2.17
Aggregate Intrinsic Value, Outstanding, Ending Balance | $
Options, Exercisable, Ending Balance | shares	862,813
Weighted-Average Exercise Price, Exercisable, Ending Balance | $ / shares	$ 2.17
Aggregate Intrinsic Value, Exercisable, Ending Balance | $

v3.24.2.u1

SCHEDULE OF STOCK-BASED COMPENSATION (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Share-Based Payment Arrangement [Abstract]
Stock-based compensation expense included in general and administrative expense	$ 12,746	$ 77,870	$ 63,413	$ 162,315
Earnings per share effect of share-based compensation expense - basic	$ (0.00)	$ (0.01)	$ (0.00)	$ (0.02)
Earnings per share effect of share-based compensation expense - diluted	$ (0.00)	$ (0.01)	$ (0.00)	$ (0.02)

v3.24.2.u1

STOCK-BASED COMPENSATION EXPENSE (Details Narrative) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2024	Dec. 31, 2021	Dec. 31, 2017	Dec. 31, 2008
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of options granted during period		60,000
Stock option exercisable price per share	$ 2.17	$ 2.17
Directors [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of options granted during period		60,000
Option term		10 years
Stock option exercisable price per share	1.21	$ 1.21
Description on vesting of stock options		vest 20% on the date of grant and 80% nine months from the date of grant.
Fair value of options granted		$ 63,730
Market value of common stock	$ 1.21	$ 1.21
Risk free interest rate		0.00%
Expected dividend yield		0.00%
Expected stock volatility		97.80%
Stock option life, term		10 years
Expected forfeiture rate		0.00%
2008 Equity Incentive Plan [Member] | Maximum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of options authorized to purchase shares of common stock					480,000
2017 Equity Incentive Plan [Member] | Maximum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of options authorized to purchase shares of common stock				400,000
2021 Equity Incentive Plan [Member] | Maximum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of options authorized to purchase shares of common stock			500,000
2021 Equity Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share based compensation	$ 12,746	$ 63,413
Unrecognized share-based compensation expense related to non-vested stock options	$ 50,988	$ 50,988
Weighted average period for unrecognition of compensation expense		8 months 19 days
Weighted average remaining contractual term of the outstanding options		6 years 5 months 8 days
Weighted average remaining contractual term of the exercisable options		6 years 2 months 19 days
Common stock available for issuance to future	61,333	61,333

v3.24.2.u1

SCHEDULE OF WARRANT ACTIVITY (Details) - Warrant [Member]	6 Months Ended
	Jun. 30, 2024 USD ($) $ / shares shares
Accumulated Other Comprehensive Income (Loss) [Line Items]
Warrants Outstanding, Beginning | shares	94,400
Weighted-Average Exercise Price Outstanding, Beginning | $ / shares	$ 2.46
Warrants Outstanding, Issued | shares
Weighted-Average Exercise Price, Issued | $ / shares
Warrants Outstanding, Exercised | shares
Weighted-Average Exercise Price, Exercised | $ / shares
Warrants Outstanding, Expired | shares
Weighted-Average Exercise Price, Expired | $ / shares
Warrants Outstanding, Ending | shares	94,400
Weighted-Average Exercise Price Outstanding, Ending | $ / shares	$ 2.46
Aggregate Intrinsic Value Outstanding at end of the period | $
Warrants Outstanding, Exercisable | shares	94,400
Weighted-Average Exercise Price Outstanding, Exercisable | $ / shares	$ 2.46
Aggregate Intrinsic Value Outstanding Exercisable at end of the period | $

v3.24.2.u1

SCHEDULE OF EARNINGS (LOSS) PER COMMON SHARE (Details) - USD ($)	3 Months Ended				6 Months Ended
	Jun. 30, 2024	Mar. 31, 2024	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2024	Jun. 30, 2023
Earnings Per Share [Abstract]
Net (loss) income	$ (89,085)	$ (15,699)	$ (300,381)	$ 104,175	$ (104,785)	$ (196,206)
Effect of common stock equivalents
Net (loss) income adjusted for common stock equivalents	$ (89,085)		$ (300,381)		$ (104,785)	$ (196,206)
Weighted average common shares – basic	10,906,353		10,896,996		10,906,353	10,659,076
Options and warrants
Weighted average common shares – diluted	10,906,353		10,896,996		10,906,353	10,659,076
(Loss) earnings per common share – basic	$ (0.01)		$ (0.03)		$ (0.01)	$ (0.02)
(Loss) earnings per common share – diluted	$ (0.01)		$ (0.03)		$ (0.01)	$ (0.02)

v3.24.2.u1

SCHEDULE OF ANTI-DILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF DILUTED NET INCOME LOSS (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total	1,002,539	1,098,577	1,002,539	1,098,577
Warrant [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total	94,400	94,400	94,400	94,400
Share-Based Payment Arrangement, Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total	908,139	1,004,177	908,139	1,004,177

v3.24.2.u1

SCHEDULE OF FUTURE PAYMENTS UNDER LEASE AGREEMENT (Details) - USD ($)	Jun. 30, 2024	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
2024	$ 44,526
2025	75,051
Total future lease payments	119,577
Less: imputed interest	(9,608)
Present value of future operating lease payments	109,969
Less: current portion of operating lease liabilities	(80,683)	$ (75,276)
Operating lease liabilities, net of current portion	29,286	71,083
Right of use assets	$ 108,582	$ 145,021

v3.24.2.u1

COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Expense of right of use asset			$ 36,385	$ 32,836
Rental expense	$ 22,161	$ 22,570	$ 44,322	$ 45,731
Operating Lease Agreement [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Operating lease agreement expire date			Oct. 31, 2025
Operating cash outflows related to operating lease liabilities	22,137		$ 44,274
Expense of right of use asset	$ 18,492		$ 36,440
Weighted-average remaining term	1 year 6 months 29 days		1 year 6 months 29 days
Weighted average discount rate	12.00%		12.00%

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