Ring Energy, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

REVENUE RECOGNITION

REVENUE RECOGNITION

6 Months Ended

Jun. 30, 2019

REVENUE RECOGNITION

REVENUE RECOGNITION

NOTE 2 – REVENUE RECOGNITION

Oil sales

Under the Company’s oil sales contracts, the Company sells oil production at the point of delivery and collects an agreed upon index price, net of pricing differentials. The Company recognizes revenue when control transfers to the purchaser at the point of delivery at the net price received.

Natural gas sales

Under the Company’s natural gas sales contracts, the Company delivers unprocessed natural gas to a midstream processing entity at the wellhead. The midstream processing entity obtains control of the natural gas at the wellhead. The midstream processing entity gathers and processes the natural gas and remits proceeds to the Company for the resulting sale of natural gas. Under these agreements, the Company recognizes revenue when control transfers to the purchaser at the point of delivery.

Disaggregation of Revenue. The following table presents revenues disaggregated by product for the three and six months ended June 30, 2019 and 2018:


	For The Three Months				For The Six Months
	Ended June 30,				Ended June 30,
	2019		2018		2019		2018
Operating revenues
Oil	$	50,793,472	$	28,962,880	$	91,671,455	$	58,103,045
Natural gas		540,753		962,003		1,461,085		1,713,229

Total operating revenues	$	51,334,225	$	29,924,883	$	93,132,540	$	59,816,274

All revenues are from production from the Permian Basin in Texas and New Mexico.