Nevada
|
66-0549380
|
|
(State
of incorporation)
|
(IRS Employer ID
Number)
|
Page
|
|
PART
I - Financial Information
|
|
Item
1 - Financial Statements
|
|
F-1
|
|
F-2
|
|
F-3
to F-4
|
|
|
|
F-5
to F13
|
|
1
|
|
3
|
|
Item
4 - Controls and Procedures
|
4
|
PART
II - Other Information
|
|
Item
1 - Legal Proceedings
|
4
|
Item 1A - Risk Factors |
5
|
5
|
|
Item
3 - Defaults Upon Senior Securities
|
6
|
6
|
|
Item
5 - Other Information
|
6
|
Item
6 - Exhibits
|
6
|
7
|
TIDELANDS
OIL & GAS CORPORATION
|
|||||||
CONDENSED
CONSOLIDATED
BALANCE
SHEETS
|
|||||||
|
|
|
|
|
|
||
ASSETS
|
|
|
|
|||||
|
March
31,
|
December
31,
|
|||||
|
2007
|
2006
|
|||||
|
(Unaudited)
|
||||||
Current
Assets:
|
|||||||
Cash
|
$
|
302,202
|
$
|
367,437
|
|||
Accounts
and Other Receivable
|
284,951
|
388,754
|
|||||
Inventory
|
119,478
|
84,030
|
|||||
Prepaid
Expenses
|
95,634
|
148,551
|
|||||
Total
Current Assets
|
802,265
|
988,772
|
|||||
|
|||||||
Property
Plant and Equipment, Net
|
13,147,781
|
12,364,359
|
|||||
|
|||||||
Other
Assets:
|
|||||||
Deposits
|
56,858
|
56,708
|
|||||
Cash
Restricted
|
53,250
|
52,642
|
|||||
Deferred
Charges
|
256,392
|
565,221
|
|||||
Goodwill
|
1,158,937
|
1,158,937
|
|||||
Total
Other Assets
|
1,525,437
|
1,833,508
|
|||||
|
|||||||
Total
Assets
|
$
|
15,475,483
|
$
|
15,186,639
|
|||
|
|||||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|||||||
|
|||||||
Current
Liabilities:
|
|||||||
Current
Maturities - Note Payable
|
$
|
2,599,291
|
$
|
225,000
|
|||
Accounts
Payable and Accrued Expenses
|
1,988,261
|
1,624,752
|
|||||
Customer
Deposits
|
8,100
|
0
|
|||||
Reserve
for Litigation
|
2,250,000
|
2,250,000
|
|||||
Total
Current Liabilities
|
6,845,652
|
4,099,752
|
|||||
|
|||||||
Due
to Related Party
|
100,000
|
0
|
|||||
|
|||||||
Long-Term
Debt
|
4,586,315
|
8,934,294
|
|||||
|
|||||||
Total
Liabilities
|
11,531,967
|
13,034,046
|
|||||
|
|||||||
Stockholders'
Equity:
|
|||||||
Common
Stock, $.001 Par Value per Share,
|
|||||||
250,000,000
Shares Authorized, 98,688,909
|
|||||||
and
86,457,922 Shares Issued and Outstanding at
|
|||||||
March
31, 2007 and December 31, 2006 Respectively
|
98,690
|
86,459
|
|||||
Additional
Paid-in Capital
|
50,823,250
|
46,703,202
|
|||||
Subscriptions
Receivable
|
(110,000
|
)
|
(220,000
|
)
|
|||
Minority
Interest
|
-
|
-
|
|||||
Accumulated
(Deficit)
|
(46,868,424
|
)
|
(44,417,068
|
)
|
|||
Total
Stockholders' Equity
|
3,943,516
|
2,152,593
|
|||||
|
|||||||
Total
Liabilities and Stockholders' Equity
|
$
|
15,475,483
|
$
|
15,186,639
|
TIDELANDS
OIL & GAS CORPORATION
|
||||||
CONDENSED
CONSOLIDATED
STATEMENTS OF
OPERATIONS
|
||||||
(UNAUDITED)
|
|
|
|
|
|
||
|
Three
Months Ended
|
|
Three
Months Ended
|
|
||
|
March
31, 2007
|
|
March
31, 2006
|
|
||
Revenues:
|
|
|
|
|
|
|
Gas
Sales and Pipeline Fees
|
$
|
1,001,882
|
|
$
|
672,506
|
|
Construction
Services
|
|
102,089
|
|
|
129,388
|
|
Total
Revenues
|
|
1,103,971
|
|
|
801,894
|
|
Expenses:
|
|
|
|
|
|
|
Cost
of Sales
|
|
567,721
|
|
|
376,866
|
|
Operating
Expenses
|
|
83,371
|
|
|
84,531
|
|
Depreciation
|
|
122,609
|
|
|
115,764
|
|
Interest
|
|
346,104
|
|
|
111,059
|
|
Stock-Based
Compensation - Related Parties
|
1,100,000
|
445,000
|
||||
Sales,
General and Administrative
|
|
1,336,147
|
|
|
1,397,942
|
|
Total
Expenses
|
|
3,555,952
|
|
|
2,531,162
|
|
|
|
|
|
|
|
|
(Loss)
From Operations
|
|
(2,451,981
|
)
|
|
(1,729,268
|
)
|
|
|
|
|
|
|
|
Interest
and Dividend Income
|
|
625
|
|
|
33,620
|
|
|
|
|
|
|
|
|
Net
(Loss)
|
$
|
(2,451,356
|
)
|
$
|
(1,695,648
|
)
|
|
|
|
|
|
|
|
Net
(Loss) Per Common Share:
|
|
|
|
|
|
|
Basic
and Diluted
|
$
|
(0.03
|
)
|
$
|
(0.02
|
)
|
|
|
|
|
|
|
|
Weighted
Average Number of Common
|
|
|
|
|
|
|
Shares
Outstanding
|
|
92,573,416
|
|
|
79,712,485
|
|
TIDELANDS
OIL & GAS CORPORATION
|
|||||||
STATEMENTS
OF
CONDENSED CONSOLIDATED CASH
FLOWS
|
|||||||
(UNAUDITED)
|
|||||||
|
|
|
|
|
|||
|
Three
Months Ended
|
|
Three
Months Ended
|
|
|||
|
March
31, 2007
|
|
March
31, 2006
|
|
|||
Cash
Flows Provided (Required) By
|
|
|
|
|
|
|
|
Operating
Activities:
|
|
|
|
|
|
|
|
Net
(Loss)
|
$
|
(2,451,356
|
)
|
$
|
(1,695,648
|
)
|
|
Adjustments
to Reconcile Net (Loss)
|
|
|
|
|
|
|
|
to
Net Cash Provided (Required) By
|
|
|
|
|
|
|
|
Operating
Activities:
|
|
|
|
|
|
|
|
Depreciation
|
|
122,609
|
|
|
115,764
|
|
|
Change
in Derivative Liability
|
|
0
|
|
|
0
|
|
|
Issuance
of Common Stock:
|
|
|
|
|
|
|
|
For
Services Provided - Related Parties
|
|
1,100,000
|
|
|
445,000
|
|
|
For
Services Provided - Other
|
599,033
|
424,500
|
|||||
Changes
in:
|
|
|
|
|
|
|
|
Accounts
Receivable
|
|
103,803
|
|
|
128,825
|
|
|
Inventory
|
|
(35,448
|
)
|
|
25,599
|
|
|
Prepaid
Expenses
|
|
52,917
|
|
|
31,132
|
|
|
Deferred
Charges
|
|
308,829
|
|
|
(1,625,458
|
)
|
|
Deposits
|
|
(150
|
)
|
|
(50,000
|
)
|
|
Restricted
Cash
|
|
(608
|
)
|
|
(561
|
)
|
|
Accounts
Payable and Accrued Expenses
|
|
706,753
|
|
|
24,626
|
|
|
Customer
Deposits
|
|
8,100
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
Net
Cash Provided (Required) By Operating Activities
|
|
514,482
|
|
|
(2,176,221
|
)
|
|
|
|
|
|
|
|
|
|
Cash
Flows Provided (Required)
|
|
|
|
|
|
|
|
By
Investing Activities:
|
|
|
|
|
|
|
|
Acquisitions
of Property, Plant and Equipment
|
|
(906,031
|
)
|
|
(637,301
|
)
|
|
Net
Cash (Required) By Investing Activities
|
|
(906,031
|
)
|
|
(637,301
|
)
|
TIDELANDS
OIL & GAS CORPORATION
|
||||||
STATEMENTS
OF CONDENSED CONSOLIDATED CASH FLOWS
|
||||||
(CONTINUED)
|
||||||
(UNAUDITED)
|
||||||
|
||||||
Three
Months Ended
|
Three
Months Ended
|
|||||
March
31, 2007
|
March
31, 2006
|
|||||
Cash
Flows Provided
|
||||||
by
Financing Activities:
|
||||||
Proceeds
from Stock Subscriptions Receivable
|
|
0
|
|
110,000
|
||
Proceeds
from Exercise of Stock Option
|
200,000
|
0
|
||||
Proceeds
from Long-Term Loans
|
26,314
|
6,644,502
|
||||
Loan
from Related Party
|
100,000
|
(3,606
|
)
|
|||
Repayment
of Loan by Related Party
|
0
|
0
|
||||
Net
Cash Provided by Financing Activities
|
326,314
|
6,750,896
|
||||
Net
Increase (Decrease) in Cash
|
(65,235
|
)
|
3,937,374
|
|||
Cash
at Beginning of Period
|
367,437
|
1,113,911
|
||||
Cash
at End of Period
|
$
|
302,202
|
$
|
5,051,285
|
||
Supplemental
Disclosures of Cash Flow Information:
|
||||||
Cash
Payments for Interest
|
$
|
75,043
|
$
|
84,657
|
||
Cash
Payments for Income Taxes
|
$
|
0
|
$
|
0
|
||
Non-Cash
Investing and Financing Activities:
|
||||||
Issuance
of Common Stock:
|
||||||
Payments
of Accrued Expenses & Accounts Payable
|
$
|
343,244
|
$
|
445,000
|
||
Conversion
of Debentures
|
2,000,000
|
0
|
||||
Cancellation
of Common Stock:
|
||||||
In
Payment of Stock Subscription
|
(110,000
|
)
|
0
|
|||
Total
Non-Cash Investing and Financing Activities
|
$
|
2,233,244
|
$
|
445,000
|
Exhibit
|
|
Description
|
|
Location
of Exhibit
|
10.1
|
Employment
Agreement with James B. Smith*
|
Incorporated
by reference to Exhibit 10.1 to 8-K filed April 3, 2007
|
||
10.2
|
2007
Non-Qualified Stock Grant and Option Plan *
|
Incorporated
by reference to Exhibit 10.1 of Form 8-K filed on February 16,
2007
|
||
10.3
|
Form
of Option Grant under 2007 Non-Qualified Stock Grant and Option
Plan
*
|
Incorporated
by reference to Exhibit 10.2 of Form 8-K filed on February 16,
2007
|
||
10.4
|
Form
of Stock Award Agreement under 2007 Non-Qualified Stock Grant
and Option
Plan *
|
Incorporated
by reference to Exhibit 10.3 of Form 8-K filed on February 16,
2007
|
||
31.1
|
|
Chief
Executive Officer and Chief Financial Officer Section 302 Certification
pursuant to Sarbanes - Oxley Act.
|
|
Included
with this filing
|
32.1
|
|
Chief
Executive Officer-Section 906 Certification pursuant To Sarbanes-Oxley
Act
|
|
Furnished
herewith
|
|
|
|
|
TIDELANDS
OIL & GAS CORPORATION
|
|
|
|
|
Date: May
18, 2007
|
By:
|
/s/ James
B.
Smith
|
|
James
B. Smith, President and Chief Executive
Officer
|