VIKING ENERGY GROUP, INC. - Quarter Report: 2016 September (Form 10-Q)

vkin_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED: September 30, 2016

¨	TRANSITION REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______.

Commission file number: 000-29219

VIKING INVESTMENTS GROUP, INC.

(Exact name of registrant as specified in its charter)

Nevada		98-0199508
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

1330 Avenue of the Americas, Suite 23 A, New York, New York		10019
(Address of principal executive offices)		(Zip Code)

Issuer’s telephone number (212) 653 0946

______________________________________________________________

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

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 x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes ¨ No x

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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	¨	Accelerated Filer	¨
Non Accelerated Filer	¨	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 ¨ No x

APPLICABLE ONLY TO CORPORATE ISSUERS

As of November 11, 2016, the registrant had 47,647,419 shares of common stock outstanding, including 1,996,590 issuable.

EXPLANATORY NOTE

As disclosed in the Current Report on Form 8-K of Viking Investments Group, Inc. (the “Company”) filed on November 14, 2016, on November 9, 2016, the Company engaged Turner, Stone & Company, L.L.P. (the “New Auditors”) as the Company’s new independent registered public accounting firm. The New Auditors have been engaged to audit the Company’s financial statements for the year ended December 31, 2015, and review the Company’s financial statements for the periods ending March 31, 2016, June 30, 2016, and September 30, 2016, but they have not completed the audit or reviews.

As a result, this report is deficient because the unaudited financial statements contained in this report for the period ended September 30, 2016, have not been reviewed by an independent registered public accountant as required by rule 10-01(d) regulation S-X. Completion of the New Auditors’ independent review of the Company’s financial statements for the period ended September 30, 2016, and the subsequent filing of an amendment to this report after the completion of that review, will make this report current. When the review is complete, the Company intends to file an amendment to this report which will include the required certifications of the Company's Principal Executive Officer and Principal Financial and Accounting Officer as required by sections 302 and 906 of the Sarbanes-Oxley Act.

VIKING INVESTMENTS GROUP, INC.

Part I – Financial Information

Item 1	Financial Statements	4
	Consolidated Balance Sheets as of September 30, 2016 (unaudited) and December 31, 2015 (unaudited)	4
	Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2016 and 2015 (unaudited)	5
	Consolidated Statements of Cash Flows for the nine months ended September 30, 2016 and 2015 (unaudited)	6
	Consolidated Statements of Stockholders’ Deficit (unaudited)	7
	Notes to the Unaudited Consolidated Financial Statements (unaudited)	8
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	37
Item 3	Quantitative and Qualitative Disclosures about Market Risk	40
Item 4	Controls and Procedures	40

Part II – Other Information

Item 1	Legal Proceedings	41
Item 2	Unregistered Sales Of Equity Securities And Use Of Proceeds	41
Item 3	Defaults Upon Senior Securities	42
Item 4	Mine Safety Disclosures	42
Item 5	Other Information	42
Item 6	Exhibits	43

PART I—FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

VIKING INVESTMENTS GROUP, INC.

Consolidated Balance Sheets

(Unaudited)

(Amounts expressed in US dollars)

	September 30,			December 31,
	2016			2015
	(Unaudited)			(Unaudited)
ASSETS
Current assets:
Cash	$	88,625		$	30,585
Accounts receivable – oil and gas		11,948			-
Other receivable – related party		76,719			76,719
Total current assets		177,292			107,304

Oil and gas properties, full cost method
Proved developed producing oil and gas properties, net		1,305,414			48,221
Undeveloped and non-producing oil and gas properties, net		1,557,632			755,439
Total oil and gas properties, net		2,863,046			803,660

Long term investment – related party		235,819			87,156
Deposit		288,000			-
TOTAL ASSETS	$	3,564,157		$	998,120

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accrued expenses and other current liabilities	$	244,103		$	95,575
Accounts payable		15,492			104,774
Derivative liability		547,894			810,647
Amount due to directors		756,215			614,991
Secured notes payable, net of debt discount		632,904			-
Convertible notes – current, net of debt discount		1,225,000			16,770
Total current liabilities		3,421,608			1,642.757
Convertible notes – net of current portion and debt discount		-			6,778
Asset retirement obligation		431,760			416,246
TOTAL LIABILITIES		3,853,367			2,065,781

Commitments and contingencies		-			-
STOCKHOLDERS’ DEFICIT
Capital Stock
Preferred stock, $0.001 par value, 5,000,000 shares authorized, 28,092 shares issued and outstanding as of September 30, 2016 and December 31, 2015		28			28
Common stock, $0.001 par value, 100,000,000 shares
Authorized, 47,534,919 and 30,333,993 shares issued, issuable and outstanding as of September 30, 2016 and December 31, 2015 respectively. (1,996,590 and 0 shares issuable, respectively).		47,648			30,334
Additional Paid-In Capital		10,640,079			7,960,372
Prepaid equity-based compensation		(97,095	)		(145,561	)
Accumulated other comprehensive income		(9,761	)		(158,424	)
Deficit		(10,870,110	)		(8,754,410	)
TOTAL STOCKHOLDERS’ DEFICIT		(289,211	)		(1,067,661	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	3,564,157		$	998,120

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

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VIKING INVESTMENTS GROUP, INC.

Consolidated Statements Of Operations And Comprehensive Loss

(Unaudited)

(Amounts expressed in US dollars)

	Three months ended,						Nine months ended,
	September 30,						September 30,
	2016			2015			2016			2015
	$			$			$			$
Revenue
Oil and gas sales		105,426			32,425			232,013			64,448

Operating expenses
Lease operating costs		66,456			24,961			165,773			46,736
General and administrative		166,507			181,010			419,603			403,927
Stock based compensation		172,219			-			578,363			108,000
Accretion – ARO		5,234			4,985			15,514			4,985
Depreciation, depletion and amortization		40,677			10,155			110,863			10,155
Total operating expenses		451,093			221,111			1,290,116			573,804

Loss from operations		(345,667	)		(188,686	)		(1,058,103	)		(509,356	)

Other income (expense)
Interest expense		(542,107	)		(137,801	)		(1,966,015	)		(195,702	)
Debt settlement income		-			-			75,000			-
Derivative expense					-			-			(403,193	)
Change in the fair value of derivative liability		2,765,013			(36,424	)		833,418			77,682
Total other income (expense)		2,222,906			(174,225	)		(1,057,597	)		(521,213	)

Net Income (loss)		1,877,239			(362,911	)		(2,115,700	)		(1,030,569	)

Other comprehensive income (loss)
Unrealized gain (loss) on securities available-for-sale		(3,394	)		(4,420	)		148,663			(16,642	)
Total comprehensive income (loss)		(3,394	)		(4,420	)		148,663			(16,642	)
Net Comprehensive Income (loss)		1,873,845			(367,331	)		(1,967,037	)		(1,047,211	)

Income (loss) per common share - Basic and diluted		0.041			(0.013	)		(0.049	)		(0.040	)
Weighted average number of common shares outstanding – basic and diluted		45,837,636			27,602,291			43,584,699			25,882,581

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

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VIKING INVESTMENTS GROUP, INC.

Consolidated Statements of Cash Flows

(Unaudited)

(Amounts expressed in US dollars)

	Nine Months Ended
	September 30,
	2016			2015
	$			$
Cash flows from operating activities:
Net loss		(2,115,700	)		(1,030,569	)
Adjustments to reconcile net loss to net cash used in operating activities:
Chang in the fair value of derivative liability		(833,418	)		(77,682	)
Derivative expense		-			403,193
Stock based compensation		578,363			108,000
Stock based interest payment		52,500
Depreciation, depletion and amortization		110,863			10,155
Accretion – Asset retirement obligation		15,514			4,985
Amortization of debt discount		1,626,062			119,211
Gain on settlement of debt		(75,000	)		-
Changes in operating assets and liabilities:
Increase(decrease) in accounts payable		(14,282	)		82,904
Increase in accrued expenses and other liabilities		151,862			29,826
Decrease (increase) in other receivables		-			(76,719	)
Decrease (increase) in accounts receivables		(11,948	)		-
Net cash used in operating activities		(515,184	)		(426,696	)

Cash flows from investing activities:
Acquisition of oil and gas properties		(1,350,000	)		(77,158	)
Net cash used in investing activities		(1,350,000	)		(77,158	)

Cash flows from financing activities:
Advances from Directors		197,280			479,400
Repayments to Directors		(56,056	)		(15,000	)
Sale of common stock		388,125			-
Proceeds from notes payable		619,875			-
Repayments of notes payable		(98,000	)		-
Payment of issuance costs		(37,500	)		-
Proceeds from convertible notes		1,480,000			211,000
Repayment of convertible notes		(570,500	)		(164,000	)
Net cash provided by financing activities		1,923,224			511,400

Net increase (decrease) in cash		58,040			7,546
Cash, beginning of period		30,585			1,345

Cash, end of period		88,625			8,891

Supplemental Cash Flow Information:
Cash paid for:
Interest	$	125,431		$	63,741
Income taxes	$	-		$	-
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Conversion of convertible note and accrued interest into shares	$	10,111		$	-
Issuance of shares as part of oil and gas property acquisition	$	820,250		$	-
Notes payable for oil and gas property acquisition	$	1,350,000		$	-
Issuance of warrants for 4,062,500 common shares as debt discount	$	415,569		$	-
Derivative liability at inception	$	1,216,303		$	1,374,808
Extinguished derivative liability	$	645,638		$	143,403
Issuance of shares for prepaid equity-based compensation	$	800,000		$	-
Stock issued for debt	$	-		$	227,807

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

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VIKING INVESTMENTS GROUP, INC.

Consolidated Statements of Stockholders’ Deficit

(Unaudited)

(Amounts expressed in US dollars)

																							Accumulated						Total
																	Additional			Prepaid			Other						Stockholders'
	Common Stock						Shares to be Issued						Preferred Stock				Paid-in			Equity-Based			Comprehensive						Equity
	Number			Amount			Number			Amount			Number		Amount		Capital			Compensation			Income			Deficit			(Deficiency)

Balance at December 31, 2014		24,094,551		$	24,095			675,000		$	675			28,092	$	28	$	7,162,660		$	-		$	(177,452	)	$	(7,067,267	)	$	(57,261	)

Shares issued to investors		675,000			675			(675,000	)		(675	)																		-
Shares issued for consulting services		720,000			720													107,280												108,000
Shares issued in satisfaction of debt		421,571			421													29,579												30,000
Shares issued in satisfaction of debt		2,872,871			2,873													198,228												201,101
Shares issued for convertible debt		550,000			550													20,450												21,000
Shares issued as prepaid equity-based compensation		1,000,000			1,000													164,000			(165,000	)								-
Derivative liability adjustment - satisfaction of convertible debt																		278,175												278,175
Unrealized gain (loss) on securities held for sale																								19,028						19,028
Amortization of prepaid equity-based compensation																					19,439									19,439
Net loss for the year ended December 31, 2015																											(1,687,143	)		(1,687,143	)

Balances at December 31, 2015		30,333,993		$	30,334			-		$	-			28,092	$	28	$	7,960,372		$	(145,561	)	$	(158,424	)	$	(8,754,410	)	$	(1,067,661	)

Shares issued for convertible debt		300,926			301													9,810												10,111
Shares issued for consulting services		1,000,000			1,000													101,500												102,500
Shares issued in acquisition of oil and gas properties		9,650,000			9,650													810,600												820,250
Shares issued as prepaid equity-based compensation		4,000,000			4,000													636,000			(640,000	)								-
Shares committed for prepaid equity-based compensation								1,000,000			1,000							159,000			(160,000	)								-
Derivative liability adjustment - satisfaction of convertible debt																		17,745												17,745
Shares issued from sale of stock		1,250,000			1,250													186,250												187,500
Debt issuance costs																		(37,500	)											(37,500	)
Derivative liability adjustment - satisfaction of convertible debt																		602,580												602,580
Cancelation of shares issued as prepaid equity-based compensation		(4,000,000	)		(4,000	)												(368,603	)		372,603									-
Shares issued to secure an oil and gas property acquisition		2,400,000			2,400													285,600												288,000
Shares commited as costs associated with settlement of debt								375,000			375							52,125												52,500
Shares committed from sale of stock								1,337,500			1,338							199,287												200,625
Issuable shares issued		715,910			716			(715,910	)		(716	)																		-
Derivative liability adjustment - satisfaction of convertible debt																		25,313												25,313
Unrealized gain (loss) on securities held for sale																								148,663						148,663
Amortization of prepaid equity-based compensation																					475,863									475,863
Net loss for the nine months ended September 30, 2016																											(2,115,700	)		(2,115,700	)

Balances at September 30, 2016		45,650,829		$	45,651			1,996,590		$	1,997			28,092	$	28	$	10,640,079		$	(97,095	)	$	(9,761	)	$	(10,870,110	)	$	(289,211	)

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

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VIKING INVESTMENTS GROUP, INC.

Notes to Consolidated Financial Statements

(Unaudited)

(Amounts expressed in US dollars)

Note 1. Nature of Business and Going Concern

The Company was incorporated under the laws of the State of Florida on May 3, 1989, as Sparta Ventures Corp. and remained inactive until June 27, 1998. After several name changes, the Company merged with and into a wholly-owned subsidiary, SinoCubate, Inc., which remained the surviving entity of the merger. SinoCubate, Inc. was formed in the State of Nevada on September 11, 2008. The merger resulted in a change of name of the Company from Synthenol Inc. to SinoCubate, Inc., and a change in the state of incorporation of the Company from Florida to Nevada. On June 13, 2012, the Company changed its name to Viking Investments Group, Inc., and the Company’s ticker symbol was changed to “VKIN.”

Prior to the first quarter of 2016, the Company’s business plan consisted of two strategies: (a) identifying target companies that were undergoing or anticipating periods of rapid growth to provide advisory and consulting services, and (b) identifying investments in oil and gas properties for future exploration and development. In November of 2014, the Company entered into its first contract relative to oil and gas activities involving jointly controlled assets and related liabilities by purchasing an undivided 50% interest in the Joffre project located in Alberta, Canada, as explained in note 4.

Commencing with the first quarter of 2016, the Company determined that its singular business plan is to engage in the acquisition, exploration, development and production of oil and natural gas properties. Consistent with its refocused efforts, on February 23, 2016, the Company closed on the acquisition of working interests in four leases with access to the mineral rights (oil and gas) concerning approximately 281 acres of property in Miami and Franklin Counties in eastern Kansas.

These unaudited consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company had a net loss of $2,120,840 and $1,030,569 for the nine months ended September 30, 2016 and 2015, respectively. The Company has accumulated a stockholders’ deficit of ($294,351) as of September 30, 2016. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or related party advances; however, there is no assurance of additional funding being available. These unaudited consolidated financial statements do not include any adjustments to the recorded assets or liabilities that might be necessary should the Company have to curtail operations or be unable to continue in existence.

Note 2. Summary of Significant Accounting Policies

a) Basis of Presentation

The accompanying unaudited consolidated financial statements of Viking Investments Group, Inc. (“Viking” or the “Company”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with the audited financial statements and notes thereto contained in Viking’s latest Annual Report filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.

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In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and the reported amounts of revenues and expenses for the period. Actual results could differ significantly from those estimates.

b) Basis of Consolidation

The financial statements presented herein reflect the consolidated financial results of the Company and its wholly owned subsidiary, Viking Oil & Gas (Canada) ULC, a Canadian corporation formed on March 8, 2016. This subsidiary is intended to provide a base of operations in Canada, although at the time of this filing there has been no activity. All significant intercompany transactions and balances have been eliminated upon consolidation.

c) Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts assets, liabilities, revenues and expenses, as well as certain financial statement disclosures. While management believes that the estimates and assumptions used in the preparation of the financial statements are appropriate, actual results could differ from these estimates. Significant estimates generally include those with respect to the amount of recoverable oil and gas reserves, the fair value of financial instruments, oil and gas depletion, asset retirement obligations, stock-based compensation, derivative liabilities and impairment of long-term investment.

d) Financial Instruments

ASC Topic 820-10, “Fair Value Measurements and Disclosures,” requires disclosure of the fair value of financial instruments held by the Company. ASC Topic 820-10, “Financial Instruments,” defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for other receivables, other payable, accrued liabilities, short term loan and due to director each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows:

Level 1: inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2: inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3: inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The changes in the Level 3 investments during the nine months ended September 30, 2016 consisted of an investment in the oil and gas properties acquired in February of 2016 in the amount of $2,170,250 minus depreciation of the recorded Asset Retirement Cost in the amount of $30,466 and depletion of $80,397.

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Assets and liabilities measured at fair value as of September 30, 2016 are classified below based on the three fair value hierarchy described above:

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Gains (Losses)

Financial Assets
Long term investment	$	235,819	$	-	$	-	$	148,663
Oil and Gas properties - net		-		-		2,863,046		-
	$	239,213	$	-	$	2,863,046	$	152,057

Financial liabilities
Derivative liabilities	$	-	$	547,894	$	-	$	833,418
	$	-	$	547,894	$	-	$	833,418

Assets and liabilities measured at fair value as of December 31, 2015 are classified below based on the three fair value hierarchy described above:

Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Gains (Losses)

Financial Assets
Long term investment	$	87,156	$	-	$	-	$	19,028
Oil and Gas properties - net		-		-		803,660		-
	$	87,156	$	-	$	803,660	$	19,028

Financial liabilities
Derivative liabilities	$	-	$	810,647	$	-	$	266,378
	$	-	$	810,647	$	-	$	266,378

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e) Cash

Cash includes bank deposits and cash on hand.

f) Accounts receivable

Accounts receivable consist of oil and gas receivables. The Company has classified these as short-term assets in the balance sheet because the Company expects repayment or recovery within the next 12 months. The Company evaluates these accounts receivable for collectability and, when necessary, records allowances for expected unrecoverable amounts. The Company deems all accounts receivable to be collectable, and has not recorded any allowance for doubtful accounts.

g) Prepaid equity-based compensation

Prepaid equity-based expenses represent amounts paid in advance through the issuance of restricted shares of stock, for future contractual benefits to be received. These expenses paid in advance are recorded as prepaid equity-based compensation as a component of “Stockholders’ Equity” and then amortized to the statements of operations over the life of the contract using the straight-line method. At September 30, 2016 and December 31, 2015, the balances of the prepaid equity-based compensation were comprised of the following:

	September 30, 2016		December 31, 2015

In November, 2015, a one-year consulting agreement with an unrelated party for services related to the petroleum industry in the amount of $165,000.	$	21,698		145,561

In March, 2016, 3 one-year consulting agreements with 3 unrelated parties for services related to the petroleum industry for a combined total amount of $800,000. Two of the agreements have been cancelled. The balance remaining pertains to only of the original agreements		75,397		-
	$	97,095	$	145,561

h) Oil and Gas Properties

The Company uses the full cost method of accounting for its investment in oil and natural gas properties. Under this method of accounting, all costs associated with acquisition, exploration and development of oil and gas reserves, including directly related overhead costs, are capitalized. General and administrative costs related to production and general overhead are expensed as incurred.

All capitalized costs of oil and gas properties, including the estimated future costs to develop proved reserves, are amortized on the unit of production method using estimates of proved reserves. Disposition of oil and gas properties are accounted for as a reduction capitalized costs, with no gain or loss recognized unless such adjustment would significantly alter the relationship between capitalized costs and proved reserves of oil and gas, in which case the gain or loss is recognized to income. Investment in unproved properties and major development projects are not amortized until proved reserves associated with the projects can be determined or until impairment occurs. If the results of an assessment indicate that the properties are impaired, the amount of the impairment is included in loss from continuing operations before income taxes and the adjusted carrying amount of the unproved properties is amortized on the unit-of-production method.

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Amortization expense utilizing the unit-of-production method for the Company’s oil and gas properties in both Canada and the United States for the three and nine months ended September 30, 2016 and 2015 were as follows:

Oil and Gas Properties by Geographical Cost Center
	Three months ended,				Nine months ended,
	September 30,				September 30,
Cost Center	2016		2015		2016		2015

Canada	$	8,374	$	-	$	15,046	$	14,570
United States		22,148		-		65,351		-

	$	30,522	$	-	$	80,397	$	14,570

i) Limitation on Capitalized Costs

Under the full-cost method of accounting, we are required, at the end of each fiscal quarter, to perform a test to determine the limit on the book value of our oil and natural gas properties (the “Ceiling” test). If the capitalized costs of our oil and natural gas properties, net of accumulated amortization and related deferred income taxes, exceed the Ceiling, this excess or impairment is charged to expense and reflected as additional accumulated depreciation, depletion and amortization or as credit to oil and natural gas properties. The expense may not be reversed in future periods, even though higher oil and natural gas prices may subsequently increase the Ceiling. The Ceiling is defined as the sum of:

(a) the present value, discounted at 10 percent, and assuming continuation of existing economic conditions, of 1) estimated future gross revenues from proved reserves, which is computed using oil and natural gas prices determined as the unweighted arithmetic average of the first-day-of-the-month price for each month within the 12-month hedging arrangements pursuant to SAB 103, less 2) estimated future expenditures (based on current costs) to be incurred in developing and producing the proved reserves, plus

(b) the cost of properties not being amortized (pursuant to Reg. S-X Rule 4-10 (c)(3)(ii); plus

(d) the related tax effects related to the difference between the book and tax basis of our oil and natural gas properties.

j) Oil and Gas Reserves

Our proved oil and gas reserves are estimated by independent petroleum engineers. Reserve engineering is a subjective process that is dependent upon the quality of available data and the interpretation thereof, including evaluations and extrapolations of well flow rates and reservoir pressure. Estimates by different engineers often vary sometimes significantly. In addition, physical factors such as the results of drilling, testing and production subsequent to the date of an estimate, as well as economic factors such as changes in product prices, may justify revision of such estimates. Because proved reserves are required to be estimated using recent prices of the evaluation, estimated reserve quantities can be significantly impacted by changes in product prices.

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The standardized measure of discounted future net cash flows and changes in such cash flows are prepared using assumptions required by the Financial Accounting Standards Board and the Securities and Exchange Commission. Such assumptions include using a 10% rate. Changes in any of these assumptions could have a significant impact on the standardized measure. Accordingly, the standardized measure does not represent management’s estimated current market value of proved reserves. At September 30, 2016, the Company’s net book value of oil and natural gas properties did not exceed the ceiling amount calculated for the quarter.

k) Revenue Recognition

All revenue is recognized when persuasive evidence of an arrangement exists, the service or sale is complete, the price is fixed or determinable and collectability is reasonably assured. Revenue is derived from the sale of crude oil and natural gas. Revenue from crude oil and natural gas sales is recognized when the product is delivered to the purchaser and collectability is reasonably assured. The Company follows the “sales method” of accounting for oil and natural gas revenue, so it recognizes revenue on all natural gas or crude oil sold to purchasers.

l) Comprehensive Income

FASB ASC 220 “Comprehensive Income,” establishes standards for the reporting and display of comprehensive income and its components in the consolidated financial statements. The comprehensive income for the three months ended September 30, 2016 was $1,868,704 and the comprehensive loss for the nine months ended September 30, 2016 was ($1,972,177) respectively, and the comprehensive losses for the three and nine months ended September 30, 2015 was ($367,331) and ($1,047,211) respectively.

m) Loss per Share

Basic net loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common shares and, adjusted by any effects of warrants and options outstanding, if dilutive, that may add to the number of common shares during the period. Dilution is computed by applying the treasury stock method for options and warrants. Under this method, “in-the money” options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. At September 30, 2016, there were 4,062,500 common stock equivalents that were anti-dilutive and not included in the calculation.

n) Income Taxes

The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”). Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740-10-25, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company provides a valuation allowance for deferred tax assets for which it does not consider realization of such assets likely. The Company did not incur any material impact to its financial condition or results of operations due to the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company is subject to U.S federal jurisdiction income tax examinations for the tax years 2006 through 2014. In addition, the Company is subject to state and local income tax examinations for the tax years 2006 through 2015.

o) Stock-Based Compensation

The Company may issue stock options to employees and stock options or warrants to non-employees in non-capital raising transactions for services and for financing costs. The Company has adopted ASC Topic 718 (formerly SFAS 123R), “Accounting for Stock-Based Compensation,” which establishes a fair value method of accounting for stock-based compensation plans. In accordance with guidance now incorporated in ASC Topic 718, the cost of stock options and warrants issued to employees and non-employees is measured on the grant date based on the fair value. The fair value is determined using the Black-Scholes option pricing model. The resulting amount is charged to expense on the straight-line basis over the period in which the Company expects to receive the benefit, which is generally the vesting period.

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The fair value of stock warrants was determined at the date of grant using the Black-Scholes option pricing model. The Black-Scholes option model requires management to make various estimates and assumptions, including expected term, expected volatility, risk-free rate, and dividend yield. The expected term represents the period of time that stock-based compensation awards granted are expected to be outstanding and is estimated based on considerations including the vesting period, contractual term and anticipated employee exercise patterns. Expected volatility is based on the historical volatility of the Company’s stock. The risk-free rate is based on the U.S. Treasury yield curve in relation to the contractual life of stock-based compensation instrument. The dividend yield assumption is based on historical patterns and future expectations for the Company dividends.

The following table represents stock warrant activity as of and for the nine months ended September 30, 2016:


	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
Warrants Outstanding – December 31, 2015		-		-.		-		-
Granted		4,062,500	$	0.20	5.0 years			-
Exercised		-		-		-		-
Forfeited/expired/cancelled		-				-		-

Warrants Outstanding – September 30, 2016		4,062,500	$	0.20	4.25 years		$	-

Outstanding Exercisable – December 31, 2015		-	$	-		-	$	-
Outstanding Exercisable – September 30, 2016		4,062,500	$	0.20	4.25 years		$	-

p) Long-term Investment

Management determines the appropriate classification of investment securities at the time of purchase. Securities are classified held-to-maturity when the Company has both the positive intent and ability to hold the securities to maturity. Held-to-maturity securities are stated at amortized cost. Securities that are bought and held principally for the purpose of selling in the near term are classified as trading securities and reported at fair value, with unrealized gains and losses included in earnings. Securities not classified as held-to-maturity or trading are classified as available-for-sale. Available-for-sale securities are stated at fair value, the changes in the market value of available-for-sale securities, excluding other-than-temporary impairments, are reflected in Other Comprehensive Income, with the impairment losses, net of income taxes, charged to net income in the period in which it occurs.

The fair value of securities is based on quoted market prices. If a quoted market price is not available, fair value is estimated using quoted market prices for similar securities. A decline in the market value of any available-for-sale or held-for-maturity security below cost that is deemed to be other-then-temporary results in a reduction in carrying amount to fair value.

Impairments that are considered other-than-temporary are recognized as a loss in the consolidated statements of operations. The Company considers various factors in reviewing impairments, including the length of time and extent to which fair value has been less than the Company’s cost basis, the financial condition and near-term prospects of the issuer, and the Company’s intent and ability to hold the investments for a period of time sufficient to allow for any anticipated recovery in market value.

As of September 30, 2016 and December 31, 2015, the Company had no trading and held-to-maturity securities.

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On September 9, 2014, the Company subscribed for 1,250,000 units of Tanager Energy Inc. (“Tanager”), a Canadian mining company listed on the Canadian TSXVenture Exchange as a Tier 2 company and trading under the stock symbol “TAN,” at a price of C$0.08 per unit. Each unit consists of one share of Tanager’s common stock and one warrant to purchase one additional common share at a price of C$0.15 at any time until October 5, 2016. The warrants expire on October 5, 2016. The total price for the units subscribed for was C$101,247.47. The Company paid $92,000, which was equivalent to C$101,247.47 on September 11, 2014.

On October 6, 2014, the Company subscribed for an additional 2,187,500 units of Tanager at a price of C$0.08 per unit. Each unit consists of one share of Tanager’s common stock to purchase one additional common share at a price of C$0.15 at any time until October 5, 2016. The warrants expire on October 5, 2016. The total price for the units subscribed for was C$175,000. The Company paid $155,444, which was equivalent to C$175,000 on October 17, 2014.

The Company’s investment in Tanager is considered as “available-for-sale” securities, and an unrealized gain of $148,663 was recorded in other comprehensive income for the nine months ended September 30, 2016.

q) Impairment of long-lived assets

In accordance with ASC 360, "Accounting for the Impairment or Disposal of Long-Lived Assets", the Company is required to review its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through the estimated undiscounted cash flows expected to result from the use and eventual disposition of the assets. Whenever any such impairment exists, an impairment loss will be recognized for the amount by which the carrying value exceeds the fair value.

Assets are grouped and evaluated at the lowest level for their identifiable cash flows that are largely independent of the cash flows of other groups of assets. The Company considers historical performance and future estimated results in its evaluation of potential impairment and then compares the carrying amount of the asset to the future estimated cash flows expected to result from the use of the asset. If the carrying amount of the asset exceeds estimated expected undiscounted future cash flows, the Company measures the amount of impairment by comparing the carrying amount of the asset to its fair value. The estimation of fair value is generally determined by using the asset's expected future discounted cash flows or market value. The Company estimates fair value of the assets based on certain assumptions such as budgets, internal projections, and other available information as considered necessary. There is no impairment of long-lived assets during the nine months ended September 30, 2016 and 2015.

r) Foreign Currency Exchange

An entity's functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which the entity primarily generates and expends cash. Management's judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. Functional currency of the parent company is the U.S. Dollar. The reporting currency of the Company is the U.S. Dollar. The Company has oil and gas operations in Alberta, Canada in which the Canadian Dollar (“CAD” or “C$” herein) is the primary economic environment. The reporting currency of these consolidated financial statements is the U.S. Dollar.

For financial reporting purposes, the operational results of the Company's oil and gas operations in Canada are prepared using the CAD, and are translated in the Company’s reporting currency, the U.S. Dollar. Revenue and expenses applicable to the oil and gas operations in Alberta, Canada are translated using average rates prevailing during each reporting period. Gains or losses resulting from the settlement of foreign currency transactions are recorded as a separate component of accumulated other comprehensive income in stockholders; equity when realized. There have been no settlement transactions that resulted in the recognition of a foreign currency exchange gain or loss during the three or nine months ended September 30, 2016 and 2015.

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s) Convertible Notes Payable

The Company accounts for conversion options embedded in convertible notes in accordance with ASC 815. ASC 815 generally requires companies to bifurcate conversion options embedded in convertible notes from their host instruments and to account for them as free standing derivative financial instruments.

The Company has evaluated the terms and conditions of the convertible note under the guidance of ASC 815. The conversion feature did not meet the definition of “indexed to a company’s own stock” provided for in ASC 815 due to the down round protection feature. Therefore, the conversion feature requires bifurcation and liability classification. Additionally, the default put requires bifurcation because it is indexed to risks that are not associated with credit or interest risk. As a result, the compound embedded derivative comprises of (i) the embedded conversion feature and (i) the default put. Rather than bifurcating and recording the compound embedded derivative as a derivative liability, the Company elected to initially and subsequently measure the convertible note in its entirety at fair value, with changes in fair value recognized in earnings in accordance with ASC 815-15-25-4.

t) Derivative Liability

We review the terms of convertible debt issues to determine whether there are embedded derivative instruments, including embedded conversion options, which are required to be bifurcated and accounted for separately as derivative financial instruments. In circumstances where the host instrument contains more than one embedded derivative instrument, including the conversion option, that is required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument.

Bifurcated embedded derivatives are initially recorded at fair value and are then revalued at each reporting date with changes in the fair value reported as non-operating income or expense. When the equity or convertible debt instruments contain embedded derivative instruments that are to be bifurcated and accounted for as liabilities, the total proceeds received are first allocated to the fair value of all the bifurcated derivative instruments. The remaining proceeds, if any, are then allocated to the host instruments themselves, usually resulting in those instruments being recorded at a discount from their face value. The discount from the face value of the convertible debt, together with the stated interest on the instrument, is amortized over the life of the instrument through periodic charges to interest expense.

u) Accounting for Asset Retirement Obligations

On July 1, 2015, the Company adopted Statement of Financial Accounting Standards (“SFAS”) No. 143, Accounting for Asset Retirement Obligations, which addresses the financial accounting and reporting obligations and retirement costs related to the retirement of tangible long-lived assets. Among other things, SFAS No. 143 requires oil and gas companies to reflect decommissioning liabilities on the face of the balance sheet at fair value on a discounted basis. This statement requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred. The associated asset retirement costs are capitalized as part of the carrying cost of the asset. Our asset retirement obligations consist of estimated costs for dismantlement, removal, site reclamation and similar activities associated with our oil and gas properties.

With the adoption of SFAS No. 143, an asset retirement obligation and the related asset retirement cost in the amount of $406,214 have been recorded. This asset retirement cost was determined and discounted to present value using a credit-adjusted risk-free rate. After the initial recording, the liability is increased for the passage of time, with the increase being reflected as accretion expense in the statement of operations. Subsequent adjustments in the cost estimate are reflected in the liability and the amounts continue to be amortized over the useful life of the related long-lived asset.

Pursuant to the terms of the operating agreement associated with the oil and gas property acquisitions in the United States made during the quarter ended March 31, 2016, the Company has not incurred any additional asset retirement obligations as a result of this acquisition.

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The following table describes the changes in the Company’s asset retirement obligations for the nine months ended September 30, 2016:

Asset retirement obligation at December 31, 2015	$	416,246
Accretion expense		15,514

Asset retirement obligation at September 30, 2016	$	431,760

v) Reclassification of Prior Year Presentation

Certain reclassifications have been made to conform the prior period data to the current presentations.

w) Recent Accounting Pronouncements

The Financial Accounting Standards Board and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2016. Management has carefully considered the new pronouncements that altered generally accepted accounting principles and does not believe that any other new or modified principles will have a material impact on the Company’s reported financial position or operations in the near term.

x) Subsequent events

The Company has evaluated all transactions through the date the consolidated financial statements were issued for subsequent event disclosure consideration.

Note 3. Related Party Transactions

During April 2015, the Company made an advance to Tanager Energy Inc., in conjunction with a joint investment in the second oil well of the Joffre Project. As of September 30, 2016, the balance owed by Tanager to the Company is $76,719, which is shown as “Other receivable – related party” on the balance sheet.

During the nine months ended September 30, 2016, the Company’s Executive Chairman and Director, Tom Simeo did not accrue payroll and made no advances to the Company. The Company paid a total of $1,056 against prior advances by Mr. Simeo. Any accruals and advances do not bear interest, are unsecured and have no specific terms of repayment. As of September 30, 2016, the net amount due for prior accruals and expenses paid on behalf of the Company is $36,103. The Company has not imputed interest as the amount is deemed immaterial.

During the nine months ended September 30, 2016, the Company’s CEO and Director, James Doris incurred expenses on behalf of, and made advances to the Company in the amount of $197,281 in order to provide the Company with funds to carry on its operations, and the Company made repayments of $55,000 against prior advances. These advances by Mr. Doris do not bear interest, are unsecured and have no specific terms of repayment. As of September 30, 2016, the amount due for expenses paid on behalf of the Company is $253,276. The Company has not imputed interest as the amount is deemed immaterial. Additionally, Mr. Doris made several loans to the Company totaling $466,836, all accruing interest at 12%, and payable on demand. As of September 30, 2016, the total amount due to Mr. Doris for advances and expenses paid on behalf of the Company and loans is $720,112. Accrued interest of $53,931 is included in accrued expenses and other current liabilities at September 30, 2016.

On June 5, 2015, the Company authorized and approved the issuance of 2,000,000 and 872,871 restricted shares of common stock in settlement and cancellation of a total of $201,101 of amounts owed to directors at a cost basis of $0.07 per share.

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Note 4. Oil and Gas Properties

The following table summarizes the Company’s oil and gas activities by classification and geographical cost center for the nine months ended September 30, 2016:

	December 31,								September 30,
	2015			Additions			Disposals		2016
Proved developed producing oil and gas properties
Canada cost center	$	50,313		$	-		$	-	$	50,313
United States cost center		-			1,308,938			-		1,308,938
Accumulated depletion and impairment		(874	)		(49,918	)		-		(50,792	)
Accumulated depreciation, asset retirement costs		(1,218	)		(1,827	)		-		(3,045	)
Proved developed producing oil and gas properties, net	$	48,221		$	1,257,193		$	-	$	1,305,414

Undeveloped and non-producing oil and gas properties
Canada cost center	$	788,227		$	-		$	-	$	788,227
United States cost center		-			861,312			-		861,312
Accumulated depletion and impairment		(13,696	)		(30,481	)		-		(44,177	)
Accumulated depreciation, asset retirement costs		(19,092	)		(28,638	)		-		(47,730	)
Undeveloped and non-producing oil and gas properties, net	$	755,439		$	802,193		$	-	$	1,557,632

Total Oil and Gas Properties, Net	$	803,660		$	2,059,386		$	-	$	2,863,046

On November 3, 2014, the Company entered into a Purchase and Sale, Petroleum and Natural Gas Conveyance Agreement (the “Agreement”), with Tanager Energy Inc., a Canadian corporation listed on the TSX Venture Exchange as a Tier 2 company and trading under the stock symbol “TAN” (“Tanager Energy”). Pursuant to the Agreement, the Company was to receive a 50% working interest in the Joffre oil and gas property located in Alberta, Canada (the “Joffre Property”), and the Company was obligated to pay Tanager C$400,000 for the interest in the Joffre Property, with C$340,000 payable at closing.

On November 4, 2014, the Company closed the transaction by paying Tanager $302,367, with the balance of $52,801 (C$60,000) paid in January of 2015. Tanager owns the remaining 50% working interest in the property and operates and manages the property in accordance with an operating agreement pursuant to the Canadian Association of Petroleum Landman Operating Procedure. The proceeds were to be used by Tanager to complete and place on production the first of four suspended Devonian oil wells in the Joffre D-3 B oil pool (the “Joffre Project”). The Company’s (and Tanager’s) working interest in the Joffre Property will generally terminate when future production, if any, ceases (or in the case of the water disposal well on the Joffre Property, on the date that production ceases after 5 years has elapsed).

In April 2015, the Company advanced to Tanager Energy Inc., an additional $153,877 (C$190,000) as an investment in the second well in the Joffre D-3 oil pool. As the Company and Tanager each own 50% of each phase of this project, the Company has accounted for this transaction as an investment by the Company of $77,158 (C$95,270), with a loan receivable from Tanager of $76,719 (C$94,730).

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On February 23, 2016, the Company closed on the acquisition of working interests in four leases with access to the mineral rights (oil and gas) concerning approximately 281 acres of property in Miami and Franklin Counties in eastern Kansas. This project produces oil from the Cherokee formation at a depth of approximately 600 feet. These leases offer the potential for several future drilling locations. The purchase includes an undivided interest in all oil and gas wells, equipment, fixtures and other personal property located upon the leased properties and used in connection with oil and gas operations upon the leases attributable to the working interests purchased by the Company. The names of the four leases and Viking’s percentage ownership of the working interest of each lease is as follows:

Lease Name	Viking's Working Interest Percentage

HAHN		32.299	%
JOHNSTON		84.041	%
WILSON, EAST		15.000	%
WILSON, WEST		55.003	%

The effective date of the acquisitions is February 1, 2016, so the Company was entitled to net revenues from its share of production as of such date. As consideration for this transaction, the Company paid $1,350,000, plus 4,650,000 shares of common stock valued at $0.10 per share, or $465,000.

The Company also purchased a 100% working interest (a net revenue interest of 83%) in certain non-producing leases as follows: (i) three leases with access to the mineral rights (oil and gas) concerning approximately 270 acres of property in Miami and Franklin Counties in eastern Kansas; and (ii) 31 leases with access to the mineral rights (oil and gas) concerning approximately 5,500 acres of property in Cass and Bates Counties in Missouri. The purchase includes an undivided interest in all oil and gas wells, equipment, fixtures and other personal property located upon the leased properties and used in connection with oil and gas operations upon the leases attributable to the working interests purchased by Viking. As consideration for this transaction, Viking agreed to issue the vendors 5,000,000 shares of common stock valued at $0.10 per share, or $500,000.

The total purchase of these oil and gas interests is calculated as follows, and is included as an investment in Petroleum and Gas properties on the balance sheet at September 30, 2016:

Cash consideration	$	1,350,000
Stock for producing interests		395,250
Stock for non-producing interests		425,000

Total purchase price	$	2,170,250

Proforma condensed selected financial data for the three and nine months ended September 30, 2016 and 2015, as though this acquisition had taken place at January 1, 2015, are as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015

Revenues	$	105,426		$	68,985		$	246,449		$	243,708

Net Loss	$	(688,024	)	$	(619,621	)	$	(2,114,117	)	$	(966,696	)

Loss per share	$	(0.016	)	$	(0.003	)	$	(0.034	)	$	(0.039	)

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For the three and nine months ended September 30, 2016, the Company has included $49,232 and $135,334 of revenue providing $11,947 and $46,138 of net earnings in its consolidated income statement from the date of acquisition.

To facilitate these acquisitions, the Company borrowed $1,450,000 from private lenders pursuant to a 15% Senior Secured Convertible Promissory Note (the "Note"), arranged through a licensed broker/dealer, with the primary terms of the loan being as follows: (i) Term – 6 months; (ii) Rate – 15% per annum; (iii) Security – 1^st ranking charge against company assets pursuant to a Security and Pledge Agreement (the "Security Agreement"); (iv) Conversion – the lenders have a right to convert all or part of the note into common stock of Viking at a price of $0.15 per share, subject to certain ownership restrictions; and (v) Warrants – the lenders were given an option to purchase, within the next 5 years, 4,062,500 shares of common stock of Viking at an initial exercise price of $0.20 per share pursuant to a Common Stock Purchase Warrant. Viking's CEO and director, James Doris, also personally guaranteed repayment of the loan and granted the lenders a security interest in his assets.

Note 5. Capital Stock and Additional Paid-in Capital

(a) Preferred Stock

The Company is authorized to issue 5,000,000 shares of Preferred Stock, par value $0.001 per share (the “Preferred Stock”), of which 50,000 have been designated as Series C Preferred Stock (the “Series C Preferred Stock”).

On October 3, 2012, the Company issued 28,092 shares of Series C Preferred Stock to Tom Simeo in exchange for the return of the equal amount of shares of common stock, owned by Tom Simeo, deposited in a brokerage account, to the Company for cancellation. On or about September 1, 2015, Tom Simeo instructed the Company’s Stock Transfer Agent, VStock Transfer LLC, to cancel stock certificate number 3032, representing 28,092 shares of common stock, in consideration for the missing 28,092 shares of common stock. Neither the common stock, nor the preferred stock, were assessed any value.

Each share of Series C Preferred Stock shall entitle the holder thereof to two thousand (2,000) votes on all matters submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at any time on or after the date that Preferred Stock has been issued (“Distribution Date) declare or pay any dividend on common stock payable in shares of common stock, or effect a subdivision or combination or consolidation of the outstanding shares of common stock (by reclassification or otherwise than by payment of a dividend in shares of common stock) into a greater or lesser number of shares of common stock, then in each such case the number of votes per share to which holders of shares of Series C Preferred Stock were entitled immediately prior to such event shall be adjusted by multiplying such number by a fraction of the numerator of which is the number of shares of common stock outstanding immediately after such event and the denominator of which is the number of shares of common stock that were outstanding immediately prior to such event.

Each share of Series C Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, at the office of the Corporation or any transfer agent for such stock, into one share of fully paid and non-assessable common stock (the “Conversion Rate”).

On July 16, 2015, Tom Simeo, Executive Chairman, and a director of the Company, who owned 28,092 shares of the Company’s Series C Preferred Stock (the “Shares”), transferred 50% (14,046) of the Shares to James A. Doris, President, CEO and a director of the Company in consideration of the purchase price of $10,000, paid from the personal funds of Mr. Doris. Mr. Simeo retained 14,046 shares of the Company’s Series C Preferred Stock, and no other shares of Series C Preferred Stock are issued or outstanding. Since each of the preferred shares entitles the voter of 2,000 votes per share, or 70,230,000 each, Mr. Simeo and Mr. Doris effectively control the Company jointly, neither of them solely controls the Company, and the transfer of the preferred shares constituted a change of control of the Company.

(b) Common Stock

The Company is authorized to issue 100,000,000 shares of common stock, par value $0.001 per share.

In May 2015, the Company authorized and approved the issuance of 720,000 shares of its common stock in conjunction with a six month consulting agreement, at a cost basis of $0.15 per share, the current fair market value at the time of the agreement.

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On August 3, 2015, the Company issued 421,571 restricted shares of common stock in settlement and cancellation of $30,000 of accrued payroll, and 2,000,000 and 872,871 restricted shares of common stock in settlement and cancellation of a total of $201,101 of amounts owed to directors, at a cost basis of $0.07 per share.

On November 18, 2015, the Company issued 1,000,000 restricted shares of its common stock in conjunction with a one-year consulting agreement, at a cost of $0.165 per share, the current fair market value at the time of agreement.

On November 23, 2015, a convertible note holder elected to convert $4,200 of the principal amount of the convertible note dated May 22, 2015, into 100,000 shares of the Company's common stock in accordance with the convertible note agreement.

On December 1, 2015, a convertible note holder elected to convert $8,400 of the principal amount of the convertible note dated May 22, 2015, into 200,000 shares of the Company's common stock in accordance with the convertible note agreement.

On December 24, 2015, a convertible note holder elected to convert $8,400 of the principal amount of the convertible note dated May 22, 2015, into 250,000 shares of the Company's common stock in accordance with the convertible note agreement.

On January 12, 2016, the Company issued 300,926 common shares upon the conversion of convertible debt in the amount of $10,111.

On March 16, 2016, the Company issued 1,000,000 common shares for services, valued at $102,500.

As of February 1, 2016, the Company issued 9,650,000 common shares as part of the consideration for the acquisition of the oil and gas investment made at that time.

On March 21, 2016, the Company executed two one-year consulting agreements requiring the issuance of 2,000,000 common shares for each contract. Both of these contracts were terminated, the shares were returned to the Company, and were cancelled in August 2016.

On March 21, 2016, the Company executed a one-year advisory services agreement requiring the issuance of 1,000,000 common shares for the contract. The shares are to be issued as 375,002 upon execution of the contract, with 56,818 shares being issued at the beginning of each month for the remaining eleven months. The Company has determined to account for all 1,000,000 common shares valued at $0.16 per share upon execution of the agreement as prepaid equity-based compensation to be amortized over the term of the contract. As of September 30, 2016, 284,090 shares remain unissued, and are accounted for as issuable.

As of April 29, 2016, the Company, pursuant to a securities purchase agreement, sold 1,250,000 shares of its common stock at $0.15 per share.

On September 28, 2016, the Company issued 2,400,000 common shares, at the current market value of $288,000 as a portion of the purchase price of additional oil and gas properties acquired on October 4, 2016. This amount is included as a deposit in other assets as of September 30, 2016.

During September 2016, the Company negotiated the payment of certain convertible notes, and committed to the issuance of 375,000 common shares at the current market value of $52,500 as additional interest. These shares have not been issued as of the date of this report, and are accounted for as issuable at September 30, 2016.

As of September 30, 2016, the Company, pursuant to a securities purchase agreement, sold $1,337,500 shares of its common stock at $0.15 per share.

From time to time, the Company has issued shares of restricted common stock to various unrelated parties as prepayment for certain services to be rendered over a term of one year from the date of the agreement. The Company has recorded the fair value of the shares at the date of the agreement as prepaid equity-based compensation, and then amortizes this amount to stock based compensation ratably over the life of the agreements. As of September 30, 2016, the prepaid equity-based compensation balance is $97,095.

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Note 6. Convertible Notes

Convertible notes payable at September 30, 2016, and December 31, 2015, as detailed below, are summarized as follows:

	September 30,			December 31,
	2016			2015

(e) - JMJ Financial	$	-		$	6,778
(f) - LG Capital		-			63,000
(g) - GW Holdings		-			30,000
(h) - EMA Financial		-			50,000
(i) - JDF Capital		-			27,500
(j) - (p) Senior Secured 15% Convertible Promissory Notes (7)		1,225,000			-
		1,225,000			177,278
Net of unamortized debt discount		-			(153,730	)
	$	1,225,000		$	23,548
Less current portion		(1,225,000	)		(16,770	)
	$	-		$	6,778

(a) March 11, 2015 Convertible Note

On March11, 2015, the Company issued a $50,000 8% convertible note with a term expiring on March 11, 2016 (the “Maturity Date”). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder’s option, at a price equal to 58% of the lowest trading price of the common stock for the fifteen prior trading days including the day upon which a Notice of Conversion is received by the Company. In the event the Company prepays the note in full, the Company is required to pay off all principal, interest and any other amounts owing multiplied by (i) 115% if prepaid during the period commencing on the closing date through 30 days thereafter, (ii) 121% if prepaid 31 days following the closing through 60 days following the closing, (iii) 127% if prepaid 61 days following the closing through 90 days following the closing, (iv) 133% if prepaid 91 days following the closing through 120 days following the closing, (v) 139% if prepaid 121 days following the closing through the 150 days following the closing, (vi) 145% if prepaid 151 days following the closing through the 180 days following the closing, and (vii) the Company shall have no right of prepayment after the expiration of 180 days following the closing. This note was paid in full on September 8, 2015.

(b) March 12, 2015 Convertible Note

On March12, 2015, the Company issued a $25,000 8% convertible note with a term expiring on March 12, 2016 (the “Maturity Date”). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder’s option, at a price equal to 58% of the lowest trading price of the common stock for the fifteen prior trading days including the day upon which a Notice of Conversion is received by the Company. In the event the Company prepays the note in full, the Company is required to pay off all principal, interest and any other amounts owing multiplied by (i) 115% if prepaid during the period commencing on the closing date through 30 days thereafter, (ii) 121% if prepaid 31 days following the closing through 60 days following the closing, (iii) 127% if prepaid 61 days following the closing through 90 days following the closing, (iv) 133% if prepaid 91 days following the closing through 120 days following the closing, (v) 139% if prepaid 121 days following the closing through the 150 days following the closing, (vi) 145% if prepaid 151 days following the closing through the 180 days following the closing, and (vii) the Company shall have no right of prepayment after the expiration of 180 days following the closing. This note was paid in full on September 8, 2015.

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(d) March 25, 2015 Convertible Note

On March 25, 2015, the Company issued a $35,000 12% convertible note with a term expiring on March 24, 2016 (the “Maturity Date”), and which was funded on April 23 2015. The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder’s option, at a price equal to 58% of the lowest trading price of the common stock for the fifteen prior trading days including the day upon which a Notice of Conversion is received by the Company. This note was paid in full on October 22, 2015.

(e) May 22, 2015 Convertible Note

On May 22, 2015, the Company issued a convertible promissory note with a cap of $50,000 with a 0% interest rate for the first three months. The terms of the note include a $5,000 Original Issue Discount, providing for a maximum funding of $45,000. The amount of the note funded as of September 30, 2016 was $25,000. The Company may repay this Note at any time on or before 90 days from the effective date. If the Company does not make a payment on or before 90 days from the notes effective date, a one-time interest charge of 12%shall be applied to the principal sum. The maturity date of the note is two years from the effective date of the note. The investor has the right, at any time after the Effective Date, at its election, to convert all of part of the outstanding and unpaid Principal Sum and accrued interest. The conversion price is the lesser of $0.10 or 60% of the lowest trade price in the 25 trading days previous to the conversion. As of September 30, 2016 the full amount of the note has been converted to common shares.

(f) November 3, 2015 Convertible Note

On November 3, 2015, the Company issued a $63,000 8% convertible note with a term expiring on November 3, 2016 (the "Maturity Date"). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder's option, at a price equal to 58% of the lowest trading price of the common stock for the fifteen prior trading days including the day upon which a Notice of Conversion is received by the Company. The note was paid in full on April 29, 2016.

(g) November 20, 2015 Convertible Note

On November 20, 2015, the Company issued a $30,000 12% convertible note with a term expiring on November 20, 2016 (the "Maturity Date"). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder's option, at a price equal to 52% of the lowest trading price of the common stock for the twenty prior trading days including the day upon which a Notice of Conversion is received by the Company. The note was paid in full on May 9, 2016.

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(h) November 19, 2015 Convertible Note

On November 19, 2015, the Company issued a $50,000 12% convertible note with a term expiring on November 19, 2016 (the "Maturity Date"). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder's option, at a price equal to 52% of the lowest trading price of the common stock for the twenty prior trading days including the day upon which a Notice of Conversion is received by the Company. The note was paid in full on May 12, 2016.

(i) November 25, 2015 Convertible Note

On November 25, 2015, the Company issued a $27,500 8% convertible note with a term expiring on November 25, 2016 (the "Maturity Date"). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder's option, at a price equal to 42% of the lowest trading price of the common stock for the twenty-five prior trading days including the day upon which a Notice of Conversion is received by the Company. The note was paid in full on May 2, 2016.

(j) February 19, 2016 Senior Secured Convertible Promissory Note

On February 19, 2016, the Company issued a $75,000 15% convertible note with a term expiring August 18, 2016 (the “Maturity Date”). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder’s option, The conversion price shall be the lowest of (i) $0.15, (ii) 58% of the price of the Company’s securities that are sold in any offering of the Company’s securities in excess of $100,000, of (iii) the conversion price of any Equity converted on or prior to the Conversion Date. The maturity date of this note has been extended.

(k) February 19, 2016 Senior Secured Convertible Promissory Note

On February 19, 2016, the Company issued a $50,000 15% convertible note with a term expiring August 18, 2016 (the “Maturity Date”). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder’s option, The conversion price shall be the lowest of (i) $0.15, (ii) 58% of the price of the Company’s securities that are sold in any offering of the Company’s securities in excess of $100,000, of (iii) the conversion price of any Equity converted on or prior to the Conversion Date. The maturity date of this note has been extended.

(l) February 19, 2016 Senior Secured Convertible Promissory Note

(m) February 19, 2016 Senior Secured Convertible Promissory Note

On February 19, 2016, the Company issued a $1,100,000 15% convertible note with a term expiring August 18, 2016 (the “Maturity Date”). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder’s option, The conversion price shall be the lowest of (i) $0.15, (ii) 58% of the price of the Company’s securities that are sold in any offering of the Company’s securities in excess of $100,000, of (iii) the conversion price of any Equity converted on or prior to the Conversion Date. The note was paid in full on October 4, 2016.

(n) February 19, 2016 Senior Secured Convertible Promissory Note

On February 19, 2016, the Company issued a $200,000 15% convertible note with a term expiring August 18, 2016 (the “Maturity Date”). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder’s option, The conversion price shall be the lowest of (i) $0.15, (ii) 58% of the price of the Company’s securities that are sold in any offering of the Company’s securities in excess of $100,000, of (iii) the conversion price of any Equity converted on or prior to the Conversion Date. The note was paid in full on September 30, 2016.

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(o) February 19, 2016 Senior Secured Convertible Promissory Note

On February 19, 2016, the Company issued a $100,000 15% convertible note with a term expiring August 18, 2016 (the “Maturity Date”). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock at any time, at the holder’s option, The conversion price shall be the lowest of (i) $0.15, (ii) 58% of the price of the Company’s securities that are sold in any offering of the Company’s securities in excess of $100,000, of (iii) the conversion price of any Equity converted on or prior to the Conversion Date. The note was paid in full on August 18, 2016.

(p) February 19, 2016 Senior Secured Convertible Promissory Note

Note 7. Secured Notes

As of April 29, 2016, the Company issued a total of $375,000 of 10% Secured Subordinated promissory notes with a term expiring January 12, 2017 (the “Maturity Date”), and an original issue discount of fifty percent (50%). Interest is payable on the outstanding principal of these notes at 10% per annum on the Maturity Date. The balance of these notes as of September 30, 2016, is $298,529, net of an unamortized discount of $76,471.

As of September 2016, the Company issued a total of $535,000 of 10% Secured promissory notes with a term expiring April 3, 2017 (the “Maturity Date”), and an original issue discount of thirty seven and one half percent (37.5%). Interest is payable on the outstanding principal of these notes at 10% per annum on the Maturity Date. The balance of these notes as of September 30, 2016 is $334,375, net of an unamortized discount of $200,625.

Note 8. Revolver Loan

On September 30, 2016, the Company entered into a Revolver Loan agreement with Crossfirst Bank, a Kansas banking corporation for a revolving line of credit facility in the amount of $3,000,000, with an initial funding commitment of $1,800,000, interest at Prime plus 1.5%, and a final maturity date of September 30, 2018. As of September 30, 2016, the Company had not borrowed any money under this agreement.

Note 9. Subsequent Events

The Company has evaluated subsequent events from September 30, 2016, through the date of filing this report, and determined there are no other items to disclose other than those disclosed below:

On October 4, 2016, the Company closed on the purchase of working interests in various oil and gas leases in Eastern Kansas. Simultaneously, to facilitate the purchase, the Company closed on its initial funding from Crossfirst Bank under the September 30, 2016 Revolver Agreement in the amount of $1,800,000.

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SUPPLEMENTAL INFORMATION – OIL AND NATURAL GAS PRODUCTION – (unaudited)

As of September 30, 2016, the Company has two separate oil and gas production projects as follows:

(1)

The Company has a 50% undivided interest in an oil property located approximately ten miles northeast of Red Deer, Alberta in Canada. The property consists of one oil well producing from the Leduc Formation, three suspended oil wells, one abandoned oil well, and a suspended water injector.

The Lake Devonian Leduc formation is represented by large barrier reef and smaller pinnacle reef bioherms which grew on the Cooking Lake platform carbonates. Trending northeast to southwest, the limestones and dolostones of the Leduc/Cooking Lake Formations were deposited on the bathymetric highs of the Lake Devonian seas. Hydrocarbons are trapped by lateral stratigraphic pinch out of these dolomitic carbonates into deeper water shale sediments.

Proved developed producing reserves have been assigned to the first producing oil well. The well was re-activated and came on production in January 2015. The well has produced sporadically since January averaging seven to ten days of production per month. Production forecasts have taken into account this workover and reflect the increase of reserves in the total proved and proved plus probable cases.

The Company plans on installing a pumpjack to the well in early 2016 to enhance performance. The three suspended wells are scheduled to be re-activated in 2016. Proved reserves are assigned to these wells as the wells have demonstrated production over a number of years.

	(2)	The Company has various working interests in four leases with access to the mineral rights (oil and gas) concerning approximately 281 acres of property in Miami and Franklin Counties in eastern Kansas. This project produces oil from the Cherokee formation at a depth of approximately 600 feet. These leases offer the potential for several future drilling locations.

		The Company also purchased a 100% working interest (a net revenue interest of 83%) in certain non-producing leases as follows: (i) three leases with access to the mineral rights (oil and gas) concerning approximately 270 acres of property in Miami and Franklin Counties in eastern Kansas; and (ii) 31 leases with access to the mineral rights (oil and gas) concerning approximately 5,500 acres of property in Cass and Bates Counties in Missouri.

Results of Operations

The results of operations for petroleum and natural gas production for the three and nine months ended September 30, 2016, consist of both the 50% undivided interest in the Joffre oil and gas property located in Alberta, Canada as well as the various working interests in the four leases in eastern Kansas, as follows:

	Three Months Ended September 30, 2016
Results of Operations by Geographic Area	Canada		United States		Total

Revenue
Oil	$	47,656	$	49,232	$	96,888
Gas		4,844		-		4,844
Liquids		3,296		-		3,296
Sulphur		398		-		398

Total revenues		56,194		49,232		105,426
Production costs		29,172		37,285		66,457

	$	27,022	$	11,947	$	38,969

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Oil and Gas Production and Sales by Geographic Area	Canada		United States		Totals

Production
Oil - (barrels)		1,319		1,307		2,626
Natural Gas - (mcf)		2,813		-		2,813
Natural Gas Liquids - (barrels)		415		-		415
Sulphur - (tonnes)		16		-		16

Sales
Oil - (barrels)		1,319		1,307		2,626
Natural Gas - (mcf)		2,813		-		2,813
Natural Gas Liquids - (barrels)		415		-		415
Sulphur - (tonnes)		16		-		16

Average Sales Prices
Oil - (barrels)	$	36.13	$	37.67	$	36.90
Natural Gas - (mcf)	$	1.72	$	-	$	1.72
Natural Gas Liquids - (barrels)	$	7.94	$	-	$	7.94
Sulphur - (tonnes)	$	24.88	$	-	$	24.88

Mcf = thousands of cubic feet
Tonnes = Metric tons

	Nine Months Ended September 30, 2016
Results of Operations by Geographic Area	Canada		United States		Total

Revenue
Oil	$	79,653	$	135,334	$	214,987
Gas		9,328		-		9,328
Liquids		7,207		-		7,207
Sulphur		491		-		491

Total revenues		96,679		135,334		232,013
Production costs		76,577		89,196		165,773

	$	20,102	$	46,138	$	66,240

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Oil and Gas Production and Sales by Geographic Area	Canada		United States		Totals

Production
Oil - (barrels)		2,276		3,857		6,133
Natural Gas - (mcf)		8,666		-		8,666
Natural Gas Liquids - (barrels)		887		-		887
Sulphur - (tonnes)		25		-		25

Sales
Oil - (barrels)		2,229		3,857		6,086
Natural Gas - (mcf)		6,597		-		6,597
Natural Gas Liquids - (barrels)		941		-		941
Sulphur - (tonnes)		25		-		25

Average Sales Prices
Oil - (barrels)	$	35.73	$	35.09	$	35.32
Natural Gas - (mcf)	$	1.41	$	-	$	1.41
Natural Gas Liquids - (barrels)	$	7.66	$	-	$	7.66
Sulphur - (tonnes)	$	19.64	$	-	$	19.64

Mcf = thousands of cubic feet
Tonnes = Metric tons

Petroleum and Natural Gas Exploration and Production Costs

The amounts shown as net capitalized costs for petroleum and natural gas rights of $2,863,046 and $803,660 consist of the initial investment to acquire the undivided interest in the Joffre Project, as well as additional licensing costs at that location, as well as the investment made during the first quarter of this year, to acquire the oil and gas properties in Kansas. The Company does not incur any production or exploratory costs as the entire project is operated through a subcontract relationship.

Petroleum and Natural Gas Reserves

Reserves are estimated remaining quantities of oil and natural gas and related substances, which by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible – from a given date forward, from known reservoirs, and under existing economic conditions, operating methods and government regulations – prior to the time at which contracts providing the right to operate expire. The detailed reserve information and production forecasts for the Joffre project in Alberta, Canada were presented in the Company’s annual report on Form 10-K for the year ended December 31, 2015, and is incorporated herein.

The following information is an estimate of the proved oil reserve, and the associated economic values of those certain properties in Franklin, Linn and Miami counties, Kansas, acquired by the Company in February 2016

The following tables summarize projected revenues, expenses and discounted cash flows:

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Proved, Developed Producing Reserves

The Proved, Developed Producing (PDP) reserves were determined by extrapolation of the lease production decline curves. Waterflood reserves are classified as PDP on these leases by virtue of the successful past operations in these, and regional analogous, reservoirs. Developed reserves are those expected to be recovered from existing wells (including reserves behind pipe). Improved recovery reserves are considered developed only after the necessary equipment has been installed, or when the costs to do so are relatively minor. The gross PDP reserves (November 1, 2015) of the subject leases are:

	Gross PDP Reserves						Working Interest PDP Reserves					Viking PDP Reserves
Lease Name	Cumulative Production to Date		Remaining Reserve		Ultimate Production		Net Revenue Interest % (Working Interest)			NRI Remaining Reserve		Viking % of Working Interest			Viking Reserve Balances

HAHN		5,092		64,908		70,000		86.500	%		56,145		32.299	%		18,134
JOHNSTON		40,738		81,762		122,500		83.000	%		67,862		84.041	%		57,032
WILSON, EAST		16,346		153,654		170,000		83.000	%		127,533		15.000	%		19,130
WILSON, WEST		7,962		134,438		142,400		83.000	%		111,584		55.003	%		61,375

		70,138		434,762		504,900					363,124					155,671

The following table summarizes PDP projected revenues, expenses and discounted cash flows for the HAHN lease as of November 1, 2015:

Projected Revenues and Discounted Cash Flows - Hahn Lease
Proved, Developed, Producing Reserves - (PDP)

Year	Number of Wells		Volume (mbbl)		Price ($/bbl)		Revenue (m$)		Sev + Adv Taxes (m$)		Net Operating Expenses (m$)		Capital Outlay (m$)		Annual Cash Flow (m$)		Cumulative Discounted Cash Flow at 10% (m$)

2015		14		0.184		39.68		7.318		0.073		2.035		-		5.210		5.168
2016		14		1.450		44.55		64.579		0.646		12.209		-		51.724		53.708
2017		14		1.475		48.43		71.439		0.714		12.209		-		58.515		103.629
2018		14		1.367		51.03		69.753		0.698		12.209		-		56.846		147.717
2019		14		1.261		52.87		66.684		0.667		12.209		-		53.808		185.655
2020		14		1.164		54.08		62.952		0.630		12.209		-		50.114		217.776
2021		14		1.074		56.25		60.409		0.604		12.209		-		47.596		245.510
2022		14		0.991		58.00		57.474		0.575		12.209		-		44.691		269.183
2023		14		0.915		58.00		53.053		0.531		12.209		-		40.313		288.597
2024		14		0.844		58.00		48.932		0.489		12.209		-		36.233		304.459
2025		14		0.779		58.00		45.166		0.452		12.209		-		32.506		317.396
2026		14		0.719		58.00		41.682		0.417		12.209		-		29.056		327.909
2027		14		0.663		58.00		38.460		0.385		12.209		-		25.866		336.417
2028		14		0.611		58.00		35.462		0.355		12.209		-		22.899		343.264
2029		14		0.565		58.00		32.746		0.328		12.209		-		20.209		348.758
2030		14		0.521		58.00		30.198		0.302		12.209		-		17.687		353.129
2031		14		0.481		58.00		27.875		0.279		12.209		-		15.388		356.586
2032		14		0.444		58.00		25.740		0.257		12.209		-		13.273		359.297
2033		14		0.409		58.00		23.717		0.237		12.209		-		11.270		361.389
2034		14		0.378		58.00		21.899		0.219		12.209		-		9.471		362.988
Sub-Total				16.293		54.35		885.538		8.856		234.006		-		642.676		362.988
Remaining				1.841		58.00		106.799		1.068		79.672		-		26.059		366.444
Total				18.134		54.72		992.337		9.924		313.678		-		668.735		366.444

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The following table summarizes PDP projected revenues, expenses and discounted cash flows for the JOHNSTON lease as of November 1, 2015:

Projected Revenues and Discounted Cash Flows - Johnston Lease
Proved, Developed, Producing Reserves - (PDP)

Year	Number of Wells		Volume (mbbl)		Price ($/bbl)		Revenue (m$)		Sev + Adv Taxes (m$)		Net Operating Expenses (m$)		Capital Outlay (m$)		Annual Cash Flow (m$)		Cumulative Discounted Cash Flow at 10% (m$)

2015		29		0.490		39.68		19.442		0.194		10.967		-		8.280		8.214
2016		29		5.085		44.55		226.551		2.266		65.804		-		158.481		156.939
2017		29		6.721		48.43		325.486		3.255		65.804		-		256.427		375.704
2018		29		5.390		51.03		275.072		2.751		65.804		-		206.517		535.871
2019		29		4.200		52.87		222.029		2.220		65.804		-		154.005		644.453
2020		29		3.506		54.08		189.615		1.896		65.804		-		121.915		722.596
2021		29		3.043		56.25		171.176		1.712		65.804		-		103.660		782.998
2022		29		2.709		58.00		157.101		1.571		65.804		-		89.726		830.528
2023		29		2.453		58.00		142.283		1.423		65.804		-		75.056		866.673
2024		29		2.250		58.00		130.487		1.305		65.804		-		63.378		894.419
2025		29		2.085		58.00		120.933		1.209		65.804		-		53.920		915.879
2026		29		1.946		58.00		112.891		1.129		65.804		-		45.958		932.506
2027		29		1.830		58.00		106.115		1.061		65.804		-		39.250		945.416
2028		29		1.728		58.00		100.217		1.002		65.804		-		33.411		955.407
2029		29		1.640		58.00		95.148		0.951		65.804		-		28.392		963.125
2030		29		1.562		58.00		90.615		0.906		65.804		-		23.905		969.032
2031		29		1.493		58.00		86.618		0.866		65.804		-		19.947		973.513
2032		29		1.431		58.00		83.011		0.830		65.804		-		16.376		976.858
2033		29		1.376		58.00		79.794		0.798		65.804		-		13.192		979.307
2034		29		1.324		58.00		76.820		0.768		65.804		-		10.248		981.037
Sub-Total				52.263		53.79		2,811.403		28.113		1,261.245		-		1,522.044		981.037
Remaining				4.768		58.00		276.523		2.765		257.225		-		16.533		983.392
Total				57.031		54.14		3,087.926		30.878		1,518.470		-		1,538.577		983.392

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The following table summarizes PDP projected revenues, expenses and discounted cash flows for the WILSON, EAST lease as of November 1, 2015:

Projected Revenues and Discounted Cash Flows - Wilson, East Lease
Proved, Developed, Producing Reserves - (PDP)

Year	Number of Wells		Volume (mbbl)		Price ($/bbl)		Revenue (m$)		Sev + Adv Taxes (m$)		Net Operating Expenses (m$)		Capital Outlay (m$)		Annual Cash Flow (m$)		Cumulative Discounted Cash Flow at 10% (m$)

2015		43		0.115		39.68		4.553		0.046		2.903		-		1.605		1.592
2016		43		1.075		44.55		47.893		0.479		17.415		-		30.000		29.745
2017		43		1.530		48.43		74.083		0.741		17.415		-		55.928		77.458
2018		43		1.455		51.03		74.241		0.742		17.415		-		56.084		120.955
2019		43		1.347		52.87		71.224		0.712		17.415		-		53.097		158.391
2020		43		1.247		54.08		67.435		0.674		17.415		-		49.346		190.020
2021		43		1.155		56.25		64.943		0.650		17.415		-		46.879		217.336
2022		43		1.069		58.00		61.996		0.620		17.415		-		43.961		240.623
2023		43		0.990		58.00		57.394		0.574		17.415		-		39.405		259.599
2024		43		0.916		58.00		53.131		0.531		17.415		-		35.185		275.003
2025		43		0.848		58.00		49.190		0.492		17.415		-		31.283		287.453
2026		43		0.785		58.00		45.545		0.455		17.415		-		27.674		297.466
2027		43		0.727		58.00		42.160		0.422		17.415		-		24.324		305.466
2028		43		0.673		58.00		39.028		0.390		17.415		-		21.223		311.812
2029		43		0.623		58.00		36.140		0.361		17.415		-		18.363		316.804
2030		43		0.577		58.00		33.452		0.335		14.175		-		18.942		321.485
2031		43		0.534		58.00		30.972		0.310		14.175		-		16.487		325.188
2032		43		0.494		58.00		28.675		0.287		14.175		-		14.213		328.091
2033		43		0.458		58.00		26.544		0.266		14.175		-		12.103		330.338
2034		43		0.424		58.00		24.578		0.246		14.175		-		10.157		332.053
Sub-Total				17.040		54.76		933.177		9.332		317.588		-		606.257		332.053
Remaining				2.089		58.00		121.182		1.212		92.457		-		27.514		335.712
Total				19.130		55.12		1,054.359		10.544		410.044		-		633.771		335.712

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The following table summarizes PDP projected revenues, expenses and discounted cash flows for the WILSON, WEST lease as of November 1, 2015:

Projected Revenues and Discounted Cash Flows - Wilson, West Lease
Proved, Developed, Producing Reserves - (PDP)

Year	Number of Wells		Volume (mbbl)		Price ($/bbl)		Revenue (m$)		Sev + Adv Taxes (m$)		Net Operating Expenses (m$)		Capital Outlay (m$)		Annual Cash Flow (m$)		Cumulative Discounted Cash Flow at 10% (m$)

2015		53		0.372		39.68		14.754		0.147		13.118		-		1.488		1.477
2016		53		4.056		44.55		180.716		1.807		78.709		-		100.199		95.507
2017		53		6.812		48.43		329.884		3.299		78.709		-		247.876		306.976
2018		53		6.494		51.03		331.399		3.314		78.709		-		249.376		500.384
2019		53		5.787		52.87		305.981		3.060		78.709		-		224.212		658.467
2020		53		5.155		54.08		278.776		2.788		78.709		-		197.279		784.916
2021		53		4.592		56.25		258.311		2.583		78.709		-		177.019		888.064
2022		53		4.091		58.00		237.253		2.372		78.709		-		156.172		970.792
2023		53		3.644		58.00		211.349		2.114		78.709		-		130.526		1033.649
2024		53		3.246		58.00		188.252		1.883		78.709		-		107.660		1080.781
2025		53		2.892		58.00		167.707		1.677		78.709		-		87.321		1115.533
2026		53		2.576		58.00		149.396		1.494		78.709		-		69.193		1140.568
2027		53		2.294		58.00		133.062		1.331		78.709		-		53.022		1158.008
2028		53		2.044		58.00		118.547		1.185		78.709		-		38.652		1169.566
2029		53		1.821		58.00		105.595		1.056		78.709		-		25.829		1176.587
2030		53		1.622		58.00		94.078		0.941		62.373		-		30.764		1184.189
2031		53		1.444		58.00		83.774		0.838		62.373		-		20.563		1188.809
2032		53		1.287		58.00		74.650		0.746		62.373		-		11.530		1191.164
2033		53		1.146		58.00		66.483		0.665		62.373		-		3.445		1191.803
2034		53		-		-		-		-		-		-		-		1191.803
Sub-Total				61.375		54.26		3,329.968		33.299		1,364.542		-		1,932.127		1191.803
Remaining				-		-		-		-		-		-		-		1191.803
Total				61.375		54.26		3,329.968		33.299		1,364.542		-		1,932.127		1191.803

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Proved Undeveloped Reserves

The Proved Undeveloped (PUD) reserves were determined by analogy to existing wells on the evaluated leases, or to similar production in the area. Waterflood reserves are included. Undeveloped reserves are those expected to be recovered: (1) from new wells on undrilled acreage, (2) from deepening existing wells to a different reservoir, or (3) where a relatively large expenditure is required to (a) recomplete an existing well or (b) install production or transportation facilities for primary or improved recovery projects. The gross PUD reserves (November 1, 2015) of the subject leases are:

	Gross PUD Reserves						Working Interest PUD Reserves					Viking PUD Reserves
Lease Name	Cumulative Production to Date		Remaining Reserve		Ultimate Production		Net Revenue Interest % (Working Interest)			NRI Remaining Reserve		Viking % of Working Interest			Viking Reserve Balances

HAHN		-		25,000		25,000		86.500	%		21,625		32.299	%		6,985
JOHNSTON		-		30,000		30,000		83.000	%		24,900		84.041	%		20,926
WILSON, EAST		-		30,000		30,000		83.000	%		24,900		15.000	%		3,735
WILSON, WEST		-		47,000		47,000		83.000	%		39,010		55.003	%		21,457

		-		132,000		132,000					110,435					53,103

The following table summarizes PUD projected revenues, expenses and discounted cash flows for the HAHN lease as of November 1, 2015:

Projected Revenues and Discounted Cash Flows - Hahn Lease
Proved Undeveloped Reserves - (PUD)

Year	Number of Wells		Volume (mbbl)		Price ($/bbl)		Revenue (m$)		Sev + Adv Taxes (m$)		Net Operating Expenses (m$)		Capital Outlay (m$)		Annual Cash Flow (m$)			Cumulative Discounted Cash Flow at 10% (m$)

2015		5		-		39.68		-		-		0.000		22.609		(22.609	)		(22.573	)
2016		5		0.509		44.55		22.663		0.227		4.360		22.609		(4.533	)		(27.278	)
2017		5		0.511		48.43		24.746		0.247		4.360		-		20.139			(10.159	)
2018		5		0.479		51.03		24.427		0.244		4.360		-		19.822			5.214
2019		5		0.445		52.87		23.514		0.235		4.360		-		18.919			18.553
2020		5		0.413		54.08		22.341		0.224		4.360		-		17.757			29.935
2021		5		0.384		56.25		21.584		0.216		4.360		-		17.008			39.845
2022		5		0.357		58.00		20.682		0.207		4.360		-		16.115			48.381
2023		5		0.331		58.00		19.183		0.192		4.360		-		14.631			55.427
2024		5		0.307		58.00		17.834		0.178		4.360		-		13.296			61.248
2025		5		0.286		58.00		16.560		0.166		4.360		-		12.034			66.037
2026		5		0.265		58.00		15.399		0.154		4.360		-		10.884			69.975
2027		5		0.246		58.00		14.294		0.143		4.360		-		9.790			73.196
2028		5		0.229		58.00		13.282		0.133		4.360		-		8.789			75.824
2029		5		0.213		58.00		12.327		0.123		4.360		-		7.843			77.956
2030		5		0.197		58.00		11.446		0.114		4.360		-		6.971			79.678
2031		5		0.183		58.00		10.641		0.106		4.360		-		6.174			81.065
2032		5		0.171		58.00		9.891		0.099		4.360		-		5.432			82.175
2033		5		0.158		58.00		9.179		0.092		4.360		-		4.727			83.052
2034		5		0.147		58.00		8.524		0.085		4.360		-		4.078			83.741
Sub-Total				5.830		54.63		318.516		3.185		82.847		45.218		187.266			83.741
Remaining				0.872		58.00		50.580		0.506		79.672		-		(29.597	)		85.546
Total				6.702		55.07		369.096		3.691		162.519		45.218		157.669			85.546

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The following table summarizes PUD projected revenues, expenses and discounted cash flows for the JOHNSTON lease as of November 1, 2015:

Projected Revenues and Discounted Cash Flows - Johnston Lease
Proved, Undeveloped Reserves - (PUD)

Year	Number of Wells		Volume (mbbl)		Price ($/bbl)		Revenue (m$)		Sev + Adv Taxes (m$)		Net Operating Expenses (m$)		Capital Outlay (m$)		Annual Cash Flow (m$)			Cumulative Discounted Cash Flow at 10% (m$)

2015		5		-		39.68		-		-		-		-		-			-
2016		5		0.459		44.55		20.442		0.204		9.455		117.657		(106.873	)		(103.037	)
2017		5		1.931		48.43		93.531		0.935		11.346		-		81.250			(33.721	)
2018		5		1.954		51.03		99.710		0.997		11.346		-		87.368			34.039
2019		5		1.811		52.87		95.752		0.957		11.346		-		83.449			92.876
2020		5		1.676		54.08		90.626		0.906		11.346		-		78.375			143.112
2021		5		1.550		56.25		87.172		0.872		11.346		-		74.954			186.787
2022		5		1.433		58.00		83.108		0.831		11.346		-		70.931			224.361
2023		5		1.326		58.00		76.918		0.769		11.346		-		64.803			255.568
2024		5		1.226		58.00		71.117		0.711		11.346		-		59.061			281.424
2025		5		1.135		58.00		65.804		0.658		11.346		-		53.801			302.836
2026		5		1.049		58.00		60.832		0.608		11.346		-		48.878			320.521
2027		5		0.971		58.00		56.299		0.563		11.346		-		44.390			335.121
2028		5		0.898		58.00		52.058		0.520		11.346		-		40.193			347.139
2029		5		0.830		58.00		48.159		0.482		11.346		-		36.332			357.015
2030		5		0.769		58.00		44.601		0.446		11.346		-		32.809			365.123
2031		5		0.710		58.00		41.188		0.412		11.346		-		29.431			371.734
2032		5		0.658		58.00		38.166		0.382		11.346		-		26.439			377.134
2033		5		0.541		58.00		31.391		0.314		10.060		-		21.017			381.057
2034		5		-		-		-		-		-		-		-			-
Sub-Total				20.926		55.28		1,156.875		11.567		201.043		117.657		826.608			381.057
Remaining				-		-		-		-		-		-		-			381.057
Total				20.926		55.28		1,156.875		11.567		201.043		117.657		826.608			381.057

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The following table summarizes PUD projected revenues, expenses and discounted cash flows for the WILSON, EAST lease as of November 1, 2015:

Projected Revenues and Discounted Cash Flows - Wilson, East Lease
Proved, Undeveloped Reserves - (PUD)

Year	Number of Wells		Volume (mbbl)		Price ($/bbl)		Revenue (m$)		Sev + Adv Taxes (m$)		Net Operating Expenses (m$)		Capital Outlay (m$)		Annual Cash Flow (m$)			Cumulative Discounted Cash Flow at 10% (m$)

2015		5		-		39.68		-		-		-		25.200		(25.200	)		(25.160	)
2016		5		0.102		44.55		4.551		0.045		1.856		25.200		(22.551	)		(46.903	)
2017		5		0.354		48.43		17.151		0.171		2.025		-		14.955			(34.144	)
2018		5		0.347		51.03		17.697		0.177		2.025		-		15.495			(22.127	)
2019		5		0.321		52.87		16.979		0.170		2.025		-		14.784			(11.703	)
2020		5		0.297		54.08		16.062		0.161		2.025		-		13.876			(2.809	)
2021		5		0.275		56.25		15.458		0.155		2.025		-		13.278			4.928
2022		5		0.254		58.00		14.747		0.147		2.025		-		12.574			11.589
2023		5		0.235		58.00		13.633		0.136		2.025		-		11.472			17.114
2024		5		0.218		58.00		12.615		0.126		2.025		-		10.464			21.695
2025		5		0.201		58.00		11.667		0.117		2.025		-		9.525			25.485
2026		5		0.186		58.00		10.788		0.108		2.025		-		8.655			28.617
2027		5		0.172		58.00		9.988		0.100		2.025		-		7.863			31.203
2028		5		0.159		58.00		9.239		0.092		2.025		-		7.122			33.333
2029		5		0.147		58.00		8.535		0.085		2.025		-		6.424			35.079
2030		5		0.136		58.00		7.908		0.079		2.025		-		5.804			36.513
2031		5		0.126		58.00		7.308		0.073		2.025		-		5.210			37.684
2032		5		0.117		58.00		6.760		0.068		2.025		-		4.667			38.637
2033		5		0.087		58.00		5.063		0.051		1.627		-		3.386			39.271
2034		5		-		58.00		-		-		0.000		-		-			-
Sub-Total				3.735		55.20		206.148		2.062		35.883		50.400		117.804			39.271
Remaining				-		-		-		-		-		-		-			39.271
Total				3.735		55.20		206.148		2.062		35.883		50.400		117.804			39.271

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The following table summarizes PUD projected revenues, expenses and discounted cash flows for the WILSON, WEST lease as of November 1, 2015:

Projected Revenues and Discounted Cash Flows - Wilson, West Lease
Proved, Undeveloped Reserves - (PUD)

Year	Number of Wells		Volume (mbbl)		Price ($/bbl)		Revenue (m$)		Sev + Adv Taxes (m$)		Net Operating Expenses (m$)		Capital Outlay (m$)		Annual Cash Flow (m$)			Cumulative Discounted Cash Flow at 10% (m$)

2015		14		-		39.68		-		-		0.000		-		-			-
2016		14		0.661		44.55		29.429		0.294		17.326		213.412		(201.603	)		(199.054	)
2017		14		2.218		48.43		107.431		1.074		20.791		-		85.566			(126.056	)
2018		14		2.183		51.03		111.402		1.114		20.791		-		89.497			(56.645	)
2019		14		1.957		52.87		103.467		1.035		20.791		-		81.641			0.917
2020		14		1.752		54.08		94.770		0.948		20.791		-		73.031			47.727
2021		14		1.569		56.25		88.239		0.882		20.791		-		66.565			86.514
2022		14		1.404		58.00		81.413		0.814		20.791		-		59.808			118.196
2023		14		1.257		58.00		72.927		0.729		20.791		-		51.407			142.952
2024		14		1.125		58.00		65.239		0.652		20.791		-		43.796			162.125
2025		14		1.007		58.00		58.412		0.584		20.791		-		37.037			176.865
2026		14		0.901		58.00		52.287		0.523		20.791		-		30.973			188.071
2027		14		0.807		58.00		46.800		0.468		20.791		-		25.541			196.472
2028		14		0.723		58.00		41.919		0.419		20.791		-		20.709			202.664
2029		14		0.647		58.00		37.516		0.375		20.791		-		16.350			207.108
2030		14		0.579		58.00		33.561		0.336		14.851		-		18.374			211.649
2031		14		0.518		58.00		30.051		0.300		14.851		-		14.900			214.996
2032		14		0.464		58.00		26.893		0.269		14.851		-		11.773			217.401
2033		14		0.415		58.00		24.086		0.241		14.851		-		8.994			219.071
2034		14		0.372		58.00		21.566		0.216		14.851		-		6.499			220.168
Sub-Total				20.558		54.84		1,127.408		11.273		361.865		213.412		540.857			220.168
Remaining				0.898		58.00		52.064		0.520		44.55		-		6.991			221.196
Total				21.456		54.97		1,179.471		11.794		406.417		213.412		547.848			221.198

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis in conjunction with the financial statements and notes thereto appearing elsewhere in this annual report on Form 10-Q. In preparing the management’s discussion and analysis, the registrant presumes that you have read or have access to the discussion and analysis for the preceding fiscal year.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This document includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 or the Reform Act. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earning, revenue or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions of performance; and statements of belief; and any statements of assumptions underlying any of the foregoing. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: our ability to raise capital and the terms thereof; ability to gain an adequate player base to generate the expected revenue; competition with established gaming websites; adverse changes in government regulations or polices; and other factors referenced in this Form 10-Q.

The use in this Form 10-Q of such words as “believes”, “plans”, “anticipates”, “expects”, “intends”, and similar expressions are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. These forward-looking statements present the Company’s estimates and assumptions only as of the date of this Report. Except for the Company’s ongoing obligation to disclose material information as required by the federal securities laws, the Company does not intend, and undertakes no obligation, to update any forward-looking statements.

Although the Company believes that the expectations reflected in any of the forward-looking statements are reasonable, actual results could differ materially from those projected or assumed or any of the Company’s forward-looking statements. The Company’s future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties.

PLAN OF OPERATIONS

Overview

Commencing with the first quarter of 2016, the Company has determined that its singular business plan is to engage in the acquisition, exploration, development and production of oil and natural gas properties. Consistent with its refocused efforts, on February 23, 2016, the Company closed on the acquisition of working interests in four leases with access to the mineral rights (oil and gas) concerning approximately 281 acres of property in Miami and Franklin Counties in eastern Kansas.

Going Concern Qualification

The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or related party advances; however there is no assurance of additional funding being available.

Table of Contents

RESULTS OF CONTINUING OPERATIONS

The following discussion of the financial condition and results of operation of the Company for the three and nine months ended September 30, 2016 and 2015, should be read in conjunction with the audited consolidated financial statements and the notes thereto in the Company’s Form 10-K for the year ended December 31, 2015.

Liquidity and Capital Resources

As of September 30, 2016 and December 31, 2015, the Company had $88,625 and $30,585 in cash holdings, respectively.

Three months ended September 30, 2016, compared to the three months ended September 30, 2015

Revenue

The Company had gross revenues of $105,426 for the three months ended September 30, 2016, representing its share of revenue from its 50% undivided interest in the Joffre Property as well as the new revenues from the investment in the oil properties in Kansas, as compared to $32,425 for the three months ended September 30, 2015, which only represented revenue from the Joffre Property. This revenue from the Joffre Property comes from the first two oil wells in the project which began producing during April of 2015, and the revenue from the Kansas property comes from four leases.

Expenses

The Company’s operating expenses increased by $229,982 to $451,093 for the three-month period ended September 30, 2016, from $221,111 in the corresponding period in 2015. The increase was mainly due to stock based compensation of $172,219 as well as depreciation, depletion and amortization costs associated with ownership of oil and gas properties, as compared to the three months ended September 30, 2015.

Other Income and Expense

The Company’s interest expense increased by $404,306 to $542,107 for the three months ended September 30, 2016, as compared to $137,801 for the three months ended September 30, 2015. This large increase in interest cost is reflective of the increase in debt associated with the Company’s growth strategy relative to oil and gas property acquisitions. This expense item is expected to go down as the Company anticipates replacing debt with unfavorable terms. The Company also had a gain on derivatives of $2,765,013 as compared to a derivative loss of $36,424 for the three months ended September 30, 2015.

Net Loss

The Company incurred a net comprehensive income of $1,873,845 during the three-month period ended September 30, 2016, compared with a net comprehensive loss of $367,331 for the three-month period ended September 30, 2015. The increase in Net comprehensive income was mainly due to the items referred to in the analysis of operating expenses and other income.

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Nine months ended September 30, 2016, compared to the nine months ended September 30, 2015

Revenue

The Company had gross revenues of $232,013 for the nine months ended September 30, 2016, representing its share of revenue from its 50% undivided interest in the Joffre Property as well as the new revenues from the investment in the oil properties in Kansas, as compared to $64,448 for the nine months ended September 30, 2015, which only represented revenue from the Joffre project.

Expenses

The Company’s operating expenses increased by $716,312 to $1,290,116 for the nine month period ended September 30, 2016, from $573,804 in the corresponding period in 2015. The increase was mainly due to stock based compensation of $578,363 for the nine months ended September 30, 2016 as compared to 108,000 for the prior year. Additionally is the increase in both lease operating costs and depletion expense as production from the wells increases.

Other Income and Expense

The Company’s interest expense increased by $1,770,313 to $1,966,015 for the nine months ended September 30, 2016, as compared to $195,702 for the nine months ended September 30, 2015. This large increase in interest cost is reflective of the increase in debt associated with the Company’s growth strategy relative to oil and gas property acquisitions, which also created a large amortization of debt discount. This expense item is expected to go down as the Company anticipates replacing debt with unfavorable terms. The Company also had a gain on the settlement of debt associated with professional services in the amount of $75,000 during the nine months ended September 30, 2016, and a gain on derivatives of $833,418 as compared to a derivative gain of $77,682 for the nine months ended September 30, 2015.

Net Loss

The Company incurred a net comprehensive loss of $1,967,037 during the nine month period ended September 30, 2016, compared with a net comprehensive loss of $1,047,211 for the nine month period ended September 30, 2015. The increase in net loss was mainly due to the items referred to in the analysis of operating expenses and other income.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Company has adopted various accounting policies that govern the application of accounting principles generally accepted in the United States of America in the preparation of the Company’s financial statements which requires it to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.

Although these estimates are based on management’s knowledge of current events and actions the Company may undertake in the future, the final results may ultimately differ from actual results. Certain accounting policies involve significant judgments and assumptions, which have a material impact on the Company’s financial condition and results. Management believes its critical accounting policies reflect its most significant estimates and assumptions used in the presentation of the Company’s financial statements. The Company’s critical accounting policies include debt management and accounting for stock-based compensation. The Company does not have off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities.”

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934, the Company is not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company does not currently maintain controls and procedures that are designed to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act are recorded, processed, summarized, and reported within the time periods specified by the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of management, including the Company’s Chief Executive Officer, the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2016, have been evaluated, and, based upon this evaluation, the Company’s Chief Executive Officer has concluded that these controls and procedures are not effective in providing reasonable assurance of compliance.

Changes in Internal Control over Financial Reporting

Management and directors will continue to monitor and evaluate the effectiveness of the Company's internal controls and procedures and the Company's internal controls over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow. There were no changes in internal control over financial reporting during the quarter ended September 30, 2016.

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PART II—OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The disclosure in Items 4.01 and 4.02 of the Company’s Current Report on Form 8-K/A filed on November 18, 2016, is incorporated by reference herein regarding the resignation of the Company’s former independent registered public accounting firm.

ITEM 1A. RISK FACTORS

As a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934, the Company is not required to provide the information under this item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

On January 12, 2016, the Company issued 300,926 common shares for convertible debt in the amount of $10,111.

On March 16, 2016, the Company issued 1,000,000 common shares for services, valued at $40,000.

As of February 1, 2016, the Company authorized the issuance of 9,650,000 common shares as part of the consideration for the acquisition of the Oil and Gas investment made at that time.

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As of April 29, 2016, the Company, pursuant to a securities purchase agreement, sold 1,250,000 shares of its common stock at $0.15 per share.

As of September 30, 2016, the Company, pursuant to a securities purchase agreement, sold $1,337,500 shares of its common stock at $0.15 per share.

The securities identified in this Item were originally or will be issued pursuant to exemptions from registration requirements relying on Section 4(a)(2) of the Securities Act of 1933 and upon Rule 506 of Regulation D of the Securities Act of 1933 as there was no general solicitation, and the transactions did not involve a public offering.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS

Number		Description

3.1		Articles of Incorporation (incorporated by reference to our Definitive Information Statement on Schedule 14C filed on October 14, 2008)

3.2		Bylaws (incorporated by reference to our Definitive Information Statement on Schedule 14C filed on October 14, 2008)

3.3		Certificate of Amendment to Articles of Incorporation (incorporated by reference to our Definitive Information Statement on Schedule 14C filed on May 23, 2012)

10.1		Purchase and Sale, Petroleum and Natural Gas Conveyance Agreement with Tanager Energy Inc. dated November 3, 2014 (incorporated by reference to our Current Report on Form 8-K filed on November 10, 2014)

10.2		Purchase, Sale and Capital Contribution Agreement effective February 1, 2016 (incorporated by reference to our Annual Report on Form 10-K/A filed on May 16, 2016)

31.1*		Certification of Principal Executive Officer required by Rule 13a-14(1) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2*		Certification of Principal Financial Officer required by Rule 13a-14(1) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1*		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18 U.S.C. 63

32.2*		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18 U.S.C. 63

99.1		Guaranty and Repurchase Agreement dated April 11, 2012 (incorporated by reference to our Annual Report on Form 10-K filed on April 18, 2013)

99.2		Repurchase Agreement dated April 15, 2013 (incorporated by reference to our Annual Report on Form 10-K filed on April 18, 2013)

101.INS*		XBRL Instance Document

101.SCH*		XBRL Taxonomy Extension Schema Document

101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*		XBRL Taxonomy Extension Label Linkbase Document

101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document

_________

* to be filed or furnished by amendment.

ITEM 7. OFF BALANCE-SHEET ARRANGEMENTS

None.

SIGNATURES

In accordance with the requirements of Section 13 or 15(d) of the Securities Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	VIKING INVESTMENTS GROUP, INC. (Registrant)

Date: November 21, 2016	By:	/s/ James Doris
		James Doris
		Principal Executive Officer

In accordance with the Securities Exchange Act this report has been signed below by the following person(s) on behalf of the registrant and in the capacities and on the dates indicated.


Date: November 21, 2016	By:	/s/ Tom Simeo
		Tom Simeo
		Principal Financial and Accounting Officer