7.	General and Administrative Expenses

In connection with the property acquisition agreement entered into in the third quarter of 2011, the Company executed an operating agreement whereby DNR provides services to operate all of the properties acquired by the Company for a monthly fee of $23,000. The operating agreement expired on March 31, 2012 and renews on a month to month basis. Based on operator costs for the properties prior to the Company’s acquisition, approximately $8,000 per month is included in lease operating expenses and $15,000 per month is included in related party consulting fees in the accompanying Consolidated Statements of Operations. Effective July 1, 2012, the monthly operator fee was reduced to $18,000 per month, of which $8,000 per month is included in lease operating expense and the remaining $10,000 per month is included in related party consulting fees.

Presented below is a summary of general and administrative expenses for the years ended December 31, 2013 and 2014:


	2013		2014		Change
Director fees	$	2,250	$	20,450	$	18,200
Investor relations		98,505		65,833		(32,672	)
Legal, auditing and professional services		147,348		146,581		(767	)
Consulting and executive services:
Related parties		123,000		220,800		97,800
Unrelated parties		—		—		—
Other administrative expenses		59,712		72,807		13,095
Depreciation		570		570		—

Total general and administrative expenses	$	431,485	$	527,041	$	95,656

General and administrative expenses increased by $95,656 for 2014 compared to 2014, primarily due to decreases in investor relations and legal, auditing and professional fees; and increases in consulting and executive services, directors fees, and other administrative expenses.