American Noble Gas, Inc. Commences Commercial Production of Natural Gas and Helium in August 2022

American Noble Gas, Inc. (AMNI) recently announced the completion of its initial well, which has successfully connected to the pipeline and commenced commercial production of both natural gas and helium on August 17, 2022. These findings are based on data derived from the company’s most recent SEC report.

The initial well was completed after successful perforation across two lower intervals of the Chase group of formations.

The fracture stimulation was carried out in two stages during June 2022. The company, which is engaged in the exploration and production of oil and gas properties, is currently evaluating the initial flows of natural gas and helium to determine its plan for additional wells on the farmout.

According to the SEC report, American Noble Gas, Inc. adopted the full cost accounting method, which involves capitalizing all exploration, exploitation, development, and acquisition costs.

The full cost pool includes intangible drilling costs, lease and well equipment, and exploration and development costs incurred, as well as acquired proved and unproved leaseholds.

The company also follows the equity method of accounting for equity investments, which is applied when the investment provides the ability to exercise significant influence, but not control, over the operating and financial policies of the investee. This method helps to evaluate equity investments for impairment when there are changes in circumstances and recoverability.

American Noble Gas, Inc. recognized an impairment charge of $905,574 as of December 31, 2022, due to a change in strategy towards exploring for noble gases and moving away from crude oil production at its Central Kansas Uplift properties.

This strategic shift resulted in a significant decrease in estimated future cash flows.

Moreover, the company estimates its asset retirement obligations for costs related to the plugging of wells, the removal of facilities and equipment, and site restoration on oil and gas properties.

These obligations are driven by factors such as changes in costs and the estimated useful life of wells. As of the end of 2022, the company recognized an additional liability of $1,715,953 for potential retirements related to its former oil and gas producing properties in Texas, Colorado, and Wyoming.

In terms of income taxes, American Noble Gas, Inc. uses the asset and liability method, which recognizes deferred tax liabilities and assets for the expected future tax consequences of temporary differences between financial accounting bases and tax bases of assets and liabilities.

The company recorded a deferred tax asset, net of valuation allowance, of $0 at both March 31, 2023, and December 31, 2022.

The commencement of commercial production of natural gas and helium is a significant milestone for American Noble Gas, Inc., as it signifies the company’s successful focus on exploring and producing noble gases.

With its ongoing evaluation of initial flows and plans for additional wells, the company is poised for potential growth and expansion within the oil and gas industry.

Note that we may hold securities mentioned in this article. All data is based on recent SEC filings. Even though we have implemented various manual and automatic fact-checking and data acquisition processes, some incorrect information may have slipped through (false positive). Let us know if you find any inconsistencies!