Unassociated Document
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
10-Q
x |
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
|
For
the
quarterly period ended September
30,
2008
o |
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 1-4668
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
(Exact
name of registrant as specified in its charter)
|
|
|
BERMUDA
|
|
NONE
|
(State
or other jurisdiction of incorporation
or organization)
|
|
(I.R.S.
Employer Identification
No.)
|
|
|
|
Clarendon
House, Church Street, Hamilton,
Bermuda
|
|
HM
11
|
(Address
of principal executive
offices)
|
|
(Zip
Code)
|
(850)
653-2732
(Registrant's
telephone number, including area code)
(Former
name, former address and former fiscal year, if changed since last
report)
Indicate
by check mark whether the registrant (l) has filed all reports required to
be
filed by Section 13 or 15 (d) of the Securities Exchange Act of l934 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. T
Yes
¨
No
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company.
See
definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer o |
Accelerated filer o |
Non-accelerated filer o (Do
not check if smaller reporting company) |
Smaller reporting company x |
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). ¨
Yes
T
No
The
number of shares outstanding of the issuer's single class of common stock as
of
November 13, 2008 was 46,261,604.
Table
of Contents
PART
I - FINANCIAL INFORMATION
ITEM
1
|
Financial
Statements
|
Page
|
|
|
|
|
Consolidated
balance sheets at September 30, 2008 and December 31,
2007
|
3
|
|
|
|
|
Consolidated
statements of operations for the three and nine month periods ended
September 30, 2008 and 2007 and for the period from January 31, 1953
(inception) to September 30, 2008
|
4
|
|
|
|
|
Consolidated
statements of cash flows for the nine month periods ended
September 30, 2008 and 2007 and for the period from January 31,
1953 (inception) to September 30, 2008
|
5
|
|
|
|
|
Notes
to consolidated financial statements
|
6
|
|
|
|
ITEM
2
|
Management's
Discussion and Analysis of Financial Condition and Results of
Operations
|
11
|
|
|
|
ITEM
3
|
Quantitative
and Qualitative Disclosure About Market Risk
|
16
|
|
|
|
ITEM
4
|
Controls
and Procedures
|
17
|
|
|
|
|
PART
II - OTHER INFORMATION
|
|
|
|
|
ITEM
5
|
Other
Information
|
17
|
|
|
|
ITEM
6
|
Exhibits
|
19
|
|
|
|
|
Signatures
|
20
|
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I -
FINANCIAL INFORMATION
September 30,
2008
ITEM
1
- Financial
Statements
CONSOLIDATED
BALANCE SHEETS
(Expressed
in U.S. dollars)
(A
Bermuda Corporation)
A
Development Stage Company
|
|
September 30,
|
|
December
31,
|
|
|
|
2008
|
|
2007
|
|
Assets
|
|
(Unaudited)
|
|
(Note)
|
|
Current
assets:
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$
|
16,098
|
|
$
|
30,264
|
|
Prepaid
expenses and other
|
|
|
-
|
|
|
30,040
|
|
Total
current assets
|
|
|
16,098
|
|
|
60,304
|
|
|
|
|
|
|
|
|
|
Certificates
of deposit, restricted
|
|
|
84,668
|
|
|
135,364
|
|
Petroleum
leases
|
|
|
2,174,836
|
|
|
2,168,293
|
|
Equipment,
net
|
|
|
7,045
|
|
|
8,935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
2,282,647
|
|
$
|
2,372,896
|
|
|
|
|
|
|
|
|
|
Liabilities
and Shareholders’ Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable and accrued liabilities
|
|
$
|
32,564
|
|
$
|
11,125
|
|
Amounts
due to related parties
|
|
|
664,942
|
|
|
348,208
|
|
Total
current liabilities
|
|
|
697,506
|
|
|
359,333
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
Common
stock, par value $.12 per share:
|
|
|
|
|
|
|
|
Authorized
- 250,000,000 shares
|
|
|
|
|
|
|
|
Outstanding
- 46,261,604 and 46,211,604 shares, respectively
|
|
|
5,551,392
|
|
|
5,545,392
|
|
Capital
in excess of par value
|
|
|
32,139,311
|
|
|
32,137,811
|
|
|
|
|
37,690,703
|
|
|
37,683,203
|
|
Deficit
accumulated during the development stage
|
|
|
(36,105,562
|
)
|
|
(35,669,640
|
)
|
Total
shareholders’ equity
|
|
|
1,585,141
|
|
|
2,013,563
|
|
Total
liabilities and shareholders’ equity
|
|
$
|
2,282,647
|
|
$
|
2,372,896
|
|
Note:
The
balance sheet at December 31, 2007 has been derived from
the
audited consolidated financial statements at that date.
See
accompanying notes.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I -
FINANCIAL INFORMATION
September 30,
2008
ITEM
1
- Financial
Statements
CONSOLIDATED
STATEMENTS OF OPERATIONS
(Expressed
in U.S. dollars)
(A
Bermuda Corporation)
A
Development Stage Company
(Unaudited)
|
|
|
|
|
|
For
the
|
|
|
|
|
|
|
|
period
from
|
|
|
|
|
|
|
|
Jan.
31, 1953
|
|
|
|
|
|
|
|
(inception)
|
|
|
|
Three
months ended September 30,
|
|
Nine
months ended September 30,
|
|
to
September
30,
|
|
|
|
2008
|
|
2007
|
|
2008
|
|
2007
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
and other income
|
|
$
|
1,587
|
|
$
|
8
|
|
$
|
3,960
|
|
$
|
4,815
|
|
$
|
3,983,874
|
|
Gain
on settlement
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
8,124,016
|
|
|
|
|
1,587
|
|
|
8
|
|
|
3,960
|
|
|
4,815
|
|
|
12,107,890
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Legal
fees and costs
|
|
|
37,640
|
|
|
36,956
|
|
|
115,006
|
|
|
121,432
|
|
|
17,533,901
|
|
Administrative
expenses
|
|
|
63,384
|
|
|
63,862
|
|
|
221,900
|
|
|
223,490
|
|
|
10,804,121
|
|
Salaries
|
|
|
31,250
|
|
|
31,250
|
|
|
93,750
|
|
|
104,150
|
|
|
4,240,181
|
|
Shareholder
communications
|
|
|
2,066
|
|
|
469
|
|
|
9,226
|
|
|
10,697
|
|
|
4,124,921
|
|
Goodwill
impairment
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
801,823
|
|
Write
off of unproved properties
|
|
|
-
|
|
|
(34,766
|
)
|
|
-
|
|
|
51,026
|
|
|
6,631,505
|
|
Exploration
costs
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
247,465
|
|
Lawsuit
judgments
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
1,941,916
|
|
Minority
interests
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(632,974
|
)
|
Other
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
364,865
|
|
Contractual
services
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
2,155,728
|
|
|
|
|
134,340
|
|
|
97,771
|
|
|
439,882
|
|
|
510,795
|
|
|
48,213,452
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
tax benefit
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
$
|
(132,753
|
)
|
$
|
(97,763
|
)
|
$
|
(435,922
|
)
|
$
|
(505,980
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
accumulated during the development stage
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(36,105,562
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of Shares outstanding (basic &
diluted)
|
|
|
46,229,122
|
|
|
46,221,604
|
|
|
46,211,604
|
|
|
46,211,604
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss per share (basic & diluted)
|
|
$
|
(.00
|
)
|
$
|
(.00
|
)
|
$
|
(.00
|
)
|
$
|
(.00
|
)
|
|
|
|
See
accompanying notes.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I -
FINANCIAL INFORMATION
September 30,
2008
ITEM
1
- Financial
Statements
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Expressed
in U.S. Dollars)
(A
Bermuda Corporation)
A
Development Stage Company
(Unaudited)
|
|
|
|
|
|
|
|
|
For
the period
|
|
|
|
|
|
|
|
|
|
|
from
Jan. 31, 1953
|
|
|
|
|
|
|
|
|
|
|
(inception)
|
|
|
|
|
Nine
months ended
|
|
|
to
|
|
|
|
|
September
30,
|
|
|
September
30,
|
|
|
|
|
2008
|
|
|
2007
|
|
|
2008
|
|
Operating
activities: |
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
$
|
(435,922
|
)
|
$
|
(505,980
|
)
|
$
|
(36,105,562
|
)
|
Adjustments
to reconcile net loss to net cash used
in operating activities:
|
|
|
|
|
|
|
|
|
|
|
Gain
on settlement
|
|
|
-
|
|
|
-
|
|
|
(8,124,016
|
)
|
Goodwill
impairment
|
|
|
-
|
|
|
-
|
|
|
801,823
|
|
Minority
interest
|
|
|
-
|
|
|
-
|
|
|
(632,974
|
)
|
Depreciation
|
|
|
1,890
|
|
|
1,890
|
|
|
5,928
|
|
Write
off of unproved properties
|
|
|
-
|
|
|
51,026
|
|
|
6,690,752
|
|
Common
stock issued for services
|
|
|
-
|
|
|
-
|
|
|
119,500
|
|
Compensation
recognized for stock option grant
|
|
|
-
|
|
|
-
|
|
|
75,000
|
|
Recoveries
from previously written off properties
|
|
|
-
|
|
|
-
|
|
|
252,173
|
|
Net
change in:
|
|
|
|
|
|
|
|
|
|
|
Prepaid expenses and other
|
|
|
30,040
|
|
|
29,256
|
|
|
-
|
|
Income taxes receivable
|
|
|
-
|
|
|
-
|
|
|
-
|
|
Accounts payable and accrued liabilities
|
|
|
338,173
|
|
|
204,494
|
|
|
697,507
|
|
Income taxes payable
|
|
|
-
|
|
|
-
|
|
|
-
|
|
Net
cash used in operating activities
|
|
|
(65,819
|
)
|
|
(219,314
|
)
|
|
(36,219,869
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
|
|
|
|
|
Additions
to oil, gas, and mineral properties
|
|
|
|
|
|
|
|
|
|
|
net
of assets acquired for common stock and reimbursements
|
|
|
(224,363
|
)
|
|
(207,140
|
)
|
|
(6,427,452
|
)
|
Well
drilling costs
|
|
|
-
|
|
|
(51,026
|
)
|
|
(1,071,011
|
)
|
Sale
of unproved nonoperating interests
|
|
|
217,820
|
|
|
89,175
|
|
|
512,434
|
|
Net
proceeds from settlement
|
|
|
-
|
|
|
-
|
|
|
8,124,016
|
|
Proceeds
from relinquishment of surface rights
|
|
|
-
|
|
|
-
|
|
|
246,733
|
|
Redemption
(purchase) of certificate of deposit
|
|
|
50,696
|
|
|
(3,596
|
)
|
|
(84,668
|
)
|
Purchase
of minority interest in CPC
|
|
|
-
|
|
|
-
|
|
|
(801,823
|
)
|
Purchase
of fixed assets
|
|
|
-
|
|
|
-
|
|
|
(74,623
|
)
|
Net
cash provided by (used in) investing activities
|
|
|
44,153
|
|
|
(172,587
|
)
|
|
423,606
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
|
|
|
|
|
Loan
proceeds
|
|
|
-
|
|
|
126,000
|
|
|
-
|
|
Loans
from officers
|
|
|
-
|
|
|
-
|
|
|
111,790
|
|
Repayments
of loans from officers
|
|
|
-
|
|
|
-
|
|
|
(111,790
|
)
|
Sale
of common stock net of expenses
|
|
|
-
|
|
|
-
|
|
|
30,380,612
|
|
Shares
issued upon exercise of options
|
|
|
7,500
|
|
|
-
|
|
|
891,749
|
|
Sale
of shares by subsidiary
|
|
|
-
|
|
|
-
|
|
|
820,000
|
|
Sale
of subsidiary shares
|
|
|
-
|
|
|
-
|
|
|
3,720,000
|
|
Net
cash provided by financing activities
|
|
|
7,500
|
|
|
126,000
|
|
|
35,812,361
|
|
Net
(decrease) increase in cash and cash equivalents
|
|
|
(14,166
|
)
|
|
(265,901
|
)
|
|
16,098
|
|
Cash
and cash equivalents at beginning of period
|
|
|
30,264
|
|
|
342,541
|
|
|
-
|
|
Cash
and cash equivalents at end of period
|
|
$
|
16,098
|
|
$
|
76,640
|
|
$
|
16,098
|
|
See
accompanying notes.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
1 Financial
Statements
Note
1. Basis
of Presentation
The
accompanying unaudited consolidated financial statements include Coastal
Caribbean Oils & Minerals, Ltd. (“the Company”) and its wholly owned
subsidiary, Coastal Petroleum Company (“Coastal Petroleum”) and have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01
of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments considered
necessary for a fair presentation have been included. All such adjustments
are
of a normal recurring nature. Operating results for the three and nine month
periods ended September 30, 2008 are not necessarily indicative of the
results that may be expected for the year ending December 31, 2008. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2007.
Note
2. Going
Concern
As
of
September 30, 2008, the Company had no revenues, had recurring losses from
operations and has had an accumulated deficit during the development
stage. The Company's current cash position is not adequate to fund
existing operations or exploration and development of its oil and gas
properties. Management currently has in place an agreement with a party covering
part of the Company’s leases under which the party will drill a test well and
have the option to purchase a 50% working interest in the leases covered by
the
agreement. If the party exercises the option, the Company would receive
approximately $1,000,000, although there is no assurance drilling will be
successful or the option will be exercised. The Company also has an agreement
with another party, under which the party has the option to purchase a 50%
working interest in the Company’s remaining Valley County leases by paying
$1,000,000 in drilling costs on the Company’s behalf, although there is no
assurance drilling will be successful or the option will be exercised. These
situations raise substantial doubt about the Company's ability to continue
as a
going concern. These consolidated financial statements do not include any
adjustments to reflect the possible future effects on the recoverability and
classification of assets or amounts and classification of liabilities, which
may
result from the outcome of this uncertainty.
Note
3. Net
income (loss) per share
Net
income (loss) per share is based upon the weighted average number of common
and
common equivalent shares outstanding during the period. The Company’s basic and
diluted calculations of EPS are the same because the exercise of options is
not
assumed in calculating diluted EPS, as the result would be
anti-dilutive.
Note
4.
Oil
& Gas Development Activity
Montana
Leases
The
Company’s primary presence in Montana is in Valley County, where it holds leases
covering approximately 124,882 net acres, which the Company acquired in three
separate acquisitions
between July 2005 and February 2006. The leases acquired in those acquisitions
are contiguous to each other and are referred to collectively as “the Valley
County Leases.” The Valley County Leases are subject to various overriding
royalty interests to others ranging up to 19.5%. These leases expire in years
from 2011 to 2016.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
1 Financial
Statements (Continued)
Note
4.
Oil
& Gas Development Activity
(Continued)
The
Company has an agreement with a consultant entity, controlled by one of the
Company’s Directors, to identify Mississippian Lodgepole Reef prospects to be
drilled on and near its Valley County Leases. Previously under the agreement,
the Company was required to drill a test well on an identified Lodgepole Reef
prospect by a certain deadline, however, there is no longer a drilling
obligation under the agreement.
In
May
2008, the Company entered an agreement with Cobra Oil and Gas. Under the
agreement, Cobra paid Coastal $180,000 for the option to acquire a half interest
in approximately 87,000 acres of Coastal’s Valley County Leases. The agreement
allowed the Company to pay its Lease rentals that were due June 1st
and
brings in a new party to explore on the Leases. Cobra will have two years to
exercise the option by spending $1,000,000 on behalf of the Company, drilling
wells on the leases under the agreement. Those leases include approximately
62,000 acres of leases that were formally under an agreement with F-Cross
Resources that expired earlier this year and more than 20,000 acres of other
leases Coastal held in Valley County.
In
August
2007, the Company entered into a farm-out agreement with Western Standard Energy
Corp. (“Western Standard”) Under the agreement Western Standard paid $40,000 up
front to Coastal and then paid an additional $255,000 to cover the costs of
drilling the first well to test a shallow natural gas prospect in Valley County,
Montana and $129,000 to cover associated lease rentals. Western Standard will
have a 100% working interest in the well until payout when it will be reduced
to
80% with Coastal receiving the remaining 20% working interest.
The
first
well under this agreement was drilled during October 2007, to test a shallow
natural gas prospect near the middle of the Company’s Valley County Leases. The
well, known as the Federal 1-19 Well, had three objectives: to confirm the
34,000 acre Starbuck East Prospect by finding that the Eagle formation was
high
to surrounding wells off the Prospect; to confirm that there were good natural
gas shows in the Starbuck East Prospect; and to find commercial gas in either
the Eagle formation or the Judith River formation. The first two objectives
were
met. Due to drilling damage, the third objective has not yet been
met.
During
October 2007, the Federal 1-19 well reached a total depth of 1,126 feet, and
confirmed the structural high that was targeted. The well also had gas shows
in
two zones. Casing was run into the hole and operations to complete and test
the
well were scheduled to begin at the end of November, but were delayed by
equipment repairs. The well is located on Federal land and the Bureau of Land
Management would not allow the completion and testing operations or any further
drilling to begin until July 2008, so operations were suspended until that
time. The Company also received an additional $29,000 from Western Standard
to cover additional
drilling and other costs associated with the delay in well completion, which
has
been recorded as a reduction in capitalized petroleum lease costs. Western
Standard paid the estimated well completion costs of $65,000 and operations
to
complete and test the well were performed in two stages during the third quarter
and proceeded to the third stage subsequent to the end of the third quarter.
In
October 2008, the Company received approximately $29,000 from Western Standard
to pay for the third stage of operations which included stimulation of the
well,
a common procedure in completing oil and gas wells.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
1 Financial
Statements (Continued)
Note
4.
Oil
& Gas Development Activity
(Continued)
The
Company was unable to determine by this well whether the target formations
contain economic quantities of gas. Drilling damage in the well prevented the
testing of either of the prospective formations at this location. Completion
efforts found that the Eagle formation was damaged by the initial drilling
and
the formation was not able to be tested from this well. Further drilling into
the Eagle formation during completion did not yield gas like the gas show seen
from the upper part of the formation that was damaged. The Judith River
formation, a secondary target, was damaged by drilling fluids lost into the
formation while drilling through it to get to the Eagle formation, the primary
target. Future wells to test this structure will incorporate the information
obtained from these wells to prevent that damage from occurring again in other
locations on the structure.
It
is not
unusual that the first well confirming a structure does not become a producing
well. The test well did produce valuable information about the two gas bearing
formations and their potential for economically feasible commercial gas
production. Problems encountered in drilling the test well can now be avoided
when future wells are drilled on the Starbuck East Prospect. With the first
two
objectives met, the Company will now focus on achieving the third objective,
specifically finding commercial gas in either the Eagle or Judith River
formations.
Now
that
the test well is completed, Western Standard has 30 days to exercise its option
to purchase a 50% interest in approximately 42,000 (37,000 after some leases
have expired) acres near the well location (referred to as “Valley County
Shallow Gas Assembly”). The cost to exercise the option would be $1,000,000,
payable in $200,000 installments based on certain milestones related to drilling
step-out wells. The Company currently has permits to drill two of the step-out
wells and is in the permitting process for permits to drill two additional
step-out wells.
F-Cross
Resources, LLC (“F-Cross”) will continue to hold its interest in the section in
which it drilled a well under the September 2007 agreement which has otherwise
expired. Under that agreement the Company received $50,000 from F-Cross
Resources, LLC (“F- Cross”) when the two parties entered into a farm-out
agreement covering approximately 64,000 acres (now 62,000 after some leases
expired) on the northwest part of the Company’s Valley County Leases. Under the
agreement, F-Cross had the option to drill a Lodgepole test well within six
months and after drilling that well had the further option to acquire an
interest in surrounding acreage. F-Cross is to pay for the cost of drilling
the
initial well and will receive a 100% working interest in the well until payout
and an 80% working interest subsequent to payout. The first Lodgepole test
well
under the agreement was drilled in November, 2007, but the well is awaiting
completion and testing of several zones which have potential for both oil and
gas.
Unlike the shallow gas well on Federal land, this well is located on State
land
and provided that there is no State objection, the Company expects F-Cross
will
resume operations to complete and test the well once the weather and regulators
permit it, although to date those operations have not been resumed.
F-Cross did not meet the requirements in the agreement and in late March the
option to acquire an interest in additional acreage expired, leaving F-Cross
with rights only in the section in which it drilled the well.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
1 Financial
Statements (Continued)
Note
4.
Oil
& Gas Development Activity
(Continued)
North
Dakota Leases
In
July
2005, the Company acquired leases to the deeper rights in approximately 21,688
net acres in and near Slope County, North Dakota for a one time fee of $50,000
from an entity controlled
by one of the Company’s Directors and the Company has invested some additional
funds to geochemically test and high-grade these and other prospects on the
leases. Since that time, some of the leases have expired and the Company
currently holds leases on approximately 8,510 net acres in North Dakota. The
Company is obligated to drill a test well on the original leases totaling 7,031
acres before January 31, 2009, and has the option to drill the remaining
Lodgepole Reef prospects on these leases. That deadline has been extended in
the
past and may be extended again. The Company intends to team with other entities
to share the cost of the initial 9,700 foot test well, the total estimated
drilling cost of which is estimated to be $1,500,000, however, it is unlikely
that the Company will be able to identify and contract with a team prospect
prior to the expiration date. The leases making up the remaining acreage were
leased by the Company and have no obligation associated with them.
In
an
effort to explore the North Dakota leases, in December of 2007 the Company
entered a new farm-out agreement with Western Standard. Under the agreement,
the
Company assigned leases over four of its high-graded Lodgepole Reef prospects
to
Western Standard in return for $80,000. The Company received $40,000 in November
2007, $25,000 in February 2008 and $15,000 in April 2008, which was recorded
as
a reduction in capitalized petroleum lease costs. The Company will also retain
a
back-in working interest of 20% in the leases after payout. Oil For America
has
agreed to waive the drilling obligation on these four prospects. The Company
still retains additional Lodgepole reef prospects on its North Dakota leases
that are not covered by this farm-out agreement.
Note
5.
Income
Taxes
For
the
three and nine month periods ending September 30,
2008 and 2007, the Company reported a loss for both financial statement
reporting and income tax purposes. The Company has provided a 100% valuation
allowance on its deferred tax asset as a result of its net operating loss
carryforwards. The Company has approximately $10,000,000 in net operating loss
carryforwards at December 31, 2007.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
1 Financial
Statements (Continued)
Note
6. Related
Party Transactions
Pursuant
to a written agreement with respect to the Valley County Leases, the Company
uses an entity controlled by an individual who is a shareholder, officer and
director of the Company to perform geotechnical analysis of potential drilling
sites at a cost of $1,000 per site. The Company paid no amounts to this entity
for the three and nine month periods ended September
30,
2008, and 2007, respectively.
The
Company pays a monthly retainer to the law firm of Angerer & Angerer which
has been litigation counsel to the Company for more than twenty-five years
and
continues to serve the Company in that capacity as well as others including
general counsel services, management services, public relations, shareholder
relations and representing the Company before state and federal agencies for
permitting. The principals of the law firm include two individuals who are
collectively shareholders, officers and a director of the Company. The Company
expensed $108,000 and $108,000 in legal fees for the nine month periods ended
September 30, 2008 and 2007, respectively, including $36,000 and $36,000 in
legal fees for the three month periods ended September 30,
2008 and 2007, respectively. The Company owes $204,000 in accrued legal fees
to
Angerer & Angerer as of September 30,
2008.
The
Company has retained the law firm of Igler & Dougherty, P.A. as securities
counsel. One of the Company’s directors is a shareholder in the law firm. The
Company expensed $12,447 and $10,716 in legal fees and costs for the nine month
periods ended September
30, 2008
and 2007, respectively, including $2,768 and $956 in legal fees for the three
month periods ended September 30,
2008 and 2007, respectively.
Note
7. Note
Payable
The
Company borrowed $126,000 in May 2007 to pay lease obligations that were due
in
June 2007. The note required the loan to be repaid prior to the spudding of
the
first well on any of the approximately 42,000 (37,000 after some leases have
expired) acres of the Company’s leases that are covered by the loan agreement.
Coastal assigned a 5% overriding royalty interest (before all expenses) in
8/8ths of the oil or natural gas produced from those Valley County Montana
leases to the lender. The loan was repaid on October 15, 2007, prior to the
spudding of the first well on the acreage, out of the money advanced by Western
Standard Energy Corp. to drill the first well under their agreement with the
Company.
Note
8. Stock
Transactions
In
March
2008, the Company received $7,500 from the exercise of outstanding stock options
for 50,000 shares from Robert J. Angerer, Sr., a vice president and a director
of the Company.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
2 Management's
Discussion and Analysis of Financial Condition and Results
of Operations
Forward
Looking Statements
Statements
included in Management’s Discussion and Analysis of Financial Condition and
Results of Operations, which are not historical in nature are intended to be
forward looking statements. The Company cautions readers that forward looking
statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from those indicated in the forward looking
statements. Among the risks and uncertainties are: the uncertainty of securing
additional financing through the sale of shares of Coastal Petroleum and/or
Coastal Caribbean; changes in the income tax laws relating to tax loss carry
forwards; the failure of the Company’s test wells to locate oil or gas reserves
or the failure to locate oil or gas reserves which are economically feasible
to
recover; reductions in world wide oil or gas prices; adverse weather conditions;
or mechanical failures of equipment used to explore the Company’s
leases.
Critical
Accounting Policies
The
Company follows the full cost method of accounting for its oil and gas
properties. All costs associated with property acquisition, exploration and
development activities whether successful or unsuccessful are
capitalized
The
capitalized costs are subject to a ceiling test which basically limits such
costs to the aggregate of the estimated present value discounted at a 10% rate
of future net revenues from proved reserves, based on current economic and
operating conditions, plus the lower of cost or fair market value of unproved
properties.
The
Company assesses whether its unproved properties are impaired on a periodic
basis. This assessment is based upon work completed on the properties to date,
the expiration date of its leases and technical data from the properties and
adjacent areas. Using this assessment, Management has determined that the
Company’s leases are not impaired.
Liquidity and Capital Resources
Liquidity
The
Company has no available cash, excluding certificate of deposits pledged for
drilling permits, at September 30,
2008,
compared to $30,000 at December 31, 2007. Our current liabilities exceed
our current assets by $680,000 at September 30,
2008. We have suspended payments to our directors, general legal counsel, and
employee since the second quarter of 2007 and have accrued $665,000 in expenses
as of September 30,
2008. We received $195,000 from the sale of unproved lease rights and redeemed
a
$50,000 certificate of deposit released from restrictions as a drilling bond
during the nine months ended September
30,
2008, which we used primarily to pay our annual lease payments and other
operating expenses.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
2 Management's
Discussion and Analysis of Financial Condition and Results
of Operations (Continued)
During
2008, we received $180,000 and $40,000 respectively under farm-out agreements
for lease and drilling rights on our Montana and North Dakota leases. During
2007, we received approximately $309,000 under various agreements for lease
and
drilling rights and the options to acquire additional rights. Also during 2007,
we received $255,000 that was used to drill one of the wells on our leases.
During
2008, we have paid lease rentals of $201,000. We have additional lease payments
of approximately $22,000 due in November 2008. We may need to sell additional
lease rights to obtain the cash to make these payments, although there is no
guarantee we will be able to sell additional lease rights. Western Standard
has
paid for estimated gas well completion costs of $65,000 and funds are in place
for the completion and testing operations.
We
received $7,500 in March 2008 from the exercise of outstanding stock options
from Robert J. Angerer, Sr., our vice president and a director of the
Company.
As
of September 30,
2008,
we had no revenues, had recurring losses prior to 2005
and
since 2005, and had an accumulated deficit during the development stage. Our
current cash position is not adequate to fund existing operations or exploration
and development of its oil and gas properties. We
currently have in place an agreement with a party covering part of our leases
under which the party will drill a test well and have the option to purchase
a
50% working interest in the leases covered by the agreement. If the party
exercised the option, we would receive approximately $1,000,000, although there
is no assurance drilling will be successful or the option will be exercised.
The
Company also has an agreement with another party, under which the party has
the
option to purchase a 50% working interest in the Company’s remaining Valley
County leases by paying $1,000,000 in drilling costs on the Company’s behalf,
although there is no assurance drilling will be successful or the option will
be
exercised. These
situations raise substantial doubt about our ability to continue as a going
concern.
Capital
Resources
In
Montana, we have obtained the rights to explore for oil and gas in one area
which will be our primary area of focus. This primary area is a large assembly
of leases covering approximately 124,882 net acres in Valley County, located
in
northeastern Montana close to known production from a Lodgepole reef. This
area
of Montana has a number of other producing formations in addition to the
Lodgepole, including the Eagle sands. Currently we have two agreements with
two
different entities covering separate areas of the leases and exploration has
begun on those leases. During 2006, we drilled two wells on lands outside these
leases and they did not find economic quantities of oil or gas and were
abandoned. We also hold leases in southwestern North Dakota and have an
agreement covering four Lodgepole prospects on those leases.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
2 Management's
Discussion and Analysis of Financial Condition
and Results
of Operations (Continued)
The
first
of the two agreements we entered into was a farm-out agreement with Western
Standard Energy Corp. (“Western Standard”) in August 2007. Under the agreement,
Western Standard paid us $40,000 at execution and then paid an additional
$384,000. From the $384,000, $255,000 was paid to cover the costs of drilling
the first well to test a shallow natural gas prospect in Valley County, Montana
and $129,000 was paid to cover associated lease rentals. Western Standard
will
have a 100% working interest in the first well until payout when it will
be
reduced to 80% and we will receive the other 20% working interest. Upon
receiving the funds to cover lease rentals, we repaid in full our loan of
$126,000. Under the loan agreement, the individual that loaned us the money
continues to hold a 5% overriding royalty on the same approximately 42,000
(37,000 after some leases have expired) acres that are covered in the Western
Standard farm-out agreement.
The
first
well under this agreement was drilled during October 2007, to test a shallow
natural gas prospect near the middle of the Company’s Valley County Leases. The
well, known as the Federal 1-19 Well, had three objectives: to confirm the
34,000 acre Starbuck East Prospect by finding that the Eagle formation was
high
to surrounding wells off the Prospect; to confirm that there were good natural
gas shows in the Starbuck East Prospect; and to find commercial gas in either
the Eagle formation or the Judith River formation. The first two objectives
were
met. Due to drilling damage, the third objective has not yet been met.
During
October 2007, the Federal 1-19 well reached a total depth of 1,126 feet and
confirmed the structural high that we believed to be there. The well also had
gas shows in two zones. Casing was run into the hole and operations to complete
and test the well were scheduled to begin at the end of November, but were
delayed by equipment repairs. The well is located on Federal land and the Bureau
of Land Management would not allow the completion and testing operations or
any
further drilling to begin between December 1st and July 1st, so operations
were
suspended until July. In December, we entered a Memorandum of Understanding
with
Western Standard which led to a farm-out agreement on our North Dakota Leases
discussed below, but also allowed us to use $29,000 of the funds from Western
Standard originally sent to cover completion to now cover lease rental and
other
costs associated with the delay in well completion. Western Standard paid the
estimated well completion costs of $65,000 and operations to complete and test
the well were performed in two stages during the third quarter and proceeded
to
the third stage subsequent to the end of the third quarter. In October 2008,
the
Company received approximately $29,000 from Western Standard to pay for the
third stage of operations which included stimulation of the well, a common
procedure in completing oil and gas wells.
The
Company was unable to determine by this well whether the target formations
contain economic quantities of gas. Drilling damage in the well prevented the
testing of either of the prospective formations at this location. Completion
efforts found that the Eagle formation was damaged by the initial drilling
and
the formation was not able to be tested from this well. Further drilling into
the Eagle formation during completion did not yield gas like the gas show seen
from the upper part of the formation that was damaged. The Judith River
formation, a secondary target, was damaged by drilling fluids lost into the
formation while drilling through it to get to the Eagle formation, the primary
target. Future wells to test this structure will incorporate the information
obtained from these wells to prevent that damage from occurring again in other
locations on the structure.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
2 Management's
Discussion and Analysis of Financial Condition
and Results
of Operations (Continued)
It
is not
unusual that the first well confirming a structure does not become a producing
well. The test well did produce valuable information about the two gas bearing
formations and their potential for economically feasible commercial gas
production. Problems encountered in drilling the test well can now be avoided
when future wells are drilled on the Starbuck East Prospect. With the first
two
objectives met, we will now focus on achieving the third objective, specifically
finding commercial gas in either the Eagle or Judith River formations.
Western
Standard now has 30 days from the completion to exercise its option to purchase
a 50% interest in approximately 42,000 (37,000 after some leases have expired)
acres near the well location (referred to as “Valley County Shallow Gas
Assembly”). The cost to exercise the option would be $1,000,000, payable in
$200,000 installments based on certain milestones related to drilling step-out
wells. We have received permits to drill two step-out wells and are currently
in
the permitting process for two more.
We
entered the second agreement with Cobra Oil and Gas, in May of 2008. Under
the
agreement, Cobra has paid Coastal $180,000 for the option to acquire a half
interest in approximately 87,000 acres of Coastal’s Valley County Leases. The
agreement allowed us to pay our Lease rentals that were due June 1, 2008 and
brings in a new party to explore on the Leases. Cobra will have two years to
exercise the option by spending $1,000,000 on our behalf, drilling wells on
the
leases under the agreement. Those leases include approximately 62,000 acres
of
leases that were formally under an agreement with F-Cross Resources that expired
earlier this year and more than 20,000 acres of other leases Coastal held in
Valley County.
F-Cross
Resources, LLC (“F-Cross”) will continue to hold its interest in the section in
which it drilled a well under the September 2007 agreement which has otherwise
expired. Under that agreement we received $50,000 from F-Cross at the execution
of a farm-out agreement covering approximately 64,000 acres (now 62,000 after
some leases expired) on the northwest part of our Valley County Leases. Under
the agreement, F-Cross had the option to drill a Lodgepole test well within
six
months and after that well had the further option to acquire an interest in
surrounding acreage. F-Cross is to pay for the cost of drilling the initial
well
and will receive a 100% working interest in the well until payout and an 80%
working interest after payout. F-Cross exercised its option and drilled the
first Lodgepole test well during November, 2007. The well is awaiting completion
and testing of several zones which have potential for both oil and gas. Unlike
the shallow gas well on Federal land, this well is located on State land and
provided that there is no State objection, we expect that F-Cross will resume
operations to complete and test the well once the weather and state regulators
permit it, however those operation have not yet been resumed. F-Cross did
not meet the requirements in the agreement and in late March the option to
acquire an interest in additional acreage expired, leaving F-Cross with the
interest in the section in which it drilled the well.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
2 Management's
Discussion and Analysis of Financial Condition
and Results
of Operations (Continued)
The
two
wells we were involved with drilling during 2006 and that were abandoned during
2007 were drilled in Montana, but in areas outside of and as far as 130 miles
from our Valley County Leases and were farm-in wells on leases held by others.
Both of those wells reached the targeted Lodgepole reefs, but no gas or oil
was
present in economic quantities. We will not pursue any further drilling in
these
areas. The second of these wells was drilled with partners and there
are
approximately $115,000 in unpaid expenses related to this well that are
collectively the responsibility of the various partners. This amount is not
reflected as a liability in the accompanying financial statements.
In
North
Dakota, we control the working interest on approximately 8,510 net acres in
Slope, Billings, and Stark Counties, on which a number of drillable prospects
have been mapped to date. The depth of wells here is greater than in Montana
(approximately 9,500 feet versus approximately 5,000 feet), and so the cost
of
drilling is higher. A typical North Dakota wildcat well costs about $1.5 million
to drill. We intend to bring in others to share the risk and investment in
wells
we drill in North Dakota until we are in a stronger financial
position.
Through
our efforts to bring in others to explore our North Dakota leases, in December
of 2007 we entered a new farm-out agreement with Western Standard. Under the
agreement, we assigned leases over four of our high-graded Lodgepole Reef
prospects to Western Standard in return for $80,000. We received $40,000 in
November 2007, $25,000 in February 2008 and $15,000 in April 2008. We will
also
retain a back-in working interest of 20% in the leases after payout. The leases
cover all rights below the Tyler formation, including the Lodgepole formation,
with an 80% net revenue interest. We acquired these and other leases in the
area
in 2005 from Oil For America for $50,000 and we have invested some additional
funds to geochemically test and high-grade these and other prospects on the
leases. Oil For America has agreed to waive the drilling obligation on these
four prospects. We will still retain additional Lodgepole reef prospects on
our
North Dakota leases not covered by this farm-out agreement.
As
briefly described above, in the Memorandum of Understanding which gave rise
to
the new farm-out agreement, Western Standard also agreed that we could use
the
more than $29,000 originally forwarded to be used for completion of the first
shallow gas well to cover the costs associated with the delay in operations,
including annual rentals. This amount combined with the $80,000 paid for the
four reef prospects helped cover our operations during the first half of
2008.
Results of Operations
Nine
months ended September 30, 2008 vs. September 30,
2007
We
did
not conduct drilling activities for the nine months ended September 30, 2008
or
2007, due to weather and/or landowner access restrictions on our leases from
January 1st
to July
1st.
We
performed some completion work in two stages during the 3rd
quarter
and expect to finish the remainder of the operations, including completion
work,
stimulation and testing of the well, during the 4th quarter
of 2008. Substantially all the drilling activity on our leases for 2007 was
financed under farm-out agreements with other entities, and we expect that
to
continue in 2008.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
ITEM
2 Management's
Discussion and Analysis of Financial Condition
and Results
of Operations (Continued)
Therefore,
our expenses are primarily administrative and our 2008 expenses remained
consistent with 2007 amounts. During 2007, we incurred $51,000 to prepare our
2006 wells for abandonment.
Our
interest income decreased in 2008 from 2007 due to lower cash
balances.
Three
months ended September 30, 2008 vs. September 30,
2007
We
conducted initial completion activities in the third quarter of 2008, but did
not conduct any drilling activities in 2007. We expect to finish completion
and
testing operations during the 4th quarter
of 2008. Substantially all the drilling activity on our leases for 2007 was
financed under farm-out agreements with other entities, and we expect that
to
continue in 2008. Therefore, our expenses are primarily administrative and
our
2008 expenses remained consistent with 2007 amounts. During 2007, we sold
certain piping and other well supplies for $17,000, which reduced the cost
of
preparing the 2006 wells for abandonment.
Our
interest income decreased in 2008 from 2007 due to lower cash
balances.
ITEM
3 Quantitative
and Qualitative Disclosure About Market Risk
The
Company does not have any significant exposure to market risk as there were
no
investments in marketable securities at September 30,
2008.
ITEM
4 Controls
and Procedures
a.
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Evaluation
of disclosure controls and procedures.
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We
maintain controls and procedures designed to ensure that information required
to
be disclosed in the reports that the Company files or submits under the
Securities Exchange Act of 1934 is recorded, processed, summarized and reported
within the time periods specified in the rules and forms of the Securities
and
Exchange Commission. Our Chief Executive Officer and our Chief Financial
Officer, after evaluating the effectiveness of our “disclosure controls and
procedures” (as defined in the Securities Exchange Act of 1934 (the “Exchange
Act”) Rules 13a-15(e) or 15d-15(e)) as of the end of the period covered by this
quarterly report, have concluded that our disclosure controls and procedures
are
effective based on their evaluation of these controls and procedures required
by
paragraph (b) of Exchange Act Rules 13a-15 or 15d-15.
b.
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Changes
in internal controls.
The Company made no changes in its internal control over financial
reporting that occurred during the Company’s first fiscal quarter that has
materially affected, or which is reasonably likely to materially
affect
the Company’s internal control over financial
reporting.
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COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
I - FINANCIAL INFORMATION
September
30, 2008
c.
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Limitations
on the Effectiveness of Controls
Our management, including our Chief Executive
and Chief Financial Officer, does not expect that our disclosure
controls
and internal controls will prevent all error and all fraud. A
control
system, no matter how well conceived and operated, can provide
only
reasonable, not absolute, assurance that the objectives of the
control
system are met. Further, the design of a control system must
reflect the
fact that there are resource constraints, and the benefits of
controls
must be considered relative to their costs. Because of the inherent
limitations in all control systems, no evaluation of controls
can provide
absolute assurance that all control issues and instances of fraud,
if any,
within the Company have been detected. These inherent limitations
include
the realities that judgments in decision-making can be faulty,
and that
breakdowns can occur because of simple error or mistake. Additionally,
controls can be circumvented by the individual acts of some persons,
by
collusion of two or more people, or by management override of
the control.
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The
design of any system of controls also is based in part upon certain assumptions
about the likelihood of future events, and there can be no assurance that any
design will succeed in achieving its stated goals under all potential future
conditions; over time, controls may become inadequate because of changes in
conditions, or the degree of compliance with the policies or procedures may
deteriorate. Because of the inherent limitations in a cost-effective control
system, misstatements due to error or fraud may occur and not be
detected.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
PART
II -
OTHER INFORMATION
September
30, 2008
ITEM
5 Other
Information
The
Internal Revenue Code of 1986, as amended, provides special rules for
distributions received by U.S. holders on stock of a passive foreign investment
company (PFIC), as well as amounts received from the sale or other disposition
of PFIC stock. Under the PFIC rules, a non-U.S. corporation will be classified
as a PFIC for U.S. federal income tax purposes in any taxable year in which,
after applying certain look-through rules, either (1) at least 75 percent of
its
gross income is passive income or (2) at least 50 percent of the gross value
of
its assets is attributable to assets that produce passive income or are held
for
the production of passive income.
The
Company believes that it would not be classified as a PFIC for the year 2007,
because it derived the majority of its gross income in 2007 from the sale of
interests in parts of its leases to other companies through farm-out agreements,
and received a relatively small amount of interest the Company. However, the
Company
may have
been considered a PFIC in previous years, which could result in negative tax
consequences to a shareholder. The determination of whether the Company will
be
considered a PFIC for United States federal income tax purposes is an annual
determination that cannot be made until the close of the fiscal year. Also,
how
the Company was classified last year does not affect how it will be classified
this year.
If,
for
any taxable year, the Company’s passive income or assets that produce passive
income exceed levels provided by U.S. law, the Company would be a "passive
foreign investment company," or PFIC, for U.S. federal income tax purposes.
For
the years 1987 through 2004 and in 2006, Coastal Caribbean's passive income
and
assets that produce passive income exceeded those levels and for those years
Coastal Caribbean constituted a PFIC. If Coastal Caribbean is a PFIC for any
taxable year, then the Company’s U.S. shareholders potentially would be subject
to adverse U.S. tax consequences of holding and disposing of shares of our
common stock for that year and for future tax years. Any gain from the sale
of,
and certain distributions with respect to, shares of the Company’s common stock,
would cause a U.S. holder to become liable for U.S. federal income tax under
section 1291 of the Internal Revenue Code (the interest charge regime). The
tax
is computed by allocating the amount of the gain on the sale or the amount
of
the distribution, as the case may be, to each day in the U.S. shareholder’s
holding period. To the extent that the amount is allocated to a year, other
than
the year of the disposition or distribution, in which the corporation was
treated as a PFIC with respect to the U.S. holder, the income will be taxed
as
ordinary income at the highest rate in effect for that year, plus an interest
charge.
For
further information, refer to the consolidated financial statements and
footnotes thereto included in the Company’s Annual Report on Form 10-K for the
year ended December 31, 2007.
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
September
30, 2008
ITEM
6 Exhibits
31.1
Certification
pursuant to Rule 13a-14 by Phillip W. Ware
32.1
Certification
pursuant to Section 906 by Phillip W.
Ware
COASTAL
CARIBBEAN OILS & MINERALS, LTD.
FORM
10-Q
September
30, 2008
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
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COASTAL
CARIBBEAN OILS & MINERALS, LTD.
Registrant
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Date:
November
13, 2008 |
By: |
/s/ Phillip
W. Ware |
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Phillip
W. Ware
Chief
Executive Officer,
President
and Treasurer
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