Nevada
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20-4119257
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Large accelerated filer
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o
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Accelerated filer
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o
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Non-accelerated filer
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o
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Smaller reporting company
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þ
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(Do not check if a smaller reporting company)
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PART I - FINANCIAL INFORMATION
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1
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Item 1. Financial Statements
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1
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
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9
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Item 3. Quantitative and Qualitative Disclosures About Market Risk
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14
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Item 4. Controls and Procedures
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14
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PART II - OTHER INFORMATION
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15
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Item 1. Legal Proceedings
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15
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Item 1A. Risk Factors
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16
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
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23
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Item 3. Defaults Upon Senior Securities
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23
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Item 4. Mine Safety Disclosures
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23
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Item 5. Other Information
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23
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Item 6. Exhibits
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24
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SIGNATURES
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25
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STRONGBOW RESOURCES INC.
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||||||||
BALANCE SHEETS
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||||||||
(Unaudited) | ||||||||
August 31, 2015
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February 28, 2015
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|||||||
$ | $ | |||||||
ASSETS
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||||||||
Current assets
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||||||||
Cash
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- | 26,858 | ||||||
Receivable
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2,069 | 4,680 | ||||||
Prepaid expense and other
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81,972 | 72,578 | ||||||
84,041 | 104,116 | |||||||
Equipment
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60,569 | 65,421 | ||||||
Oil and gas properties, full cost method
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579,590 | 587,770 | ||||||
724,200 | 757,307 | |||||||
LIABILITIES AND STOCKHOLDERS' DEFICIT
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||||||||
Current liabilities
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||||||||
Accounts payable
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595,065 | 558,591 | ||||||
Accrued liabilities
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60,808 | 35,937 | ||||||
Due to related parties
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250,264 | 130,884 | ||||||
Note payable
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19,003 | 19,965 | ||||||
Derivative financial liabilities
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28,116 | 379,463 | ||||||
953,256 | 1,124,840 | |||||||
Asset retirement obligation
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21,500 | 21,515 | ||||||
974,756 | 1,146,355 | |||||||
Stockholders' deficit
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||||||||
Capital Stock
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||||||||
Authorized:
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||||||||
750,000,000 common shares, par value $0.001 per share
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||||||||
Issued and outstanding:
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||||||||
29,904,046 common shares (29,881,824 at February 28, 2015)
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21,794 | 21,772 | ||||||
Additional paid in capital
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2,970,531 | 2,962,947 | ||||||
Accumulated other comprehensive loss
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(111,638 | ) | (123,371 | ) | ||||
Deficit accumulated during the exploration stage
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(3,131,243 | ) | (3,250,396 | ) | ||||
(250,556 | ) | (389,048 | ) | |||||
724,200 | 757,307 |
STRONGBOW RESOURCES INC.
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||||||||||||||||
STATEMENTS OF OPERATIONS
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||||||||||||||||
(Unaudited)
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||||||||||||||||
For the three months ended
August 31,
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For the six months ended
August 31,
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|||||||||||||||
2015
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2014
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2015
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2014
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|||||||||||||
$
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$
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$ |
$
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|||||||||||||
General and administrative expenses
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||||||||||||||||
Accretion
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526 | - | 1,069 | - | ||||||||||||
Consulting
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13,429 | 7,631 | 27,843 | 30,223 | ||||||||||||
Depreciation
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874 | 800 | 1,776 | 1,600 | ||||||||||||
Management fees
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23,463 | 27,705 | 47,688 | 54,984 | ||||||||||||
Office, travel and general
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35,279 | 23,375 | 45,371 | 31,088 | ||||||||||||
Professional fees
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27,343 | 20,833 | 49,303 | 52,018 | ||||||||||||
Salaries and benefits
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22,035 | - | 59,246 | - | ||||||||||||
Loss from operations
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(122,949 | ) | (80,344 | ) | (232,296 | ) | (169,913 | ) | ||||||||
Gain on settlement of debt
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- | 53,787 | - | 53,787 | ||||||||||||
Interest income
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53 | 28 | 102 | 28 | ||||||||||||
Gain on fair value adjustment of derivative financial liabilities
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229,111 | - | 351,347 | - | ||||||||||||
Net income (loss)
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106,215 | (26,529 | ) | 119,153 | (116,098 | ) | ||||||||||
Foreign currency translation
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14,447 | (10,830 | ) | 11,733 | (36,913 | ) | ||||||||||
Comprehensive income (loss)
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120,662 | (37,359 | ) | 130,886 | (153,011 | ) | ||||||||||
Basic and diluted income (loss) per share
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0.00 | (0.00 | ) | 0.00 | (0.00 | ) | ||||||||||
Weighted average number of basic
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||||||||||||||||
common shares outstanding
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29,884,360 | 28,234,523 | 29,886,896 | 28,085,718 |
STRONGBOW RESOURCES INC.
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||||||||
STATEMENTS OF CASH FLOWS
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||||||||
(Unaudited)
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||||||||
For the six months ended August 31,
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||||||||
2015
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2014
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|||||||
$
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$
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|||||||
Cash flows used in operating activities
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||||||||
Net income (loss)
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119,153 | (116,098 | ) | |||||
Non-cash items
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||||||||
Accretion
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1,069 | - | ||||||
Gain on settlement of debt
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- | (53,787 | ) | |||||
Gain on fair value adjustment of derivative financial liabilities
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(351,347 | ) | - | |||||
Depreciation
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1,776 | 1,600 | ||||||
Changes in non-cash working capital items
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||||||||
Receivable
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2,611 | 1,702 | ||||||
Prepaid expenses
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(9,394 | ) | (28,350 | ) | ||||
Accounts payable and accrued liabilities
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83,045 | 17,325 | ||||||
Cash used in operating activities
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(153,087 | ) | (177,608 | ) | ||||
Cash flows used in investing activities
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||||||||
Expenditures on oil and gas properties
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(10,005 | ) | (38,825 | ) | ||||
Cash flows from financing activities
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||||||||
Common stock issued for cash
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7,606 | 145,657 | ||||||
Net proceeds from related parties
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131,428 | 13,796 | ||||||
Cash provided by financing activities
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139,034 | 159,453 | ||||||
Effect of foreign exchange
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(2,800 | ) | 26,561 | |||||
Change in cash
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(26,858 | ) | (30,419 | ) | ||||
Cash, beginning of period
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26,858 | 43,137 | ||||||
Cash, end of period
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- | 12,718 | ||||||
Non-cash transactions
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||||||||
Accrued expenditures on oil and gas properties
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11,070 | - | ||||||
Common stock issued as settlement of accounts payable
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- | 128,828 |
August 31, 2015
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||||||||||||
Cost
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Accumulated Depreciation
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Net Book Value | ||||||||||
$
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$
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$ | ||||||||||
Oil and gas equipment
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67,924 | 7,355 | 60,569 |
February 28, 2015
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||||||||||||
Cost
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Accumulated Depreciation
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Net Book Value | ||||||||||
$
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$
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$ | ||||||||||
Oil and gas equipment
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71,364 | 5,943 | 65,421 |
$ | ||||
Balance, February 28, 2014
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- | |||
Warrants issued
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579,952 | |||
Fair value adjustment
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(200,489 | ) | ||
Balance, February 28, 2015
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379,463 | |||
Fair value adjustment
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(351,347 | ) | ||
Balance, August 31, 2015
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28,116 |
August 31, 2015
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February 28, 2015
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|||||||
Volatility
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139 | % | 126 | % | ||||
Risk-free interest rate
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0.71 | % | 0.79 | % | ||||
Expected life
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1.94 years
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2.44 years
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||||||
Dividend yield
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nil
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nil
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Exercise
Price
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Number Outstanding
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Expiry Date
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||
$
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||||
11.50
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80,000
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August 26, 2016
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||
1.00
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1,000,000
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September 3, 2017
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●
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Incurred a total of $47,688 (August 31, 2014 - $54,984) in management fees to a director and officer of the Company.
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●
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Incurred a total of $3,775 (August 31, 2014 - $5,223) in consulting fees to a director and officer of the Company.
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August 31, 2015
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February 28, 2015
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|||||||
$ | $ | |||||||
Due to directors and officers of the Company
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250,264 | 130,884 |
●
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our beliefs regarding the future of our competitors;
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●
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our future capital expenditures;
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●
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our future exploration programs and results; and
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●
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our expectation that we will be able to raise capital when we need it, including pursuant to the LOI with the Investor.
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●
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volatility in market prices for oil and natural gas;
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●
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volatility in exchange rates;
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●
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liabilities inherent in oil and natural gas operations;
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●
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changes or fluctuations in production levels;
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●
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unexpected adverse weather conditions;
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●
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stock market volatility and market valuation of our common shares;
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●
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uncertainties associated with estimating oil and natural gas reserves;
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●
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competition for, among other things, capital, acquisitions of reserves, undeveloped lands and skilled personnel;
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●
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incorrect assessments of the value of exploration and development programs;
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●
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geological, technical, drilling, production and processing problems;
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●
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changes in legislation, including changes in tax laws, royalty rates and incentive programs relating to the oil and natural gas industry; and
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●
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our ability to raise capital.
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●
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we may be unable to raise sufficient funds to execute our business plan;
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●
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we have a limited operating history;
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●
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we are dependent on a small management team;
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●
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we may be unable to manage any growth;
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●
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market conditions or operation impediments may hinder our access to natural gas and oil markets or delay our production;
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●
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risks inherent in the oil and gas industry;
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●
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competition for, among other things, capital and skilled personnel; and
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●
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other factors discussed under the section entitled “Risk Factors”,
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For the three months ended
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For the six months ended
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|||||||||||||||
August 31, 2015
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August 31, 2014
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August 31, 2015
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August 31, 2014
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|||||||||||||
Oil and gas sales
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$ | - | $ | 4,272 | $ | - | $ | 4,272 | ||||||||
Expenses
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$ | 122,949 | $ | 80,344 | $ | 232,296 | $ | 169,913 | ||||||||
Net income (loss)
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$ | 106,215 | $ | (26,529 | ) | $ | 119,153 | $ | (116,098 | ) |
Expenses
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Increase / Decrease in Expenses
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Explanation for Change
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Consulting fees
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Decrease of $2,380
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Decrease due to less consulting services related to investor relation, market awareness, and oil and gas property during the quarter.
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Office, travel and general expenses
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Increase of $14,283
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Increase due to increase in insurance, general office expenses, office rent, and travel expenses.
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Professional fees
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Decrease of $2,715
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Decrease due to less professional services used for corporate filings, accounting, and professional services.
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Salaries and benefits
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Increase of $59,246
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Increase due to new hiring of COO and VP of Exploration during the quarter.
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August 31, 2015
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February 28, 2015
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|||||||
Current Assets
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$ | 84,041 | $ | 104,116 | ||||
Current Liabilities
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$ | 953,256 | $ | 1,124,840 | ||||
Working Capital (Deficiency)
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$ | (869,215 | ) | $ | (1,020,724 | ) |
Six months ended
August 31, 2015
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Six months ended
August 31, 2014
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|||||||
Net Cash Provided by (Used in) Operating Activities
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$ | (153,087 | ) | $ | (177,608 | ) | ||
Net Cash Provided by (Used in) Investing Activities
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$ | (10,005 | ) | $ | (38,825 | ) | ||
Net Cash Provided by (Used in) Financing Activities
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$ | 139,034 | $ | 159,453 | ||||
Net Increase in Cash
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$ | (26,858 | ) | $ | (30,419 | ) |
Payments due by period
|
||||||||||||||||||||
Contractual Obligations
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Total
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Less than 1 Year
|
1-3 Years
|
3-5 Years
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More than 5 Years
|
|||||||||||||||
Note payable
|
$
|
19,003
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$
|
19,003
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—
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—
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—
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Court/Registry
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Date Instituted
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Principal Parties
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Description of Claim
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Court of Queen's Bench of Alberta
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July 23, 2013
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Plaintiff: Baker Hughes Canada Company;
Defendant: Strongbow Resources Inc., also known as Big Lake Energy Ltd.
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A Statement of Claim was filed July 23, 2013, whereby the Plaintiff is suing the Defendant for the sum of $281,267.68 representing the amount owing for oil-field services and equipment, including cementing and fishing products and services provided by the Plaintiff.
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●
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the lack of pipeline transmission facilities or carrying capacity;
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●
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government regulation of natural gas and oil production;
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●
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government transportation, tax and energy policies;
|
●
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changes in supply and demand; and
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●
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general economic conditions.
|
●
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weather conditions;
|
●
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economic conditions, including demand for petroleum-based products;
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●
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actions by OPEC, the Organization of Petroleum Exporting Countries;
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●
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political instability in the Middle East and other major oil and gas producing regions;
|
●
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governmental regulations, both domestic and foreign;
|
●
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domestic and foreign tax policy;
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●
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the pace adopted by foreign governments for the exploration, development, and production of their national reserves;
|
●
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the price of foreign imports of oil and gas;
|
●
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the cost of exploring for, producing and delivering oil and gas;
|
●
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the discovery rate of new oil and gas reserves;
|
●
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the rate of decline of existing and new oil and gas reserves;
|
●
|
available pipeline and other oil and gas transportation capacity;
|
●
|
the ability of oil and gas companies to raise capital;
|
●
|
the overall supply and demand for oil and gas; and
|
●
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the availability of alternate fuel sources.
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No.
|
Description
|
|
3.1
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Articles of Incorporation (incorporated by reference from our registration statement on Form SB-2 filed on December 1, 2006)
|
|
3.2
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Corporate Bylaws (incorporated by reference from our registration statement on Form SB-2 filed on December 1, 2006)
|
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3.3*
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Certificate of Change filed October 25, 2007
|
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10.1
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Farmout Agreement, Compeer Area with Harvest Operations Corp. effective February 21, 2012 (incorporated by reference from our annual report on Form 10-K filed on May 29, 2012)
|
|
10.2
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Debt Settlement Agreement dated October 16, 2014, amongst the Company, Professional Trading S.A. and Stockbridge Resources Corp. (incorporated by reference from our current report on Form 8-K filed on October 20, 2014)
|
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10.3
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Employment Agreement dated April 23, 2015 with Kent Edney (incorporated by reference from our current report on Form 8-K filed on May 5, 2015)
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31.1*
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Certification of Michael Caetano Pursuant to Section 302 of the Sarbanes-Oxley Act Of 2002
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31.2*
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Certification of Robert DaCunha Pursuant to Section 302 of the Sarbanes-Oxley Act Of 2002
|
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32.1*
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Certification of Michael Caetano Pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002
|
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32.2*
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Certification of Robert DaCunha Pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002
|
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99.1*
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Audit Committee Charter
|
|
101.INS*
|
XBRL INSTANCE DOCUMENT
|
|
101.SCH*
|
XBRL TAXONOMY EXTENSION SCHEMA
|
|
101.CAL*
|
XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
|
|
101.DEF*
|
XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
|
|
101.LAB*
|
XBRL TAXONOMY EXTENSION LABEL LINKBASE
|
|
101.PRE*
|
XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE
|
STRONGBOW RESOURCES INC.
|
|||
Date: October 20, 2015
|
By:
|
/s/ Michael Caetano | |
Michael Caetano | |||
Chief Executive Officer | |||
President, Secretary, Treasurer and Director
|
|||
(Principal Executive Officer)
|
Date: October 20, 2015
|
By:
|
/s/ Robert Da Cunha | |
Robert Da Cunha | |||
Chief Financial Officer | |||
Director | |||
(Principal Financial Officer and Principal Accounting Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Strongbow Resources Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in the Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.
|
Date: October 20, 2015
|
By:
|
/s/ Michael Caetano | |
Michael Caetano | |||
President, Secretary, Treasurer and Director | |||
(Principal Executive Officer) |
1.
|
I have reviewed this quarterly report on Form 10-Q of Strongbow Resources Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in the Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.
|
Dated: October 20, 2015
|
By:
|
/s/ Robert Da Cunha | |
Robert Da Cunha | |||
Chief Financial Officer and Director | |||
(Principal Financial Officer and Principal Accounting Officer) |
(1)
|
the Quarterly Report on Form 10-Q of Strongbow Resources Inc. for the period ended August 31, 2015 fully complies with the requirements of Section 13(a) or 15(d) of theSecurities Exchange Act of 1934, as amended; and
|
(2)
|
the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Strongbow Resources Inc. Dated: October 20, 2015
|
Date: October 20, 2015
|
By:
|
/s/ Michael Caetano | |
Michael Caetano | |||
President, Secretary, Treasurer and Director | |||
(Principal Executive Officer) |
(1)
|
the Quarterly Report on Form 10-Q of Strongbow Resources Inc. for the period ended August 31,2015 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Strongbow Resources Inc.
|
Dated: October 20, 2015
|
By:
|
/s/ Robert Da Cunha | |
Robert Da Cunha | |||
Chief Financial Officer and Director | |||
(Principal Financial Officer and Principal Accounting Officer) |
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7. DERIVATIVE FINANCIAL LIABILITIES (Details 1) |
6 Months Ended | 12 Months Ended |
---|---|---|
Aug. 31, 2015 |
Feb. 28, 2015 |
|
Derivative Financial Liabilities Details 1 | ||
Volatility | 139.00% | 126.00% |
Risk-free interest rate | 0.71% | 0.79% |
Expected life | 1 year 11 months 8 days | 2 years 5 months 8 days |
Dividend yield | 0.00% | 0.00% |
4. EQUIPMENT |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2015 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EQUIPMENT |
|
3. OIL AND GAS PROPERTIES |
6 Months Ended |
---|---|
Aug. 31, 2015 | |
Notes to Financial Statements | |
OIL AND GAS PROPERTIES | Effective February 21, 2012, the Company entered into a Farmout Agreement (the Agreement) with Harvest Operations Corp. (Farmor). The Agreement provided for the Companys acquisition of an undivided 100% working interest (Working Interest) in a petroleum and natural gas license covering land located in the Compeer Area in the Province of Alberta, Canada (the Farmout Lands).
To earn the Working Interest the Company was required to drill, complete, equip or abandon a test well on the Farmout Lands (Test Well). On March 14, 2012, the Company obtained operator status and was transferred the well license relating to the Test Well.
The Companys Working Interest in the Farmout Lands will be held subject to a non-convertible overriding royalty payable to the Farmor (Farmors Royalty). The Farmors Royalty on net crude oil revenues will be measured on a sliding scale from 5% to 15% over a range of production volumes from 1 to 150 barrels per day. The Farmors Royalty on net gas and other petroleum product revenues is 15%.
The Test Well was spudded on May 27, 2012, and on September 5, 2012, the Company received an earning notice granting the Company a 100% working interest in the Farmout Lands.
During the year ended February 28, 2015, the Company estimated that the net present value of future cash flows from the property is $587,770 and recorded an impairment charge of $221,648.
During the period ended August 31, 2015, net proceeds of $nil (August 31, 2014 - $4,272) were received from the sales of oil less direct costs of $5,768 (August 31, 2014 - $7,055) was added to the carrying value of the oil and gas properties.
As of August 31, 2015, the Company has incurred $579,590 (February 28, 2015 - $587,770) in exploration costs to drill, complete and equip the Test Well, net of impairment charges in prior periods. |
1. NATURE AND CONTINUANCE OF OPERATIONS |
6 Months Ended |
---|---|
Aug. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE AND CONTINUANCE OF OPERATIONS | Strongbow Resources Inc. (the Company) was incorporated in the State of Nevada on July 9, 2004. The Company focuses its business efforts on the acquisition, exploration, and development of oil and gas properties.
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As of August 31, 2015, the Company has not achieved profitable operations, has incurred losses in developing its business, and further losses are anticipated. The Company has an accumulated deficit of $3,131,243.
As of August 31, 2015, one Statement of Claim totaling $213,791 (CAD$281,267) is outstanding against the Company and is recorded in accounts payable.
The Companys ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and pay its liabilities when they come due. To date, the Company has funded operations through the issuance of capital stock and debt. Management plans to continue raising additional funds through equity or debt financings and loans from directors. There is no certainty that further funding will be available as needed. These factors raise substantial doubt about the ability of the Company to continue operating as a going concern. The ability of the Company to continue its operations as a going concern is dependent upon its ability to raise sufficient new capital to fund its operating commitments and ongoing losses and ultimately on generating profitable operations. |
5. NOTES PAYABLE (Details Narrative) - USD ($) |
Aug. 31, 2015 |
Feb. 28, 2015 |
---|---|---|
Notes Payable Details Narrative | ||
Notes payable | $ 19,003 | $ 19,965 |
7. DERIVATIVE FINANCIAL LIABILITIES (Details) - USD ($) |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Aug. 31, 2015 |
Aug. 31, 2014 |
Aug. 31, 2015 |
Aug. 31, 2014 |
Feb. 28, 2015 |
|
Derivative Financial Liabilities Details | |||||
Balance, beginning | $ 379,463 | $ 0 | $ 0 | ||
Warrants issued | 0 | 579,952 | |||
Fair value adjustment | $ (229,111) | $ 0 | (351,347) | $ 0 | (200,489) |
Balance, ending | $ 28,116 | $ 28,116 | $ 379,463 |
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
6 Months Ended |
---|---|
Aug. 31, 2015 | |
Notes to Financial Statements | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Basis of Presentation The unaudited interim financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (GAAP) for interim financial information and the rules and regulations of the Securities and Exchange Commission (SEC). They do not include all information and footnotes required by GAAP for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended February 28, 2015 included in the Companys Annual Report on Form 10-K filed with the SEC. The interim unaudited financial statements should be read in conjunction with those financial statements included in the 10-K report. In the opinion of management, all adjustments considered necessary for fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the six months ended August 31, 2015 are not necessarily indicative of the results that may be expected for the year ending February 28, 2016.
Recent Accounting Pronouncements Recent pronouncements with future effective dates are either not applicable or are not expected to be significant to the financial statements of the Company. |
Balance Sheets (Parenthetical) - $ / shares |
Aug. 31, 2015 |
Feb. 28, 2015 |
---|---|---|
Stockholders equity: | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, authorized shares | 750,000,000 | 750,000,000 |
Common stock, issued shares | 29,904,046 | 29,881,824 |
Common stock, outstanding shares | 29,904,046 | 29,881,824 |
7. DERIVATIVE FINANCIAL LIABILITIES (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2015 | ||||||||||||||||||||||||||||||||||||||||||||||
Derivative Financial Liabilities Tables | ||||||||||||||||||||||||||||||||||||||||||||||
Schedule of derivative liabilities |
|
|||||||||||||||||||||||||||||||||||||||||||||
Schedule of fair value of warrants and dividends |
|
Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Aug. 31, 2015 |
Oct. 19, 2015 |
|
Document And Entity Information | ||
Entity Registrant Name | STRONGBOW RESOURCES INC. | |
Entity Central Index Key | 0001382231 | |
Document Type | 10-Q | |
Document Period End Date | Aug. 31, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --02-29 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 29,904,046 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2015 |
8. SHARE CAPITAL (Tables) |
6 Months Ended | ||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2015 | |||||||||||||||||||||
Share Capital Tables | |||||||||||||||||||||
Schedule of warrants outstanding and exercisable |
|
Statements of Operations (Unaudited) - USD ($) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Aug. 31, 2015 |
Aug. 31, 2014 |
Aug. 31, 2015 |
Aug. 31, 2014 |
|
GENERAL AND ADMINISTRATIVE EXPENSES | ||||
Accretion | $ 526 | $ 0 | $ (1,069) | $ 0 |
Consulting | 13,429 | 7,631 | 27,843 | 30,223 |
Depreciation | 874 | 800 | 1,776 | 1,600 |
Management fees | 23,463 | 27,705 | 47,688 | 54,984 |
Office, travel and general (recovery) | 35,279 | 23,375 | 45,371 | 31,088 |
Professional fees | 27,343 | 20,833 | 49,303 | 52,018 |
Salaries and benefits | 22,035 | 0 | 59,246 | 0 |
Loss from operations | (122,949) | (80,344) | (232,296) | (169,913) |
Gain on settlement of debt | 0 | 53,787 | 0 | 53,787 |
Interest income | 53 | 28 | 102 | 28 |
Gain on fair value adjustment of derivative financial liabilities | 229,111 | 0 | 351,347 | 0 |
Net income (loss) | 106,215 | (26,529) | 119,153 | (116,098) |
Foreign Currency Translation | 14,447 | (10,830) | 11,733 | (36,913) |
Comprehensive income (loss) | $ 120,662 | $ (37,359) | $ 130,886 | $ (153,011) |
Basic and diluted income (loss) per share | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
Weighted average number of basic common shares outstanding | 29,884,360 | 28,234,523 | 29,886,896 | 28,085,718 |
7. DERIVATIVE FINANCIAL LIABILITIES |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2015 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notes to Financial Statements | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DERIVATIVE FINANCIAL LIABILITIES |
The derivative liability consists of the fair value of share purchase warrants that were issued in unit private placements that have an exercise price in a currency other than the functional currency of the Company. The derivative liability is a non-cash liability as the Company will not be required to expend any cash.
The fair value of the warrants was determined using the Black-Scholes option pricing model using the following weighted average market assumptions:
|
6. ASSET RETIREMENT OBLIGATIONS |
6 Months Ended |
---|---|
Aug. 31, 2015 | |
Asset Retirement Obligation Disclosure [Abstract] | |
ASSET RETIREMENT OBLIGATIONS | The Companys asset retirement obligation consists of reclamation and closure costs associated with the Test Well in the Farmout Lands. The asset retirement obligation was estimated based on the Companys understanding of its requirements to reclaim currently disturbed areas. Significant reclamation and closure activities include land rehabilitation, water, removal of building and well facilities and tailings reclamation.
The undiscounted estimate of this liability was $38,005 (CAD$50,000) (February 28, 2015 - $39,930 (CAD$50,000)) reflecting payments commencing in 2024. This estimate was adjusted for an inflation rate of 2.00% and then discounted at a rate of 10.00% for a net present value of $21,500 (CAD$28,286) (February 28, 2015 - $21,515 (CAD$26,941)) as at August 31, 2015. |
6. ASSET RETIREMENT OBLIGATIONS (Details Narrative) - USD ($) |
Aug. 31, 2015 |
Feb. 28, 2015 |
---|---|---|
Asset Retirement Obligations Details Narrative | ||
Assets retirement obligation related to Test Well on Farmout Lands | $ 21,500 | $ 21,515 |
9. RELATED PARTY TRANSACTIONS (Tables) |
6 Months Ended | |||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2015 | ||||||||||||||||||||||||||||
Related Party Transactions Tables | ||||||||||||||||||||||||||||
Schedule of related party transactions |
|
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
6 Months Ended |
---|---|
Aug. 31, 2015 | |
Summary Of Significant Accounting Policies Policies | |
Basis of Presentation | The unaudited interim financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (GAAP) for interim financial information and the rules and regulations of the Securities and Exchange Commission (SEC). They do not include all information and footnotes required by GAAP for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended February 28, 2015 included in the Companys Annual Report on Form 10-K filed with the SEC. The interim unaudited financial statements should be read in conjunction with those financial statements included in the 10-K report. In the opinion of management, all adjustments considered necessary for fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the six months ended August 31, 2015 are not necessarily indicative of the results that may be expected for the year ending February 28, 2016. |
Recent Accounting Pronouncements | Recent pronouncements with future effective dates are either not applicable or are not expected to be significant to the financial statements of the Company. |
8. SHARE CAPITAL |
6 Months Ended | ||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2015 | |||||||||||||||||||||
Notes to Financial Statements | |||||||||||||||||||||
SHARE CAPITAL | In March 2014, the Company completed a one for four reverse stock split of the issued and outstanding common stock. All share and per share information in these financial statements has been retroactively restated to reflect the consolidation.
In August 2015, the Company issued 22,222 shares for gross proceeds of $7,606 (CAD$10,000) in subscriptions for a private placement.
Warrants
A summary of the share purchase warrants outstanding and exercisable at August 31, 2015 is as follows:
The weighted average exercise price is $1.04 and weighted average life of the warrants is 1.94 years. |
9. RELATED PARTY TRANSACTIONS |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
Notes to Financial Statements | |||||||||||||||||||||||||||||||||||||||||
RELATED PARTY TRANSACTIONS | During the six months ended August 31, 2015, the Company
As at August 31, 2015, $36,000 (February 28, 2015 - $36,000) was owing to a former director and officer of the Company and has been included in accounts payable. The amounts are non-interest bearing and unsecured. Due to related parties consist of the following:
All of the Companys advances from related parties are non-interest bearing, unsecured, and payable upon demand. |
4. EQUIPMENT (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Aug. 31, 2015 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Oil and gas equipment |
|
4. EQUIPMENT (Details) - USD ($) |
Aug. 31, 2015 |
Feb. 28, 2015 |
---|---|---|
Cost | ||
Oil and gas equipment | $ 67,924 | $ 71,364 |
Accumulated Depreciation | ||
Oil and gas equipment | 7,355 | 5,943 |
Net Book Value | ||
Oil and gas equipment | $ 60,569 | $ 65,421 |
8. SHARE CAPITAL (Details) |
6 Months Ended |
---|---|
Aug. 31, 2015
$ / shares
shares
| |
Warrant 1 | |
Exercise Price | $ 1.50 |
Number Outstanding | shares | 80,000 |
Expiry Date | 8/26/2016 |
Warrant 2 | |
Exercise Price | $ 1.00 |
Number Outstanding | shares | 1,000,000 |
Expiry Date | 9/3/2017 |
5. ADVANCES AND NOTES PAYABLE |
6 Months Ended |
---|---|
Aug. 31, 2015 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | As at August 31, 2015, the Company had $19,003 (CAD$25,000) (February 28, 2015 - $19,965 (CAD$25,000)) in short term note obligations to an unrelated party. The note payable is unsecured, non-interest bearing and payable upon demand. |
9. RELATED PARTY TRANSACTIONS (Details) - USD ($) |
Aug. 31, 2015 |
Feb. 28, 2015 |
---|---|---|
Director and officer of the Company | ||
Related party advances | $ 250,264 | $ 130,884 |
3. OIL AND GAS PROPERTIES (Details Narrative) |
6 Months Ended |
---|---|
Aug. 31, 2015
USD ($)
| |
Oil And Gas Properties Details Narrative | |
Exploration Costs | $ 579,590 |
Revenue - sales of oil | 0 |
Cost of sales of oil | $ 5,768 |