GOODWILL

We perform a goodwill impairment analysis at least annually, unless indicators of impairment exist in interim periods. The goodwill impairment assessment is based on several factors requiring judgment and is based on how our Chief Executive Officer and Chief Financial Officer manage the business. Each of our three operating segments, Black Oil, Refining and Marketing, and Recovery, constitutes a reportable segment for purposes of reviewing impairment and the recoverability of goodwill and other intangible assets. We must make various assumptions in determining their estimated fair values regarding estimated future cash flows and other factors in determining the fair values of the reportable segments. We performed a qualitative assessment (commonly referred to as a "Step 0" test) to determine if it was more likely than not that the fair value of each of our reportable segments with goodwill exceeded their carrying value. In making this assessment, we evaluated overall business and overall macroeconomic conditions since the date of our last quantitative assessment. We considered in our qualitative assessment, among other things, expectations of projected revenues and cash flows, trends in market multiples, changes in our stock price, changes in the carrying values of our reportable segments with goodwill, and overall market conditions. Based on this evaluation, we concluded that our goodwill was likely impaired and performed a quantitative Step One assessment. A quantitative Step One assessment involves determining the fair value of each reportable segment using market participant assumptions along with a discounted cash flow approach. As we believe that the carrying value of certain reportable segments with goodwill did not exceed their estimated fair value, we performed a quantitative Step Two assessment. A quantitative Step Two assessment compares the carrying value of the reportable segment to the fair value of all of the assets and liabilities of the reportable segment (including any unrecognized intangibles) as if the reportable segment was acquired in a business combination. If the carrying amount of a reportable segment's goodwill exceeds the implied fair value of its goodwill, an impairment loss is recognized in an amount equal to the excess.

We recognized a $4,922,353 Goodwill Impairment in 2015, which eliminated the goodwill balance. This result occurred primarily due to the adverse impact of recently declining oil prices on current and anticipated future oil activity. At December 31, 2016 and 2015, there was no goodwill recorded. Our Refining and Marketing segment did not have any goodwill recorded as of December 31, 2016 or 2015.

The following table contains consideration paid in excess of the net assets of the companies acquired, allocated to the respective business segment as of December 31, 2015:



	Black Oil			Refining and Marketing		Recovery			Total
Balance as of December 31, 2014	$	3,554,515		$	—	$	1,367,838		$	4,922,353
Less: Impairment	(3,554,515		)	—		(1,367,838		)	(4,922,353		)
Balance as of December 31, 2015	$	—		$	—	$	—		$	—