BKEN Bakken Energy Corporation (CE)

LIAONING, CHINA, May 25, 2012 /PRNewswire/ - Orofino Gold Corp. (OTCQB-US:ORFG) ("Orofino"), The Board of Directors announce the financial results for the period ending November 30, 2011, for Orofino Gold Corp, a minerals exploration and mining company whose shares of Common Stock are listed for trading on the over-the-counter market with Pink OTC Markets, Inc., announced today its financial results for the three and six-month periods ended November 30, 2011.  Orofino reported a net loss of ($198,939) or $0.0010 per share of Common Stock on a diluted basis for the three-months ended November 30, 2011 and a net loss of ($487,669) or $0.0035 per share of Common Stock on a diluted basis for the six-months ended November 30, 2011.  As the Company is still in its development stage, it did not generate any income or revenue for the reporting periods.

Orofino's unaudited and unreviewed financial statements for the three and six-month periods ended November 30, 2011, compiled in accordance with United States generally accepted accounting principles are attached to this release.

Future Operations:

Orofino continues to pursue the development of its interests in two gold concessions located in the southern region of the Bolivar Department in Colombia. The company has recently undertaken additional exploratory activity on the Rio Viejo Concession and collected additional assay samples for processing.

Orofino continues to be challenged by the current economic environment in its efforts to raise additional funds for operations. As a result, there is no assurance that the company will be able to achieve its operations goals.

As reported on Form NT 10-K filed on August 29, 2011, Orofino did not file its Annual Report on Form 10-K for the year ended May 31, 2011 with the Securities and Exchange Commission (the "Commission") by the required due date of August 29, 2011. Due to the company's current financial condition, it is only beginning the process of preparing its Annual Report on Form 10-K for the year ended May 31, 2011. Registrant intends to prepare the Annual Report with expanded financial and other disclosures in lieu of filing a separate Annual Report on Form 10-K for the fiscal years ended May 31, 2010, 2011 and 2012, and Quarterly Reports on Forms 10-Q for each of the Registrant's fiscal quarters commencing with the fiscal quarter ended August 31, 2009. Orofino currently anticipates filing such expanded Form 10-K by August 30, 2012.

About Orofino Gold Corp.

Orofino is a Nevada corporation engaged in the business of exploring for and mining minerals, principally gold. The company currently holds an option to acquire an interest in two gold concessions located in the southern area of the Bolivar Department in Colombia.

Forward Looking Statements

Certain of the statements in this news release are forward-looking statements, including statements regarding the strategy and focus of Orofino and the ability to regain compliance with securities and tax reporting obligations. Additional information regarding the company can be found in its most recent filings on Form 8-K.

Orofino Gold Corp.

Notes to the financial statements

For the six months ended November 30, 2011

1. ORGANIZATION AND DESCRIPTION OF BUSINESS

Orofino Gold Corp. ("Orofino" or the "Company") was organized under the laws of the State of Nevada on April 12, 2005.  Orofino started operations on September 1, 2007 under the "Clean `N Shine" name operating as a full service automotive car wash, cleaning, detailing, and polishing business generating some revenues. With limited opportunities available the Company decided to look at mineral resources as an alternative business. On May 20, 2009, the Company completed a forward stock split of its common stock on a ratio of six shares for every one share of the Company. The record date of the forward stock split was May 15, 2009, the payment date of the forward split was May 19, 2009, and the ex-dividend date of the forward split was May 20, 2009. As a result of the forward split, the post forward split number off issued and outstanding shares was 60,000,000. On December 5, 2009, the Company passed a resolution to change its name from SNT Cleaning Inc. to Orofino Gold Corp.

The Company is an exploration stage gold mining company with its efforts initially focused on what it believes to be under-explored mineral concessions and larger scale development of existing high grade artisanal mining operations. The Company has achieved no operating revenues to date.

2. SIGNIFICANT ACCOUNTING POLICIES 

Basis of presentation

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). A summary of the significant accounting policies are as follows:

Use of estimates

Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported revenues and expenses for the periods presented. Actual results could differ from those estimates.

Comprehensive income

The Company has adopted ASC Topic 220, "Comprehensive Income." Comprehensive income is comprised of net income (loss) and all changes to stockholders' equity (deficit), except those related to investments by stockholders, changes in paid-in capital and distribution to owners. In accordance with FASB ASC Topic 220 "Comprehensive Income," comprehensive income consists of net income and other gains and losses affecting stockholder's equity that are excluded from net income, such as unrealized gains and losses on investments available for sale, foreign currency translation gains and losses and minimum pension liability. Since inception other comprehensive income has consisted of translation gains and losses.

Mineral properties

All exploration expenditures are expensed as incurred. Costs of acquisition and option costs of mineral rights are capitalized upon acquisition. Mine development costs incurred to develop new ore deposits, to expand the capacity of mines or to develop mine areas substantially in advance of production are also capitalized once proven and probable reserves exist, and the property is determined to be a commercially mineable property. Costs incurred to maintain current production or to maintain assets on a standby basis are charged to operations. If the Company does not continue with exploration after the completion of the feasibility study, the cost of mineral rights will be expensed at that time. Costs of abandoned projects, including related property and equipment costs, are charged to mining costs. To determine if these costs are in excess of their recoverable amount, periodic evaluations of the carrying value of capitalized costs and any related property and equipment costs are performed. These evaluations are based upon expected future cash flows and/or estimated salvage value.

Fair Value of Financial Instruments

The Company adopted FASB ASC 820-Fair Value Measurements and Disclosures, for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing generally accepted accounting principles that require the use of fair value measurements establishes a framework for measuring fair value and expands disclosure about such fair value measurements. The adoption of ASC 820 did not have an impact on the Company's financial position or operating results, but did expand certain disclosures. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below:

The Company did not have any Level 2 or Level 3 assets or liabilities as of November 30, 2011.

The Company discloses the estimated fair values for all financial instruments for which it is practicable to estimate fair value. As of the date of the financial statements, the fair value short-term financial instruments including prepaids, and accounts payable and accrued expenses, approximates book value due to their short-term duration.

Basic and diluted loss per share 

Basic net earnings (loss) per common share are computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the period. Diluted net earnings (loss) per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents.

Income taxes 

Income taxes are accounted for in accordance with the provisions of FASB ASC 740, Accounting for Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized.

Foreign Currency Translation and Transactions 

The Company's functional currency is US dollars. Foreign currency balances are translated into US dollars as follows:

Monetary assets and liabilities are translated at the period-end exchange rate. Non-monetary assets are translated at the rate of exchange in effect at their acquisition, unless such assets are carried at market or nominal value, in which case they are translated at the period-end exchange rate. Revenue and expense items are translated at the average exchange rate for the period. Foreign exchange gains and losses in the period are included in operations.

The assets and liabilities arising from these operations are translated at current exchange rates and related revenues and expenses at the exchange rates in effect at the time the revenue or expense is incurred. Resulting translation adjustments, if material, are accumulated as a separate component of accumulated other comprehensive income in the statement of stockholders 'deficit while foreign currency transaction gains and losses are included in operations.

Convertible debt 

The Company reviews the terms of convertible debt and equity instruments to determine whether there are conversion features or embedded derivative instruments including embedded conversion options that are required to be bifurcated and accounted for separately as a derivative financial instrument. In circumstances where the convertible instrument contains more than one embedded derivative instrument, including conversion options that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single compound instrument. Also, in connection with the sale of convertible debt and equity instruments, the Company may issue free standing warrants that may, depending on their terms, be accounted for as derivative instrument liabilities, rather than as equity. When convertible debt or equity instruments contain embedded derivative instruments that are to be bifurcated and accounted for separately, the total proceeds allocated to the convertible host instruments are first allocated to the fair value of all the bifurcated derivative instruments. The remaining proceeds, if any, are then allocated to the convertible instruments themselves, usually resulting in those instruments being recorded at a discount from their face amount. When the Company issues debt securities, which bear interest at rates that are lower than market rates, the Company recognizes a discount, which is offset against the carrying value of the debt. Such discount from the face value of the debt, together with the stated interest on the instrument, is amortized over the life of the instrument through periodic charges to income. In addition, certain conversion features are recognized as beneficial conversion features to the extent the conversion price as defined in the convertible note is less than the closing stock price on the issuance of the convertible notes. Fees incurred in the placement of the convertible notes are deferred and recognized over the life of the debt agreement as an adjustment to interest expense using the interest method.

New Accounting Standards 

In May 2011, the FASB issued ASU 2011-04, "Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs," ("ASU 2011-04"). This standard results in a common requirement between the FASB and the International Accounting Standards Board for measuring fair value and disclosing information about fair value measurements. ASU 2011-04 is effective for fiscal years and interim periods beginning after December 15, 2011. We do not expect the adoption of this accounting pronouncement to have any effect on our financial position and results of operations.

In June 2011, the FASB issued ASU 2011-05, "Comprehensive Income: Presentation of Comprehensive Income. "ASU 2011-05 will require companies to present the components of net income and other comprehensive income either as one continuous statement or as two consecutive statements. ASU 2011-05 eliminates the option to present components of other comprehensive income as part of the statement of changes in stockholders' equity. ASU 2011-05 does not change the items which must be reported in other comprehensive income, how such items are measured or when they must be reclassified to net income. ASU 2011-05 will be effective for the first interim and annual periods beginning after December 15, 2011. Further, in December 2011, the FASB issued ASU 2011-12, "Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update # 2011-05." The Company believes the adoption of this guidance concerns disclosure only and will not have a material impact on its financial statements.

Management does not believe that any other recently issued, but not yet effective, accounting standards could have a material effect on the accompanying financial statements. As new accounting pronouncements are issued, the Company will adopt those that are applicable under the circumstances. A variety of proposed or otherwise potential accounting standards are currently under study by standard setting organizations and various regulatory agencies. Due to the tentative and preliminary nature of those proposed standards, management has not determined whether implementation of such proposed standards would be material to our financial statements.

3. GOING CONCERN 

In the course of the Company's exploration activities, the Company has sustained losses and expects such losses to continue unless and until the Company can achieve net operating revenues. Future issuances of the Company's equity or debt securities will be required in order for the Company to continue to finance its operations and continue as a going concern. The Company currently has no revenue from operations and has incurred cumulative net losses of $2,653,841 since its inception. The Company's financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. Realization values may be substantially different from carrying values as shown and the Company's financial statements do not include any adjustments relating to the recoverability or classification of recorded asset amounts or the amount and classification of liabilities that might be necessary if the Company is unable to continue as a going concern.

4. PREPAID EXPENSE 

The Company's attorney received a retainer of $25,000 of which $7,115 has been expensed leaving a balance of $17,885 for future work.

5. MINERAL PROPERTIES 

On April 6, 2010, the Company counter-signed an offer for joint venture-earn-in to option several mining concessions in the Department of Bolivar, Republic of Colombia.  Pursuant to various stages of due diligence it was determined that the best way of obtaining title to the various target mineral properties was to enter into new agreements. On November 15, 2010 the Company entered into four agreements. The terms of the new agreements allowed for the Company to acquire an 80% interest in four mining concessions. The agreements were amended on April 18, 2011. However the Company was unable to make the October 1, 2011 payment under the amended formula. On March 1, 2012 the Company amended the acquisition agreements again on a basis of reducing the number of properties from 4 to 2 and reducing the payment schedule. A summary of the terms and ongoing payment obligations are as follows:

Cash payments:

1. $5,000 as an initial option payment;

2. $100,000 on or before January 31, 2011 (paid);

3. $150,000 on or before March 31, 2011 (amended), (paid), (previously February 28, 2011);

4. $50,000 on April 18, 2011 (amended), (paid) (previously $800,000 on or before March 31, 2011);

5. $450,000 every six months starting on July 1, 2012 (previously $900,000 every six months starting October 1, 2011, of which the Company may pay one-half of issuing restricted common shares to the vendor at a 10-day average trading price per amendment on April 18, 2011), (previously $800,000 every six months thereafter starting on June 1, 2011).

Share issuances:

1. 24 million shares on or before March 31, 2011 (issued in March 2011)

2. 10 million shares on or before March 31, 2012, (discontinued under March 1, 2012 amendment) and

3. 10 million shares on or before December 31, 2012 (discontinued under March 1, 2012 amendment).

The Company paid a total of $350,000 to independent third parties for consulting services in relation to the signing of the option agreements. The Company incurred a cost of $100,000 paid to a person in the United States for the initial introduction of the mineral concessions and $250,000 paid to some concession holders as the initial payments to pursue an option agreement.

6. LOANS PAYABLE 

The Company has loans payable to various independent third parties on the basis of being unsecured, payable on demand and bearing interest at the rate of 10% per annum.

7. CONVERTIBLE LOANS 

On January 18, 2011 the Company concluded agreements to convert a portion of loans payable into 10% convertible promissory notes on the basis that the principal balance and unpaid interest at the rate of 10% per annum be convertible into shares of the Company's restricted common stock at the conversion price of $0.0075 per share. The holder is limited to convert no more than 4.99% of the issued and outstanding common stock at the time of conversion.

8. CAPITAL STOCK 

Common Stock 

The company issued to the founders 10,000,000 common shares of stock for $1,000. On May 20, 2009, the Company completed a 6-for-1 forward stock split (the Forward Split") of the Company's common stock in the form of a stock dividend.  All share and per share information has been retroactively adjusted to reflect the Forward Split.

The par value of the Company's common stock was unchanged by the Forward Split.

On October 14, 2010, the Company increased its total authorized shares of common stock from 75,000,000 to 250,000,000, par value $0.001 per share.

On June 10, 2010 the Company issued 600,000 restricted shares to two parties for services at a value of $0.13 per share.

On August 17, 2010 the Company issued 3,600,000 restricted shares at $0.01 each pursuant to an assignment of debt dated October 31, 2009.

On August 18, 2010 the Company issued 6,000,000 restricted shares at $0.01 each pursuant to the retirement of debt as at February 17, 2010.

On March 8, 2011 the Company issued 24,000,000 restricted shares at $0.015 each pursuant to the acquisition of mineral properties.

On March 8, 2011 the Company issued 46,450,000 restricted shares at $0.0075 each to fourteen parties pursuant to the exercise of convertible debt.

On March 28, 2011 the Company issued 5,000,000 warrants at $0.10 each for cash consideration of $500,000. The warrants may be exercised to purchase 5,000,000 shares at $1.00 each until December 31, 2012 or may be surrendered for the receipt of 2,500,000 restricted shares.

On August 23, 2011 the Company issued 550,000 restricted shares at $0.0075 each to two parties pursuant to the exercise of convertible debt.

Warrants          

The warrants may be exercised to purchase 5,000,000 shares at $1.00 each until December 31, 2012 or may be surrendered for the receipt of 2,500,000 restricted shares.

9. RELATED PARTY TRANSACTIONS    

As at November 30, 2011 accounts payable included $22,000 (May 31, 2011 - $40,000) owing to officers and directors.

The amounts charged to the Company for the services provided have been determined by negotiation among the parties. These transactions were in the normal course of operations and were measured at the exchange amount which is the amount of consideration established and agreed to by the related parties.

10. INCOME TAXES 

No provision for federal income taxes has been recognized for the years ended May 31, 2011 and 2010 as the Company incurred a net operating loss for income tax purposes in each year and has no carryback potential. Deferred tax assets and liabilities at May 31, 2011 and 2010 totaled a net deferred tax asset of $505,000 and $350,000, respectively. At May 31, 2011 and 2010, the Company provided a full valuation allowance due to uncertainty regarding the realizability of these tax assets.

At May 31, 2011, the Company has net operating loss carry forwards totaling approximately $2.2 million for federal income tax purposes, which may be carried forward in varying amounts until the time when they begin to expire in 2029 through 2031.

11. SUBSEQUENT EVENTS 

Nil

SOURCE Orofino Gold Corp.