10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

FORM 10-Q 

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

For the quarterly period ended September 30, 2016

OR

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

For the transition period from   to  

Commission file number: 333-169507

BRENHAM OIL & GAS CORP.

(Exact Name Of Registrant As Specified In Its Charter)

Nevada	27-2413874
(State of Incorporation)	(I.R.S. Employer Identification No.)
601 Cien Street, Suite 235, Kemah, TX	77565-3077
(Address of Principal Executive Offices)	(ZIP Code)

Registrant’s Telephone Number, Including Area Code: (281) 334-9479

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

Indicate by check mark whether the registrant has submitted electronically 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☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or 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  ☒

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

The number of shares outstanding of each of the issuer’s classes of equity as of November 11, 2016 is 128,031,064 shares of common stock.

TABLE OF CONTENTS

Item	Description	Page
	PART I – FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS	3
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	11
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	13
ITEM 4.	CONTROLS AND PROCEDURES	13
	PART II – OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	14
ITEM 1A.	RISK FACTORS	14
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	14
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	14
ITEM 4.	MINE SAFETY DISCLOSURES	14
ITEM 5.	OTHER INFORMATION	14
ITEM 6.	EXHIBITS	15

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Financial Statements 

Financial Statements
Unaudited Consolidated Balance Sheets - September 30, 2016 and December 31, 2015	4
Unaudited Consolidated Statements of Operations - Three Months and Nine Months Ended September 30, 2016 and 2015	5
Unaudited Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2016 and 2015	6
Notes to Unaudited Consolidated Financial Statements	7

3

BRENHAM OIL & GAS CORP.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30, 2016			December 31, 2015
ASSETS
Current assets:
Cash and cash equivalents	$	6,530		$	6,051
Total assets	$	6,530		$	6,051
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable and accrued expenses	$	26,010		$	23,518
Accounts payable – related parties		767,089			651,750
Total current liabilities		793,099			675,268
Long-term liabilities:
Asset retirement obligations		7,625			7,400
Total liabilities		800,724			682,668
Commitments and contingencies
Stockholders’ deficit:
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, 0 shares issued and outstanding		-			-
Common stock, $0.0001 par value, 200,000,000 shares authorized; 128,293,536 shares issued and outstanding		12,830			12,830
Less: treasury stock, at cost; 262,472 shares		(4,728	)		(4,728	)
Additional paid-in capital		992,981			992,981
Accumulated deficit		(1,795,277	)		(1,677,700	)
Total stockholders’ deficit		(794,194	)		(676,617	)
Total liabilities and stockholders’ deficit	$	6,530		$	6,051

See accompanying notes to the unaudited consolidated financial statements.

4

BRENHAM OIL & GAS CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2016 AND 2015

(Unaudited)

	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2016			2015			2016			2015
Oil and gas revenues	$	-		$	1,726		$	-		$	5,736
Costs and expenses:
Lease operating expenses		-			1,758			-			8,039
General and administrative		36,793			34,731			117,352			110,616
Depletion and accretion		-			394			225			2,102
Impairment of oil and gas assets		-			-			-			20,000
Total operating expenses		36,793			36,883			117,577			140,757
Net loss	$	(36,793	)	$	(35,157	)	$	(117,577	)	$	(135,021	)
Net loss per common share – basic and diluted	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Weighted average number of common shares outstanding – basic and diluted		128,293,536			128,293,036			128,293,536			128,293,113

See accompanying notes to the unaudited consolidated financial statements. 

5

BRENHAM OIL & GAS CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2016 AND 2015 (Unaudited)

	For the Nine Months Ended September 30,
	2016			2015
Cash flows from operating activities:
Net loss	$	(117,577	)	$	(135,021	)
Adjustments to reconcile net loss to cash used in operating activities:
Depletion and accretion		225			2,102
Impairment of oil and gas property		-			20,000
Changes in operating assets and liabilities:
Accounts payable and accrued expenses		2,492			(1,622	)
Net cash used in operating activities		(114,860	)		(114,541	)
Cash flows from financing activities:
Payments for acquisition of treasury stock		-			(267	)
Advances from related parties, net		115,339			115,305
Net cash provided by financing activities		115,339			115,038
Net increase in cash		479			497
Cash and cash equivalents, beginning of period		6,051			6,000
Cash and cash equivalents, end of period	$	6,530		$	6,497
Supplemental disclosures:
Interest paid	$	-		$	-
Income taxes paid	$	-		$	-
Non-cash investing and financing transactions:
Change in estimate of asset retirement costs	$	225		$	499

See accompanying notes to the unaudited consolidated financial statements. 

6

BRENHAM OIL & GAS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited interim consolidated financial statements of Brenham Oil & Gas Corp. (“Brenham”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in Brenham’s Annual Report on Form 10-K filed with the SEC for the year ended December 31, 2015. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of 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. Notes to the unaudited interim consolidated financial statements that would substantially duplicate the disclosures contained in the audited financial statements for the most recent fiscal year as reported in the Form 10-K have been omitted.

Organization, Ownership and Business

Brenham Oil & Gas, Inc. was incorporated under the laws of the State of Texas in November 1997 and became a wholly-owned subsidiary of American International Industries, Inc. (“American”) in November 1997. On April 21, 2010, the Company was re-domiciled in Nevada as Brenham Oil & Gas Corp. (“Brenham”) and Brenham Oil & Gas, Inc. became a wholly-owned subsidiary of Brenham. American was issued 64,977,093 shares of common stock of Brenham in connection with the reorganization in exchange for all shares outstanding of Brenham Oil & Gas, Inc. The reorganization has been retroactively applied to the consolidated financial statements for all periods presented.

On November 10, 2016, Brenham filed a Form 8-K reporting the Closing of the Agreement and Plan of Merger with Africa International Capital Ltd., a Bermuda corporation (“AIC”) pursuant to which a wholly-owned subsidiary of Brenham will be merged with and into AIC which will be the surviving entity and will become a subsidiary of Brenham. See subsequent event footnote for further information

Use of Estimates

In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Going Concern

The consolidated financial statements have been prepared on a going concern basis, which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company incurred a loss from operations during the nine months ended September 30, 2016 and 2015, has financial commitments in excess of current capital resources, and expects to incur further losses in the future, thus raising substantial doubt about the Company's ability to continue as a going concern.

The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. These financials do not include any adjustments relating to the recoverability and reclassification of recorded asset amounts, or amounts and classifications of liabilities that might result from this uncertainty.

With the merger completed on November 10, 2016, the Company's new management believes it should have the ability to continue as a going concern.

These financials do not include any adjustments relating to the recoverability and reclassification of recorded asset amounts, or amounts and classifications of liabilities that might result from this uncertainty.

Cash and Cash Equivalents

Brenham considers all short-term securities purchased with a maturity of three months or less to be cash equivalents.

7

Oil & Gas Properties

The Company has followed the full cost method of accounting for its investments in oil and gas properties, whereby all costs incurred in connection with the acquisition, exploration for and development of petroleum and natural gas reserves, including unproductive wells, are capitalized. Such costs have included lease acquisition, geological and geophysical activities, rentals on non-producing leases, drilling, completing and equipping of oil and gas wells and administrative costs directly attributable to those activities, and asset retirement costs. General and administrative costs related to production and general overhead are expensed as incurred.

Disposition of oil properties are accounted for as a reduction of capitalized costs, with no gain or loss recognized unless such adjustment would significantly alter the relationship between capital costs and proved reserves of oil, in which case the gain or loss is recognized in the statement of operations.

Future development, site restoration, dismantlement and abandonment costs, are estimated property by property, based upon current economic conditions and regulatory requirements, and are included in amortization of our oil and natural gas property costs.

Depletion of capitalized oil properties and estimated future development costs, excluding unproved properties, are based on the unit-of-production method based on proved reserves.

At the end of each quarter, the unamortized cost of oil and natural gas properties, net of related deferred income taxes, is limited to the sum of the estimated future after-tax net revenues from proved properties, after giving effect to cash flow hedge positions, discounted at 10%, and the lower of cost or fair value of unproved properties, adjusted for related income tax effects. This limitation is known as the “ceiling test,” and is based on SEC rules for the full cost oil and gas accounting method. There was no ceiling test write-down recorded during the nine months ended September 30, 2016 and 2015.

The Company assesses the carrying value of its unproved properties for impairment periodically. If the results of an assessment indicate that an unproved property is impaired (which was assessed in connection with the Company’s evaluation of goodwill impairment), then the carrying value of the unproved properties is added to the proved oil property costs to be amortized and subject to the ceiling test. The Company recorded an oil and gas impairment of $20,000 during the nine months ended September 30, 2015.

At December 31, 2015, the Company wrote off all of the Company’s oil and gas properties as impairment expense.

Income Taxes

Brenham is a taxable entity and recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to be in effect when the temporary differences reverse. The effect on the deferred tax assets and liabilities of a change in tax rates is recognized in income in the year that includes the enactment date of the rate change. A valuation allowance is used to reduce deferred tax assets to the amount that is more likely than not to be realized. Interest and penalties associated with income taxes are included in selling, general and administrative expense.

Brenham has adopted ASC 740-10 “Accounting for Uncertainty in Income Taxes,” which prescribes a comprehensive model of how a company should recognize, measure, present, and disclose in its financial statements uncertain tax positions that the company has taken or expects to take on a tax return. ASC 740-10 states that a tax benefit from an uncertain position may be recognized if it is “more likely than not” that the position is sustainable, based upon its technical merits. The tax benefit of a qualifying position is the largest amount of tax benefit that is greater than 50 percent likely of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. As of September 30, 2016, Brenham had not recorded any tax benefits from uncertain tax positions.

Net Loss Per Common Share

Net loss per common share is computed by dividing the net loss by the weighted average number of shares outstanding during a period. The weighted average number of shares was calculated by taking the number of shares outstanding and weighting them by the amount of time that they were outstanding. Basic and diluted net losses per share were the same, as there were no common stock equivalents outstanding. 

8

Recent Accounting Pronouncements

There were various accounting standards and interpretations issued recently, none of which are expected to have a material impact on the Company’s financial position, operations, or cash flows.

Subsequent Events

The Company has evaluated all transactions through the date the consolidated financial statements were issued for subsequent event disclosure consideration. Reference is made to Note 3. “Merger Agreement/Subsequent Events” below.

Note 2. Accounts Payable – Related Parties

Related party payables at September 30, 2016 consisted of $635,989 owed to American as advances to assist with Brenham’s operating expenses, and $131,100 owed to KDT for the acquisition of mineral rights for the Gillock Field. Related party payables at December 31, 2015 consists of $520,650 owed to American as advances to assist with Brenham’s operating expenses, and $131,100 owed to KDT and Daniel Dror II Trust of 2012 for the acquisition of mineral rights for the Gillock Field. KDT is owned by an entity which is controlled by the brother of Daniel Dror, Brenham’s Chairman, Chief Executive Officer, and President. Daniel Dror II is the adult son of Daniel Dror, Brenham’s Chairman and Chief Executive Officer.  The advances to Brenham are non-interest bearing and due on demand.

Note 3. Merger Agreement/Subsequent Events

On April 29, 2016, the Company filed a Form 8-K reporting that it had entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Africa International Capital Ltd., a Bermuda corporation (“AIC”) pursuant to which a wholly-owned subsidiary of the Registrant will be merged with and into AIC which will be the surviving entity and will become a subsidiary of the Registrant. A copy of the Merger Agreement was filed as Exhibit 2.1 to that Form 8-K. The Registrant also reported in the same 8-K that it had also entered into a Contribution Agreement with its corporate parent and principal shareholder, American International Industries, Inc., a Nevada corporation (“AIII”), a copy of which was filed as Exhibit 2.2 to this same Form 8-K.

On November 9, 2016, Brenham filed an amended Preliminary Information Statement on Schedule 14C with full disclosure required by Items 11 through 14 of Schedule 14A, including but not limited to the audited financial statements of the Registrant and AIC as well as the pro forma consolidated financial statements of the Registrant and AIC as required by Schedule 14A together with additional disclosure regarding the business of AIC.

Pursuant to the authority granted by the Joint Written Consent, a copy of which was attached as an exhibit to the PRE14C, the Company agreed to Company file a Certificate of Amendment to the Company’s Articles of Incorporation, to:

(i) change the name of the Company from Brenham Oil & Gas Corp. to Africa Growth Corporation (the “Name Change”);

(ii) implement a one-for-two hundred (1:200) reverse split of its 128,042,064 shares of issued and outstanding Common Stock (the “Reverse Split”);

(iii) rename existing Brenham Common Stock to Common Stock Series A;

(iv) authorize the issuance of up to 100,000,000 shares of a new class of non-voting common stock with the same economic rights of Common Stock Series A but without the right to vote on any matter which shall be designated Common Stock Series B;

(v) authorize the issuance of up to 1,000,000 shares of a new class of super-voting common stock with all of the economic rights of existing common stock except that such common stock will have five thousand (5,000) votes for each share, which shall be designated Common Stock Series C; and

(vi) authorize the issuance of up to 29,000,000 shares of preferred stock at par value of $0.0001 per share, which may be issued in one or more series (“Preferred Stock”) and the Board of Directors shall be authorized to fix the powers, preferences, rights, qualifications, limitations or restrictions of the Preferred Stock and any series thereof.

The foregoing are referred to collectively, as the “Corporate Actions.” The Corporate Actions will be evidenced by the filing of the Certificate of Amendment with the Secretary of State of the State of Nevada but will not become effective until the Company’s PRE 14C is cleared by the SEC and the Corporation Actions receive approval from FINRA of the Name Change and the Reverse Split (the “Effective Date”).

9

On November 10, 2016, the Company filed a Form 8-K with the SEC reporting the Closing of the Merger Agreement with AIC on November 9, 2016, as well as including disclosure under Items 1.01, 3.02, 5.01, 5.02 and 5.03 of Form 8-K. The Closing of the Merger Agreement is subject to certain conditions subsequent (the "Post-Closing Events") discussed below. In order to implement the Corporate Actions and conclude the Post-Closing Events, the Certificate of Amendment must be filed with the State of Nevada in connection with applying for and receiving FINRA approval of the Name Change and the Reverse Split. At November 9, 2016, the date of the Closing, and prior to the implementation of the Reverse Split and the issuance of any shares of Common Stock to the AIC shareholders, the Company had 200,000,000 shares of Common Stock authorized and 128,293,536 shares of Common Stock issued and outstanding. In connection with the Closing on November 9, 2016, the Company has instructed its transfer agent to issue a certificate evidencing 71,706,464 shares of pre-Reverse Split Common Stock, representing the remaining authorized but unissued pre-Reverse Split Shares in the name of a designee of AIC, in furtherance of the Company's obligation, following the Closing of the Merger Agreement, that the outstanding shares of AIC shall be converted into and exchanged for 7,362,421 post-Reverse Split shares of new Common Stock Series A, representing 1,472,484,200 pre-Reverse Split shares of Common Stock, or approximately 92% of the outstanding Common Stock Series A after the Closing and the implementation of the Reverse Split. As noted above, the Company does not have and will not have a sufficient number of authorized but unissued shares until FINRA approves all of the Corporate Actions.

In addition, in connection with the Closing and the Change in Control, the Company's Board of Directors: (i) accepted the resignations of Daniel Dror, CEO, President and Chairman, Charles R. Zeller, Director and Interim CFO, Bryan M. Mook, Director and COO and L. Rogers Hardy, Director and VP of Exploration, effective November 10, 2016; and (ii) appointed Brenton Kuss to the position of CFO and Christopher Darnell as Chairman and CEO, also effective November 10, 2016. The Company reasonably expects that prior to the implementation of the Post-Closing Events, one or more executive officers and directors may also be expected to be appointed.

S. Scott Gaille, who has been a director of the Company since 2010, shall continue to serve as a member of the Board of Directors

10

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

As used in this Quarterly Report, the terms “we”, “us”, “our” and the “Company” means Brenham Oil & Gas, Corp., a Nevada corporation, and its subsidiary, Brenham Oil & Gas, Inc. (collectively, “Brenham”). To the extent that we make any forward-looking statements in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report, we emphasize that forward-looking statements involve risks and uncertainties and our actual results may differ materially from those expressed or implied by our forward-looking statements. Our forward-looking statements in this Quarterly Report reflect our current views about future events and are based on assumptions and are subject to risks and uncertainties. Generally, forward-looking statements include phrases with words such as “expect”, “anticipate”, “intend”, “plan”, “believe”, “seek”, “estimate” and similar expressions to identify forward-looking statements.

Overview

The Company’s primary objective and focus through its fiscal year ended December 31, 2015 had been to access capital to fund its drilling programs in Texas.

Brenham had been an independent exploration and production company focused on acquiring a portfolio of assets in the United States and international locations. Brenham’s approach was to create a foundation of development and production assets in the United States, coupled with high potential international exploration opportunities.

The discussion of the results of operations represents our historical results. As a result of Brenham writing off all of its oil and gas assets effective December 31, 2015, the following discussion is not indicative of future results for many reasons.

The reason for entering into the Merger Agreement was due to the continuing low oil prices that have had a material adverse effect on the Company’s business prospects related to the development and commercial exploitation of its oil and gas assets and the likelihood that such assets would continue to underperform and not produce adequate returns.

The Company’s Board of Directors determined in April 2016 that rather than waiting for a commodity price recovery, it  would be in the best interests of the Company and its shareholders to enter into the Merger Agreement, abandon of its oil and gas exploration efforts and effect a change in control to permit new management to pursue the growth opportunities presented by AIC’s business model which has focused on real estate acquisitions and long-term housing for middle-income families in Sub-Saharan Africa.

11

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

Net loss for the three months ended September 30, 2016 was $36,793, compared to $35,157 for the three months ended September 30, 2015. Oil and gas revenues were $0 and $1,726 for the three months ended September 30, 2016 and 2015, respectively. Lease operating expenses were $0 and $1,758 for the three months ended September 30, 2016 and 2015, respectively. General and administrative expenses for the three months ended September 30, 2016 were $36,793, and consisted primarily of executive compensation and legal and professional expenses. General and administrative expenses for the three months ended September 30, 2015 were $34,731, and consisted of executive compensation, travel, and legal and professional expenses.

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

Net loss for the nine months ended September 30, 2016 was $117,577, compared to $135,021 for the nine months ended September 30, 2015. Oil and gas revenues for the nine months ended September 30, 2016 were $0. Pierce Junction Field lease operating expenses were $0 and $8,039 for the nine months ended September 30, 2016 and 2015, respectively. General and administrative expenses for the nine months ended September 30, 2016 were $117,352, and consisted primarily of executive compensation and legal and professional expenses.  General and administrative expenses for the nine months ended September 30, 2015 were $110,616, and consisted of executive compensation, travel, and legal and professional expenses.

Liquidity and Capital Resources

At September 30, 2016 and December 31, 2015, total assets were $6,530, and $6,051, respectively. At September 30, 2016, total liabilities were $800,724, consisting of $26,010 in accounts payable and accrued expenses, $767,089 of accounts payable to related parties, and asset retirement obligations of $7,625. At December 31, 2015, total liabilities were $682,668, consisting of $23,518 in accounts payable and accrued expenses, $651,750 in accounts payable to related parties, and asset retirement obligations of $7,400.

We had cash flow used in operations of $114,860 during the nine months ended September 30, 2016, principally due to a net loss of 117,577. We had cash used in operations of $114,541 during the nine months ended September 30, 2015 principally due to a net loss of $135,021, partially offset by an impairment of oil and gas property of $20,000.

For the nine months ended September 30, 2016 and 2015, we had no cash flows from investing activities.

For the nine months ended September 30, 2016 and 2015, cash provided by financing activities was $115,339 and $115,038, respectively, which consist primarily of advances from related parties. 

Reference is made and incorporated herein to the amended Preliminary Information Statement on Schedule 14C filed on November 9, 2016 for discussion on Brenham’s post-merger financial condition and liquidity.

Contractual Obligations

Reference is made and incorporated herein to the amended Preliminary Information Statement on Schedule 14C filed on November 9, 2016 for discussion on Brenham’s post-merger financial condition and liquidity.

• credit facilities;

• contracts for the lease of drilling rigs;

• contracts for the provision of production facilities;

• infrastructure construction contracts; and

• long-term oil and gas property lease arrangements.

Off-Balance Sheet Arrangements

As of September 30, 2016 and December 31, 2015, we did not have any off-balance sheet arrangements.

12

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The primary objective of the following information is to provide forward-looking quantitative and qualitative information about our potential exposure to market risks. The disclosures are not meant to be precise indicators of expected future results, but rather indicators of reasonably possible results. This forward-looking information provides indicators of how we view and manage our ongoing market risk exposures. All of our market risk sensitive instruments will be entered into for purposes of risk management and not for speculation.

Reference is made and incorporated herein to the amended Preliminary Information Statement on Schedule 14C filed on November 9, 2016 for discussion on Brenham’s post-merger financial condition and liquidity.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures. As of September 30, 2016, the Company’s chief executive officer and interim chief financial officer conducted an evaluation regarding the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act. As of September 30, 2016, based  upon the evaluation of these controls and procedures, our chief executive officer and interim chief financial officer concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this report. Such conclusion reflects the departure of our chief financial officer and assumption of duties of the principal financial officer by our chief executive officer and the resulting lack of accounting experience of our now principal financial officer and a lack of segregation of duties. Until we are able to remedy these material weaknesses, we are relying on third party consultants to assist with financial reporting.

Changes in internal controls. During the quarterly period covered by this report, no changes occurred in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

13

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1A. RISK FACTORS

For the nine months ended September 30, 2016, there were no material changes from risk factors as disclosed in Company’s annual report on Form 10-K for the year ended December 31, 2015.

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

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

The following documents are filed as exhibits to this report on Form 10-Q or incorporated by reference herein. Any document incorporated by reference is identified by a parenthetical reference to the SEC filing that included such document.

Exhibit No.	Description
31.1	Certification of CEO Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to the Sarbanes-Oxley Act of 2002
31.2	Certification of CFO Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to the Sarbanes-Oxley Act of 2002
32.1	Certification of CEO Pursuant to Section 906 of Sarbanes-Oxley Act of 2002
32.2	Certification of CFO Pursuant to Section 906 of Sarbanes-Oxley Act of 2002
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

14

SIGNATURES 

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

By /s/ Daniel Dror

Daniel Dror

Chief Executive Officer, President, and Chairman

November 9, 2016

By /s/ Charles R. Zeller

Charles R. Zeller

Director and Interim Chief Financial Officer

November 9, 2016

15

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Daniel Dror, certify that:

1. I have reviewed this quarterly report of Brenham Oil & Gas Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (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. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2016

/s/ Daniel Dror

Daniel Dror

Chief Executive Officer, President, and Chairman

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Charles R. Zeller, certify that:

1. I have reviewed this quarterly report of Brenham Oil & Gas Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (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. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.  

Date:  November 9, 2016

/s/ Charles R. Zeller

Charles R. Zeller

Director and Interim Chief Financial Officer

EX-32.1

Exhibit 32.1

Statement Pursuant to Section 906 of Sarbanes-Oxley Act of 2002

The undersigned, Daniel Dror, Chief Executive Officer, President, and Chairman of Brenham Oil & Gas Corp., a Nevada corporation, hereby makes the following certification as required by Section 906(a) of the Sarbanes-Oxley Act of 2002, with respect to the following of this report filed pursuant to Section 15(d) of the Securities Exchange Act of 1934: Quarterly Report of Form 10-Q for the period ended September 30, 2016.

The undersigned certifies that the above annual report fully complies with the requirements of Section 15(d) of the Securities Exchange Act of 1934, and information contained in the above quarterly report fairly presents, in all respects, the financial condition of Brenham Oil & Gas Corp. and results of its operations. 

Date:  November 9, 2016

/s/ Daniel Dror

Daniel Dror

Chief Executive Officer, President, and Chairman

EX-32.2

Exhibit 32.2

 Statement Pursuant to Section 906 of Sarbanes-Oxley Act of 2002

The undersigned, Charles R. Zeller, Director and Interim Chief Financial Officer of Brenham Oil & Gas Corp., a Nevada corporation, hereby makes the following certification as required by Section 906(a) of the Sarbanes-Oxley Act of 2002, with respect to the following of this report filed pursuant to Section 15(d) of the Securities Exchange Act of 1934: Quarterly Report of Form 10-Q for the period ended September 30, 2016.

The undersigned certifies that the above annual report fully complies with the requirements of Section 15(d) of the Securities Exchange Act of 1934, and information contained in the above quarterly report fairly presents, in all respects, the financial condition of Brenham Oil & Gas Corp. and results of its operations. 

Date:  November 9, 2016

/s/ Charles R. Zeller

Charles R. Zeller

Director and Interim Chief Financial Officer

XML

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Nov. 11, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	Brenham Oil & Gas Corp.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		128,031,064
Amendment Flag	false
Entity Central Index Key	0001501720
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	Sep. 30, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3

XML

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 6,530	$ 6,051
Total assets	6,530	6,051
Current liabilities:
Accounts payable and accrued expenses	26,010	23,518
Accounts payable – related parties	767,089	651,750
Total current liabilities	793,099	675,268
Long-term liabilities:
Asset retirement obligations	7,625	7,400
Total liabilities	800,724	682,668
Commitments and contingencies
Stockholders’ deficit:
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, 0 shares issued and outstanding	0	0
Common stock, $0.0001 par value, 200,000,000 shares authorized; 128,293,536 shares issued and outstanding	12,830	12,830
Less: treasury stock, at cost; 262,472 shares	(4,728)	(4,728)
Additional paid-in capital	992,981	992,981
Accumulated deficit	(1,795,277)	(1,677,700)
Total stockholders’ deficit	(794,194)	(676,617)
Total liabilities and stockholders’ deficit	$ 6,530	$ 6,051

XML

CONSOLIDATED BALANCE SHEETS (Unaudited) (Parentheticals) - $ / shares	Sep. 30, 2016	Dec. 31, 2015
Preferred stock par value (in Dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock par value (in Dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	128,293,536	128,293,536
Common stock, shares outstanding	128,293,536	128,293,536
Treasury stock, shares	262,472	262,472

XML

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Oil and gas revenues	$ 0	$ 1,726	$ 0	$ 5,736
Costs and expenses:
Lease operating expenses	0	1,758	0	8,039
General and administrative	36,793	34,731	117,352	110,616
Depletion and accretion	0	394	225	2,102
Impairment of oil and gas assets	0	0	0	20,000
Total operating expenses	36,793	36,883	117,577	140,757
Net loss	$ (36,793)	$ (35,157)	$ (117,577)	$ (135,021)
Net loss per common share – basic and diluted (in Dollars per share)	$ 0.00	$ 0.00	$ 0.00	$ 0.00
Weighted average number of common shares outstanding – basic and diluted (in Shares)	128,293,536	128,293,036	128,293,536	128,293,113

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities:
Net loss	$ (117,577)	$ (135,021)
Adjustments to reconcile net loss to cash used in operating activities:
Depletion and accretion	225	2,102
Impairment of oil and gas property	0	20,000
Changes in operating assets and liabilities:
Accounts payable and accrued expenses	2,492	(1,622)
Net cash used in operating activities	(114,860)	(114,541)
Cash flows from financing activities:
Payments for acquisition of treasury stock	0	(267)
Advances from related parties, net	115,339	115,305
Net cash provided by financing activities	115,339	115,038
Net increase in cash	479	497
Cash and cash equivalents, beginning of period	6,051	6,000
Cash and cash equivalents, end of period	6,530	6,497
Supplemental disclosures:
Interest paid	0	0
Income taxes paid	0	0
Non-cash investing and financing transactions:
Change in estimate of asset retirement costs	$ 225	$ 499

XML

Note 1. Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

Note 1. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited interim consolidated financial statements of Brenham Oil & Gas Corp. (“Brenham”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in Brenham’s Annual Report on Form 10-K filed with the SEC for the year ended December 31, 2015. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of 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. Notes to the unaudited interim consolidated financial statements that would substantially duplicate the disclosures contained in the audited financial statements for the most recent fiscal year as reported in the Form 10-K have been omitted.

Organization, Ownership and Business

Brenham Oil & Gas, Inc. was incorporated under the laws of the State of Texas in November 1997 and became a wholly-owned subsidiary of American International Industries, Inc. (“American”) in November 1997. On April 21, 2010, the Company was re-domiciled in Nevada as Brenham Oil & Gas Corp. (“Brenham”) and Brenham Oil & Gas, Inc. became a wholly-owned subsidiary of Brenham. American was issued 64,977,093 shares of common stock of Brenham in connection with the reorganization in exchange for all shares outstanding of Brenham Oil & Gas, Inc. The reorganization has been retroactively applied to the consolidated financial statements for all periods presented.

On November 10, 2016, Brenham filed a Form 8-K reporting the Closing of the Agreement and Plan of Merger with Africa International Capital Ltd., a Bermuda corporation (“AIC”) pursuant to which a wholly-owned subsidiary of Brenham will be merged with and into AIC which will be the surviving entity and will become a subsidiary of Brenham. See subsequent event footnote for further information

Use of Estimates

In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Going Concern

The consolidated financial statements have been prepared on a going concern basis, which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company incurred a loss from operations during the nine months ended September 30, 2016 and 2015, has financial commitments in excess of current capital resources, and expects to incur further losses in the future, thus raising substantial doubt about the Company's ability to continue as a going concern.

The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. These financials do not include any adjustments relating to the recoverability and reclassification of recorded asset amounts, or amounts and classifications of liabilities that might result from this uncertainty.

With the merger completed on November 10, 2016, the Company's new management believes it should have the ability to continue as a going concern.

These financials do not include any adjustments relating to the recoverability and reclassification of recorded asset amounts, or amounts and classifications of liabilities that might result from this uncertainty.

Cash and Cash Equivalents

Brenham considers all short-term securities purchased with a maturity of three months or less to be cash equivalents.

Oil & Gas Properties

The Company has followed the full cost method of accounting for its investments in oil and gas properties, whereby all costs incurred in connection with the acquisition, exploration for and development of petroleum and natural gas reserves, including unproductive wells, are capitalized. Such costs have included lease acquisition, geological and geophysical activities, rentals on non-producing leases, drilling, completing and equipping of oil and gas wells and administrative costs directly attributable to those activities, and asset retirement costs. General and administrative costs related to production and general overhead are expensed as incurred.

Disposition of oil properties are accounted for as a reduction of capitalized costs, with no gain or loss recognized unless such adjustment would significantly alter the relationship between capital costs and proved reserves of oil, in which case the gain or loss is recognized in the statement of operations.

Future development, site restoration, dismantlement and abandonment costs, are estimated property by property, based upon current economic conditions and regulatory requirements, and are included in amortization of our oil and natural gas property costs.

Depletion of capitalized oil properties and estimated future development costs, excluding unproved properties, are based on the unit-of-production method based on proved reserves.

At the end of each quarter, the unamortized cost of oil and natural gas properties, net of related deferred income taxes, is limited to the sum of the estimated future after-tax net revenues from proved properties, after giving effect to cash flow hedge positions, discounted at 10%, and the lower of cost or fair value of unproved properties, adjusted for related income tax effects. This limitation is known as the “ceiling test,” and is based on SEC rules for the full cost oil and gas accounting method. There was no ceiling test write-down recorded during the nine months ended September 30, 2016 and 2015.

The Company assesses the carrying value of its unproved properties for impairment periodically. If the results of an assessment indicate that an unproved property is impaired (which was assessed in connection with the Company’s evaluation of goodwill impairment), then the carrying value of the unproved properties is added to the proved oil property costs to be amortized and subject to the ceiling test. The Company recorded an oil and gas impairment of $20,000 during the nine months ended September 30, 2015.

At December 31, 2015, the Company wrote off all of the Company’s oil and gas properties as impairment expense.

Income Taxes

Brenham is a taxable entity and recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to be in effect when the temporary differences reverse. The effect on the deferred tax assets and liabilities of a change in tax rates is recognized in income in the year that includes the enactment date of the rate change. A valuation allowance is used to reduce deferred tax assets to the amount that is more likely than not to be realized. Interest and penalties associated with income taxes are included in selling, general and administrative expense.

Brenham has adopted ASC 740-10 “Accounting for Uncertainty in Income Taxes,” which prescribes a comprehensive model of how a company should recognize, measure, present, and disclose in its financial statements uncertain tax positions that the company has taken or expects to take on a tax return. ASC 740-10 states that a tax benefit from an uncertain position may be recognized if it is “more likely than not” that the position is sustainable, based upon its technical merits. The tax benefit of a qualifying position is the largest amount of tax benefit that is greater than 50 percent likely of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. As of September 30, 2016, Brenham had not recorded any tax benefits from uncertain tax positions.

Net Loss Per Common Share

Net loss per common share is computed by dividing the net loss by the weighted average number of shares outstanding during a period. The weighted average number of shares was calculated by taking the number of shares outstanding and weighting them by the amount of time that they were outstanding. Basic and diluted net losses per share were the same, as there were no common stock equivalents outstanding. 

Recent Accounting Pronouncements

There were various accounting standards and interpretations issued recently, none of which are expected to have a material impact on the Company’s financial position, operations, or cash flows.

Subsequent Events

The Company has evaluated all transactions through the date the consolidated financial statements were issued for subsequent event disclosure consideration. Reference is made to Note 3. “Merger Agreement/Subsequent Events” below.

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Note 2. Accounts Payable – Related Parties

9 Months Ended

Sep. 30, 2016

Related Party Transactions [Abstract]

Related Party Transactions Disclosure [Text Block]

Note 2. Accounts Payable – Related Parties

Related party payables at September 30, 2016 consisted of $635,989 owed to American as advances to assist with Brenham’s operating expenses, and $131,100 owed to KDT for the acquisition of mineral rights for the Gillock Field. Related party payables at December 31, 2015 consists of $520,650 owed to American as advances to assist with Brenham’s operating expenses, and $131,100 owed to KDT and Daniel Dror II Trust of 2012 for the acquisition of mineral rights for the Gillock Field. KDT is owned by an entity which is controlled by the brother of Daniel Dror, Brenham’s Chairman, Chief Executive Officer, and President. Daniel Dror II is the adult son of Daniel Dror, Brenham’s Chairman and Chief Executive Officer.  The advances to Brenham are non-interest bearing and due on demand.

XML

Note 3. Merger Agreement

9 Months Ended

Sep. 30, 2016

Business Combinations [Abstract]

Business Combination Disclosure [Text Block]

Note 3. Merger Agreement/Subsequent Events

On April 29, 2016, the Company filed a Form 8-K reporting that it had entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Africa International Capital Ltd., a Bermuda corporation (“AIC”) pursuant to which a wholly-owned subsidiary of the Registrant will be merged with and into AIC which will be the surviving entity and will become a subsidiary of the Registrant. A copy of the Merger Agreement was filed as Exhibit 2.1 to that Form 8-K. The Registrant also reported in the same 8-K that it had also entered into a Contribution Agreement with its corporate parent and principal shareholder, American International Industries, Inc., a Nevada corporation (“AIII”), a copy of which was filed as Exhibit 2.2 to this same Form 8-K.

On November 9, 2016, Brenham filed an amended Preliminary Information Statement on Schedule 14C with full disclosure required by Items 11 through 14 of Schedule 14A, including but not limited to the audited financial statements of the Registrant and AIC as well as the pro forma consolidated financial statements of the Registrant and AIC as required by Schedule 14A together with additional disclosure regarding the business of AIC.

Pursuant to the authority granted by the Joint Written Consent, a copy of which was attached as an exhibit to the PRE14C, the Company agreed to Company file a Certificate of Amendment to the Company’s Articles of Incorporation, to:

(i) change the name of the Company from Brenham Oil & Gas Corp. to Africa Growth Corporation (the “Name Change”);

(ii) implement a one-for-two hundred (1:200) reverse split of its 128,042,064 shares of issued and outstanding Common Stock (the “Reverse Split”);

(iii) rename existing Brenham Common Stock to Common Stock Series A;

(iv) authorize the issuance of up to 100,000,000 shares of a new class of non-voting common stock with the same economic rights of Common Stock Series A but without the right to vote on any matter which shall be designated Common Stock Series B;

(v) authorize the issuance of up to 1,000,000 shares of a new class of super-voting common stock with all of the economic rights of existing common stock except that such common stock will have five thousand (5,000) votes for each share, which shall be designated Common Stock Series C; and

(vi) authorize the issuance of up to 29,000,000 shares of preferred stock at par value of $0.0001 per share, which may be issued in one or more series (“Preferred Stock”) and the Board of Directors shall be authorized to fix the powers, preferences, rights, qualifications, limitations or restrictions of the Preferred Stock and any series thereof.

The foregoing are referred to collectively, as the “Corporate Actions.” The Corporate Actions will be evidenced by the filing of the Certificate of Amendment with the Secretary of State of the State of Nevada but will not become effective until the Company’s PRE 14C is cleared by the SEC and the Corporation Actions receive approval from FINRA of the Name Change and the Reverse Split (the “Effective Date”).

On November 10, 2016, the Company filed a Form 8-K with the SEC reporting the Closing of the Merger Agreement with AIC on November 9, 2016, as well as including disclosure under Items 1.01, 3.02, 5.01, 5.02 and 5.03 of Form 8-K. The Closing of the Merger Agreement is subject to certain conditions subsequent (the "Post-Closing Events") discussed below. In order to implement the Corporate Actions and conclude the Post-Closing Events, the Certificate of Amendment must be filed with the State of Nevada in connection with applying for and receiving FINRA approval of the Name Change and the Reverse Split. At November 9, 2016, the date of the Closing, and prior to the implementation of the Reverse Split and the issuance of any shares of Common Stock to the AIC shareholders, the Company had 200,000,000 shares of Common Stock authorized and 128,293,536 shares of Common Stock issued and outstanding. In connection with the Closing on November 9, 2016, the Company has instructed its transfer agent to issue a certificate evidencing 71,706,464 shares of pre-Reverse Split Common Stock, representing the remaining authorized but unissued pre-Reverse Split Shares in the name of a designee of AIC, in furtherance of the Company's obligation, following the Closing of the Merger Agreement, that the outstanding shares of AIC shall be converted into and exchanged for 7,362,421 post-Reverse Split shares of new Common Stock Series A, representing 1,472,484,200 pre-Reverse Split shares of Common Stock, or approximately 92% of the outstanding Common Stock Series A after the Closing and the implementation of the Reverse Split. As noted above, the Company does not have and will not have a sufficient number of authorized but unissued shares until FINRA approves all of the Corporate Actions.

In addition, in connection with the Closing and the Change in Control, the Company's Board of Directors: (i) accepted the resignations of Daniel Dror, CEO, President and Chairman, Charles R. Zeller, Director and Interim CFO, Bryan M. Mook, Director and COO and L. Rogers Hardy, Director and VP of Exploration, effective November 10, 2016; and (ii) appointed Brenton Kuss to the position of CFO and Christopher Darnell as Chairman and CEO, also effective November 10, 2016. The Company reasonably expects that prior to the implementation of the Post-Closing Events, one or more executive officers and directors may also be expected to be appointed.

S. Scott Gaille, who has been a director of the Company since 2010, shall continue to serve as a member of the Board of Directors

XML

Accounting Policies, by Policy (Policies)

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Basis of Accounting, Policy [Policy Text Block]

Basis of Presentation

The accompanying unaudited interim consolidated financial statements of Brenham Oil & Gas Corp. (“Brenham”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in Brenham’s Annual Report on Form 10-K filed with the SEC for the year ended December 31, 2015. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of 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. Notes to the unaudited interim consolidated financial statements that would substantially duplicate the disclosures contained in the audited financial statements for the most recent fiscal year as reported in the Form 10-K have been omitted.

Organization Ownership and Business, Policy [Text Block]

Organization, Ownership and Business

Brenham Oil & Gas, Inc. was incorporated under the laws of the State of Texas in November 1997 and became a wholly-owned subsidiary of American International Industries, Inc. (“American”) in November 1997. On April 21, 2010, the Company was re-domiciled in Nevada as Brenham Oil & Gas Corp. (“Brenham”) and Brenham Oil & Gas, Inc. became a wholly-owned subsidiary of Brenham. American was issued 64,977,093 shares of common stock of Brenham in connection with the reorganization in exchange for all shares outstanding of Brenham Oil & Gas, Inc. The reorganization has been retroactively applied to the consolidated financial statements for all periods presented.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Going Concern, Policy [Text Block]

Going Concern

The consolidated financial statements have been prepared on a going concern basis, which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company incurred a loss from operations during the nine months ended September 30, 2016 and 2015, has financial commitments in excess of current capital resources, and expects to incur further losses in the future, thus raising substantial doubt about the Company's ability to continue as a going concern.

The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. These financials do not include any adjustments relating to the recoverability and reclassification of recorded asset amounts, or amounts and classifications of liabilities that might result from this uncertainty.

With the merger completed on November 10, 2016, the Company's new management believes it should have the ability to continue as a going concern.

These financials do not include any adjustments relating to the recoverability and reclassification of recorded asset amounts, or amounts and classifications of liabilities that might result from this uncertainty.

Cash and Cash Equivalents, Policy [Policy Text Block]

Cash and Cash Equivalents

Brenham considers all short-term securities purchased with a maturity of three months or less to be cash equivalents.

Oil and Gas Properties Policy [Policy Text Block]

Oil & Gas Properties

The Company has followed the full cost method of accounting for its investments in oil and gas properties, whereby all costs incurred in connection with the acquisition, exploration for and development of petroleum and natural gas reserves, including unproductive wells, are capitalized. Such costs have included lease acquisition, geological and geophysical activities, rentals on non-producing leases, drilling, completing and equipping of oil and gas wells and administrative costs directly attributable to those activities, and asset retirement costs. General and administrative costs related to production and general overhead are expensed as incurred.

Disposition of oil properties are accounted for as a reduction of capitalized costs, with no gain or loss recognized unless such adjustment would significantly alter the relationship between capital costs and proved reserves of oil, in which case the gain or loss is recognized in the statement of operations.

Future development, site restoration, dismantlement and abandonment costs, are estimated property by property, based upon current economic conditions and regulatory requirements, and are included in amortization of our oil and natural gas property costs.

Depletion of capitalized oil properties and estimated future development costs, excluding unproved properties, are based on the unit-of-production method based on proved reserves.

At the end of each quarter, the unamortized cost of oil and natural gas properties, net of related deferred income taxes, is limited to the sum of the estimated future after-tax net revenues from proved properties, after giving effect to cash flow hedge positions, discounted at 10%, and the lower of cost or fair value of unproved properties, adjusted for related income tax effects. This limitation is known as the “ceiling test,” and is based on SEC rules for the full cost oil and gas accounting method. There was no ceiling test write-down recorded during the nine months ended September 30, 2016 and 2015.

The Company assesses the carrying value of its unproved properties for impairment periodically. If the results of an assessment indicate that an unproved property is impaired (which was assessed in connection with the Company’s evaluation of goodwill impairment), then the carrying value of the unproved properties is added to the proved oil property costs to be amortized and subject to the ceiling test. The Company recorded an oil and gas impairment of $20,000 during the nine months ended September 30, 2015.

At December 31, 2015, the Company wrote off all of the Company’s oil and gas properties as impairment expense.

Income Tax, Policy [Policy Text Block]

Income Taxes

Brenham is a taxable entity and recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to be in effect when the temporary differences reverse. The effect on the deferred tax assets and liabilities of a change in tax rates is recognized in income in the year that includes the enactment date of the rate change. A valuation allowance is used to reduce deferred tax assets to the amount that is more likely than not to be realized. Interest and penalties associated with income taxes are included in selling, general and administrative expense.

Brenham has adopted ASC 740-10 “Accounting for Uncertainty in Income Taxes,” which prescribes a comprehensive model of how a company should recognize, measure, present, and disclose in its financial statements uncertain tax positions that the company has taken or expects to take on a tax return. ASC 740-10 states that a tax benefit from an uncertain position may be recognized if it is “more likely than not” that the position is sustainable, based upon its technical merits. The tax benefit of a qualifying position is the largest amount of tax benefit that is greater than 50 percent likely of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. As of September 30, 2016, Brenham had not recorded any tax benefits from uncertain tax positions.

Earnings Per Share, Policy [Policy Text Block]

Net Loss Per Common Share

Net loss per common share is computed by dividing the net loss by the weighted average number of shares outstanding during a period. The weighted average number of shares was calculated by taking the number of shares outstanding and weighting them by the amount of time that they were outstanding. Basic and diluted net losses per share were the same, as there were no common stock equivalents outstanding.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements

There were various accounting standards and interpretations issued recently, none of which are expected to have a material impact on the Company’s financial position, operations, or cash flows.

Subsequent Events, Policy [Policy Text Block]

Subsequent Events

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

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Note 1. Summary of Significant Accounting Policies (Details) - USD ($)		3 Months Ended		9 Months Ended
	Apr. 21, 2010	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Accounting Policies [Abstract]
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares	64,977,093
Fair Value Inputs, Discount Rate				10.00%
Impairment of Oil and Gas Properties		$ 0	$ 0	$ 0	$ 20,000

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Note 2. Accounts Payable – Related Parties (Details) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Note 2. Accounts Payable – Related Parties (Details) [Line Items]
Accounts Payable, Related Parties, Current	$ 767,089	$ 651,750
Affiliated Entity [Member]
Note 2. Accounts Payable – Related Parties (Details) [Line Items]
Accounts Payable, Related Parties, Current	635,989	520,650
Immediate Family Member of Management or Principal Owner [Member]
Note 2. Accounts Payable – Related Parties (Details) [Line Items]
Accounts Payable, Related Parties, Current	$ 131,100	$ 131,100

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Note 3. Merger Agreement (Details) - $ / shares	Nov. 09, 2016	Nov. 10, 2016	Sep. 30, 2016	Dec. 31, 2015
Note 3. Merger Agreement (Details) [Line Items]
Common Stock, Shares, Issued			128,293,536	128,293,536
Common Stock, Shares, Outstanding			128,293,536	128,293,536
Common Stock, Shares Authorized			200,000,000	200,000,000
Preferred Stock, Shares Authorized			10,000,000	10,000,000
Preferred Stock, Par or Stated Value Per Share (in Dollars per share)			$ 0.0001	$ 0.0001
Subsequent Event [Member]
Note 3. Merger Agreement (Details) [Line Items]
Stockholders' Equity, Reverse Stock Split	one-for-two hundred
Common Stock, Shares, Issued	128,042,064	128,293,536
Common Stock, Shares, Outstanding	128,042,064	128,293,536
Common Stock, Shares Authorized	200,000,000
Preferred Stock, Shares Authorized	29,000,000
Preferred Stock, Par or Stated Value Per Share (in Dollars per share)	$ 0.0001
Stock Issued During Period, Shares, Reverse Stock Splits	71,706,464
Stock Repurchased and Retired During Period, Shares	7,362,421
Common Class A [Member] | Subsequent Event [Member]
Note 3. Merger Agreement (Details) [Line Items]
Common Stock, Shares, Outstanding	1,472,484,200
Common Stock, Shares Authorized	100,000,000
Common Stock, Perdentage Outstanding	92.00%
Common Class C [Member] | Subsequent Event [Member]
Note 3. Merger Agreement (Details) [Line Items]
Common Stock, Shares Authorized	1,000,000
Common Stock, Voting Rights	five thousand (5,000) votes for each share