ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:	9 Months Ended
Sep. 30, 2014
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:	NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: ORGANIZATION Chancellor Group, Inc. (the "Company", "our", "we", "Chancellor" or the "Company") was incorporated in the state of Utah on May 2, 1986, and then, on December 30, 1993, dissolved as a Utah corporation and reincorporated as a Nevada corporation. On March 26, 1996, the Company's corporate name was changed from Nighthawk Capital, Inc. to Chancellor Group, Inc. During early 2012, the Company's corporate office was moved from Pampa to Amarillo, Texas. Throughout most of the Company's history, our primary business purpose has been to explore for, develop and produce oil and gas. Effective as of July 1, 2014, we sold substantially all of our oil and gas assets. Although the Company expects to continue to explore strategic opportunities in the oil and gas business, our primary focus going forward will be to manage and develop the operations of our subsidiaries, Pimovi, Inc. ("Pimovi") and The Fuelist, LLC ("Fuelist"). Pimovi was incorporated in Delaware on November 16, 2012, and subsequently reincorporated in Nevada. Chancellor owns 61% of the equity in Pimovi in the form of Series A Preferred Stock, and therefore maintains significant financial control over Pimovi. As a result, Pimovi's financial statements have been consolidated with Chancellor's consolidated financial statements since the fourth quarter of 2012. On August 15, 2013, Chancellor Group, Inc. entered into a binding term sheet with Fuelist and its founders, Matthew Hamilton, Eric Maas and Thomas Rand-Nash (together, the "Founders"), pursuant to which Chancellor agreed to acquire a 51% ownership interest in Fuelist. As consideration for the ownership interest, Chancellor contributed to Fuelist a total of $271,200 in cash. As additional consideration for the ownership interest, Chancellor contributed a total of 2,000,000 shares of newly issued common stock to Fuelist on August 19, 2013, valued at $156,000, or $0.078 per share. As of September 30, 2014, Fuelist had not commenced principal operations and had no sales or operating revenues through September 30, 2014. The primary purpose of Fuelist is the development of a data-driven mobile and web technology platform that leverages extensive segment expertise and big data analysis tools to value classic vehicles. These tools are expected to enable users to quickly find values, track valuations over time, and to identify investment and arbitrage opportunities in this lucrative market. GOING CONCERN These condensed and consolidated financial statements have been prepared on the basis of a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has had continued net operating losses with net losses attributable to Chancellor Group, Inc. shareholders of $842,610 and $664,385 for the nine months ended September 30, 2014 and 2013, respectively, and retained earnings deficits of $3,616,268 and $2,773,659 as of September 30, 2014 and December 31, 2013, respectively. The Company's continued operations are dependent on the successful implementation of its business plan and its ability to obtain additional financing as needed. The accompanying condensed and consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. OPERATIONS Until July 1, 2014, the Company and its wholly-owned subsidiary, Gryphon Production Company, LLC , owned 5 wells in Gray County, Texas, of which 1 is a water disposal well and 4 are oil wells. We produced a total of 127 and 375 barrels of oil in the three and nine months ended September 30, 2014, respectively, and a total of 134 and 479 barrels of oil in the three and nine months ended September 30, 2013, respectively. The oil is light sweet crude. Effective July 1, 2014, we sold all of our oil wells to S & W Oil & Gas, LLC. Both Pimovi and Fuelist as of September 30, 2014, had no significant operations other than the ongoing development of their respective technologies. SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION The consolidated financial statements of Chancellor Group, Inc. have been prepared pursuant to the rules and regulations of the SEC for Quarterly Reports on Form 10-Q and in accordance with US GAAP. Accordingly, these consolidated financial statements do not include all of the information and footnotes required by US GAAP for annual consolidated financial statements. These consolidated financial statements should be read in conjunction with the consolidated financial statements and notes in the Chancellor Group, Inc. Annual Report on Form 10-K for the year ended December 31, 2013. These accompanying consolidated financial statements include the accounts of Chancellor and its wholly-owned subsidiaries: Gryphon Production Company, LLC, and Gryphon Field Services, LLC. These entities are collectively hereinafter referred to as "the Company". The accompanying consolidated financial statements include the accounts of Chancellor's majority-owned subsidiary, Pimovi, Inc., with which Chancellor owns 61% of the equity of Pimovi and maintains significant financial control. Beginning in the third quarter 2013, the accompanying consolidated financial statements also include The Fuelist, LLC, which Chancellor acquired 51% of the equity of Fuelist and maintains significant financial control. All material intercompany accounts and transactions have been eliminated in the condensed and consolidated financial statements. The consolidated financial statements are unaudited, but, in management's opinion, include all adjustments (which, unless otherwise noted, include only normal recurring adjustments) necessary for a fair presentation of such financial statements. Financial results for this interim period are not necessarily indicative of results that may be expected for any other interim period or for the year ending December 31, 2014. ACCOUNTING YEAR The Company employs a calendar accounting year. The Company recognizes income and expenses based on the accrual method of accounting under generally accepted accounting principles (U.S.). USE OF ESTIMATES The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. PRODUCTS AND SERVICES, GEOGRAPHIC AREAS AND MAJOR CUSTOMERS For our oil segment, the Company's major customers during the nine months ended September 30, 2014, to which substantially all oil production was sold, were Plains Marketing and XTO Energy. Given the number of readily available purchasers for out products, it is unlikely that the loss of a single customer in the areas in which we sell our products would materially affect our sales. The Company sold substantially all of its oil and gas assets effective July 1, 2014. We expect to continue to explore strategic opportunities in the oil and gas business in the future. For our technology segment, the Company plans to continue developing its web-based and mobile technology platforms for its two majority-owned subsidiaries, Pimovi, Inc. and Fuelist, LLC. NET LOSS PER SHARE The net loss per share is computed by dividing the net loss by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share. CASH AND CASH EQUIVALENTS The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents. CONCENTRATION OF CREDIT RISK Some of the Company's operating cash balances are maintained in accounts that currently exceed federally insured limits. The Company believes that the financial strength of depositing institutions mitigates the underlying risk of loss. To date, these concentrations of credit risk have not had a significant impact on the Company's financial position or results of operations. RESTRICTED CASH Included in restricted cash at September 30, 2014 and December 31, 2013 are deposits totaling $25,000, in the form of a bond issued to the Railroad Commission of Texas as required for the Company's oil and gas activities which is renewed annually. ACCOUNTS RECEIVABLE The Company reviews accounts receivable periodically for collectability, establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary. Based on review of accounts receivable by management at period end, including credit quality and subsequent collections from customers, an allowance for doubtful accounts was not considered necessary or recorded at September 30, 2014 or December 31, 2013. PREPAID EXPENSES Certain expenses, primarily consulting fees and insurance, have been prepaid and will be used within one year. GOODWILL Goodwill represents the cost in excess of the fair value of net assets of the acquisition. Goodwill is not amortized but is subject to periodic testing for impairment. The Company tests goodwill for impairment using a two-step process. The first step tests for potential impairment, while the second step measures the amount of the impairment, if any. The Company performs annual impairment testing during the last quarter of each year. However, during the quarter ended September 30, 2014, based on both qualitative and quantitative factors surrounding Fuelist including limitations to further needed capital sufficient to continue work on its app and technologies, losses to date aggregating approximately $263,000 for the nine month ended September 30, 2014, and an accumulated negative deficit of approximately $72,000 as of September 30, 2014, the Company recognized full impairment of its $427,200 of goodwill related to Fuelist. This impairment was determined under the two-step process for identifying and determining impairment which included both the estimation of fair value for Fuelist and its implied fair value of goodwill. Goodwill impairment was recorded in other expense in the statement of operations during the quarter ended September 30, 2014. PROPERTY AND DEPRECIATION Property and equipment are recorded at cost and depreciated under the straight-line method over the estimated useful life of the assets. The estimated useful life of leasehold costs, equipment and tools ranges from five to seven years. Equipment is depreciated over the estimated useful lives of the assets, which ranged from 5 to 7 years, using the straight-line method. OIL AND GAS PROPERTIES The Company follows the successful efforts method of accounting for its oil and gas activities. Under this accounting method, costs associated with the acquisition, drilling and equipping of successful exploratory and development wells are capitalized. Geological and geophysical costs, delay rentals and drilling costs of unsuccessful exploratory wells are charged to expense as incurred. The carrying value of mineral leases is depleted over the minimum estimated productive life of the leases, or ten years. Undeveloped properties are periodically assessed for possible impairment due to un-recoverability of costs invested. Cash received for partial conveyances of property interests is treated as a recovery of cost and no gain or loss is recognized. LONG-LIVED ASSETS The Company assesses potential impairment of its long-lived assets, which include its property and equipment and its identifiable intangibles such as deferred charges, under the guidance Topic 360 "PROPERTY, PLANT AND EQUIPMENT" in the Accounting Standards Codification (the "ASC"). The Company must continually determine if a permanent impairment of its long-lived assets has occurred and write down the assets to their fair values and charge current operations for the measured impairment. As of September 30, 2014 we do not believe any of our long-lived assets are impaired. ASSET RETIREMENT OBLIGATIONS The Company has not recorded an asset retirement obligation (ARO) in accordance with ASC 410. Under ASC 410, a liability should be recorded for the fair value of an asset retirement obligation when there is a legal obligation associated with the retirement of a tangible long-lived asset, and the liability can be reasonably estimated. The associated asset retirement costs should also be capitalized and recorded as part of the carrying amount of the related oil and gas properties. Management believes that not recording an ARO liability and asset under ASC 410 is immaterial to the consolidated financial statements. INCOME TAXES Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carry-forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. We have recorded a valuation allowance as of September 30, 2014. REVENUE RECOGNITION For our oil segment, revenue was recognized for the oil production when a product is sold to a customer, either for cash or as evidenced by an obligation on the part of the customer to pay. For our technology segment, revenue will be recognized when earned, including both future subscriptions and other future revenue streams, as required under relevant revenue recognition policies under generally accepted accounting policies. FAIR VALUE MEASUREMENTS AND DISCLOSURES The Company estimates fair values of assets and liabilities which require either recognition or disclosure in the financial statements in accordance with FASB ASC Topic 820 "FAIR VALUE MEASUREMENTS". There is no material impact on the September 30, 2014 consolidated financial statements related to fair value measurements and disclosures. Fair value measurements include the following levels: Level 1: Quoted market prices in active markets for identical assets or liabilities. Valuations for assets and liabilities traded in active exchange markets, such as the New York Stock Exchange. Level 1 also includes U.S. Treasury and federal agency securities and federal agency mortgage-backed securities, which are traded by dealers or brokers in active markets. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities. Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data. Valuations for assets and liabilities traded in less active dealer or broker markets. Valuations are obtained from third party pricing services for identical or similar assets or liabilities. Level 3: Unobservable inputs that are not corroborated by market data. Valuations for assets and liabilities that are derived from other valuation methodologies, including option pricing models, discounted cash flow models and similar techniques, and not based on market FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying value of the Company's financial instruments, including cash and cash equivalents, accounts receivable and accounts payable and long term debt, as reported in the accompanying consolidated balance sheet, approximates fair values. EMPLOYEE STOCK-BASED COMPENSATION Compensation expense is recognized for performance-based stock awards if management deems it probable that the performance conditions are or will be met. Determining the amount of stock-based compensation expense requires us to develop estimates that are used in calculating the fair value of stock-based compensation, and also requires us to make estimates of assumptions including expected stock price volatility which is derived based upon our historical stock prices. BUSINESS COMBINATIONS The Company accounts for business combinations in accordance with FASB ASC Topic 805 "Business Combinations". This standard modifies certain aspects of how the acquiring entity recognizes and measures the identifiable assets, the liabilities assumed and the goodwill acquired in a business combination. The Company entered into a business combination with The Fuelist, LLC on August 15, 2013 (See Note 7 for further disclosure). DISCONTINUED OPERATIONS The Company complies with guidance related to when the results of operations of a component of an entity that either has been disposed of or is classified as held for sale should be reported as a discontinued operations as provided by (ASC) Subtopic 205-20, Presentation of Financial Statements - Discontinued Operations. A component of an entity comprises operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the entity. A component of an entity may be a reportable segment or an operating segment, a reporting unit, a subsidiary, or an asset group. To qualify for presentation as a discontinued operation, both conditions must be met, including (1) the operations and cash flows of the component have been (or will be) eliminated from the ongoing operations of the entity as a result of the disposal transaction, and (2) the entity will not have any significant continuing involvement in the operations of the component after the disposal transaction. SUBSEQUENT EVENTS Events occurring after September 30, 2014 were evaluated through the date this quarterly report was issued, in compliance FASB ASC Topic 855 "SUBSEQUENT EVENTS", to ensure that any subsequent events that met the criteria for recognition and/or disclosure in this report have been included. RECENT ACCOUNTING PRONOUNCEMENTS In August 2014, FASB issued ASU No. 2014-15, PRESENTATION OF FINANCIAL STATEMENTS - GOING CONCERN (SUBTOPIC 205-40): DISCLOSURE OF UNCERTAINTIES ABOUT AN ENTITY'S ABILITY TO CONTINUE AS A GOING CONCERN. This ASU is effective for the interim and annual periods beginning after December 15, 2016. Early application is permitted. The amendments in this update provide guidance in GAAP about management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. This accounting pronouncement did not have any material effect on our condensed and consolidated financial statements. In May 2014, FASB issued ASU No. 2014-09, REVENUE FROM CONTRACTS WITH CUSTOMERS (TOPIC 606). This ASU is effective for interim and annual periods beginning after December 15, 2016. Early application is not permitted. This ASU is a result of a joint project initiated by the FASB and the International Accounting Standards Board (IASB) to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and IFRS that would remove inconsistencies and weaknesses in revenue requirements, provide a more robust framework for addressing revenue issues, improve comparability of revenue recognition practices, provide more useful information to users of the financial statements through disclosure requirements, and simplify the preparation of financial statements by reducing the number of requirements to which an entity must refer. This accounting pronouncement did not have any material effect on our condensed and consolidated financial statements. In June 2014, FASB issued ASU No. 2014-10, DEVELOPMENT STAGE ENTITIES (TOPIC 915): ELIMINATION OF CERTAIN FINANCIAL REPORTING REQUIREMENTS, INCLUDING AN AMENDMENT TO VARIABLE INTEREST ENTITIES GUIDANCE IN TOPIC 810, CONSOLIDATION. The presentation and disclosure requirements in Topic 915 will no longer be required effective for annual periods beginning after December 15, 2014. The revised consolidation standards are effective one year later, in annual periods beginning after December 15, 2015. The new guidance is intended to reduce the overall cost and complexity associated with financial reporting for development stage entities, such as startup companies, without compromising the availability of relevant information. The new guidance removes the requirement to present the additional inception-to-date information. This accounting pronouncement did not have any material effect on our condensed and consolidated financial statements. In July 2013, FASB issued ASU No. 2013-11, INCOME TAXES (TOPIC 740): PRESENTATION OF AN UNRECOGNIZED TAX BENEFIT WHEN A NET OPERATING LOSS CARRYFORWARD, A SIMILAR TAX LOSS, OR A TAX CREDIT CARRYFORWARD EXISTS. This ASU is effective for interim and annual periods beginning after December 15, 2013. This update standardizes the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This accounting pronouncement did not have any material effect on our condensed and consolidated financial statements. There were various other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries, and are not expected to have a material impact on the Company's financial position, results of operations or cash flows.

ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

9 Months Ended

Sep. 30, 2014

ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

ORGANIZATION

Chancellor  Group,  Inc.  (the  "Company",  "our",  "we",  "Chancellor"  or  the

"Company")  was  incorporated  in the state of Utah on May 2, 1986, and then, on

December  30, 1993,  dissolved as a Utah  corporation  and  reincorporated  as a

Nevada corporation.  On March 26, 1996, the Company's corporate name was changed

from Nighthawk  Capital,  Inc. to Chancellor  Group, Inc. During early 2012, the

Company's corporate office was moved from Pampa to Amarillo,  Texas.  Throughout

most of the Company's history,  our primary business purpose has been to explore

for,  develop  and produce oil and gas.  Effective  as of July 1, 2014,  we sold

substantially  all of our oil and gas assets.  Although  the Company  expects to

continue to explore  strategic  opportunities  in the oil and gas business,  our

primary focus going forward will be to manage and develop the  operations of our

subsidiaries, Pimovi, Inc. ("Pimovi") and The Fuelist, LLC ("Fuelist").

Pimovi was  incorporated  in Delaware on November  16,  2012,  and  subsequently

reincorporated  in  Nevada.  Chancellor  owns 61% of the equity in Pimovi in the

form of Series A Preferred Stock, and therefore maintains  significant financial

control  over  Pimovi.  As a result,  Pimovi's  financial  statements  have been

consolidated  with  Chancellor's  consolidated  financial  statements  since the

fourth quarter of 2012.

On August 15, 2013,  Chancellor  Group,  Inc.  entered into a binding term sheet

with Fuelist and its founders,  Matthew Hamilton, Eric Maas and Thomas Rand-Nash

(together, the "Founders"), pursuant to which Chancellor agreed to acquire a 51%

ownership  interest in Fuelist.  As  consideration  for the ownership  interest,

Chancellor  contributed  to Fuelist a total of $271,200 in cash.  As  additional

consideration  for the  ownership  interest,  Chancellor  contributed a total of

2,000,000  shares of newly  issued  common  stock to Fuelist on August 19, 2013,

valued at $156,000,  or $0.078 per share. As of September 30, 2014,  Fuelist had

not  commenced  principal  operations  and had no  sales or  operating  revenues

through September 30, 2014. The primary purpose of Fuelist is the development of

a  data-driven  mobile and web  technology  platform  that  leverages  extensive

segment expertise and big data analysis tools to value classic  vehicles.  These

tools are expected to enable users to quickly find values, track valuations over

time, and to identify  investment and arbitrage  opportunities in this lucrative

market.

GOING CONCERN

These condensed and consolidated  financial statements have been prepared on the

basis of a going  concern,  which  contemplates  the  realization  of assets and

satisfaction  of liabilities  in the normal course of business.  The Company has

had continued net operating  losses with net losses  attributable  to Chancellor

Group,  Inc.  shareholders  of $842,610  and  $664,385 for the nine months ended

September 30, 2014 and 2013,  respectively,  and retained  earnings  deficits of

$3,616,268  and  $2,773,659  as of  September  30, 2014 and  December  31, 2013,

respectively. The Company's continued operations are dependent on the successful

implementation  of its  business  plan  and its  ability  to  obtain  additional

financing as needed.  The  accompanying  condensed  and  consolidated  financial

statements do not include any adjustments that might be necessary if the Company

is unable to continue as a going concern.

OPERATIONS

Until  July 1,  2014,  the  Company  and its  wholly-owned  subsidiary,  Gryphon

Production Company,  LLC , owned 5 wells in Gray County,  Texas, of which 1 is a

water disposal well and 4 are oil wells.

We  produced a total of 127 and 375  barrels of oil in the three and nine months

ended  September 30, 2014,  respectively,  and a total of 134 and 479 barrels of

oil in the three and nine months ended September 30, 2013, respectively. The oil

is light sweet crude.  Effective July 1, 2014, we sold all of our oil wells to S

& W Oil & Gas, LLC.

Both Pimovi and Fuelist as of September 30, 2014, had no significant  operations

other than the ongoing development of their respective technologies.

SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION

The  consolidated  financial  statements  of  Chancellor  Group,  Inc. have been

prepared  pursuant to the rules and regulations of the SEC for Quarterly Reports

on Form 10-Q and in accordance  with US GAAP.  Accordingly,  these  consolidated

financial  statements  do  not  include  all of the  information  and  footnotes

required  by  US  GAAP  for  annual  consolidated  financial  statements.  These

consolidated  financial  statements  should  be read  in  conjunction  with  the

consolidated financial statements and notes in the Chancellor Group, Inc. Annual

Report on Form 10-K for the year ended December 31, 2013.

These  accompanying  consolidated  financial  statements include the accounts of

Chancellor and its wholly-owned  subsidiaries:  Gryphon Production Company, LLC,

and Gryphon Field  Services,  LLC. These entities are  collectively  hereinafter

referred to as "the Company". The accompanying consolidated financial statements

include the accounts of Chancellor's  majority-owned  subsidiary,  Pimovi, Inc.,

with which Chancellor owns 61% of the equity of Pimovi and maintains significant

financial  control.  Beginning  in the  third  quarter  2013,  the  accompanying

consolidated   financial  statements  also  include  The  Fuelist,   LLC,  which

Chancellor  acquired  51% of the equity of  Fuelist  and  maintains  significant

financial control. All material intercompany accounts and transactions have been

eliminated in the condensed and consolidated financial statements.

The  consolidated  financial  statements  are  unaudited,  but, in  management's

opinion,  include all adjustments (which,  unless otherwise noted,  include only

normal  recurring  adjustments)  necessary  for  a  fair  presentation  of  such

financial  statements.  Financial  results  for  this  interim  period  are  not

necessarily  indicative  of results that may be expected  for any other  interim

period or for the year ending December 31, 2014.

ACCOUNTING YEAR

The Company employs a calendar  accounting year. The Company  recognizes  income

and expenses based on the accrual method of accounting under generally  accepted

accounting principles (U.S.).

USE OF ESTIMATES

The  preparation  of  consolidated   financial  statements  in  conformity  with

generally accepted  accounting  principles requires management to make estimates

and  assumptions  that affect  reported  amounts of assets and  liabilities  and

disclosure of contingent  assets and liabilities at the date of the consolidated

financial  statements and the reported  amounts of revenues and expenses  during

the reporting period. Actual results could differ from those estimates.

PRODUCTS AND SERVICES, GEOGRAPHIC AREAS AND MAJOR CUSTOMERS

For our oil segment,  the Company's major customers during the nine months ended

September 30, 2014, to which  substantially  all oil production  was sold,  were

Plains  Marketing  and  XTO  Energy.  Given  the  number  of  readily  available

purchasers for out products,  it is unlikely that the loss of a single  customer

in the areas in which we sell our products  would  materially  affect our sales.

The Company sold  substantially  all of its oil and gas assets effective July 1,

2014. We expect to continue to explore  strategic  opportunities  in the oil and

gas business in the future.  For our  technology  segment,  the Company plans to

continue  developing its web-based and mobile  technology  platforms for its two

majority-owned subsidiaries, Pimovi, Inc. and Fuelist, LLC.

NET LOSS PER SHARE

The net loss per share is  computed  by  dividing  the net loss by the  weighted

average number of shares of common  outstanding.  Warrants,  stock options,  and

common stock issuable upon the conversion of the Company's  preferred  stock (if

any), are not included in the  computation if the effect would be  anti-dilutive

and would increase the earnings or decrease loss per share.

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid investments with an original maturity of

three months or less as cash equivalents.

CONCENTRATION OF CREDIT RISK

Some of the Company's  operating  cash balances are  maintained in accounts that

currently  exceed  federally  insured  limits.  The  Company  believes  that the

financial strength of depositing  institutions  mitigates the underlying risk of

loss. To date,  these  concentrations  of credit risk have not had a significant

impact on the Company's financial position or results of operations.

RESTRICTED CASH

Included in  restricted  cash at  September  30, 2014 and  December 31, 2013 are

deposits  totaling  $25,000,  in the  form  of a  bond  issued  to the  Railroad

Commission of Texas as required for the Company's oil and gas  activities  which

is renewed annually.

ACCOUNTS RECEIVABLE

The  Company  reviews  accounts  receivable   periodically  for  collectability,

establishes an allowance for doubtful accounts and records bad debt expense when

deemed necessary. Based on review of accounts receivable by management at period

end,  including  credit quality and subsequent  collections  from customers,  an

allowance  for  doubtful  accounts was not  considered  necessary or recorded at

September 30, 2014 or December 31, 2013.

PREPAID EXPENSES

Certain expenses, primarily consulting fees and insurance, have been prepaid and

will be used within one year.

GOODWILL

Goodwill  represents  the cost in excess of the fair  value of net assets of the

acquisition.  Goodwill is not amortized  but is subject to periodic  testing for

impairment.  The Company tests goodwill for impairment using a two-step process.

The first step tests for  potential  impairment,  while the second step measures

the amount of the impairment,  if any. The Company  performs  annual  impairment

testing during the last quarter of each year. However,  during the quarter ended

September  30,  2014,  based  on  both  qualitative  and  quantitative   factors

surrounding  Fuelist including  limitations to further needed capital sufficient

to  continue  work on its  app  and  technologies,  losses  to date  aggregating

approximately  $263,000  for the nine month ended  September  30,  2014,  and an

accumulated negative deficit of approximately  $72,000 as of September 30, 2014,

the Company  recognized full  impairment of its $427,200 of goodwill  related to

Fuelist.   This  impairment  was  determined  under  the  two-step  process  for

identifying  and  determining  impairment  which included both the estimation of

fair  value  for  Fuelist  and its  implied  fair  value of  goodwill.  Goodwill

impairment  was recorded in other expense in the statement of operations  during

the quarter ended September 30, 2014.

PROPERTY AND DEPRECIATION

Property  and  equipment  are  recorded  at  cost  and  depreciated   under  the

straight-line method over the estimated useful life of the assets. The estimated

useful life of leasehold  costs,  equipment  and tools ranges from five to seven

years.  Equipment is depreciated  over the estimated useful lives of the assets,

which ranged from 5 to 7 years, using the straight-line method.

OIL AND GAS PROPERTIES

The Company follows the successful  efforts method of accounting for its oil and

gas  activities.  Under  this  accounting  method,  costs  associated  with  the

acquisition,  drilling and equipping of successful  exploratory  and development

wells are  capitalized.  Geological  and  geophysical  costs,  delay rentals and

drilling  costs of  unsuccessful  exploratory  wells are  charged  to expense as

incurred.  The  carrying  value of mineral  leases is depleted  over the minimum

estimated  productive life of the leases, or ten years.  Undeveloped  properties

are periodically  assessed for possible impairment due to  un-recoverability  of

costs invested.  Cash received for partial  conveyances of property interests is

treated as a recovery of cost and no gain or loss is recognized.

LONG-LIVED ASSETS

The Company  assesses  potential  impairment  of its  long-lived  assets,  which

include its property and  equipment  and its  identifiable  intangibles  such as

deferred charges,  under the guidance Topic 360 "PROPERTY,  PLANT AND EQUIPMENT"

in  the  Accounting  Standards   Codification  (the  "ASC").  The  Company  must

continually  determine if a permanent  impairment of its  long-lived  assets has

occurred  and write  down the assets to their  fair  values  and charge  current

operations  for the  measured  impairment.  As of  September  30, 2014 we do not

believe any of our long-lived assets are impaired.

ASSET RETIREMENT OBLIGATIONS

The Company has not recorded an asset retirement  obligation (ARO) in accordance

with ASC 410.  Under ASC 410, a liability  should be recorded for the fair value

of an asset retirement  obligation when there is a legal  obligation  associated

with the  retirement of a tangible  long-lived  asset,  and the liability can be

reasonably  estimated.  The  associated  asset  retirement  costs should also be

capitalized  and recorded as part of the carrying  amount of the related oil and

gas  properties.  Management  believes  that not  recording an ARO liability and

asset under ASC 410 is immaterial to the consolidated financial statements.

INCOME TAXES

Deferred taxes are provided on a liability  method  whereby  deferred tax assets

are  recognized  for  deductible   temporary   differences  and  operating  loss

carry-forwards and deferred tax liabilities are recognized for taxable temporary

differences.  Temporary  differences  are the  differences  between the reported

amounts of assets and liabilities  and their tax bases.  Deferred tax assets are

reduced by a valuation allowance when, in the opinion of management,  it is more

likely than not that some  portion or all of the deferred tax assets will not be

realized.  Deferred tax assets and  liabilities  are adjusted for the effects of

changes  in tax laws and  rates on the date of  enactment.  We have  recorded  a

valuation allowance as of September 30, 2014.

REVENUE RECOGNITION

For our oil  segment,  revenue  was  recognized  for the oil  production  when a

product is sold to a customer,  either for cash or as evidenced by an obligation

on the part of the customer to pay. For our technology segment,  revenue will be

recognized  when earned,  including both future  subscriptions  and other future

revenue streams, as required under relevant revenue  recognition  policies under

generally accepted accounting policies.

FAIR VALUE MEASUREMENTS AND DISCLOSURES

The Company estimates fair values of assets and liabilities which require either

recognition  or disclosure in the financial  statements in accordance  with FASB

ASC Topic 820 "FAIR  VALUE  MEASUREMENTS".  There is no  material  impact on the

September  30,  2014  consolidated  financial  statements  related to fair value

measurements  and  disclosures.  Fair value  measurements  include the following

levels:

Level 1:  Quoted  market  prices  in  active  markets  for  identical  assets or

          liabilities.  Valuations for assets and  liabilities  traded in active

          exchange  markets,  such as the New York Stock Exchange.  Level 1 also

          includes  U.S.  Treasury  and federal  agency  securities  and federal

          agency  mortgage-backed  securities,  which are  traded by  dealers or

          brokers  in active  markets.  Valuations  are  obtained  from  readily

          available pricing sources for market transactions  involving identical

          assets or liabilities.

Level 2:  Observable  market  based  inputs  or  unobservable  inputs  that  are

          corroborated  by market data.  Valuations  for assets and  liabilities

          traded  in less  active  dealer  or  broker  markets.  Valuations  are

          obtained  from third party  pricing  services for identical or similar

          assets or liabilities.

Level 3:  Unobservable   inputs  that  are  not  corroborated  by  market  data.

          Valuations  for assets and  liabilities  that are  derived  from other

          valuation methodologies,  including option pricing models,  discounted

          cash  flow  models  and  similar  techniques,  and not based on market

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying value of the Company's  financial  instruments,  including cash and

cash equivalents,  accounts  receivable and accounts payable and long term debt,

as reported in the accompanying  consolidated  balance sheet,  approximates fair

values.

EMPLOYEE STOCK-BASED COMPENSATION

Compensation  expense  is  recognized  for  performance-based  stock  awards  if

management deems it probable that the performance conditions are or will be met.

Determining  the  amount of  stock-based  compensation  expense  requires  us to

develop  estimates  that are used in  calculating  the fair value of stock-based

compensation,  and also requires us to make estimates of  assumptions  including

expected stock price volatility which is derived based upon our historical stock

prices.

BUSINESS COMBINATIONS

The Company accounts for business combinations in accordance with FASB ASC Topic

805 "Business  Combinations".  This standard modifies certain aspects of how the

acquiring  entity   recognizes  and  measures  the  identifiable   assets,   the

liabilities  assumed and the goodwill  acquired in a business  combination.  The

Company entered into a business  combination with The Fuelist, LLC on August 15,

2013 (See Note 7 for further disclosure).

DISCONTINUED OPERATIONS

The Company  complies with guidance related to when the results of operations of

a component of an entity that either has been  disposed of or is  classified  as

held for sale  should be reported as a  discontinued  operations  as provided by

(ASC)  Subtopic  205-20,  Presentation  of Financial  Statements -  Discontinued

Operations.  A component of an entity  comprises  operations and cash flows that

can  be  clearly  distinguished,   operationally  and  for  financial  reporting

purposes,  from  the rest of the  entity.  A  component  of an  entity  may be a

reportable segment or an operating  segment, a reporting unit, a subsidiary,  or

an asset group. To qualify for  presentation as a discontinued  operation,  both

conditions  must be met,  including  (1) the  operations  and cash  flows of the

component have been (or will be) eliminated  from the ongoing  operations of the

entity as a result of the disposal transaction, and (2) the entity will not have

any significant  continuing involvement in the operations of the component after

the disposal transaction.

SUBSEQUENT EVENTS

Events  occurring after September 30, 2014 were evaluated  through the date this

quarterly  report  was  issued,  in  compliance  FASB ASC Topic 855  "SUBSEQUENT

EVENTS",  to  ensure  that  any  subsequent  events  that met the  criteria  for

recognition and/or disclosure in this report have been included.

RECENT ACCOUNTING PRONOUNCEMENTS

In  August  2014,  FASB  issued  ASU  No.  2014-15,  PRESENTATION  OF  FINANCIAL

STATEMENTS - GOING CONCERN (SUBTOPIC 205-40):  DISCLOSURE OF UNCERTAINTIES ABOUT

AN ENTITY'S  ABILITY TO CONTINUE AS A GOING  CONCERN.  This ASU is effective for

the  interim  and annual  periods  beginning  after  December  15,  2016.  Early

application is permitted. The amendments in this update provide guidance in GAAP

about management's responsibility to evaluate whether there is substantial doubt

about an entity's  ability to continue as a going concern and to provide related

footnote  disclosures.  This accounting  pronouncement did not have any material

effect on our condensed and consolidated financial statements.

In May 2014, FASB issued ASU No. 2014-09,  REVENUE FROM CONTRACTS WITH CUSTOMERS

(TOPIC 606).  This ASU is  effective  for interim and annual  periods  beginning

after  December 15, 2016.  Early  application  is not  permitted.  This ASU is a

result of a joint project initiated by the FASB and the International Accounting

Standards Board (IASB) to clarify the principles for recognizing  revenue and to

develop a common  revenue  standard  for U.S.  GAAP and IFRS that  would  remove

inconsistencies  and weaknesses in revenue  requirements,  provide a more robust

framework  for  addressing  revenue  issues,  improve  comparability  of revenue

recognition practices, provide more useful information to users of the financial

statements  through  disclosure  requirements,  and simplify the  preparation of

financial  statements by reducing the number of  requirements to which an entity

must refer.  This accounting  pronouncement  did not have any material effect on

our condensed and consolidated financial statements.

In June 2014,  FASB issued ASU No.  2014-10,  DEVELOPMENT  STAGE ENTITIES (TOPIC

915):  ELIMINATION OF CERTAIN  FINANCIAL  REPORTING  REQUIREMENTS,  INCLUDING AN

AMENDMENT TO VARIABLE INTEREST  ENTITIES  GUIDANCE IN TOPIC 810,  CONSOLIDATION.

The  presentation  and  disclosure  requirements  in Topic 915 will no longer be

required  effective for annual  periods  beginning  after December 15, 2014. The

revised consolidation  standards are effective one year later, in annual periods

beginning  after  December 15, 2015.  The new guidance is intended to reduce the

overall cost and complexity  associated with financial reporting for development

stage entities, such as startup companies, without compromising the availability

of relevant information. The new guidance removes the requirement to present the

additional inception-to-date  information. This accounting pronouncement did not

have any material effect on our condensed and consolidated financial statements.

In  July  2013,  FASB  issued  ASU  No.  2013-11,   INCOME  TAXES  (TOPIC  740):

PRESENTATION  OF  AN  UNRECOGNIZED   TAX  BENEFIT  WHEN  A  NET  OPERATING  LOSS

CARRYFORWARD,  A SIMILAR TAX LOSS, OR A TAX CREDIT CARRYFORWARD EXISTS. This ASU

is effective for interim and annual periods  beginning  after December 15, 2013.

This update  standardizes the presentation of an unrecognized tax benefit when a

net  operating  loss  carryforward,   a  similar  tax  loss,  or  a  tax  credit

carryforward  exists.  This accounting  pronouncement  did not have any material

effect on our condensed and consolidated financial statements.

There were various  other updates  recently  issued,  most of which  represented

technical  corrections to the  accounting  literature or application to specific

industries,  and are not  expected  to have a material  impact on the  Company's

financial position, results of operations or cash flows.

- Definition

The entire disclosure for the organization, consolidation and basis of presentation of financial statements disclosure, and significant accounting policies of the reporting entity. May be provided in more than one note to the financial statements, as long as users are provided with an understanding of (1) the significant judgments and assumptions made by an enterprise in determining whether it must consolidate a VIE and/or disclose information about its involvement with a VIE, (2) the nature of restrictions on a consolidated VIE's assets reported by an enterprise in its statement of financial position, including the carrying amounts of such assets, (3) the nature of, and changes in, the risks associated with an enterprise's involvement with the VIE, and (4) how an enterprise's involvement with the VIE affects the enterprise's financial position, financial performance, and cash flows. Describes procedure if disclosures are provided in more than one note to the financial statements.

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CHANCELLOR GROUP INC. 10-Q